Exhibit 10.17
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$73,000,000
CREDIT AGREEMENT
DATED AS OF SEPTEMBER 26, 2002
AMONG
CENTURY BUSINESS SERVICES, INC.
BANK OF AMERICA, N.A.
AS AGENT, ISSUING BANK
AND
SWING LINE BANK,
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO,
BANC OF AMERICA SECURITIES LLC,
AS LEAD ARRANGER
AND
BOOK MANAGER
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS.......................................................................1
1.01 Certain Defined Terms.........................................................1
1.02 Other Interpretive Provisions................................................28
1.03 Accounting Principles........................................................29
ARTICLE II THE CREDITS.....................................................................29
2.01 Amounts and Terms of Commitments.............................................29
2.02 Loan Accounts................................................................32
2.03 Procedure for Borrowing......................................................33
2.04 Conversion and Continuation Elections........................................35
2.05 Voluntary Termination or Reduction of Commitments............................37
2.06 Optional Prepayments.........................................................37
2.07 Mandatory Prepayments of Loans...............................................37
2.08 Repayment....................................................................38
2.09 Interest.....................................................................38
2.10 Fees.........................................................................39
2.11 Computation of Fees and Interest.............................................39
2.12 Payments by the Company......................................................40
2.13 Payments by the Lenders to the Agent.........................................40
2.14 Sharing of Payments, Etc.....................................................41
ARTICLE III THE LETTERS OF CREDIT..........................................................41
3.01 The Letter of Credit Subfacility.............................................41
3.02 Issuance, Amendment and Renewal of Letters of Credit.........................42
3.03 Risk Participations, Drawings and Reimbursements.............................44
3.04 Repayment of Participations..................................................46
3.05 Role of the Issuing Bank.....................................................46
3.06 Obligations Absolute.........................................................47
3.07 Cash Collateral Pledge.......................................................48
3.08 Letter of Credit Fees........................................................48
3.09 Uniform Customs and Practice.................................................49
3.10 Outstanding Letters of Credit................................................49
ARTICLE IV TAXES, YIELD PROTECTION AND ILLEGALITY..........................................49
4.01 Taxes........................................................................49
4.02 Illegality...................................................................50
4.03 Increased Costs and Reduction of Return......................................51
4.04 Funding Losses...............................................................51
4.05 Inability to Determine Rates.................................................52
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TABLE OF CONTENTS
(CONTINUED)
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4.06 Certificates of Lenders......................................................52
4.07 Survival.....................................................................53
4.08 Replacement of Lenders.......................................................53
ARTICLE V CONDITIONS PRECEDENT.............................................................53
5.01 Conditions of Effectiveness and Initial Credit Extensions....................53
5.02 Conditions to All Credit Extensions..........................................55
ARTICLE VI REPRESENTATIONS AND WARRANTIES..................................................56
6.01 Corporate Existence and Power................................................56
6.02 Corporate Authorization; No Contravention....................................56
6.03 Governmental Authorization...................................................57
6.04 Binding Effect...............................................................57
6.05 Litigation...................................................................57
6.06 No Default...................................................................57
6.07 ERISA Compliance.............................................................58
6.08 Use of Proceeds; Margin Regulations..........................................58
6.09 Title to Properties..........................................................58
6.10 Taxes........................................................................58
6.11 Financial Condition..........................................................59
6.12 Environmental Matters........................................................59
6.13 Collateral Documents.........................................................60
6.14 Regulated Entities...........................................................61
6.15 No Burdensome Restrictions...................................................61
6.16 Solvency.....................................................................61
6.17 Labor Relations..............................................................61
6.18 Copyrights, Patents, Trademarks, etc.........................................61
6.19 Subsidiaries.................................................................61
6.20 Broker's; Transaction Fees...................................................61
6.21 Insurance....................................................................61
6.22 Swap Obligations.............................................................62
6.23 Full Disclosure..............................................................62
6.24 Intercompany Indebtedness....................................................62
ARTICLE VII AFFIRMATIVE COVENANTS..........................................................62
7.01 Financial Statements.........................................................62
7.02 Certificates; Other Information..............................................63
7.03 Notices......................................................................64
7.04 Preservation of Corporate Existence, Etc.....................................65
7.05 Maintenance of Property......................................................66
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TABLE OF CONTENTS
(CONTINUED)
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7.06 Insurance....................................................................66
7.07 Payment of Obligations.......................................................66
7.08 Compliance with Laws.........................................................66
7.09 Compliance with ERISA........................................................67
7.10 Inspection of Property and Books and Records.................................67
7.11 Environmental Laws...........................................................67
7.12 Use of Proceeds..............................................................67
7.13 Solvency.....................................................................67
7.14 Further Assurances...........................................................67
7.15 New Subsidiaries.............................................................68
ARTICLE VIII NEGATIVE COVENANTS............................................................69
8.01 Limitation on Liens..........................................................69
8.02 Disposition of Assets........................................................71
8.03 Consolidations and Mergers...................................................72
8.04 Loans and Investments........................................................73
8.05 Limitation on Indebtedness...................................................74
8.06 Transactions with Affiliates.................................................75
8.07 Use of Proceeds..............................................................75
8.08 Contingent Obligations.......................................................75
8.09 Lease Obligations............................................................76
8.10 Restricted Payments..........................................................76
8.11 ERISA........................................................................76
8.12 Change in Business...........................................................77
8.13 Accounting Changes...........................................................77
8.14 Minimum Tangible Net Worth...................................................77
8.15 Leverage Ratio...............................................................77
8.16 Fixed Charge Coverage Ratio..................................................77
8.17 No Impairment of Intercompany Transfers......................................77
8.18 Excluded Subsidiaries........................................................78
ARTICLE IX EVENTS OF DEFAULT...............................................................78
9.01 Event of Default.............................................................78
9.02 Remedies.....................................................................80
9.03 Rights Not Exclusive.........................................................81
ARTICLE X THE AGENT........................................................................81
10.01 Appointment and Authorization; "Agent".......................................81
10.02 Delegation of Duties.........................................................82
10.03 Liability of Agent...........................................................82
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TABLE OF CONTENTS
(CONTINUED)
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10.04 Reliance by Agent............................................................82
10.05 Notice of Default............................................................83
10.06 Credit Decision..............................................................83
10.07 Indemnification of Agent.....................................................83
10.08 Agent in Individual Capacity.................................................84
10.09 Successor Agent..............................................................84
10.10 Withholding Tax..............................................................84
10.11 Collateral and Guaranty Matters..............................................86
ARTICLE XI MISCELLANEOUS...................................................................86
11.01 Amendments and Waivers.......................................................86
11.02 Notices......................................................................87
11.03 No Waiver; Cumulative Remedies...............................................88
11.04 Costs and Expenses...........................................................88
11.05 Company Indemnification......................................................89
11.06 Payments Set Aside...........................................................89
11.07 Successors and Assigns.......................................................89
11.08 Assignments, Participations, etc.............................................90
11.09 Confidentiality..............................................................93
11.10 Set-off......................................................................93
11.11 Notification of Addresses, Lending Offices, Etc..............................94
11.12 Counterparts.................................................................94
11.13 Severability.................................................................94
11.14 No Third Parties Benefited...................................................94
11.15 Governing Law and Jurisdiction...............................................94
11.16 Waiver of Jury Trial.........................................................95
11.17 Entire Agreement.............................................................95
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SCHEDULES
Schedule 1.01 Existing Letters of Credit
Schedule 2.01 Commitments
Schedule 6.11 Permitted Liabilities
Schedule 6.05(b) Litigation
Schedule 6.19 Subsidiaries and Minority Interests
Schedule 8.02 Specified Asset Sales
Schedule 8.04 Existing Investments
Schedule 8.05 Existing Indebtedness
Schedule 8.08 Contingent Obligations
Schedule 11.02 Lending Offices; Addresses for Notices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D-1 Form of Legal Opinion of Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
Exhibit D-2 Form of Legal Opinion of Company's general counsel
Exhibit E Form of Assignment and Acceptance
Exhibit F-1 Form of Promissory Note - Revolving Loan
Exhibit F-2 Form of Promissory Note - Swing Line Loan
Exhibit G Form of Borrowing Base Certificate
Exhibit H Form of Commitment and Acceptance
CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of September 26, 2002, (as
amended, restated, supplemented or otherwise modified from time to time, the
"CREDIT AGREEMENT") among Century Business Services, Inc., a Delaware
corporation (the "COMPANY"), the several financial institutions from time to
time party to this Agreement (collectively, the "LENDERS"; individually, a
"LENDER"), and Bank of America, N.A., as administrative agent for the Lenders
(the "AGENT").
WHEREAS, the Lenders have agreed to make available to the Company a
revolving credit facility with a letter of credit subfacility upon the terms and
conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS
1.01 CERTAIN DEFINED TERMS. The following terms have the following
meanings:
"ACCOUNT DEBTOR" means each Person obligated in any way on or in
connection with a Receivable.
"ACQUISITION" means any transaction or series of related transactions
for the purpose of or resulting, directly or indirectly, in (a) the
acquisition of all or substantially all of the assets of a Person, or of
any business or division of a Person, (b) the acquisition of in excess of
50% of the capital stock, partnership interests, membership interests or
equity of any Person, or otherwise causing any Person to become a
Subsidiary, or (c) a merger or consolidation or any other combination with
another Person (other than a Person that is a Subsidiary) provided that
after giving effect to the merger the Person is a Subsidiary or the Company
or a Subsidiary is the surviving entity.
"AFFILIATE" means, as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common
control with, such Person. A Person shall be deemed to control another
Person if the controlling Person possesses, directly or indirectly, the
power to direct or cause the direction of the management and policies of
the other Person, whether through the ownership of voting securities,
membership interests, by contract, or otherwise.
"AGENT" means Bank of America in its capacity as agent for the Lenders
hereunder, and any successor agent arising under SECTION 10.09.
"AGENT-RELATED PERSONS" means Bank of America and any successor agent
arising under SECTION 10.09 and any successor letter of credit issuing bank
hereunder, together with their respective Affiliates, and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.
"AGENT'S PAYMENT OFFICE" means the address for payments set forth on
SCHEDULE 11.02 or such other address as the Agent may from time to time
specify.
"AGREEMENT" has the meaning set forth in the preamble.
"APPLICABLE MARGIN" shall mean on any date the applicable percentage
set forth below based upon the Leverage Ratio as shown in the Compliance
Certificate then most recently delivered to the Lenders:
-------------------------------------------- -----------------------------------------------------
Revolving Loans/ Letters of Credit Fees
-------------------------------------------- -----------------------------------------------------
Letter of Credit Fees
--------------- ------------ --------------- ------------------------------ ----------------------
Leverage Base Eurodollar Non- Financial Commitment Fee
Ratio Rate Rate Financial
--------------- ------------ --------------- -------------- --------------- ----------------------
greater than
1.50:1.0 1.250% 2.500% 1.250% 2.500% .50%
--------------- ------------ --------------- -------------- --------------- ----------------------
greater than
1.0:1.0, 1.000% 2.250% 1.125% 2.250% .45%
but less than
1.50:1.0
-------------- ------------ --------------- -------------- --------------- ----------------------
less than
1.0:1.0 .750% 2.000% 1.000% 2.000% .40%
--------------- ------------ --------------- -------------- --------------- ----------------------
--------------- ------------ --------------- -------------- --------------- ----------------------
; PROVIDED HOWEVER that, (i) for the period from the Closing Date to and
including the date of the delivery of the Compliance Certificate for the
period ending September 30, 2002, the Applicable Margin shall be determined
as if the Leverage Ratio for such period were greater than or equal to
1.0:1.0 but than less 1.5:1.0 and (ii) if the Company shall have failed to
deliver to the Lenders by the date required hereunder any Compliance
Certificate pursuant to SECTION 7.02(b), then from the date such Compliance
Certificate was required to be delivered until the date of such delivery
the Applicable Margin shall be determined as if the Leverage Ratio for such
period was greater than or equal to 1.5:1.0. Each change in the Applicable
Margin shall take effect with respect to all outstanding Loans on the third
Business Day immediately succeeding the day on which such Compliance
Certificate is received by the Agent. Notwithstanding the foregoing, no
reduction in the Applicable Margin shall be effected if a Default or an
Event of Default shall have occurred and be continuing on the date when
such change would otherwise occur, it being understood that on the third
Business Day immediately succeeding the day on which such Default or Event
of Default is either waived or cured (assuming no other Default or Event of
Default shall be then pending), the Applicable Margin shall be reduced (on
a prospective basis) in accordance with the then most recently delivered
Compliance Certificate.
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"APPROVED FUND" means any Fund that is administered or managed by (a)
a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of
an entity that administers or manages a Lender.
"ATTORNEY COSTS" means and includes all reasonable and customary fees
and disbursements of any law firm or other external counsel, the allocated
cost of internal legal services and all disbursements of internal counsel
related to this Agreement and the other Loan Documents.
AVAILABILITY" means, at any time, (a) the Maximum Revolver Amount at
such time MINUS (b) the sum of the Effective Amount of each of the
Revolving Loans, the Swing Line Loans and L/C Obligations at such time.
"BANK OF AMERICA" means Bank of America, N.A., a national banking
association.
"BANKRUPTCY CODE" means the Federal Bankruptcy Reform Act of 1978 (11
U.S.C.sec.101, et seq.).
"BASE RATE" means, for any day, the higher of (a) the rate of interest
in effect for such days as publicly announced from time to time by Bank of
America as its "prime rate" and (b) the latest Federal Funds Rate PLUS
0.50% per annum. The "prime rate" is a rate set by Bank of America based
upon various factors including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference
point for pricing some loans, which may be priced at, above or below such
announced rate. Any change in the prime rate announced by Bank of America
shall take effect at the opening of business on the day specified in the
public announcement of such change.
"BASE RATE LOAN" means a Revolving Loan, or an L/C Advance, that bears
interest based on the Base Rate.
"BORROWING" means a borrowing hereunder consisting of Loans of the
same Type made to the Company on the same day by the Lenders under Article
II, and, in the case of Eurodollar Rate Loans, having the same Interest
Period.
"BORROWING BASE" means, as of any date of determination by the Agent,
from time to time, an amount equal to the sum at such time of (a) 85% of
the book value of Company's Eligible Receivables at such time PLUS (b) the
lesser of (i) 60% of the book value of Company's Eligible Unbilled
Work-in-Process and (ii) 35% of the amount calculated pursuant to CLAUSE
(a) for the months of January, February and March of each calendar year and
25% of the amount calculated pursuant to CLAUSE (a) for the months of April
through December of each calendar year; PROVIDED FURTHER, HOWEVER, that (x)
the percentages set forth in either or both of CLAUSES (a) and (b)(i) above
may be reduced from time to time by the Agent in its reasonable discretion
based upon the periodic field examinations conducted by or on the behalf of
the Agent and (y) the Agent may, in its reasonable discretion, increase any
percentage set forth in CLAUSES (a) or (b)(i)
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above previously reduced by it pursuant to the terms hereof provided that
such percentage is not increased to a percentage greater than the
applicable percentage set forth above.
"BORROWING BASE CERTIFICATE" means a certificate in the form of
EXHIBIT G hereto.
"BORROWING DATE" means any date on which a Borrowing occurs under
SECTION 2.03.
"BUDGETED EBITDA" has the meaning set forth in SECTION 7.02(d).
"BUSINESS DAY" means any day other than a Saturday, Sunday or other
day on which commercial banks in Chicago or San Francisco are authorized or
required by law to close and, if the applicable Business Day relates to any
Eurodollar Rate Loan, means such a day on which dealings are carried on in
the applicable offshore interbank market.
"BUYING LENDER(S)" has the meaning set forth in SECTION 2.01(c).
"CAPITAL ADEQUACY REGULATION" means any guideline, request or
directive of any central bank or other Governmental Authority, or any other
law, rule or regulation, whether or not having the force of law, in each
case, regarding capital adequacy of any Lender or of any corporation
controlling a Lender.
"CAPITAL EXPENDITURES" means, for any period and with respect to any
Person, the aggregate of all expenditures by such Person and its
Subsidiaries for the acquisition or leasing of fixed or capital assets or
additions to equipment (including replacements, capitalized repairs and
improvements during such period) which should be capitalized under GAAP on
a consolidated balance sheet of such Person and its Subsidiaries.
"CAPITAL LEASE" has the meaning specified in the definition of
"Capital Lease Obligations."
"CAPITAL LEASE OBLIGATIONS" means all monetary obligations of the
Company or any of its Subsidiaries under any leasing or similar arrangement
which, in accordance with GAAP, is classified as a capital lease ("CAPITAL
LEASE").
"CASH COLLATERALIZE" means to pledge and deposit with or deliver to
the Agent, for the benefit of the Agent, the Issuing Bank and the Lenders,
as additional collateral for the L/C Obligations, cash or deposit account
balances pursuant to documentation in form and substance satisfactory to
the Agent and the Issuing Bank (which documents are hereby consented to by
the Lenders). The Company hereby grants the Agent, for the benefit of the
Agent, the Issuing Bank and the Lenders, a security interest in all such
cash and deposit account balances.
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Cash collateral shall be maintained in blocked deposit accounts at Bank of
America.
"CASH EQUIVALENTS" means:
(a) securities issued or fully guaranteed or insured by the
United States Government or any agency thereof and backed by the full
faith and credit of the United States having maturities of not more
than six months from the date of acquisition;
(b) certificates of deposit, time deposits, Eurodollar time
deposits, repurchase agreements, reverse repo agreements, or bankers'
acceptances, having in each case a tenor of not more than six months,
issued by any Lender, or by any U.S. commercial bank having combined
capital and surplus of not less than $100,000,000 whose short term
securities are rated at least A-1 by Standard & Poor's Corporation and
P-1 by Xxxxx'x Investors Service, Inc.;
(c) commercial paper of an issuer rated at least A-1 by Standard
& Poor's Corporation or P-1 by Xxxxx'x Investors Service Inc. and in
either case having a tenor of not more than three months;
(d) money market funds that invest principally in Cash
Equivalents described in CLAUSES (a) through (c) hereof.
"CHANGE OF CONTROL" means (a) any Person or any two or more Persons
(in each case other than a Person that is a stockholder of the Company as
of the date of this Agreement) acting in concert acquiring beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Exchange Act), directly or indirectly, of capital
stock of the Company (or other securities convertible into such capital
stock) representing 35% or more of the combined voting power of all capital
stock of the Company entitled to vote in the election of directors, other
than capital stock having such power only by reason of the happening of a
contingency, or (b) during any period of twelve consecutive calendar months
(other than pursuant to a disposition permitted pursuant to SECTION 8.02),
the ceasing of more than 35% of the individuals who hold an office
possessing the title Regional Directors or Executive Vice President or such
title that ranks senior thereto of the Company and the Company's direct
Subsidiaries (collectively, "KEY MANAGEMENT"), on the first day of each
such period to be part of the Key Management of the Company and its
Subsidiaries taken as a whole.
"CLOSING DATE" means the date on which all conditions precedent set
forth in SECTION 5.01 are satisfied or waived by all Lenders.
"CODE" means the Internal Revenue Code of 1986, as amended, and
regulations promulgated thereunder.
5
"COLLATERAL" means all property and interests in property and proceeds
thereof now owned or hereafter acquired by the Company or any Guarantor in
or upon which a Lien now or hereafter exists in favor of the Lenders, or
the Collateral Agent on behalf of the Lenders, whether under this
Agreement, the Pledge and Security Agreement or under any other documents
executed by any such Persons and delivered to the Collateral Agent.
"COLLATERAL AGENT" means the Agent acting in its capacity as
Collateral Agent pursuant to the Collateral Documents (other than the
Guaranty).
"COLLATERAL DOCUMENTS" means, collectively, the Pledge and Security
Agreement, the Guaranty and the Mortgage Documents.
"COMMITMENT" means, collectively, the Revolving Loan Commitment and
the Swing Line Loan Commitment.
"COMMITMENT AND ACCEPTANCE" means a certificate substantially in the
form attached hereto as EXHIBIT H.
"COMMITMENT FEE" has the meaning specified in SECTION 2.10(b).
"COMMITMENT INCREASE NOTICE" has the meaning specified in SECTION
2.01(c).
"COMPANY" means Century Business Services, Inc., a Delaware
corporation.
"COMPLIANCE CERTIFICATE" means a certificate substantially in the form
of EXHIBIT C.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, gross
consolidated interest expense (after giving effect to any increase in
interest expense resulting from net amount of payments made or received
with respect to Permitted Swap Obligations; PROVIDED, HOWEVER, that no net
reduction in interest expense shall be permitted if the Company should
receive more payments than the Company makes with respect thereto) for the
period (including all commissions, discounts, fees and other charges in
connection with standby letters of credit and similar instruments) for the
Company and its Subsidiaries (other than Excluded Subsidiaries), plus the
portion of the upfront costs and expenses for Swap Contracts (to the extent
not included in gross interest expense) fairly allocated to such Swap
Contracts as expenses for such period, as determined in accordance with
GAAP and after giving effect to any Swap Contract then in effect.
"CONTINGENT OBLIGATION" means, as to any Person, any direct or
indirect liability of that Person, whether or not contingent, with or
without recourse, (a) with respect to any Indebtedness, lease, dividend,
letter of credit or other obligation (the "primary obligations") of another
Person (the "primary obligor"), including any obligation of that Person
(i) to purchase, repurchase or otherwise
6
acquire such primary obligations or any security therefor, (ii) to advance
or provide funds for the payment or discharge of any such primary
obligation, or to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency or any balance
sheet item, level of income or financial condition of the primary obligor,
(iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability
of the primary obligor to make payment of such primary obligation, or (iv)
otherwise to assure or hold harmless the holder of any such primary
obligation against loss in respect thereof (each, a "GUARANTY OBLIGATION");
(b) with respect to any Surety Instrument (other than any Letter of Credit)
issued for the account of that Person or as to which that Person is
otherwise liable for reimbursement of drawings or payments; (c) to purchase
any materials, supplies or other property from, or to obtain the services
of, another Person if the relevant contract or other related document or
obligation requires that payment for such materials, supplies or other
property, or for such services, shall be made regardless of whether
delivery of such materials, supplies or other property is ever made or
tendered, or such services are ever performed or tendered, or (d) in
respect of any Swap Contract; PROVIDED, HOWEVER, that neither the term
"CONTINGENT OBLIGATION" nor the term "GUARANTY OBLIGATION" shall include
obligations in respect of insurance, reinsurance, surety or fidelity
contracts, bonds or policies entered into or issued in the ordinary course
of business. Except as otherwise expressly provided herein, the amount of
any Contingent Obligation shall, in the case of Guaranty Obligations, be
deemed equal to the stated or determinable amount of the primary obligation
in respect of which such Guaranty Obligation is made or, if not stated or
if indeterminable, the maximum reasonably anticipated liability in respect
thereof, and in the case of other Contingent Obligations other than in
respect of Swap Contracts, shall be equal to the maximum reasonably
anticipated liability in respect thereof and, in the case of Contingent
Obligations in respect of Swap Contracts, shall be equal to the Swap
Termination Value.
"CONTRACTUAL OBLIGATION" means, as to any Person, any provision of any
security issued by such Person or of any agreement, undertaking, contract,
indenture, mortgage, deed of trust or other instrument, document or
agreement to which such Person is a party or by which it or any of its
property is bound.
"CONVERSION/CONTINUATION DATE" means any date on which, under SECTION
2.04, the Company (a) converts Loans of one Type to another Type, or (b)
continues as Loans of the same Type, but with a new Interest Period, Loans
having Interest Periods expiring on such date.
"CREDIT EXTENSION" means and includes (a) the making of any Loans
hereunder, and (b) the Issuance of any Letters of Credit hereunder.
"DEFAULT" means any event or circumstance which, with the giving of
notice, the lapse of time, or both, would (if not cured or otherwise
remedied during such time) constitute an Event of Default.
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"DEFAULT RATE" has the meaning set forth in SECTION 2.09(c).
"DEFAULTING LENDER" means any Lender that (a) has failed to fund any
portion of the Revolving Loans, participations in L/C Obligations or
participations in Swing Line Loans required to be funded by it hereunder
within one Business Day of the date required to be funded by it hereunder,
(b) has otherwise failed to pay over to the Agent or any other Lender any
other amount required to be paid by it hereunder within one Business Day of
the date when due, unless the subject of a good faith dispute, or (c) has
been deemed insolvent or become the subject of a bankruptcy or insolvency
proceeding.
"DISPOSITION" means (a) the sale, lease, conveyance, or other
disposition of Property in excess of $100,000, other than sales or other
dispositions expressly permitted under CLAUSES (a) through (b) of SECTION
8.02, and (b) the sale or transfer by the Company or any Subsidiary of the
Company of any debt or equity securities issued by any Subsidiary of the
Company and held by such transferor Person.
"DOLLARS", "DOLLARS" and "$" each mean lawful money of the United
States.
"EBITDA" means, for any period, for the Company and its Subsidiaries
(other than Excluded Subsidiaries) on a consolidated basis, determined in
accordance with GAAP, the sum of (a) the Net Income (or net loss) for such
period PLUS (b) all amounts treated as expenses for depreciation and the
amortization of intangibles of any kind, including, the impairment of
goodwill charges, to the extent included in the determination of such Net
Income (or loss), PLUS (c) Consolidated Interest Expense, PLUS (d) all
accrued taxes on or measured by income to the extent included in the
determination of such Net Income (or loss), PROVIDED, HOWEVER, that the
portion of Consolidated Interest Expense, accrued taxes, expense for
depreciation and amortization, referenced in CLAUSES (b) through (d) above,
attributable to operations disposed of in accordance with SECTION 8.02
shall be excluded from the calculation of EBITDA.
"EBITDAR" means, for any period, for the Company and its Subsidiaries
(other than Excluded Subsidiaries) on a consolidated basis, determined in
accordance with GAAP, the sum of (a) EBITDA for such period, PLUS, (b) all
Rental Expense for such period; PLUS (c) non-cash rental charges incurred
during such period pursuant to FAS 146 with respect to discontinued leased
real property locations, PLUS (d) cash dividends received during such
period by the Company, or any Subsidiary that is not an Excluded
Subsidiary, from an Excluded Subsidiary, provided that the aggregate amount
of such cash dividends included in the calculation of this clause does not
exceed ten percent (10%) of EBITDA for such period.
"EFFECTIVE AMOUNT" means (a) with respect to any Revolving Loans on
any date, the aggregate outstanding principal amount thereof after giving
effect to any Borrowings and prepayments or repayments of Revolving Loans
occurring on
8
such date, (b) with respect to any Swing Line Loans on any date, the
aggregate outstanding principal amount thereof after giving effect to any
Borrowings and prepayments or repayments of Swing Line Loans occurring on
such date and (c) with respect to any outstanding L/C Obligations on any
date, the amount of such L/C 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 L/C Obligations as of such date,
including 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.
For purposes of SECTION 2.07, the Effective Amount shall be determined
without giving effect to any mandatory prepayments to be made under said
Section.
"EFFECTIVE COMMITMENT AMOUNT" has the meaning set forth in SECTION
2.01(c).
"ELIGIBLE ASSIGNEE" means (a) a Lender; (b) an Affiliate of a Lender;
(c) an Approved Fund; and (d) any other Person (other than a natural
person) approved by (i) the Agent, the Issuing Bank and the Swing Line
Bank, and (ii) unless an Event of Default has occurred and is continuing,
the Company (each such approval not to be unreasonably withheld or
delayed); PROVIDED that notwithstanding the foregoing, "Eligible Assignee"
shall not include the Company or any of the Company's Affiliates or
Subsidiaries.
"ELIGIBLE RECEIVABLES" means at any time, those Receivables owned by
the Company or any Subsidiary (other than an Excluded Subsidiary) and
reflected on the most recent Borrowing Base Certificate delivered to the
Lenders and which the Agent deems eligible as the basis for Revolving
Loans, based on criteria which the Agent establishes from time to time in
its reasonable credit judgment. Without limiting the foregoing, no
Receivable shall be an Eligible Receivable if:
(1) It is more than ninety (90) days after the date of the original
invoice issued by the Company or Subsidiary with respect to the sale giving
rise thereto; or
(2) 25% or more (based on aggregate Dollar amount) of the Receivables
from the Account Debtor are due or unpaid more than ninety (90) days after
the date of the original invoice issued by the Company or any Subsidiary
with respect to the sale giving rise thereto; or
(3) The Receivable is owed by an Account Debtor which is an employee,
officer, director or shareholder of the Company or any Subsidiary or it
arises out of a rendition of services not made in the ordinary course of
the Company's or any Subsidiary's business or to a Person which is an
Affiliate of the Company or any Subsidiary or controlled
9
by an Affiliate of Company or any Subsidiary, unless such Affiliate of
Company or Subsidiary or Person controlled by an Affiliate of Company or
any Subsidiary has been approved in writing by the Agent as a party from
whom Eligible Receivables can be generated; or
(4) The Receivable is subject to any right of set-off by the Account
Debtor, and that Account Debtor has not entered into an agreement with the
Agent which is acceptable to the Agent with respect to the waiver of rights
of set-off; or the Account Debtor has disputed liability, or made any claim
with respect to any other Receivable due from such Account Debtor to the
Company or the applicable Subsidiary, to the extent of such set off,
dispute or claim; or
(5) The Account Debtor (i) has filed a petition for bankruptcy or any
other petition for relief under the Bankruptcy Code or any other bankruptcy
or insolvency law or has made an assignment for the benefit of creditors,
(ii) has had filed against it any petition or other application for relief
under the Bankruptcy Code or any other bankruptcy or insolvency law, (iii)
has so filed, suspended its business operations, become insolvent, or
suffered a receiver or a trustee to be appointed for any of its assets or
affairs, or (iv) in the case of any Account Debtor which is an individual,
is deceased or has been declared judicially incompetent; or
(6) It arises out of a rendition of services to an Account Debtor
outside the continental United States or the Province of Ontario, Canada,
unless the sale is on letter of credit or acceptance terms acceptable to
the Agent; or
(7) The services giving rise to such Receivable have not been
performed by the Company or its Subsidiaries, as applicable, and, if
applicable, accepted by the Account Debtor, or the Account Debtor revokes
its acceptance of such goods or services; or
(8) It is owed by an Account Debtor which is obligated to the Company
or any Subsidiary respecting Receivables the aggregate unpaid (billed or
unbilled) balance of which exceeds 10% of the aggregate billed and unpaid
balance of all Receivables owed to the Company or any Subsidiary at such
time by all of the Account Debtors, to the extent of such excess; or
(9) It is an Receivable with respect to which the Account Debtor is
located in any State requiring the filing of a Notice of Business
Activities Report or similar report in order to permit the Company or any
Subsidiary to seek judicial enforcement in such State of payment of such
Receivable, unless Company or the Subsidiary has qualified to do business
in such state or has filed a Notice of Business Activities Report or
equivalent report for the then current year; or
(10) The Receivable is evidenced by instruments, unless (a) the Agent
shall have specifically agreed to include such Receivable as an Eligible
Receivable and (b) the originals of such instruments shall have been
endorsed and/or assigned and delivered to the Agent in a manner
satisfactory to the Agent; PROVIDED, that only the next installment due
under such instrument shall be included as an Eligible Receivable; or
10
(11) With respect to such Receivable, a check or other instrument for
the payment of money, tendered in full or partial satisfaction of such
Receivable, has been received, presented for payment and returned
uncollected for any reason; or
(12) The Company or the applicable Subsidiary has extended the time
for payment for such Receivable beyond the time period set forth in CLAUSE
(1) above without the consent of the Agent; or
(13) The perfection, enforceability or validity of the Agent's Liens
in such Receivable, or, except as set forth in CLAUSE (9) above and CLAUSE
(14) below, the Agent's or Lenders' ability to obtain direct payment of the
proceeds of such Receivable, is governed by any federal, state or local
statutory requirements other than those of the UCC, unless the Company or
the applicable Subsidiary assigns its right to payment of such Receivables
to the Agent in accordance with the terms of the Assignment of Claims Act
of 1940, as amended (31 U.S.C. Sec. 3727 ET SEQ.) and the Agent is
otherwise satisfied as to perfection, enforceability and validity of the
Liens in favor of the Collateral Agent; or
(14) The Account Debtor is United States of America or any department,
agency or instrumentality thereof, any state, municipality, or other
political subdivision of the United States of America, or any department,
agency, public corporation or other instrumentality thereof, except as
permitted by CLAUSE (13) above; or
(15) The Receivable is not subject to a first priority perfected
security interest in favor of the Agent; or
(16) The Receivable constitutes an Insurance Company Receivable; or
(17) The Receivable constitutes an Insurance Company Pre-Billed
Receivable.
(18) The Company or the applicable Subsidiary has not delivered an
invoice, including, without limitation, electronic or facsimile
transmission of bills or other records evidencing Receivables with respect
to the Company's or such Subsidiary's group health and benefit insurance
business, to the applicable Account Debtor with respect to such Receivable.
Notwithstanding the foregoing, the amount of Receivables excluded from
"Eligible Receivables" pursuant any of CLAUSES (2), (4), (6), (8), (10),
(11), (13) or (14), may be calculated, at the Company's option with respect
to any such clause, either (A) on the basis of the actual amount of
Receivables of the type described in such clause as of the date of
determination thereof or (B) on the basis of the percentage that the gross
book value of Receivables of the type described in such clause bears to the
aggregate gross book value of all Receivables (other than unbilled
work-in-process) of the Company and the Subsidiary (other than Excluded
Subsidiaries), in each case as determined based upon the information set
11
forth in the Field Exam Report most recently available at the time of such
determination, provided that such Field Exam Report was prepared less than
180 days prior to the date of such determination (in each case,
hereinafter, the "RELEVANT PERCENTAGE" for such type of Receivables), such
that the amount excluded under this definition for such clause as of such
date of determination pursuant to this CLAUSE (B) shall be equal to the
product of the Relevant Percentage (stated as a decimal) for the
Receivables of the type described in such clause multiplied by the gross
book value of all Receivables (other than unbilled work-in-process) as of
such date of determination. Receivables of the types described in each
other clause of this definition shall be calculated only on the basis
described in CLAUSE (A) of this paragraph.
If any Receivable at any time ceases to be an Eligible Receivable by reason
of any of the foregoing exclusions or any failure to meet any other
eligibility criteria established by the Agent in its reasonable credit
judgment upon notice to the Company, such Receivable shall thereupon be
excluded from the calculation of Eligible Receivables without the necessity
of any further action or notice of the Agent or any other Person.
"ELIGIBLE UNBILLED WORK-IN-PROCESS" means, Receivables of the Company
and any Subsidiary (other than an Excluded Subsidiary) which would
constitute Eligible Receivables, but for the provisions of CLAUSE (18) of
the definition thereof, and for which the services giving rise to such
Receivable have been fully or partially performed, such Receivables have
been entered into the applicable books and records of the Company or the
applicable Subsidiary, and the Company or the applicable Subsidiary has not
delivered an invoice to the applicable Account Debtor with respect to such
Receivable, PROVIDED, (a) that such services have been invoiced to the
applicable Account Debtor for a period less than or equal to thirty (30)
days past the date such services were performed and entered into the books
and records of the Company or the applicable Subsidiary and (b) the
services that have been performed have been accepted by the Account Debtor
and the Account Debtor has not revoked its acceptance of such services.
"ENVIRONMENTAL CLAIMS" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release or
injury to the environment.
"ENVIRONMENTAL LAWS" means all federal, state or local laws, statutes,
common law duties, rules, regulations, ordinances and codes, together with
all administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental
Authorities, in each case relating to environmental, health, safety and
land use matters.
"ENVIRONMENTAL PERMITS" has the meaning specified in SECTION 6.12(b).
12
"ERISA" means the Employee Retirement Income Security Act of 1974, and
regulations promulgated thereunder.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) under common control with the Company within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code
for purposes of provisions relating to Section 412 of the Code).
"ERISA EVENT" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the Company or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a
cessation of operations which is treated as such a withdrawal under Section
4062(e) of ERISA; (c) a complete or partial withdrawal by the Company or
any ERISA Affiliate from a Multiemployer Plan or notification that a
Multiemployer Plan is in reorganization; (d) the filing of a notice of
intent to terminate, the treatment of a Plan amendment as a termination
under Section 4041 or 4041A of ERISA, or the commencement of proceedings by
the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or
condition which might reasonably be expected to constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the
Company or any ERISA Affiliate.
"EURODOLLAR BASE RATE" has the meaning set forth in the definition of
Eurodollar Rate.
"EURODOLLAR RATE" means for any Interest Period with respect to any
Eurodollar Rate Loan, a rate per annum determined by the Agent pursuant to
the following formula:
Eurodollar Rate = EURODOLLAR BASE RATE
------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"EURODOLLAR BASE RATE" means, for such Interest Period:
(a) the rate per annum equal to the rate determined by the Agent to be
the offered rate that appears on the page of the Telerate screen (or any
successor thereto) that displays an average British Bankers Association
Interest Settlement Rate for deposits in Dollars (for delivery on the first
day of such Interest Period) with a term equivalent to such Interest
Period, determined as of approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period, or
(b) if the rate referenced in the preceding clause (a) does not appear
on such page or service or such page or service shall not be available, the
rate per
13
annum equal to the rate determined by the Agent to be the offered rate on
such other page or other service that displays an average British Bankers
Association Interest Settlement Rate for deposits in Dollars (for delivery
on the first day of such Interest Period) with a term equivalent to such
Interest Period, determined as of approximately 11:00 a.m. (London time)
two Business Days prior to the first day of such Interest Period, or
(c) if the rates referenced in the preceding clauses (a) and (b) are
not available, the rate per annum determined by the Agent as the rate of
interest at which deposits in Dollars for delivery on the first day of such
Interest Period in same day funds in the approximate amount of the
Eurodollar Rate Loan being made, continued or converted by Bank of America
and with a term equivalent to such Interest Period would be offered by Bank
of America's London Branch to major banks in the London interbank
eurodollar market at their request at approximately 4:00 p.m. (London time)
two Business Days prior to the first day of such Interest Period.
"EURODOLLAR RATE LOAN" means a Loan that bears interest at a rate
based on the Eurodollar Rate
"EURODOLLAR RESERVE PERCENTAGE" means, for any day during any Interest
Period, the reserve percentage (expressed as a decimal, carried out to five
decimal places) in effect on such day, whether or not applicable to any
Lender, under regulations issued from time to time by the FRB for
determining the maximum reserve requirement (including any emergency,
supplemental or other marginal reserve requirement) with respect to
Eurocurrency funding (currently referred to as "Eurocurrency liabilities").
The Eurodollar Rate for each outstanding Eurodollar Rate Loan shall be
adjusted automatically as of the effective date of any change in the
Eurodollar Reserve Percentage.
"EVENT OF DEFAULT" means any of the events or circumstances specified
in SECTION 9.01.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, and
regulations promulgated thereunder.
"EXCLUDED SUBSIDIARY" means, at any time, any Subsidiary whose capital
stock may not be pledged under the Pledge and Security Agreement, assets
may not be encumbered under the Pledge and Security Agreement, or may not
guaranty the Obligations under the Guaranty, in any case without violating
federal, state and/or local laws or regulations applicable to such
Subsidiary.
"EXISTING CREDIT AGREEMENT" means that certain Amended and Restated
Credit Agreement dated as of October 3, 1997 and as amended and restated as
of August 10, 1998 and August 24, 1999 among the Company, the Agent, the
Letter of Credit Issuing Bank, Swing Line Bank, the financial institutions
party thereto, Banc of America Securities LLC, as Lead Arranger and Book
Manger, and
00
XxxxXxxxxx, XX, Xxxx One, Michigan, LaSalle Bank National Association and
PNC Bank, National Association as Co-Agents (as further amended prior to
the date hereof).
"EXISTING LETTER OF CREDIT" means each letter of credit listed on
SCHEDULE 1.01.
"FDIC" means the Federal Deposit Insurance Corporation, and any
Governmental Authority succeeding to any of its principal functions.
"FEDERAL FUNDS RATE" means, for any day, the rate set forth in the
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including
any such successor, "H.15(519)") on the preceding Business Day opposite the
caption "Federal Funds (Effective)"; or, if for any relevant day such rate
is not so published on any such preceding Business Day, the rate for such
day will be the arithmetic mean as determined by the Agent of the rates for
the last transaction in overnight Federal funds arranged prior to 9:00 a.m.
(New York City time) on that day by each of three leading brokers of
Federal funds transactions in New York City selected by the Agent.
"FEE LETTER" has the meaning specified in SECTION 2.10(a).
"FIELD EXAM REPORT" means, that certain report dated as of April 30,
2002 of an appraiser, and each subsequent appraisal or verification report
issued after the Closing Date pursuant to the last sentence of SECTION
7.10.
"FINANCIAL LETTERS OF CREDIT" means any Letter of Credit which either
the Agent or the Issuing Bank determines is required under applicable law
(including regulations and guidelines established by banking regulators)
relating to reserve requirements to be classified as a financial letter of
credit.
"FIXED CHARGE COVERAGE RATIO" means, with respect to the Company and
its Subsidiaries (other than Excluded Subsidiaries) on a consolidated basis
for any fiscal period, the ratio of EBITDAR minus Capital Expenditures to
Fixed Charges.
"FIXED CHARGES" means, with respect to the Company and its
Subsidiaries (other than Excluded Subsidiaries) on a consolidated basis for
any fiscal period of determination, (a) Consolidated Interest Expense paid
in cash during such fiscal period, PLUS (b) scheduled payments of principal
with respect to Indebtedness for such fiscal period, PLUS (c) Rental
Expense paid for such fiscal period.
"FRB" means the Board of Governors of the Federal Reserve System, and
any Governmental Authority succeeding to any of its principal functions.
15
"FUND" means any Person (other than a natural person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course of
its business.
"FURTHER TAXES" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar
charges (including, without limitation, net income taxes and franchise
taxes), and all liabilities with respect thereto, imposed by any
jurisdiction on account of amounts payable or paid pursuant to SECTION
4.01.
"GAAP" means generally accepted accounting principles set forth from
time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants
and statements and pronouncements of the Financial Accounting Standards
Board (or agencies with similar functions of comparable stature and
authority within the U.S. accounting profession), which are in effect and
applicable to the circumstances as of the date of determination; PROVIDED,
HOWEVER, that for purposes of all computations required to be made with
respect to compliance by the Company with SECTIONS 8.14, 8.15, and 8.16,
such term shall mean generally accepted accounting principles as in effect
on the date of this Agreement, applied in a manner consistent with those
used in preparing the financial statements referred to in SECTION 6.11 (X)
and (Y).
"GOVERNMENTAL AUTHORITY" means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary
or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government (including, without limitation, any board of
insurance, insurance department or insurance commissioner and any taxing
authority or political subdivision), and any corporation or other entity
owned or controlled, through stock or capital ownership or otherwise, by
any of the foregoing.
"GUARANTOR" means each direct and indirect domestic Subsidiary of the
Company that is not an Excluded Subsidiary, whether now existing or
hereafter created or acquired.
"GUARANTY" means the Guaranty, dated as of the date hereof, duly
executed and delivered by each Guarantor in favor of the Collateral Agent,
on behalf of the Lenders, as the same may be amended, restated,
supplemented or otherwise modified from time to time.
"GUARANTY OBLIGATION" has the meaning specified in the definition of
"Contingent Obligation."
"HAZARDOUS MATERIALS" means any toxic or hazardous waste, substance
or chemical or any pollutant, contaminant, chemical or other substance
defined or
16
regulated pursuant to any Environmental Law, including, without limitation,
asbestos, petroleum, crude oil or any fraction thereof.
"INDEBTEDNESS" of any Person means, without duplication:
(a) all indebtedness for borrowed money;
(b) all obligations issued, undertaken or assumed as the deferred
purchase price of property or services (other than trade payables and
other accrued liabilities entered into in the ordinary course of
business);
(c) all non-contingent reimbursement or payment obligations with
respect to Surety Instruments and all L/C Obligations;
(d) all obligations evidenced by notes, bonds, debentures or
similar instruments;
(e) all indebtedness created or arising under any conditional
sale or other title retention agreement, or incurred as financing, in
either case with respect to property acquired by the Person (even
though the rights and remedies of the seller or bank under such
agreement in the event of default are limited to repossession or sale
of such property);
(f) all Capital Lease Obligations;
(g) all indebtedness referred to in CLAUSES (a) through (f) above
secured by (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien
upon or in property (including accounts and contracts rights) owned by
such Person, even though such Person has not assumed or become liable
for the payment of such Indebtedness; and
(h) all Guaranty Obligations in respect of indebtedness or
obligations of others of the kinds referred to in CLAUSES (a)
through (g) above.
"INDEMNIFIED LIABILITIES" has the meaning specified in SECTION 11.05.
"INDEMNIFIED PERSON" has the meaning specified in SECTION 11.05.
"INDEPENDENT AUDITOR" has the meaning specified in SECTION 7.01(a).
"INSOLVENCY PROCEEDING" means, with respect to any Person, (a) any
case, action or proceeding with respect to such Person before any court or
other Governmental Authority relating to bankruptcy, reorganization,
insolvency, liquidation, receivership, dissolution, winding-up or relief of
debtors, or (b) any general assignment for the benefit of creditors,
composition, marshaling of assets
17
for creditors, or other, similar arrangement in respect of its creditors
generally or any substantial portion of its creditors; undertaken under
U.S. Federal, state or foreign law, including the Bankruptcy Code.
"INSURANCE COMPANY RECEIVABLES" means insurance policy premiums
invoiced to client and, to be collected and subsequently passed through to
the insurance carrier (excluding any portion thereof which is owned, and
may be permanently retained, by the Company or its Subsidiaries).
"INSURANCE COMPANY PRE-BILLED RECEIVABLES" means xxxxxxxx of insurance
premiums and commissions in advance of the policy effective dates.
"INTEREST PAYMENT DATE" means, as to any Eurodollar Rate Loan, the
last day of each Interest Period applicable to such Eurodollar Rate Loan
and, as to any Base Rate Loan or Swing Line Loan, the last Business Day of
each March, June, September and December and each date such Loan is
converted into another Type of Loan; provided, however, that if any
Interest Period exceeds three months, the date that falls three months
after the beginning of such Interest Period and after each Interest Payment
Date thereafter is also an Interest Payment Date.
"INTEREST PERIOD" means, as to any Eurodollar Rate Loan, the period
commencing on the Borrowing Date of such Loan or on the
Conversion/Continuation Date on which the Loan is converted into or
continued as an Eurodollar Rate Loan, and ending on the date seven days (if
such seven day period ends on or before October 28, 2002), one, two, three
or six months thereafter as selected by the Company in its Notice of
Borrowing or Notice of Conversion/Continuation;
PROVIDED that:
(a) if any Interest Period would otherwise end on a day that is not a
Business Day, that Interest Period shall be extended to the following
Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month, in which event such Interest
Period shall end on the preceding Business Day;
(b) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall end on
the last Business Day of the calendar month at the end of such Interest
Period; and
(c) no Interest Period for any Revolving Loan shall extend beyond the
Revolving Termination Date.
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
"ISSUANCE DATE" has the meaning specified in SECTION 3.01(a).
18
"ISSUE" means, with respect to any Letter of Credit, to issue or to
extend the expiry of, or to renew or increase the amount of, such Letter of
Credit; and the terms "ISSUED," "ISSUING" and "ISSUANCE" have corresponding
meanings.
"ISSUING BANK" means Bank of America in its capacity as issuer of one
or more Letters of Credit hereunder together with any replacement letter of
credit issuer arising under SECTION 10.01(b) or SECTION 10.09.
"LENDER" has the meaning specified in the introductory clause hereto.
References to the "Lenders" shall include Bank of America, including in its
capacity as Issuing Bank and Swing Loan Lender; for purposes of
clarification only, to the extent that Bank of America may have any rights
or obligations in addition to those of the Lenders due to its status as
Issuing Bank, its status as such will be specifically referenced.
"LENDER INCREASE NOTICE" has the meaning set forth in SECTION 2.01(c).
"LENDING OFFICE" means, as to any Lender, the office or offices of
such Lender specified as its "Lending Office" or "Domestic Lending Office"
or "Offshore Lending Office", as the case may be, on SCHEDULE 11.02, or
such other office or offices as such Lender may from time to time notify
the Company and the Agent.
"L/C ADVANCE" means each Lender's participation in any L/C Borrowing
in accordance with its Pro Rata Share.
"L/C AMENDMENT APPLICATION" means an application form for amendment of
outstanding standby or commercial documentary letters of credit as shall at
any time be in use at the Issuing Bank, as the Issuing Bank shall request.
"L/C APPLICATION" means an application form for issuances of standby
or commercial documentary letters of credit as shall at any time be in use
at the Issuing Bank, as the Issuing Bank shall request.
"L/C 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 Borrowing of Revolving Loans under SECTION
3.03(c).
"L/C COMMITMENT" means the commitment of the Issuing Bank to Issue,
and the commitment of the Lenders severally to participate in, Letters of
Credit from time to time Issued or outstanding under Article III, in an
aggregate amount not to exceed on any date the amount of $10,000,000, as
the same shall be reduced as a result of a reduction in the L/C Commitment
pursuant to SECTION 2.06; PROVIDED that the L/C Commitment is a part of the
combined Commitments, rather than a separate, independent commitment.
"L/C OBLIGATIONS" means at any time the sum of (a) the aggregate
undrawn amount of all Letters of Credit then outstanding, plus (b) the
amount of
19
all unreimbursed drawings under all Letters of Credit, including all
outstanding L/C Borrowings.
"L/C-RELATED DOCUMENTS" means the Letters of Credit, the L/C
Applications, the L/C Amendment Applications and any other document
relating to any Letter of Credit, including any of the Issuing Bank's
standard form documents for letter of credit issuances.
"LETTER OF CREDIT" means any letter of credit (whether commercial
letters of credit or standby letters of credit) that is Issued by the
Issuing Bank pursuant to ARTICLE III.
"LEVERAGE RATIO" means, with respect to the Company and its
Subsidiaries (other than Excluded Subsidiaries), on a consolidated basis,
as of any date of determination, the ratio of total consolidated
Indebtedness as of such date to EBITDA for the twelve month period then
most recently ended (taken as a single accounting period).
"LIEN" means any security interest, mortgage, deed of trust, pledge,
hypothecation, assignment, charge or deposit arrangement, encumbrance, lien
(statutory or other) or preferential arrangement of any kind or nature
whatsoever in respect of any property (including those created by, arising
under or evidenced by any conditional sale or other title retention
agreement, the interest of a lessor under a capital lease, any financing
lease having substantially the same economic effect as any of the
foregoing, or the filing of any financing statement naming the owner of the
asset to which such lien relates as debtor, under the Uniform Commercial
Code or any comparable law) and any contingent or other agreement to
provide any of the foregoing, but not including the interest of a lessor
under an operating lease.
"LOAN" means an extension of credit by a Lender to the Company under
Article II or Article III in the form of a Revolving Loan, Swing Line Loan
or L/C Borrowing.
"LOAN DOCUMENTS" means this Agreement, any Notes, the Fee Letter, the
L/C Related Documents, the Borrowing Base Certificates, the Collateral
Documents and all other documents and certificates delivered to the Agent
or any Lender in connection herewith.
"MAJORITY LENDERS" means at any time, at least three Lenders holding
more than 50% of the then aggregate Commitments or, if the Commitments have
been terminated, Lenders holding more than 50% of the then unpaid principal
amount of Loans and L/C Obligations; PROVIDED that the Commitment of any
Defaulting Lender shall be excluded for the purposes of making a
determination of Majority Lenders.
"MARGIN STOCK" means "margin stock" as such term is defined in
Regulation T, U or X of the FRB.
20
"MATERIAL ADVERSE EFFECT" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties,
financial condition or prospects of the Company and its Subsidiaries (other
than Excluded Subsidiaries) taken as a whole, or of the Company and its
Subsidiaries (including Excluded Subsidiaries) taken as a whole; (b) a
material impairment of the ability of the Company or any Guarantor to
perform under any Loan Document and to avoid any Event of Default; or (c) a
material adverse effect upon the legality, validity, binding effect or
enforceability against the Company or any Guarantor of any Loan Document.
"MAXIMUM REVOLVER AMOUNT" means, at any time, the lesser of (a) the
combined Revolving Loan Commitments and (b) the Borrowing Base at such
time.
"MORTGAGE DOCUMENTS" means collectively, all real property mortgages,
leasehold mortgages, assignments of leases, mortgage deeds, deeds of trust,
deeds to secure debt, security agreements, and other similar instruments
entered into at any time which provide the Collateral Agent a Lien securing
the Obligations under any of the Loan Documents, for the benefit of the
Collateral Agent and the Lenders, on, or other interest in any portion of
the real property of the Company or the Guarantors or which relate to any
such Lien or interest and supporting documentation thereto.
"MULTIEMPLOYER PLAN" means a "multiemployer plan", within the meaning
of Section 4001(a)(3) of ERISA, to which the Company or any ERISA Affiliate
makes, is making, or is obligated to make contributions or, during the
immediately preceding six (6) years, has made, or been obligated to make,
contributions.
"NET INCOME" shall mean for any period, the net income (or loss) of
the Company and its Subsidiaries (other than Excluded Subsidiaries) on a
consolidated basis for such period taken as a single accounting period
determined in conformity with GAAP; PROVIDED, that there shall be excluded
from such determination, to the extent otherwise included therein, (i) the
income (or loss) of any entity accrued prior to the date it becomes a
Subsidiary (or such other date as provided in the relevant acquisition
agreement) of the Company or is merged into or consolidated with the
Company or any Subsidiary or on which its assets are acquired by the
Company or any Subsidiary of the Company, (ii) the income of any Subsidiary
of the Company to the extent that the declaration or payment of dividends
or similar distributions by that Subsidiary of that income is not at the
time permitted by operation of the terms of, or without any third-party
consent required by, its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary (iii) any non-cash charges relating to the FAS 142 transitional
goodwill impairment, (iv) non-cash, deferred financing charges, (v) income
and losses with respect to operations disposed of in accordance with
SECTION 8.02, (vi) gains and losses from dispositions permitted under
SECTION 8.02(c), (vii) non-cash charges related to the
21
effect of changes in accounting principles (all of which are in accordance
with GAAP) and (viii) extraordinary gains and losses.
"NET WORTH" means shareholders' equity as determined in accordance
with GAAP.
"NOTE" means a promissory note executed by the Company in favor of a
Lender pursuant to SECTION 2.02(b), in substantially the form of EXHIBIT
F-1, with respect to Revolving Loans, and EXHIBIT F-2, with respect to the
Swing Line Loan.
"NOTICE OF BORROWING" means a notice in substantially the form of
EXHIBIT A.
"NOTICE OF CONVERSION/CONTINUATION" means a notice in substantially
the form of EXHIBIT B.
"OBLIGATIONS" means all advances, debts, liabilities, obligations,
covenants and duties arising under any Loan Document owing by the Company
to any Lender, the Agent, the Collateral Agent, or any Indemnified Person,
whether direct or indirect (including those acquired by assignment),
absolute or contingent, due or to become due, now existing or hereafter
arising.
"ORGANIZATION DOCUMENTS" means, for any corporation, the certificate
or articles of incorporation, the bylaws, any certificate of determination
or instrument relating to the rights of preferred shareholders of such
corporation, any shareholder rights agreement, and all applicable
resolutions of the board of directors (or any committee thereof) of such
corporation and for any limited liability company, the certificate of
formation, the operating agreement and any instruments relating to the
rights of members of such limited liability company and all applicable
resolutions of the governing body of such limited liability company.
"OTHER TAXES" means any present or future stamp, court or documentary
taxes or any other excise or property taxes, charges or similar levies
which arise from any payment made hereunder or from the execution,
delivery, performance, or enforcement of, or otherwise with respect to,
this Agreement or any other Loan Documents.
"PARTICIPANT" has the meaning specified in SECTION 11.08(d).
"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under
ERISA.
"PENSION PLAN" means a pension plan (as defined in Section 3(2) of
ERISA) subject to Title IV of ERISA which the Company or any ERISA
Affiliate sponsors, maintains, or to which it makes, is making, or is
obligated to make
22
contributions, or in the case of a multiple employer plan (as described in
Section 4064(a) of ERISA) has made contributions at any time during the
immediately preceding six (6) plan years.
"PERMITTED ACQUISITION" means an Acquisition which meets the following
criteria:
(1) No Default or Event of Default has occurred and is continuing at
the time of the consummation of such Acquisition and no Default
or Event of Default would occur after giving effect to such
Acquisition;
(2) The target company or operations shall be in a same or similar
line of business as the Company or its Subsidiaries are engaged
in;
(3) The target company or operations subject to such Acquisition must
have generated positive earnings before interest, taxes,
depreciation and amortization for the twelve-month period then
most recently ended (for which financial statements are available
provided, that such financial statements are for a period ended
not more than 90 days prior to the date of such Acquisitions);
(4) Total cash consideration paid by the Company or any of its
Subsidiaries upon the consummation of such Acquisition PLUS
Indebtedness of the target company or operations assumed by the
Company or any of its Subsidiaries (other than payments by the
target company prior to the Acquisition), PLUS any deferred
payments booked as a liability upon the consummation of such
Acquisition (collectively, "CASH CONSIDERATION") for such
Acquisition is equal to or less than $10,000,000, and the sum of
such Cash Consideration and the maximum amount of contingent
payments to be made by the Company and its Subsidiaries after the
consummation of such Acquisition as additional consideration
therefor is equal to or less than $20,000,000;
(5) For all Acquisitions made in any fiscal year (after giving effect
to the subject Acquisition), the aggregate sum of: (i) Cash
Consideration paid by the Company or its Subsidiaries and (ii)
the actual amount of contingent payments made by the Company and
its Subsidiaries with respect to all Acquisitions (regardless of
whether consummated during such fiscal year) is equal to or less
than $20,000,000;
(6) Such Acquisition shall be consensual and shall have been approved
by the applicable target company's or seller's board of
directors;
(7) Comply with SECTIONS 7.14 and 7.15 with respect to acquired
target or operations;
23
(8) Such Acquisitions after giving effect thereto would not result in
the creation of any additional Excluded Subsidiaries or the
Acquisition of assets by any then existing Excluded Subsidiary,
except as permitted pursuant to SECTION 8.04(k); and
(9) prior to such Acquisition, the Company shall have delivered to
the Agent and the Lenders a certificate executed by a Responsible
Officer, demonstrating to the satisfaction of the Agent that
after giving effect to such Acquisition and the incurrence of any
Indebtedness permitted hereunder in connection therewith, on a
pro forma basis using historical audited (if any) or reviewed
unaudited (if any) financial statements or compiled financial
statements obtained from the target company in respect of each
such Acquisition, the Company is in compliance with CLAUSES (4)
and (5) above and SECTION 8.04(k), if applicable, and certifying
to CLAUSE (1) above.
"PERMITTED LIENS" has the meaning specified in SECTION 8.01.
"PERMITTED SWAP OBLIGATIONS" means all obligations (contingent or
otherwise) of the Company or any Subsidiary existing or arising under Swap
Contracts, provided that each of the following criteria is satisfied: (a)
such obligations are (or were) entered into by such Person in the ordinary
course of business for the purpose of directly mitigating risks associated
with liabilities, commitments or assets held or reasonably anticipated by
such Person, or changes in the value of securities issued by such Person in
conjunction with a securities repurchase program not otherwise prohibited
hereunder, and not for purposes of speculation or taking a "market view"
and (b) such Swap Contracts do not contain any provision ("walk-away"
provision) exonerating the non-defaulting party from its obligation to make
payments on outstanding transactions to the defaulting party.
"PERSON" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or Governmental Authority or
other entity.
"PLAN" means an employee benefit plan (as defined in Section 3(3) of
ERISA) which the Company or any ERISA Affiliate sponsors or maintains or to
which the Company makes, is making, or is obligated to make contributions
and includes any Pension Plan.
"PLEDGE AND SECURITY AGREEMENT" means, the Pledge and Security
Agreement dated as of the date hereof, duly executed and delivered by each
of the Company and the Guarantors pledging the stock of its Subsidiaries
(other than Excluded Subsidiaries) to the Collateral Agent, for the benefit
of itself and the Lenders, as the same may be amended, supplemented or
otherwise modified from time to time.
24
"PROPERTY" means any interest in any kind of property or asset,
whether real, personal or mixed, and whether tangible or intangible.
"PROPOSED NEW LENDER" has the meaning set forth in SECTION 2.01(c).
"PRO RATA SHARE" means, as to any Lender at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place) at
such time of such Lender's Revolving Loan Commitment divided by the
combined Revolving Loan Commitments of all Lenders.
"RECEIVABLES" means all of the Company's now owned or hereafter
acquired or arising accounts, contract rights, and any other rights to
payment for the rendition of services, whether or not they have been earned
by performance.
"RECONCILIATION CERTIFICATE" means a certificate executed by a
Responsible Officer of the Company providing a reconciliation report of the
Company and its Subsidiaries on a consolidated basis, setting forth a
calculation of the financial covenants set forth in SECTIONS 8.14 through
8.16 hereof, but, including, for the purposes of such reconciliation, the
financial information of all Excluded Subsidiaries of the Company to the
extent previously excluded from the calculation thereof, in a form and
accompanied by such detail and documentation as shall be requested by the
Agent in its reasonable discretion.
"RENTAL EXPENSE" means, for any period, the sum of (without
duplication with respect to gross lease arrangements): (a) all rental
payments, (b) all common area maintenance payments made pursuant to real
property leases and (c) all real estate taxes paid by the Company and its
Subsidiaries (other than Excluded Subsidiaries) pursuant to real property
leases not constituting Capital Lease Obligations.
"REPORTABLE EVENT" means, any of the events set forth in Section
4043(c) of ERISA or the regulations thereunder, other than any such event
for which the 30-day notice requirement under ERISA has been waived in
regulations issued by the PBGC.
"REQUIREMENT OF LAW" means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or of
a Governmental Authority not subject to a stay order issued by a court of
competent jurisdiction, in each case applicable to or binding upon the
Person or any of its property or to which the Person or any of its property
is subject.
"RESPONSIBLE OFFICER" means the chief executive officer, chief
operating officer, the president, or the chief financial officer of the
Company, or any other officer having substantially the same authority and
responsibility as the chief financial officer; or, with respect to
compliance with financial covenants, the chief financial officer, vice
president-finance or the treasurer of the Company, or any other officer
having substantially the same authority and responsibility.
25
"REVOLVING LOAN" has the meaning specified in SECTION 2.01.
"REVOLVING LOAN COMMITMENT", as to each Lender, has the meaning
specified in SECTION 2.01.
"REVOLVING TERMINATION DATE" means the earlier to occur of:
(a) September 26, 2005; and
(b) the date on which the Revolving Loan Commitments terminate in
accordance with the provisions of this Agreement.
"SEC" means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.
"SELLING LENDER(S)" has the meaning set forth in SECTION 2.01(c).
"SOLVENT" means, when used with respect to any Person, that as of any
date of determination, (a) the amount of the "present fair saleable value"
of the assets of such Person will as of such date, exceed the amount that
will be required to pay all "liabilities of such Person, contingent or
otherwise" (whether or not reflected on a balance sheet prepared in
accordance with GAAP), as of such date (as such quoted terms are determined
in accordance with the Bankruptcy Code or other applicable bankruptcy,
insolvency or other debtor relief laws) as such debts become due and
payable, (b) such Person will not have as of such date, an unreasonably
small amount of capital with which to conduct their business taking into
account the particular capital requirements of such Person and its
projected capital requirements and availability and (c) such Person will be
able to pay their debts as they mature, taking into account the timing of
and amounts of cash to be received by such Person, and the timing and
amounts of cash to be payable on or in respect of indebtedness of such
Person. For the purposes of this definitions, (i) "DEBT" means liability on
a "CLAIM", and (ii) "CLAIM" means any (x) right to payment, whether or not
such a right is reduced to judgement, liquidated, or unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, real or equitable,
secured or unsecured or (y) right to an equitable remedy for breach of
performance if such breach gives rise to a right of payment whether or not
such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured, unmatured, disputed, undisputed, secured or unsecured.
"SPC" has the meaning specified in SECTION 11.08(g).
"SPECIFIED ASSET SALE" means each Asset disposition described in
SCHEDULE 8.02 to this Agreement.
"SUBSIDIARY" of a Person means any corporation, association,
partnership, limited liability company, joint venture or other business
entity of which more than 50% of the voting stock, membership interests or
other equity interests (in the case of Persons other than corporations), is
owned or controlled directly or
26
indirectly by the Person, or one or more of the Subsidiaries of the Person,
or a combination thereof. Unless the context otherwise clearly requires,
references herein to a "Subsidiary" refer to a Subsidiary of the Company.
"SURETY INSTRUMENTS" means all letters of credit (including, without
limitation, standby, commercial and documentary), banker's acceptances,
bank guaranties, shipside bonds, surety bonds and similar instruments.
"SWAP CONTRACT" means any agreement, whether or not in writing,
relating to any transaction that is a rate swap, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap
or option, bond, note or xxxx option, interest rate option, forward foreign
exchange transaction, cap, collar or floor transaction, currency swap,
cross-currency rate swap, swaption, currency option or any other, similar
transaction (including any option to enter into any of the foregoing) or
any combination of the foregoing, and, unless the context otherwise clearly
requires, any master agreement relating to or governing any or all of the
foregoing.
"SWAP TERMINATION VALUE" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or
after the date such Swap Contracts have been closed out and termination
value(s) determined in accordance therewith, such termination value(s), and
(b) for any date prior to the date referenced in clause (a) the amount(s)
determined as the xxxx-to-market value(s) for such Swap Contracts, as
determined by the Company based upon one or more mid-market or other
readily available quotations provided by any recognized dealer in such Swap
Contracts (which may include any Lender).
"SWING LINE BANK" means Bank of America, in its capacity as provider
of the Swing Line Loans.
"SWING LINE LOAN" has the meaning specified in SECTION 2.01(b).
"SWING LINE LOAN COMMITMENT" has the meaning specified in SECTION
2.01(b).
"SWING LINE RATE" means the Base Rate.
"SWING LINE TERMINATION DATE" means the earlier to occur of:
(a) September 26, 2005; and
(b) the Revolving Termination Date.
"TANGIBLE NET WORTH" means shareholders' equity as determined in
accordance with GAAP, excluding all intangible assets (as determined in
conformity with GAAP), including, without limitation, goodwill, patents,
trademarks, copyrights, franchises, licenses and customer lists.
27
"TAXES" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case
of each Lender and the Agent, respectively, taxes imposed on or measured by
its net income, capital, revenue or gross receipts by the jurisdiction (or
any political subdivision thereof) under the laws of which such Lender or
the Agent, as the case may be, is organized or maintains a lending office.
"TYPE" means, with respect to any Borrowing, its nature as a Base Rate
Loan or an Eurodollar Rate Loan.
"UCC" the Uniform Commercial Code as the same may, from time to time,
be enacted and in effect in the State of Illinois; PROVIDED, that to the
extent that the UCC is used to define any term herein or in any Loan
Document and such term is defined differently in different Articles or
Divisions of the UCC, the definition of such term contained in Article or
Division 9 shall govern; PROVIDED FURTHER, that in the event that, by
reason of mandatory provisions of law, any or all of the attachment,
perfection or priority of, or remedies with respect to, the Administrative
the Agent's or any Lender's Lien on any Collateral is governed by the
Uniform Commercial Code as enacted and in effect in a jurisdiction other
than the State of Illinois, the term "UCC" shall mean the Uniform
Commercial Code as enacted and in effect in such other jurisdiction solely
for purposes of the provisions thereof relating to such attachment,
perfection, priority or remedies and for purposes of definitions related to
such provisions.
"UNFUNDED PENSION LIABILITY" means the excess of a Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of
that Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the
applicable plan year.
"UNITED STATES" and "U.S." each means the United States of America.
"WHOLLY-OWNED SUBSIDIARY" means any corporation, association,
partnership, limited liability company, joint venture or other business
entity in which (other than directors' or other qualifying shares required
by law) 100% of the equity interests of each class having ordinary voting
power, and 100% of the equity interests of every other class, in each case,
at the time as of which any determination is being made, is owned,
beneficially and of record, by the Company, or by one or more of the other
Wholly-Owned Subsidiaries, or both.
1.02 OTHER INTERPRETIVE PROVISIONS. (a) The meanings of defined terms are
equally applicable to the singular and plural forms of the defined terms.
(b) The words "hereof", "herein", "hereunder" and similar words refer
to this Agreement as a whole and not to any particular provision of this
Agreement; and Section, Schedule and Exhibit references are to this Agreement
unless otherwise specified.
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(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
(ii) The term "including" is not limiting and means "including
without limitation."
(iii) In the computation of periods of time from a specified
date to a later specified date, the word "from" means "from and
including"; the words "to" and "until" each mean "to but excluding",
and the word "through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, and
(ii) references to any statute or regulation are to be construed as including
all statutory and regulatory provisions consolidating, amending, replacing,
supplementing or interpreting the statute or regulation.
(e) The captions and headings of this Agreement are for convenience of
reference only and shall not affect the interpretation of this Agreement.
(f) This Agreement and other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters. All
such limitations, tests and measurements are cumulative and shall each be
performed in accordance with their terms.
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agent, the Company
and the other parties, and are the products of all parties. Accordingly, they
shall not be construed against the Lenders or the Agent merely because of the
Agent's or Lenders' involvement in their preparation.
1.03 ACCOUNTING PRINCIPLES. (a) Unless the context otherwise clearly
requires, all accounting terms not expressly defined herein shall be construed,
and all financial computations required under this Agreement shall be made, in
accordance with GAAP consistently applied.
(b) References herein to "fiscal year" and "fiscal quarter" refer to
such fiscal periods of the Company.
ARTICLE II
THE CREDITS
2.01 AMOUNTS AND TERMS OF COMMITMENTS. (a) Each Lender severally agrees, on
the terms and conditions set forth herein, to make loans to the Company (each
such loan, a "REVOLVING LOAN") from time to time on any Business Day during the
period from the Closing Date to the Revolving Termination Date, in an aggregate
amount not to exceed at any time the total of the amounts set forth on SCHEDULE
2.01 (such total amount, as the same may be reduced
29
under SECTION 2.05 or as a result of one or more assignments under SECTION
10.08, the Lender's "REVOLVING LOAN COMMITMENT"); PROVIDED, however, that, after
giving effect to any Borrowing of Revolving Loans (exclusive of Revolving Loans,
Swing Line Loans and L/C Obligations which are repaid with the proceeds of, and
simultaneously with the incurrence of, the respective incurrence of Revolving
Loans), the Effective Amount of all outstanding Revolving Loans, Swing Line
Loans and L/C Obligations, shall not at any time exceed the Maximum Revolver
Amount; and PROVIDED FURTHER, that the Effective Amount of the Revolving Loans
of any Lender plus the participation of such Lender in the Effective Amount of
all Swing Loan Loans and L/C Obligations shall not at any time exceed such
Lender's Revolving Loan Commitment. Within the limits of each Lender's Revolving
Loan Commitment, and subject to Availability at such time and the other terms
and conditions hereof, the Company may borrow under this SECTION 2.01(a), prepay
under SECTION 2.06 and reborrow under this SECTION 2.01(a).
(b) Subject to the terms and conditions hereof, the Swing Line Bank
agrees to make loans to the Company (each such loan, a "SWING LINE LOAN") from
time to time on any Business Day during the period from the Closing Date to the
Swing Line Termination Date in an aggregate principal amount at any one time
outstanding not to exceed $10,000,000 (the "SWING LINE LOAN COMMITMENT");
PROVIDED, after giving effect to any Borrowing of Swing Line Loans, the
Effective Amount of all outstanding Swing Line Loans shall not at any time
exceed the Swing Line Loan Commitment; AND PROVIDED FURTHER, that the Effective
Amount of all outstanding Revolving Loans, Swing Line Loans and L/C Obligations
shall not at any time exceed the Maximum Revolver Amount. Prior to the Swing
Line Termination Date, the Company may use the Swing Line Loan Commitment by
borrowing, prepaying the Swing Line Loans in whole or in part, and reborrowing,
all in accordance with the terms and conditions hereof. All Swing Line Loans
shall bear interest at the Swing Line Rate and shall not be entitled to be
converted into Loans that bear interest at any other rate.
(c) INCREASE OF REVOLVING LOAN COMMITMENT. (i) At any time, the
Company may request (in consultation with the Agent) that the combined Revolving
Loan Commitment be increased in a minimum amount equal to, and in minimum
increments of, $1,000,000, PROVIDED that, (A) the combined Revolving Loan
=Commitment shall at no time exceed $80,000,000 and (B) the Company shall not
previously have reduced the combined Revolving Loan Commitment. Such request
shall be made in a written notice given to the Agent and the Lenders by the
Company not less than twenty (20) Business Days prior to the proposed effective
date of such increase, which notice (a "COMMITMENT INCREASE NOTICE") shall
specify the amount of the proposed increase in the combined Revolving Loan
Commitment and the proposed effective date of such increase. In the event of
such a Commitment Increase Notice, each of the Lenders shall be given the
opportunity to participate in the requested increase. No Lender shall have any
obligation to increase its Commitment pursuant to a Commitment Increase Notice.
On or prior to the date that is fifteen (15) Business Days after receipt of the
Commitment Increase Notice, each Lender shall submit to the Agent a notice
indicating the maximum amount by which it is willing to increase its Commitment
in connection with such Commitment Increase Notice (any such notice to the Agent
being herein a "LENDER INCREASE NOTICE"). Any Lender which does not submit a
Lender Increase Notice to the Agent prior to the expiration of such fifteen (15)
Business Day period shall be deemed to have denied any increase in its
Commitment. In the event that the increases of Commitments set forth in the
Lender Increase Notices exceed the amount requested by the Company in the
Commitment Increase Notice, the Agent and the Arranger shall have the
30
right, in consultation with the Company, to allocate the amount of increases
necessary to meet the Company's Commitment Increase Notice. In the event that
the Lender Increase Notices are less than the amount requested by the Company,
not later than three (3) Business Days prior to the proposed effective date the
Company may notify the Agent of any financial institution that shall have agreed
to become a "Lender" party hereto (a "PROPOSED NEW LENDER") in connection with
the Commitment Increase Notice. Any Proposed New Lender shall be subject to the
consent of the Agent (which consent shall not be unreasonably withheld). If the
Company shall not have arranged any Proposed New Lender(s) to commit to the
shortfall from the Lender Increase Notices, then the Company shall be deemed to
have reduced the amount of its Commitment Increase Notice to the aggregate
amount set forth in the Lender Increase Notices. Based upon the Lender Increase
Notices, any allocations made in connection therewith and any notice regarding
any Proposed New Lender, if applicable, the Agent shall notify the Company and
the Lenders on or before the Business Day immediately prior to the proposed
effective date of the amount of each Lender's and Proposed New Lenders'
Commitment (the "EFFECTIVE COMMITMENT AMOUNT") and the amount of the combined
Revolving Loan Commitment, which amount shall be effective on the following
Business Day. Any increase in the combined Revolving Loan Commitment shall be
subject to the following conditions precedent: (1) the Company shall have
obtained from each Subsidiary party to a Loan Document its reaffirmation of such
Loan Documents, if any, executed by it, which consent and reaffirmation shall be
in writing and in form and substance reasonably satisfactory to the Agent, (2)
as of the date of the Commitment Increase Notice and as of the proposed
effective date of the increase in the combined Revolving Loan Commitment, all
representations and warranties shall be true and correct in all material
respects as though made on such date (except to the extent such representation
or warranties expressly refer to an earlier date, in which case they shall be
true and correct as of such earlier date) and no event shall have occurred and
then be continuing which constitutes a Default or Event of Default, (3) the
Company, the Agent and each Proposed New Lender or Lender that shall have agreed
to provide a "Commitment" in support of such increase in the combined Revolving
Loan Commitment shall have executed and delivered a "COMMITMENT AND ACCEPTANCE"
substantially in the form of EXHIBIT H hereto, (4) counsel for the Company and
for any such guarantors shall have provided to the Agent supplemental opinions
in form and substance reasonably satisfactory to the Agent and (5) the Company
and the Proposed New Lender shall otherwise have executed and delivered such
other instruments and documents as are consistent with those required under
ARTICLE V or that the Agent shall have reasonably requested in connection with
such increase. If any fee shall be charged by the Buying Lenders (as defined
below) in connection with any such increase, such fee shall be in accordance
with then prevailing market conditions, which market conditions shall have been
reasonably documented by the Agent to the Company. Upon satisfaction of the
conditions precedent to any increase in the combined Revolving Loan Commitment,
the Agent shall promptly advise the Company and each Lender of the effective
date of such increase. Upon the effective date of any increase in the combined
Revolving Loan Commitment that is provided by a Proposed New Lender, such
Proposed New Lender shall be a party to this Agreement as a Lender and shall
have the rights and obligations of a Lender hereunder. Nothing contained herein
shall constitute, or otherwise be deemed to be, a commitment on the part of any
Lender to increase its Commitment hereunder at any time.
(ii) For purposes of this CLAUSE (ii), (A) the term "BUYING LENDER(S)"
shall mean (1) each Lender the Effective Commitment Amount of which is greater
than its
31
Commitment prior to the effective date of any increase in the combined
Revolving Loan Commitment and (2) each Proposed New Lender that is allocated an
Effective Commitment Amount in connection with any Commitment Increase Notice,
and (B) the term "SELLING LENDER(S)" shall mean each Lender whose Commitment is
not being increased from that in effect prior to such increase in the combined
Revolving Loan Commitment. Effective on the effective date of any increase in
the combined Revolving Loan Commitment pursuant to CLAUSE (i) above, each
Selling Lender hereby sells, grants, assigns and conveys to each Buying Lender,
without recourse, warranty, or representation of any kind, except as
specifically provided herein, an undivided percentage in such Selling Lender's
right, title and interest in and to its outstanding Loans in the respective
dollar amounts and percentages necessary so that, from and after such sale, each
such Selling Lender's outstanding Loans shall equal such Selling Lender's Pro
Rata Share (calculated based upon the Effective Commitment Amounts) of the
outstanding Loans. Effective on the effective date of the increase in the
combined Revolving Loan Commitment pursuant to CLAUSE (i) above, each Buying
Lender hereby purchases and accepts such grant, assignment and conveyance from
the Selling Lenders. Each Buying Lender hereby agrees that its respective
purchase price for the portion of the outstanding Loans purchased hereby shall
equal the respective dollar amount necessary so that, from and after such
payments, each Buying Lender's outstanding Loans shall equal such Buying
Lender's Pro Rata Share (calculated based upon the Effective Commitment Amounts)
of the outstanding Loans. Such amount shall be payable on the effective date of
the increase in the combined Revolving Loan Commitment by wire transfer of
immediately available funds to the Agent. The Agent, in turn, shall wire
transfer any such funds received to the Selling Lenders, in same day funds, for
the sole account of the Selling Lenders. Each Selling Lender hereby represents
and warrants to each Buying Lender that such Selling Lender owns the Loans being
sold and assigned hereby for its own account and has not sold, transferred or
encumbered any or all of its interest in such Loans, except for participations
which will be extinguished upon payment to Selling Lender of an amount equal to
the portion of the outstanding Loans being sold by such Selling Lender. Each
Buying Lender hereby acknowledges and agrees that, except for each Selling
Lender's representations and warranties contained in the foregoing sentence,
each such Buying Lender has entered into its Commitment and Acceptance with
respect to such increase on the basis of its own independent investigation and
has not relied upon, and will not rely upon, any explicit or implicit written or
oral representation, warranty or other statement of the Lenders or the Agent
concerning the authorization, execution, legality, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or the other Loan
Documents. The Company hereby agrees to compensate each Lender for all losses,
expenses and liabilities incurred by each Lender in connection with the sale and
assignment of any Eurodollar Rate Loan hereunder on the terms and in the manner
as set forth in SECTION 4.04.
2.02 LOAN ACCOUNTS.
(a) The Loans made by each Lender and the Letters of Credit Issued by
the Issuing Bank shall be evidenced by one or more accounts or records
maintained by such Lender or Issuing Bank, as the case may be, in the ordinary
course of business. The accounts or records maintained by the Agent, the Issuing
Bank and each Lender shall be prima facie evidence of the amount of the Loans
made by the Lenders to the Company, and the Letters of Credit issued for the
account of the Company, and the interest and payments thereon. Any failure so to
record or
32
any error in doing so shall not, however, limit or otherwise affect the
obligation of the Company hereunder to pay any amount owing with respect to the
Loans or any Letter of Credit.
(b) Upon the request of any Lender made through the Agent, the Loans
made by such Lender may be evidenced by one or more Notes, instead of or in
addition to loan accounts. Each such Lender shall record on the schedules
annexed to its Note(s) the date, amount and maturity of each Loan made by it and
the amount of each payment of principal made by the Company with respect
thereto. Each such Lender is irrevocably authorized by the Company to make such
recordations on its Note(s) and each Lender's record shall be deemed prima facie
correct; PROVIDED, HOWEVER, that the failure of a Lender to make, or an error in
making, a notation thereon with respect to any Loan shall not limit or otherwise
affect the obligations of the Company hereunder or under any such Note to such
Lender.
2.03 PROCEDURE FOR BORROWING.
(a) REVOLVING LOANS. (i) Each Borrowing (other than a L/C Borrowing or
a Borrowing of Swing Line Loans) shall be made upon the Company's irrevocable
written notice delivered to the Agent in the form of a Notice of Borrowing
(which notice must be received by the Agent prior to 10:00 a.m. (Chicago time)
(x) three Business Days prior to the requested Borrowing Date, in the case of
Eurodollar Rate Loans and (y) on the date of the requested Borrowing Date, in
the case of Base Rate Loans, specifying:
(1) the amount of the Borrowing, which shall be in an aggregate
minimum amount of $500,000, or any multiple of $100,000 in excess
thereof, in the case of Base Rate Loans, and $1,000,000, or any
multiple of $500,000 in excess thereof, in the case of Eurodollar Rate
Loans;
(2) the requested Borrowing Date, which shall be a Business Day;
(3) the Type of Loans comprising the Borrowing; and
(4) the duration of the Interest Period applicable to such
Eurodollar Rate Loans included in such notice. If the Notice of
Borrowing fails to specify the duration of the Interest Period for any
Borrowing comprised of Eurodollar Rate Loans, such Interest Period
shall be one month;
PROVIDED, HOWEVER, that with respect to the Borrowing to be made on the Closing
Date, the Notice of Borrowing shall be delivered to the Agent not later than
10:00 a.m. (Chicago time) on the Closing Date and such Borrowing will consist of
Base Rate Loans only.
(ii) The Agent will promptly notify each Lender of its receipt of any
Notice of Borrowing and of the amount of such Lender's Pro Rata Share of that
Borrowing.
(iii) Each Lender will make the amount of its Pro Rata Share of each
Borrowing available to the Agent for the account of the Company at the Agent's
Payment Office by 2:00 p.m. (Chicago time) on the Borrowing Date requested by
the Company in funds immediately available to the Agent. The proceeds of all
such Loans will then be made available to the Company by the Agent at such
office by crediting the account of the Company on the
33
books of Bank of America with the aggregate of the amounts made available to the
Agent by the Lenders and in like funds as received by the Agent.
(iv) After giving effect to any Borrowing, unless the Agent shall
otherwise consent, there may not be more than seven different Interest Periods
in effect.
(b) SWING LINE LOANS. (i) The Company may borrow under the Swing Line
Loan Commitment on any Business Day until the Swing Line Termination Date;
PROVIDED that the Company shall give the Agent irrevocable notice (which notice
must be received by the Agent prior to 12:00 noon (Chicago time)) and the Agent
shall promptly deliver to the Company and the Swing Line Bank a confirmation of
such notice specifying the amount of the requested Swing Line Loan, which shall
be in a minimum amount of $100,000 or a whole multiple of $100,000 in excess
thereof. The proceeds of the Swing Line Loan will be made available by the Swing
Line Bank to the Company in immediately available funds at the office of the
Swing Line Bank by 2:00 p.m. (Chicago time) on the date of such notice. The
Company may at any time and from time to time, prepay the Swing Line Loans, in
whole or in part, without premium or penalty, by notifying the Agent prior to
12:00 noon (Chicago time) on any Business Day of the date and amount of
prepayment. If any such notice is given, the amount specified in such notice
shall be due and payable on the date specified therein. Partial prepayments
shall be in an aggregate principal amount of $100,000 or a whole multiple of
$100,000 in excess thereof.
(ii) The Agent, acting upon the demand of the Swing Line Bank, at any
time in the Swing Line Bank's sole and absolute discretion, shall on behalf of
the Company (which hereby irrevocably directs the Agent to so act on its behalf)
notify each Lender (including the Swing Line Bank) to make a Revolving Loan to
the Company in a principal amount equal to such Lender's Pro Rata Share of the
amount of such Swing Line Loan, unless any Lender or Lenders shall be obligated,
pursuant to SECTION 2.01(a), to make funds available to the Agent on the date
such notice is given in an aggregate amount equal to or in excess of such Swing
Line Loan, in which case such funds shall be applied by the Agent first to repay
such Swing Line Loan and any remaining funds shall be made available to the
Company in accordance with SECTION 2.01(a); PROVIDED, HOWEVER, that such notice
shall be deemed to have automatically been given upon the occurrence of an Event
of Default under SECTION 9.01(f) or (g). Upon notice from the Agent, following
any demand by the Swing Line Bank each Lender (other than the Swing Line Bank)
will immediately transfer to the Agent, for transfer to the Swing Line Bank, in
immediately available funds, an amount equal to such Lender's Pro Rata Share of
the amount of such Swing Line Loan so repaid. Each Lender's obligation to
transfer the amount of such Revolving Loan to the Agent shall be absolute and
unconditional and shall not be affected by any circumstance, including, without
limitation, (i) any set-off, counterclaim, recoupment, defense or other right
which such Lender or any other Person may have against the Swing Line Bank, (ii)
the occurrence or continuance of a Default or an Event of Default or the
termination of the Revolving Loan Commitment, (iii) any adverse change in the
condition (financial or otherwise) of the Company or any other Person, (iv) any
breach of this Agreement by the Company or any other Person or (v) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing.
(iii) Notwithstanding anything herein to the contrary, the Swing Line
Bank (i) shall not be obligated to make any Swing Line Loan if the conditions
set forth in ARTICLE V have
34
not been satisfied and (ii) shall not make any requested Swing Line Loan if,
prior to 1:00 p.m. (Chicago time) on the date of such requested Swing Line Loan,
it has received a written notice from the Agent or any Lender directing it not
to make further Swing Line Loans because one or more of the conditions specified
in ARTICLE V are not then satisfied.
(iv) If prior to the making of a Loan required to be made by SECTION
2.03(b)(ii) an Event of Default described in SECTION 9.01(f) or 9.01(g) shall
have occurred and be continuing with respect to the Company, each Lender will,
on the date such Loan was to have been made pursuant to the notice described in
SECTION 2.03(b)(ii), purchase an undivided participating interest in the
outstanding Swing Line Loans in an amount equal to its Pro Rata Share of the
aggregate principal amount of Swing Line Loans then outstanding. Each Lender
will immediately transfer to the Agent for the benefit of the Swing Line Bank,
in immediately available funds, the amount of its participation.
(v) Whenever, at any time after a Lender has purchased a
participating interest in a Swing Line Loan, the Swing Line Bank receives any
payment on account thereof, the Swing Line Bank will distribute to the Agent for
delivery to each Lender its participating interest in such amount (appropriately
adjusted, in the case of interest payments, to reflect the period of time during
which such Lender's participating interest was outstanding and funded);
PROVIDED, HOWEVER, that in the event that such payment received by the Swing
Line Bank is required to be returned, such Lender will return to the Agent for
delivery to the Swing Line Bank any portion thereof previously distributed by
the Swing Line Bank to it.
(vi) Each Lender's obligation to make the Loans referred to in SECTION
2.03(b)(ii) and to purchase participating interests pursuant to SECTION
2.03(b)(iv) shall be absolute and unconditional and shall not be affected by any
circumstance, including, without limitation, (i) any set-off, counterclaim,
recoupment, defense or other right which such Lender or the Company may have
against the Swing Line Bank, the Company or any other Person for any reason
whatsoever, (ii) the occurrence or continuance of a Default or an Event of
Default, (iii) any adverse change in the condition (financial or otherwise) of
the Company, (iv) any breach of this Agreement or any other Loan Document by the
Company, any Subsidiary or any other Lender, or (v) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing.
2.04 CONVERSION AND CONTINUATION ELECTIONS.
(a) The Company may, upon irrevocable written notice to the Agent in
accordance with the provisions of this SECTION 2.04:
(i) elect, as of any Business Day, in the case of Base Rate Loans
(other than Swing Line Loans), or as of the last day of the applicable
Interest Period, in the case of Eurodollar Rate Loans, to convert any
such Loans (or any part thereof in an aggregate minimum amount of
$500,000, or any multiple of $100,000 in excess thereof, in the case
of Base Rate Loans, and $1,000,000, or any multiple of $500,000 in
excess thereof, in the case of Eurodollar Rate Loans) into Loans of
any other Type; or
35
(ii) elect as of the last day of the applicable Interest Period,
to continue any Loans having Interest Periods expiring on such day (or
any part thereof in an amount not less than $1,000,000, or that is in
an integral multiple of $500,000 in excess thereof);
PROVIDED, that if at any time the aggregate amount of Eurodollar Rate Loans in
respect of any Borrowing is reduced, by payment, prepayment, or conversion of
part thereof to be less than $1,000,000, such Eurodollar Rate Loans shall
automatically convert into Base Rate Loans, and on and after such date the right
of the Company to continue such Loans as, and convert such Loans into,
Eurodollar Rate Loans shall terminate.
(b) The Company shall deliver a Notice of Conversion/Continuation to
be received by the Agent not later than 10:00 a.m. (Chicago time) at least
(i) three Business Days in advance of the Conversion/ Continuation Date, if the
Loans are to be converted into or continued as Eurodollar Rate Loans and (ii) on
the date of the Conversion/Continuation Date, if the Loans are to be converted
into Base Rate Loans, specifying:
(i) the proposed Conversion/Continuation Date;
(ii) the aggregate amount of Loans to be converted or continued;
(iii) the Type of Loans resulting from the proposed conversion or
continuation; and
(iv) other than in the case of conversions into Base Rate Loans,
the duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable to
Eurodollar Rate Loans, the Company has failed to submit or complete a notice in
accordance with SECTION 2.04(b), the Company shall be deemed to have elected to
convert such Eurodollar Rate Loans into a one month Eurodollar Rate Loan,
PROVIDED, HOWEVER, if any Default or Event of Default then exits, the Company
shall be deemed to have elected to convert such Eurodollar Rate Loans into a
Base Rate Loan.
(d) The Agent will promptly notify each Lender of its receipt of a
Notice of Conversion/Continuation, or, if no timely notice is provided by the
Company, the Agent will promptly notify each Lender of the details of any
automatic continuation or conversion. All conversions and continuations shall be
made ratably according to the respective outstanding principal amounts of the
Loans, with respect to which the notice was given, held by each Lender.
(e) Unless the Majority Lenders otherwise consent, during the
existence of a Default or Event of Default, the Company may not elect to have a
Loan converted into or continued as an Eurodollar Rate Loan.
(f) After giving effect to any conversion or continuation of
Eurodollar Rate Loans, unless the Agent shall otherwise consent, there may not
be more than seven different Interest Periods in effect.
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2.05 VOLUNTARY TERMINATION OR REDUCTION OF COMMITMENTS. The Company may,
upon not less than three Business Days' prior written notice to the Agent,
terminate the Commitments, or permanently reduce the Commitments by an aggregate
minimum amount of $1,000,000 or any multiple of $1,000,000 in excess thereof;
UNLESS, after giving effect thereto and to any prepayments of Revolving Loans
made on the effective date thereof, (i) the Effective Amount of all Revolving
Loans, Swing Line Loans and L/C Obligations would exceed the amount of the
Commitments then in effect, (ii) the Effective Amount of all Swing Line Loans
then outstanding would exceed the Swing Line Loan Commitment or (iii) the
Effective Amount of all L/C Obligations would exceed the L/C Commitment. If and
to the extent specified by the Company in the notice to the Agent, some or all
of the reduction in the Commitments shall be applied to reduce the L/C
Commitment. Once reduced in accordance with this Section, the Commitments may
not be increased. Any reduction of the Commitments shall be applied to each
Lender according to its Pro Rata Share. All accrued Commitment Fees and letter
of credit fees to, but not including, the effective date of any reduction or
termination of the Commitments shall be paid on the effective date of such
reduction or termination.
2.06 OPTIONAL PREPAYMENTS. Subject to SECTION 4.04, the Company may, at any
time or from time to time, upon irrevocable notice to the Agent by 10:00 a.m.
Chicago time, prepay Loans ratably among the Lenders in whole or in part without
penalty, in minimum amounts of $500,000, or any multiple of $100,000 in excess
thereof, in the case of Base Rate Loans, and $500,000, or any multiple of
$500,000 in excess thereof, in the case of Eurodollar Rate Loans. Such notice of
prepayment shall specify the date and amount of such prepayment and the Type(s)
of Loans to be prepaid. The Agent will promptly notify each Lender of its
receipt of any such notice, and of such Lender's Pro Rata Share of such
prepayment. If such notice is given by the Company, the Company shall make such
prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein, together with accrued interest to each
such date on the amount prepaid and any amounts required pursuant to SECTION
4.04.
2.07 MANDATORY PREPAYMENTS OF LOANS.
(a) The Company shall promptly, but in any event within two (2)
Business Days, prepay the outstanding principal amount of the Revolving Loans or
Swing Line Loans on any date on which the aggregate outstanding principal amount
of such Loans together with the Effective Amount of the L/C Obligations (after
giving effect to any other repayments or prepayments on such day) exceeds the
Maximum Revolver Amount in the amount of such excess, or if any such excess
remains after a prepayment in full hereunder of all outstanding Loans, the
Company shall Cash Collaterialize the outstanding Letters of Credit to the
extent of such remaining excess.
(b) If on any date the Effective Amount of L/C Obligations exceeds the
L/C Commitment, the Company shall Cash Collateralize on such date the
outstanding Letters of Credit in an amount equal to the excess of the maximum
amount then available to be drawn under the Letters of Credit over the Aggregate
L/C Commitment.
(c) GENERAL. Any prepayments pursuant to this SECTION 2.07 shall be
applied first to any Base Rate Loans then outstanding and then to Eurodollar
Rate Loans with the shortest Interest Periods remaining. The Company shall pay,
together with each prepayment
37
under this SECTION 2.07, accrued interest on the amount prepaid and any amounts
required pursuant to SECTION 4.04.
2.08 REPAYMENT.
(a) The Company shall repay to the Lenders on the Revolving
Termination Date the aggregate principal amount of Revolving Loans outstanding
on such date.
(b) SWING LINE LOANS. The Company shall repay to the Swing Line Bank
on the Swing Line Termination Date the aggregate principal amount of Swing Line
Loans outstanding on such date.
2.09 INTEREST.
(a) Each Loan (other than Swing Line Loans) shall bear interest on the
outstanding principal amount thereof from the applicable Borrowing Date at a
rate per annum equal to either the Eurodollar Rate or the Base Rate, as the case
may be, PLUS the Applicable Margin (and subject to the Company's right to
convert to other Types of Loans under SECTION 2.04). Swing Line Loans shall bear
interest on the outstanding principal amount thereof from the applicable
Borrowing Date at a rate per annum equal to the Swing Line Rate.
(b) Interest on each Loan shall be paid in arrears on each Interest
Payment Date. Interest shall also be paid on the date of any prepayment of Loans
under SECTION 2.06 or 2.07 for the portion of the Loans so prepaid and upon
payment (including prepayment) in full thereof and, during the existence of any
Event of Default, interest shall be paid on demand of the Agent at the request
or with the consent of the Majority Lenders.
(c) Notwithstanding SECTION 2.09(a), while any Event of Default exists
or after acceleration, the Company shall pay interest (after as well as before
entry of judgment thereon to the extent permitted by law) on the principal
amount of all outstanding Obligations, at a rate per annum which is determined
by adding 2% per annum to the Applicable Margin then in effect for such Loans;
and in the case of Obligations not subject to an Applicable Margin, at a rate
per annum equal to the Base Rate plus 2%; PROVIDED, HOWEVER, that, on and after
the expiration of any Interest Period applicable to any Eurodollar Rate Loan
outstanding on the date of occurrence of such Event of Default or acceleration,
the principal amount of such Loan shall, during the continuation of such Event
of Default or after acceleration, bear interest at a rate per annum equal to the
Base Rate plus 2% (the "DEFAULT RATE").
(d) Anything herein to the contrary notwithstanding, the obligations
of the Company to any Lender hereunder shall be subject to the limitation that
payments of interest shall not be required for any period for which interest is
computed hereunder, to the extent (but only to the extent) that contracting for
or receiving such payment by such Lender would be contrary to the provisions of
any law applicable to such Lender limiting the highest rate of interest that may
be lawfully contracted for, charged or received by such Lender, and in such
event the Company shall pay such Lender interest at the highest rate permitted
by applicable law.
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2.10 FEES.
(a) AGENCY FEES. The Company shall pay the fees to the Agent for the
Agent's own account, as required by the letter agreement ("FEE LETTER") between
the Company and the Agent, dated as of August 5, 2002.
(b) COMMITMENT FEES. The Company shall pay to the Agent for the
account of each Lender a commitment fee ("COMMITMENT FEE") on the average daily
unused portion of such Lender's Revolving Loan Commitment, computed on a
quarterly basis in arrears on the last Business Day of each calendar quarter
based upon the daily utilization for that quarter as calculated by the Agent, at
the Applicable Margin per annum. For purposes of calculating utilization under
this Section, the Revolving Loan Commitment shall be deemed used to the extent
of the Effective Amount of Revolving Loans then outstanding, PLUS the Effective
Amount of L/C Obligations then outstanding but excluding for the purposes of
calculating utilization under this Section the Effective Amount of Swing Line
Loans. Such commitment fee shall accrue from the Closing Date to the Revolving
Termination Date and shall be due and payable quarterly in arrears on the last
Business Day of each March, June, September and December through the Revolving
Termination Date, with the final payment to be made on the Revolving Termination
Date; provided that, in connection with any reduction or termination of
Revolving Loan Commitment under SECTION 2.05, the accrued commitment fee
calculated for the period ending on such date shall also be paid on the date of
such reduction or termination, with the following quarterly payment being
calculated on the basis of the period from such reduction or termination date to
such quarterly payment date. The commitment fees provided in this Section shall
accrue at all times after the above-mentioned commencement date, including at
any time during which one or more conditions in Article V are not met.
2.11 COMPUTATION OF FEES AND INTEREST.
(a) All computations of interest for Base Rate Loans when the Base
Rate is determined by Bank of America's "reference rate" shall be made on the
basis of a year of 365 or 366 days, as the case may be, and actual days elapsed.
All other computations of fees and interest shall be made on the basis of a
360-day year and actual days elapsed (which results in more interest being paid
than if computed on the basis of a 365-day year). Interest and fees shall accrue
during each period during which interest or such fees are computed from the
first day thereof to the last day thereof.
(b) Each determination of an interest rate by the Agent shall be
conclusive and binding on the Company and the Lenders and shall be prima facie
evidence of such interest rate. The Agent will, at the request of the Company or
any Lender, deliver to the Company or the Lender, as the case may be, a
statement showing the quotations used by the Agent in determining any interest
rate and the resulting interest rate.
39
2.12 PAYMENTS BY THE COMPANY.
(a) All payments to be made by the Company shall be made without
set-off, recoupment or counterclaim. Except as otherwise expressly provided
herein, all payments by the Company shall be made to the Agent for the account
of the Lenders at the Agent's Payment Office, and shall be made in dollars and
in immediately available funds, (i) solely for the purpose of calculating the
accrual of interest on the outstanding Obligations, no later than 12:00 Noon
(Chicago time) on the date specified herein and (ii) for all other purposes, no
later than 5:00 PM (Chicago time) on the date specified herein. The Agent will
promptly distribute to each Lender its Pro Rata Share (or other applicable share
as expressly provided herein) of such payment in like funds as received. Any
payment received by the Agent later than the time specified herein shall be
deemed to have been received on the following Business Day and any applicable
interest or fees shall continue to accrue for the day actually received.
(b) Subject to the provisions set forth in the definition of "Interest
Period" herein, whenever any payment is due on a day other than a Business Day,
such payment shall be made on the following Business Day, and such extension of
time shall in such case be included in the computation of interest or fees, as
the case may be.
(c) Unless the Agent receives notice from the Company prior to the
date on which any payment is due to the Lenders that the Company will not make
such payment in full as and when required, the Agent may assume that the Company
has made such payment in full to the Agent on such date in immediately available
funds and the Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Lender on such due date an amount equal to the
amount then due such Lender. If and to the extent the Company has not made such
payment in full to the Agent, each Lender shall repay to the Agent on demand
such amount distributed to such Lender, together with interest thereon at the
Federal Funds Rate for each day from the date such amount is distributed to such
Lender until the date repaid.
2.13 PAYMENTS BY THE LENDERS TO THE AGENT.
(a) Unless the Agent receives notice from a Lender on or prior to the
Closing Date or, with respect to any Borrowing after the Closing Date, at least
one Business Day prior to the date of such Borrowing, that such Lender will not
make available as and when required hereunder to the Agent for the account of
the Company the amount of that Lender's Pro Rata Share of the Borrowing, the
Agent may assume that each Lender has made such amount available to the Agent in
immediately available funds on the Borrowing Date and the Agent may (but shall
not be so required), in reliance upon such assumption, make available to the
Company on such date a corresponding amount. If and to the extent any Lender
shall not have made its full amount available to the Agent in immediately
available funds and the Agent in such circumstances has made available to the
Company such amount, that Lender shall on the Business Day following such
Borrowing Date make such amount available to the Agent, together with interest
at the Federal Funds Rate for each day during such period. A notice of the Agent
submitted to any Lender with respect to amounts owing under this clause (a)
shall be conclusive, absent manifest error. If such amount is so made available,
such payment to the Agent shall constitute such Lender's Loan on the date of
Borrowing for all purposes of this Agreement. If such amount is not made
available to the Agent on the Business Day following the Borrowing
40
Date, the Agent will notify the Company of such failure to fund and, upon demand
by the Agent, the Company shall pay such amount to the Agent for the Agent's
account, together with interest thereon for each day elapsed since the date of
such Borrowing, at a rate per annum equal to the interest rate applicable at the
time to the Loans comprising such Borrowing.
(b) The failure of any Lender to make any Loan on any Borrowing Date
shall not relieve any other Lender of any obligation hereunder to make a Loan on
such Borrowing Date, but no Lender shall be responsible for the failure of any
other Lender to make the Loan to be made by such other Lender on any Borrowing
Date.
2.14 SHARING OF PAYMENTS, ETC. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Loans made by it any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) in excess of its ratable share (or other share
contemplated hereunder), such Lender shall immediately (a) notify the Agent of
such fact, and (b) purchase from the other Lenders such participations in the
Loans made by them as shall be necessary to cause such purchasing Lender to
share the excess payment pro rata with each of them; PROVIDED, HOWEVER, that if
all or any portion of such excess payment is thereafter recovered from the
purchasing Lender, such purchase shall to that extent be rescinded and each
other Lender shall repay to the purchasing Lender the purchase price paid
therefor, together with an amount equal to such paying Lender's ratable share
(according to the proportion of (i) the amount of such paying Lender's required
repayment to (ii) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. The Company agrees that any Lender so
purchasing a participation from another Lender may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off, but subject to SECTION 11.10) with respect to such participation as
fully as if such Lender were the direct creditor of the Company in the amount of
such participation. The Agent will keep records (which shall be conclusive and
binding in the absence of manifest error) of participations purchased under this
Section and will in each case notify the Lenders following any such purchases or
repayments.
ARTICLE III
THE LETTERS OF CREDIT
3.01 THE LETTER OF CREDIT SUBFACILITY.
(a) On the terms and conditions set forth herein (i) the Issuing Bank
agrees, (A) from time to time on any Business Day during the period from the
Closing Date to the Revolving Termination Date to issue Letters of Credit for
the account of the Company, and to amend or renew Letters of Credit previously
issued by it, in accordance with SECTIONS 3.02(C) and (d), and (B) to honor
drafts under the Letters of Credit; and (ii) the Lenders severally agree to
participate in Letters of Credit Issued for the account of the Company;
PROVIDED, that the Issuing Bank shall not be obligated to Issue, and no Lender
shall be obligated to participate in, any Letter of Credit if as of the date of
Issuance of such Letter of Credit (the "ISSUANCE DATE") (1) the Effective Amount
of all L/C Obligations and Swing Line Loans plus the Effective Amount of all
Revolving Loans exceeds the Maximum Revolver Amount, (2) the participation of
any Lender in the Effective Amount of all L/C Obligations and Swing Line Loans
plus the
41
Effective Amount of the Revolving Loans of such Lender exceeds such Lender's
Revolving Loan Commitment or (3) the Effective Amount of L/C Obligations exceeds
the L/C Commitment. Within the foregoing limits, and subject to the other terms
and conditions hereof, the Company's ability to obtain Letters of Credit shall
be fully revolving, and, accordingly, the Company may, during the foregoing
period, obtain Letters of Credit to replace Letters of Credit which have expired
or which have been drawn upon and reimbursed.
(b) 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 (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
Lender, the Agent or the Company, 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 V is not then satisfied;
(iii) the expiry date of any requested Letter of Credit is after
the Revolving Termination Date, unless the Company has Cash Collateralized,
in form and substance satisfactory to the Issuing Bank, its L/C Obligations
under such Letter of Credit on or prior to the date of the Issuance of such
Letter of Credit;
(iv) any requested Letter of Credit does not provide for drafts,
or is not otherwise in form and substance reasonably 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 in a face amount less than $25,000,
unless such lesser amount is approved by the Agent and the Issuing Bank, or
is to be denominated in a currency other than Dollars.
3.02 ISSUANCE, AMENDMENT AND RENEWAL OF LETTERS OF CREDIT.
(a) Each Letter of Credit shall be issued upon the irrevocable written
request of the Company received by the Issuing Bank (with a copy sent by the
Company to the Agent) at least three days (or such shorter time as the Issuing
Bank may agree in a particular instance in its sole discretion) prior to the
proposed date of issuance. Each such request for issuance of a Letter of Credit
shall be by facsimile, confirmed immediately in an original writing, in the form
of an L/C Application, and shall specify in form and detail satisfactory to the
Issuing Bank: (i) the proposed date of issuance of the Letter of Credit (which
shall be a Business Day); (ii) the face
42
amount of the Letter of Credit; (iii) the expiry date of the Letter of Credit;
(iv) the name and address of the beneficiary thereof; (v) the documents to be
presented by the beneficiary of the Letter of Credit in case of any drawing
thereunder; (vi) the full text of any certificate to be presented by the
beneficiary in case of any drawing thereunder; and (vii) such other matters as
the Issuing Bank may require.
(b) Prior to the Issuance of any Letter of Credit, the Issuing Bank
will confirm with the Agent (by telephone or in writing) that the Agent has
received a copy of the L/C Application or L/C Amendment Application from the
Company and, if not, the Issuing Bank will provide the Agent with a copy
thereof. Unless the Issuing Bank has received notice on or before the Business
Day the Issuing Bank is to issue a requested Letter of Credit from the Agent (A)
directing the Issuing Bank not to issue such Letter of Credit because such
issuance is not then permitted under SECTION 3.01(a) as a result of the
limitations set forth in clauses (1) through (3) thereof or SECTION 3.01(b)(ii);
or (B) that one or more conditions specified in Article V are not then
satisfied; then, subject to the terms and conditions hereof, the Issuing Bank
shall, with the written approval of the Agent, on the requested date, issue a
Letter of Credit for the account of the Company in accordance with the Issuing
Bank's usual and customary business practices.
(c) From time to time while a Letter of Credit is outstanding and
prior to the Revolving Termination Date, the Issuing Bank will, upon the written
request of the Company received by the Issuing Bank (with a copy sent by the
Company to the Agent) at least three days (or such shorter time as the Issuing
Bank may agree in a particular instance in its sole discretion) prior to the
proposed date of amendment, amend any Letter of Credit issued by it. Each such
request for amendment of a Letter of Credit shall be made by facsimile,
confirmed immediately in an original writing, made in the form of an L/C
Amendment Application and shall specify in form and detail satisfactory to the
Issuing Bank: (i) the Letter of Credit to be amended; (ii) the proposed date of
amendment of the Letter of Credit (which shall be a Business Day); (iii) the
nature of the proposed amendment; and (iv) such other matters as the Issuing
Bank may require. The Issuing Bank shall be under no obligation to amend any
Letter of Credit if: (A) the Issuing Bank would have no obligation at such time
to issue such Letter of Credit in its amended form under the terms of this
Agreement; or (B) the beneficiary of any such letter of Credit does not accept
the proposed amendment to the Letter of Credit. The Agent will promptly notify
the Lenders of the receipt by it of any L/C Application or L/C Amendment
Application.
(d) The Issuing Bank and the Lenders agree that, while a Letter of
Credit is outstanding and prior to the Revolving Termination Date, at the option
of the Company and upon the written request of the Company received by the
Issuing Bank (with a copy sent by the Company to the Agent) at least five days
(or such shorter time as the Issuing Bank may agree in a particular instance in
its sole discretion) prior to the proposed date of notification of renewal, the
Issuing Bank shall be entitled to authorize the automatic renewal of any Letter
of Credit issued by it. Each such request for renewal of a Letter of Credit
shall be made by facsimile, confirmed immediately in an original writing, in the
form of an L/C Amendment Application, and shall specify in form and detail
satisfactory to the Issuing Bank: (i) the Letter of Credit to be renewed; (ii)
the proposed date of notification of renewal of the Letter of Credit (which
shall be a Business Day); (iii) the revised expiry date of the Letter of Credit;
and (iv) such other matters as the Issuing Bank may require. The Issuing Bank
shall be under no obligation so to renew any Letter of Credit if: (A) the
Issuing Bank would have no obligation at such time to issue or amend
43
such Letter of Credit in its renewed form under the terms of this Agreement; or
(B) the beneficiary of any such Letter of Credit does not accept the proposed
renewal of the Letter of Credit. If any outstanding Letter of Credit shall
provide that it shall be automatically renewed unless the beneficiary thereof
receives notice from the Issuing Bank that such Letter of Credit shall not be
renewed, and if at the time of renewal the Issuing Bank would be entitled to
authorize the automatic renewal of such Letter of Credit in accordance with this
clause (d) upon the request of the Company but the Issuing Bank shall not have
received any L/C Amendment Application from the Company with respect to such
renewal or other written direction by the Company with respect thereto, the
Issuing Bank shall nonetheless be permitted to allow such Letter of Credit to
renew, and the Company and the Lenders hereby authorize such renewal, and,
accordingly, the Issuing Bank shall be deemed to have received an L/C Amendment
Application from the Company requesting such renewal.
(e) The Issuing Bank may, at its election (or as required by the Agent
at the direction of the Majority Lenders), deliver any notices of termination or
other communications to any Letter of Credit beneficiary or transferee, and take
any other action as necessary or appropriate, at any time and from time to time,
in order to cause the expiry date of such Letter of Credit to be a date not
later than the Revolving Termination Date.
(f) This Agreement shall control in the event of any conflict with any
L/C-Related Document (other than any Letter of Credit).
(g) The Issuing Bank will also deliver to the Agent (and the Agent
shall deliver a copy to each Lender), concurrently or promptly following its
delivery of a Letter of Credit, or amendment to or renewal of a Letter of
Credit, to an advising lender or a beneficiary, a true and complete copy of each
such Letter of Credit or amendment to or renewal of a Letter of Credit.
3.03 RISK PARTICIPATIONS, DRAWINGS AND REIMBURSEMENTS.
(a) Immediately upon the Issuance of each Letter of Credit, each
Lender 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 Lender, times (ii) the maximum amount available to be drawn under such
Letter of Credit and the amount of such drawing, respectively. For purposes of
SECTION 2.10(b), each Issuance of a Letter of Credit shall be deemed to utilize
the Commitment of each Lender 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 Company and the Agent. The Company shall reimburse the Issuing Bank (by an
L/C Borrowing or otherwise) prior to 12:00 Noon (Chicago 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 Company fails to reimburse the Issuing Bank for
the full amount of any drawing under any Letter of Credit by 12:00 Noon (Chicago
time) on the Honor Date, the Issuing Bank will promptly notify the Agent and the
Agent will promptly notify each Lender thereof, and the Company shall be deemed
to have requested that Base Rate Loans
44
in an aggregate amount equal to the unreimbursed drawing be made by the Lenders
to be disbursed on the Honor Date under such Letter of Credit, subject to
Availability and subject to the conditions set forth in SECTION 5.02. Any notice
given by the Issuing Bank or the Agent pursuant to this clause (b) may be given
by telephone 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 Lender (including the Lender acting as Issuing Bank) shall
upon any notice pursuant to SECTION 3.03(b) make available to the Agent for the
account of the relevant 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 participating Lenders that so make funds available shall (subject
to SECTION 3.03(d)) each be deemed to have made a Revolving Loan consisting of a
Base Rate Loan to the Company in that amount. With respect to any unreimbursed
drawing that is not fully refinanced by a Revolving Loan consisting of Base Rate
Loans because the conditions set forth in SECTION 5.02 cannot be satisfied, the
lack of sufficient Availability or for any other reason, the Company shall be
deemed to have incurred from the Issuing Bank an L/C Borrowing in the amount of
the unreimbursed drawing that is not so refinanced, which L/C Borrowing shall be
due and payable on demand by the Agent or the Issuing Bank (together with
interest) and shall bear interest at the Default Rate. In such event, each
Lender's payment to the Agent for the account of the Issuing Bank pursuant to
this SECTION 3.03(c) shall be deemed payment in respect of its participation in
such L/C Borrowing and shall constitute an L/C Advance from such Lender in
satisfaction of its participation obligation under this SECTION 3.03. Until each
Lender funds its Revolving Loan or L/C Advance pursuant to this SECTION 3.03(c)
to reimburse the Issuing Bank for any amount drawn under any Letter of Credit,
interest in respect of such Lender's Pro Rata Share of such amount shall be
solely for the account of the Issuing Bank. The Agent shall remit the funds so
received to the Issuing Bank. If any Lender so notified fails to make available
to the Agent for the account of the Issuing Bank the amount of such Lender's Pro
Rata Share of the amount of the drawing by no later than 2:00 p.m. (Chicago
time) on the Honor Date, then interest shall accrue on such Lender's obligation
to make such payment, from the Honor Date to the date such Lender makes such
payment, at a rate per annum equal to the Federal Funds Rate in effect from time
to time during such period. A certificate of the Issuing Bank submitted to any
Lender (through the Agent) with respects to any amounts owing under this Section
shall be conclusive absent manifest error. The Agent will promptly give notice
of the occurrence of the Honor Date, but failure of the Agent to give any such
notice on the Honor Date or in sufficient time to enable any Lender to effect
such payment on such date shall not relieve such Lender from its obligations
under this SECTION 3.03.
(d) Each Lender's obligation in accordance with this Agreement to make
the Revolving Loans or to fund its L/C Advances, as contemplated by this SECTION
3.03, 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 Lender may have against the Issuing Bank, the
Company 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; PROVIDED, HOWEVER, that each Lender's
obligation to make Revolving Loans under this SECTION 3.03 (but not its
obligation to fund L/C Advances) is subject to Availability and the conditions
45
set forth in SECTION 5.02 (other than delivery by the Company of a Borrowing
Notice). No such making of an L/C Advance shall relieve or otherwise impair the
obligation of the Company to reimburse the Issuing Bank for the amount of any
payment made by the Issuing Bank under any Letter of Credit, together with
interest as provided herein.
3.04 REPAYMENT OF PARTICIPATIONS.
(a) Upon (and only upon) receipt by the Agent for the account of the
Issuing Bank of immediately available funds from the Company (i) in
reimbursement of any payment made by the Issuing Bank under the Letter of Credit
with respect to which any Lender has paid the Agent for the account of the
Issuing Bank for such Lender's participation in the Letter of Credit pursuant to
SECTION 3.03 or (ii) in payment of interest thereon, the Agent will pay to each
Lender, in the same funds as those received by the Agent for the account of the
Issuing Bank, the amount of such Lender'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
Lender that did not so pay the Agent for the account of the Issuing Bank.
(b) If the Agent or the Issuing Bank is required at any time to return
to the Company, or to a trustee, receiver, liquidator, custodian, or any
official in any Insolvency Proceeding, any portion of the payments made by the
Company to the Agent for the account of the Issuing Bank pursuant to SECTION
3.04(a) in reimbursement of a payment made under the Letter of Credit or
interest or fee thereon, each Lender shall, on demand of the Agent, forthwith
return to the Agent or the Issuing Bank the amount of its Pro Rata Share of any
amounts so returned by the Agent or the Issuing Bank plus interest thereon from
the date such demand is made to the date such amounts are returned by such
Lender to the Agent or the Issuing Bank, at a rate per annum equal to the
Federal Funds Rate in effect from time to time.
3.05 ROLE OF THE ISSUING BANK.
(a) Each Lender and the Company 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 which on its face appears valid or the
authority of the Person executing or delivering any such document.
(b) No Agent-Related Person nor any of the respective correspondents,
participants or assignees of the Issuing Bank shall be liable to any Lender for:
(i) any action taken or omitted in connection herewith at the request or with
the approval of the Majority Lenders (or all of the Lenders, as applicable under
SECTION 11.01); (ii) any action taken or omitted in the absence of gross
negligence or willful misconduct; or (iii) the due execution, effectiveness,
validity or enforceability of any L/C-Related Document.
(c) The Company hereby assumes all risks of the acts or omissions of
any beneficiary or transferee with respect to its use of any Letter of Credit;
PROVIDED, however, that this assumption is not intended to, and shall not,
preclude the Company's pursuing such rights and remedies as it may have against
the beneficiary or transferee at law or under any other agreement. No
Agent-Related Person, nor any of the respective correspondents, participants or
46
assignees of the Issuing Bank, shall be liable or responsible for any of the
matters described in clauses (i) through (vii) of SECTION 3.06; PROVIDED,
however, anything in such clauses to the contrary notwithstanding, that the
Company may have a claim against the Issuing Bank, and the Issuing Bank may be
liable to the Company, to the extent, but only to the extent, of any direct, as
opposed to consequential or exemplary, damages suffered by the Company which the
Company proves were caused by the Issuing Bank's willful misconduct or gross
negligence or the Issuing Bank's willful failure to pay under any Letter of
Credit after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing: (i) the Issuing
Bank may accept documents that appear on their face to be in order, without
responsibility for further investigation, unless it received a notice or
information to the contrary; and (ii) the Issuing Bank shall not be responsible
for the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which appear to be in order
when presented.
3.06 OBLIGATIONS ABSOLUTE. The obligations of the Company under this
Agreement and any L/C-Related Document to reimburse the Issuing Bank for a
drawing under a Letter of Credit, and to repay any L/C Borrowing and any drawing
under a Letter of Credit converted into Revolving Loans, shall be unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement and each such other L/C-Related Document under all circumstances,
including the following:
(i) any lack of validity or enforceability of this Agreement or
any L/C-Related Document;
(ii) any permitted change in the time, manner or place of payment
of, or in any other term of, all or any of the obligations of the Company
in respect of any Letter of Credit or any other amendment or waiver of or
any consent to departure from all or any of the L/C-Related Documents;
(iii) the existence of any claim, set-off, defense or other right
that the Company may have at any time against any beneficiary or any
transferee of any Letter of Credit (or any Person for whom any such
beneficiary or any such transferee may be acting), the Issuing Bank or any
other Person, whether in connection with this Agreement, the transactions
contemplated hereby or by the L/C-Related Documents or any unrelated
transaction;
(iv) any draft, demand, certificate or other document presented
under any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect; or any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under any
Letter of Credit;
(v) any payment by the Issuing Bank under any Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of any Letter of Credit; or any permitted payment
made by the Issuing Bank under any Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession,
47
assignee for the benefit of creditors, liquidator, receiver or other
representative of or successor to any beneficiary or any transferee of any
Letter of Credit, including any arising in connection with any Insolvency
Proceeding;
(vi) any exchange, release or non-perfection of any collateral,
or any release or amendment or waiver of or consent to departure from any
other guarantee, for all or any of the obligations of the Company in
respect of any Letter of Credit; or
(vii) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing, including any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the
Company or a guarantor.
3.07 CASH COLLATERAL PLEDGE. Upon (i) the request of the Agent or the
Majority Lenders, (A) if the Issuing Bank has honored any full or partial
drawing request on any Letter of Credit and such drawing has resulted in an L/C
Borrowing hereunder, or (B) if, as of the Revolving Termination Date, any
Letters of Credit may for any reason remain outstanding and partially or wholly
undrawn, or (ii) the occurrence of the circumstances described in SECTION
2.07(b) requiring the Company to Cash Collateralize Letters of Credit, then, the
Company shall immediately Cash Collateralize the L/C Obligations in an amount
equal to such L/C Obligations.
3.08 LETTER OF CREDIT FEES.
(a) The Company shall pay to the Agent for the account of each of the
Lenders a letter of credit fee with respect to the Letters of Credit equal to
the Applicable Margin per annum of the average daily maximum amount available to
be drawn of the outstanding Letters of Credit, computed on a quarterly basis in
arrears on the last Business Day of each March, June, September and December
based upon Letters of Credit outstanding for that quarter as calculated by the
Agent. Such letter of credit fees shall be due and payable quarterly in arrears
on the last Business Day of each calendar quarter during which Letters of Credit
are outstanding, commencing on the first such quarterly date to occur after the
Closing Date, through the Revolving Termination Date (or such later date upon
which the outstanding Letters of Credit shall expire), with the final payment to
be made on the Revolving Termination Date (or such later expiration date).
(b) The Company shall pay to the Issuing Bank a letter of credit
fronting fee for each Letter of Credit Issued by the Issuing Bank equal to .125%
per annum of the face amount (or increased face amount, as the case may be) of
such Letter of Credit. Such Letter of Credit fronting fee shall be due and
payable quarterly in arrears on the last Business Day of each calendar quarter
during which such Letter of Credit is outstanding, commencing on the first such
quarterly date to occur after such Letter of Credit is issued, through the
Revolving Termination Date (or such later date upon which such Letter of Credit
shall expire), with the final payment to be made on the Revolving Termination
Date (or such later expiration date).
(c) The Company shall pay to the Issuing Bank from time to time on
demand the normal issuance, presentation, amendment and other processing fees,
and other standard costs and charges, of the Issuing Bank relating to letters of
credit as from time to time in effect.
48
3.09 UNIFORM CUSTOMS AND PRACTICE. Unless otherwise expressly agreed by the
Issuing Bank and the Company when a Letter of Credit is issued (including any
such agreement applicable to an Existing Letter of Credit), (i) the rules of the
"International Standby Practices 1998" published by the Institute of
International Banking Law & Practice (or such later version thereof as may be in
effect at the time of issuance) shall apply to each standby Letter of Credit,
and (ii) the rules of the Uniform Customs and Practice for Documentary Credits,
as most recently published by the International Chamber of Commerce (the "ICC")
at the time of issuance (including the ICC decision published by the Commission
on Banking Technique and Practice on April 6, 1998 regarding the European single
currency (euro)) shall apply to each commercial Letter of Credit.
3.10 OUTSTANDING LETTERS OF CREDIt. The Existing Letters of Credit set
forth on SCHEDULE 1.01 were issued prior to the Effective Date pursuant to the
Existing Credit Agreement and will remain outstanding as of the Closing Date.
The Company, the Issuing Bank and each of the Lenders hereby agree with respect
to the Existing Letters of Credit that each such Existing Letter of Credit, for
all purposes under this Agreement, shall be deemed to be Letters of Credit
governed by the terms and conditions of this Agreement. Each Lender further
agrees to participate in each such Existing Letter of Credit in an amount equal
to its Pro Rata Share of the stated amount of such Existing Letter of Credit.
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
4.01 TAXES.
(a) Any and all payments by the Company to each Lender or the Agent
under this Agreement and any other Loan Document shall be made free and clear
of, and without deduction or withholding for, any Taxes. In addition, the
Company shall pay all Other Taxes.
(b) If the Company shall be required by law to deduct or withhold any
Taxes, Other Taxes or Further Taxes from or in respect of any sum payable
hereunder to any Lender or the Agent, then:
(i) the sum payable shall be increased as necessary so that,
after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable
under this Section), such Lender or the Agent, as the case may be,
receives and retains an amount equal to the sum it would have received
and retained had no such deductions or withholdings been made;
(ii) the Company shall make such deductions and withholdings;
(iii) the Company shall pay the full amount deducted or withheld
to the relevant taxing authority or other authority in accordance with
applicable law; and
(iv) the Company shall also pay to each Lender or the Agent for
the account of such Lender, at the time interest is paid, Further
Taxes in the amount that the
49
respective Lender specifies as necessary to preserve the after-tax
yield the Lender would have received if such Taxes, Other Taxes or
Further Taxes had not been imposed.
(c) The Company agrees to indemnify and hold harmless each Lender and
the Agent for the full amount of (i) Taxes, (ii) Other Taxes, and (iii) Further
Taxes in the amount that the respective Lender specifies as necessary to
preserve the after-tax yield the Lender would have received if such Taxes, Other
Taxes or Further Taxes had not been imposed, and any liability (including
penalties, interest, additions to tax and expenses) arising therefrom or with
respect thereto, whether or not such Taxes, Other Taxes or Further Taxes were
correctly or legally asserted. Payment under this indemnification shall be made
within 30 days after the date the Lender or the Agent makes written demand
therefor.
(d) Within 30 days after the date of any payment pursuant to this
Section by the Company of Taxes, Other Taxes or Further Taxes, the Company shall
furnish to each Lender or the Agent the original or a certified copy of a
receipt evidencing payment thereof, or other evidence of payment satisfactory to
such Lender or the Agent.
(e) If the Company is required to pay any amount to any Lender or the
Agent pursuant to clauses (b) or (c) of this Section, then such Lender shall use
reasonable efforts (consistent with legal and regulatory restrictions) to change
the jurisdiction of its Lending Office so as to eliminate any such additional
payment by the Company which may thereafter accrue, if such change in the sole
judgment of such Lender is not otherwise disadvantageous to such Lender.
4.02 ILLEGALITY.
(a) If any Lender determines that the introduction of any Requirement
of Law, or any change in any Requirement of Law, or in the interpretation or
administration of any Requirement of Law, has made it unlawful, or that any
central bank or other Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make Eurodollar Rate Loans,
then, on notice thereof by the Lender to the Company through the Agent, any
obligation of that Lender to make Eurodollar Rate Loans shall be suspended until
the Lender notifies the Agent and the Company that the circumstances giving rise
to such determination no longer exist.
(b) If a Lender determines that it is unlawful to maintain any
Eurodollar Rate Loan, the Company shall, upon its receipt of notice of such fact
and demand from such Lender (with a copy to the Agent), prepay in full such
Eurodollar Rate Loans of that Lender then outstanding, together with interest
accrued thereon and amounts required under SECTION 4.04, either on the last day
of the Interest Period thereof, if the Lender may lawfully continue to maintain
such Eurodollar Rate Loans to such day, or immediately, if the Lender may not
lawfully continue to maintain such Eurodollar Rate Loan. If the Company is
required to so prepay any Eurodollar Rate Loan, then concurrently with such
prepayment, the Company may borrow from the affected Lender, in the amount of
such repayment, a Base Rate Loan.
(c) If the obligation of any Lender to make or maintain Eurodollar
Rate Loans has been so terminated or suspended, the Company may elect, by giving
notice to the Lender
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through the Agent that all Loans which would otherwise be made by the
Lender as Eurodollar Rate Loans shall be instead Base Rate Loans.
(d) Before giving any notice to the Agent under this Section, the
affected Lender shall designate a different Lending Office with respect to its
Eurodollar Rate Loans if such designation will avoid the need for giving such
notice or making such demand and will not, in the judgment of the Lender, be
illegal or otherwise disadvantageous to the Lender.
4.03 INCREASED COSTS AND REDUCTION OF RETURN.
(a) If any Lender determines that, due to either (i) the introduction
of or any change in or in the interpretation of any law or regulation after the
date of this Agreement or (ii) the compliance by that Lender with any guideline
or request after the date of this Agreement from any central bank or other
Governmental Authority (whether or not having the force of law), there shall be
any increase in the cost to such Lender of agreeing to make or making, funding
or maintaining any Eurodollar Rate Loans (except for any such reserve
requirement reflected in the Eurodollar Reserve Percentage), or participating in
Letters of Credit, or, in the case of the Issuing Bank, any increase in the cost
to the Issuing Bank of agreeing to issue, issuing or maintaining any Letter of
Credit or of agreeing to make or making, funding or maintaining any unpaid
drawing under any Letter of Credit, then the Company shall be liable for, and
shall from time to time, upon demand (with a copy of such demand to be sent to
the Agent), pay to the Agent for the account of such Lender, additional amounts
as are sufficient to compensate such Lender for such increased costs.
(b) If any Lender shall have determined that (i) the introduction of
any Capital Adequacy Regulation after the date of this Agreement, (ii) any
change in any Capital Adequacy Regulation after the date of this Agreement,
(iii) any change after the date of this Agreement in the interpretation or
administration of any Capital Adequacy Regulation by any central bank or other
Governmental Authority charged with the interpretation or administration
thereof, or (iv) compliance by the Lender (or its Lending Office) or any
corporation controlling the Lender with any Capital Adequacy Regulation, affects
or would affect the amount of capital required or expected to be maintained by
the Lender or any corporation controlling the Lender and (taking into
consideration such Lender's or such corporation's policies with respect to
capital adequacy and such Lender's desired return on capital) determines that
the amount of such capital is increased as a consequence of its Commitment,
loans, credits or obligations under this Agreement, then, upon demand of such
Lender to the Company through the Agent, the Company shall pay to the Lender,
from time to time as specified by the Lender, additional amounts sufficient to
compensate the Lender for such increase.
4.04 FUNDING LOSSES. The Company shall reimburse each Lender and hold each
Lender harmless from any loss or expense which the Lender may sustain or incur
as a consequence of:
(i) the failure of the Company to make on a timely basis any payment
of principal of any Eurodollar Rate Loan;
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(ii) the failure of the Company to borrow a Loan, continue a
Eurodollar Rate Loan or convert a Loan into a Eurodollar Rate Loan after the
Company has given (or is deemed to have given) a Notice of Borrowing or a Notice
of Conversion/ Continuation;
(iii) the failure of the Company to make any prepayment in accordance
with any notice delivered under SECTION 2.06;
(iv) the prepayment (including pursuant to SECTION 2.07) or other
payment (including after acceleration thereof) of an Eurodollar Rate Loan on a
day that is not the last day of the relevant Interest Period; or
(v) the automatic conversion under SECTION 2.04 of any Eurodollar Rate
Loan to a Base Rate Loan on a day that is not the last day of the relevant
Interest Period; or
(vi) any Buying Lender is deemed to have purchased a Eurodollar Rate
Loan bearing interest at a rate which is less than the prevailing rate of
interest on Eurodollar Rate Loans at the time of purchase in accordance with
SECTION 2.01(c); or
(vii) any Selling Lender pursuant to SECTION 2.01(c) is deemed to have
sold a Eurodollar Rate Loan bearing interest at a rate which is higher than the
prevailing rate of interest on Eurodollar Rate Loans at the time of sale in
accordance with SECTION 2.01(c);
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Eurodollar Rate Loans or from fees
payable to terminate the deposits from which such funds were obtained. For
purposes of calculating amounts payable by the Company to the Lenders under this
Section and under SECTION 4.03(a), each Eurodollar Rate Loan made by a Lender
(and each related reserve, special deposit or similar requirement) shall be
conclusively deemed to have been funded at the Eurodollar Base Rate used in
determining the Eurodollar Rate for such Eurodollar Rate Loan by a matching
deposit or other borrowing in the interbank eurodollar market for a comparable
amount and for a comparable period, whether or not such Eurodollar Rate Loan is
in fact so funded.
4.05 INABILITY TO DETERMINE RATES. If the Agent determines that for any
reason adequate and reasonable means do not exist for determining the Eurodollar
Rate for any requested Interest Period with respect to a proposed Eurodollar
Rate Loan, or that the Eurodollar Rate applicable pursuant to SECTION 2.09(a)
for any requested Interest Period with respect to a proposed Eurodollar Rate
Loan does not adequately and fairly reflect the cost to the Lenders of funding
such Loan, the Agent will promptly so notify the Company and each Lender.
Thereafter, the obligation of the Lenders to make or maintain Eurodollar Rate
Loans hereunder shall be suspended until the Agent revokes such notice in
writing. Upon receipt of such notice, the Company may revoke any Notice of
Borrowing or Notice of Conversion/Continuation then submitted by it. If the
Company does not revoke such Notice, the Lenders shall make, convert or continue
the Loans, as proposed by the Company, in the amount specified in the applicable
notice submitted by the Company, but such Loans shall be made, converted or
continued as Base Rate Loans instead of Eurodollar Rate Loans.
4.06 CERTIFICATES OF LENDERS. Any Lender claiming reimbursement or
compensation under this Article IV shall deliver to the Company (with a copy to
the Agent) a certificate setting
52
forth in reasonable detail the amount payable to the Lender hereunder and such
certificate shall be conclusive and binding on the Company in the absence of
manifest error. Notwithstanding anything to the contrary contained in this
Agreement, no amounts shall be payable by the Company pursuant to SECTIONS 4.03
or 4.04 with respect to any period commencing more than 180 days before the
delivery of the certificate contemplated by this SECTION 4.06 unless such
amounts are claimed as a result of the retroactive effect of any newly enacted
or adopted law, rule or regulation and such certificate is delivered within 180
days after such enactment or adoption.
4.07 SURVIVAL. The agreements and obligations of the Company in this
Article IV shall survive the payment of all other Obligations.
4.08 REPLACEMENT OF LENDERS. Upon any Lender's making a claim for
compensation under SECTION 4.01 or 4.03, the Company may replace such Lender in
accordance with this Section. The Company may, upon notice to such Lender and
the Agent, replace such Lender by causing such Lender to assign its Revolving
Loan Commitment (with the assignment fee to be paid by the Company in such
instance) pursuant to SECTION 11.08(a) to one or more other Lenders or Eligible
Assignees procured by the Company; PROVIDED, HOWEVER, that if the Company elects
to exercise such right with respect to any Lender, it shall be obligated to
replace all Lenders that have made similar requests for compensation pursuant to
SECTION 4.01 or 4.03. The Lender shall have received payment in full all
principal, interest, fees and other amounts owing to such Lender through the
date of replacement (including any amounts payable pursuant to SECTIONS 4.01,
4.03 and 4.04), and the Company shall release such Lender from its obligations
under the Loan Documents. Any Lender being replaced shall execute and deliver an
Assignment and Acceptance with respect to such Lender's Revolving Loan
Commitment and outstanding Loans and participations in L/C Obligations and Swing
Line Loans.
ARTICLE V
CONDITIONS PRECEDENT
5.01 CONDITIONS OF EFFECTIVENESS AND INITIAL CREDIT EXTENSIONS. The
obligation of each Lender to make its initial Credit Extension hereunder is
subject to the condition that the Agent shall have received on or before the
Closing Date all of the following, in form and substance satisfactory to the
Agent and each Lender (the satisfaction of each Lender being conclusively
evidenced by such Lender's execution and delivery of its counterpart of this
Agreement), and in sufficient copies for each Lender:
(a) CREDIT AGREEMENT AND NOTES. This Agreement and the Notes (if any)
executed by each party thereto;
(b) RESOLUTIONS; INCUMBENCY.
(i) Copies of the resolutions of the board of directors of the
Company and each Subsidiary that may become party to a Loan Document
authorizing the transactions contemplated hereby, certified as of the
Closing Date by the Secretary or an Assistant Secretary of such
Person; and
53
(ii) A certificate of the Secretary or Assistant Secretary of the
Company, and each Subsidiary that may become party to a Loan Document
certifying the names and true signatures of the officers of the
Company or such Subsidiary authorized to execute, deliver and perform,
as applicable, this Agreement, and all other Loan Documents to be
delivered by it hereunder;
(c) ORGANIZATION DOCUMENTS; GOOD STANDING. Each of the following
documents:
(i) the Organization Documents of the Company and each Guarantor
as in effect on the Closing Date, certified by the Secretary or
Assistant Secretary or Manager of such Person as of the Closing Date;
and
(ii) a good standing certificate for the Company and each
Guarantor from the Secretary of State (or similar, applicable
Governmental Authority) of its state of incorporation and each state
where such Person is qualified to do business as a foreign corporation
as of a recent date;
(d) LEGAL OPINION. An opinion addressed to the Agent, the Collateral
Agent and the Lenders of Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P., counsel to
the Company, substantially in the form of EXHIBIT D-1. An opinion addressed to
the Agent, the Collateral Agent and the Lenders of Xxxxxxx X. Xxxxxxxx, general
counsel to the Company and its Subsidiaries substantially in the form of EXHIBIT
D-2.
(e) PAYMENT OF FEES. Evidence of payment by the Company of all accrued
and unpaid fees, costs and expenses to the extent then due and payable on the
Closing Date, together with Attorney Costs of Bank of America to the extent
invoiced prior to or on the Closing Date, plus such additional amounts of
Attorney Costs as shall constitute Bank of America's reasonable estimate of
Attorney Costs incurred or to be incurred by it through the closing proceedings
(provided that such estimate shall not thereafter preclude final settling of
accounts between the Company and Bank of America); including any such costs,
fees and expenses arising under or referenced in SECTIONS 2.10 and 10.07;
(f) CERTIFICATE. A certificate signed by a Responsible Officer of the
Company, dated as of the Closing Date:
(i) stating that the representations and warranties contained in
ARTICLE VI are true and correct on and as of such date, as though made
on and as of such date;
(ii) stating that no Default or Event of Default exists or would
result from the Credit Extension;
(iii) stating that there has occurred since December 31, 2001, no
event or circumstance that has resulted or could reasonably be
expected to result in a Material Adverse Effect; and
(iv) delineating the Applicable Margin after giving pro forma
effect to the Loans to be incurred on the Closing Date.
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(g) COLLATERAL DOCUMENTS. The Collateral Documents, executed by the
Company and each Subsidiary party to such Collateral Document, in appropriate
form for recording, where necessary, together with:
(i) all certificates and instruments representing the Collateral,
including, without limitation, stock transfer powers executed in blank
as the Collateral Agent or the Lenders may specify;
(ii) evidence that all other actions necessary or, in the opinion
of the Collateral Agent or the Lenders, desirable to perfect and
protect the first priority security interest subject to Permitted
Liens created by the Collateral Documents have been taken; and
(iii) to the extent required by the Agent, delivery of title
insurance, surveys and certificates and instruments with respect to
the Mortgage Documents and each in form and substance satisfactory to
the Agent.
(h) SOLVENCY CERTIFICATE. A written solvency certificate from the
chief financial officer of the Company in form and content satisfactory to the
Lenders, dated the initial Borrowing Date, with respect to the value, Solvency
and other factual information of, or relating to, as the case may be, Company,
after giving effect to the initial Credit Extension.
(i) OTHER DOCUMENTS. Such other approvals, opinions, documents or
materials as the Agent or any Lender may reasonably request.
(j) FINANCIAL STATEMENTS. The financial statements and other
information referenced in SECTION 6.11.
(k) INITIAL BORROWING BASE CERTIFICATE. An initial Borrowing Base
Certificate dated as of the Closing Date.
(l) PAYMENT OF EXISTING INDEBTEDNESS. Evidence satisfactory to the
Agent that the outstanding Indebtedness under the Existing Credit Agreement has
been paid in full, except with respect to contingent obligations pertaining to
undrawn Existing Letters of Credit.
5.02 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of each Lender to
make any Loan (but not its obligations to fund its participation interests
pursuant to SECTION 2.03(b)(ii) or SECTION 3.03(c)) to be made by it (including
its initial Loan hereunder after the date hereof) or to continue or convert any
Loan under SECTION 2.04 and the obligation of the Issuing Bank to Issue any
Letter of Credit (including the initial Letter of Credit) is subject to the
satisfaction of the following conditions precedent on the relevant Borrowing
Date or Issuance Date:
(a) NOTICE, APPLICATION. The Agent shall have received (with a copy
for each Lender) a Notice of Borrowing (or equivalent notice pursuant to SECTION
2.03(b) with respect to Swing Line Loans) or, in the case of any Issuance of any
Letter of Credit, the Issuing Bank and the Agent shall have received an L/C
Application or L/C Amendment Application, as required under SECTION 3.02;
55
(b) CONTINUATION OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties in Article VI shall be true and correct in all
material respects on and as of such Borrowing Date or Issuance Date with the
same effect as if made on and as of such Borrowing Date or Issuance Date (except
to the extent such representations and warranties expressly refer to an earlier
date, in which case they shall be true and correct in all material respects as
of such earlier date); and
(c) NO EXISTING DEFAULT. No Default or Event of Default shall exist or
shall result from such Borrowing or continuation or conversion or Issuance.
Each Notice of Borrowing, L/C Application or L/C Amendment Application submitted
by the Company hereunder shall constitute a representation and warranty by the
Company hereunder, as of the date of each such notice and as of each Borrowing
Date or Issuance Date, as applicable, that the conditions in this SECTION 5.02
are satisfied.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Agent and each Lender that:
6.01 CORPORATE EXISTENCE AND POWER. The Company and each of its
Subsidiaries:
(a) is a corporation (or a limited liability company) duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation;
(b) has the power and authority and all material governmental
licenses, authorizations, consents and material approvals to own its assets,
carry on its business and to execute, deliver, and perform its obligations under
the Loan Documents;
(c) is duly qualified as a foreign corporation and is licensed and in
good standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such qualification
or license, except in each case to the extent that the failure to do so could
not reasonably be expected to have a Material Adverse Effect.
(d) is in compliance with all Requirements of Law, except to the
extent that the failure to do so could not reasonably be expected to have a
Material Adverse Effect.
6.02 CORPORATE AUTHORIZATION; NO CONTRAVENTION. The execution, delivery and
performance by the Company and its Subsidiaries of this Agreement and each other
Loan Document to which such Person is party, have been duly authorized by all
necessary corporate action, and do not and will not:
(a) contravene the terms of any of such Person's Organization
Documents;
(b) conflict with or result in any breach or contravention of, or the
creation of any Lien under, any document evidencing any material Contractual
Obligation to which such
56
Person is a party or any order, injunction, writ or decree of any Governmental
Authority to which such Person or its property is subject; or
(c) violate any material Requirement of Law.
6.03 GOVERNMENTAL AUTHORIZATION. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, the Company or
any of its Subsidiaries of the Agreement or any other Loan Document, except (i)
such as have been obtained or made and are in full force, (ii) those third party
approvals or consents which, if not made or obtained, would not cause a Default
or an Event of Default hereunder or could not reasonably be expected to have an
Material Adverse Effect and (iii) solely with respect to the performance by the
Company or any of its Subsidiaries of this Agreement or any other Loan Document,
(1) the recording and filing of the Collateral Documents as required by this
Agreement, (2) filings, consents or approvals required for the exercise by the
Collateral Agent of its rights under the Collateral Documents, (3) filings under
the Exchange Act, and filings of releases with respect to the collateral (as
defined in the Existing Credit Agreement) securing the Existing Credit Agreement
and (4) routine filings to be made after the date hereof to maintain "good
standing" in such jurisdictions and to maintain licenses and permits.
6.04 BINDING EFFECT. This Agreement and each other Loan Document to which
the Company or any of its Subsidiaries is a party constitute the legal, valid
and binding obligations of the Company and any of its Subsidiaries to the extent
it is a party thereto, enforceable against such Person in accordance with their
respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting the enforcement of creditors'
rights generally or by equitable principles relating to enforceability,
regardless of whether considered in a proceeding in equity or at law.
6.05 LITIGATION. There are no actions, suits, investigations, proceedings,
claims or disputes pending, or to the best knowledge of the Company, threatened
or contemplated, at law, in equity, in arbitration or before any Governmental
Authority, against the Company, or its Subsidiaries or any of their respective
properties (a) which purport to affect or pertain to this Agreement or any other
Loan Document, or any of the transactions contemplated hereby or thereby; (b)
which are existing on the Closing Date, other than as disclosed on SCHEDULE
6.05(b), provided, however, that none of the matters set forth on such SCHEDULE
6.05(b), whether taken individually or in the aggregate, would reasonably be
expected to result in a Material Adverse Effect or (c) which arise after the
Closing Date, other than those which would not reasonably be expected to have a
Material Adverse Effect. No injunction, writ, temporary restraining order or any
order of any nature has been issued by any court or other Governmental Authority
purporting to enjoin or restrain the execution, delivery or performance of this
Agreement or any other Loan Document, or directing that the transactions
provided for herein or therein not be consummated as herein or therein provided.
6.06 NO DEFAULT. No Default or Event of Default exists or would result from
the incurring of any Obligations by the Company. As of the Closing Date, neither
the Company nor any Subsidiary is in default under or with respect to any
Contractual Obligation in any respect
57
which, individually or together with all such defaults, could reasonably be
expected to have a Material Adverse Effect, or that would, if such default had
occurred after the Closing Date, create an Event of Default under SECTION
9.01(e).
6.07 ERISA COMPLIANCE.
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law. Each
Plan which is intended to qualify under Section 401(a) of the Code has received
a favorable determination letter from the IRS and to the best knowledge of the
Company, nothing has occurred which would cause the loss of such qualification.
The Company and each ERISA Affiliate has made all required contributions to any
Plan subject to Section 412 of the Code, and no application for a funding waiver
or an extension of any amortization period pursuant to Section 412 of the Code
has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of Company,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or could reasonably be expected to
result in a Material Adverse Effect. There has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan which
has resulted or could reasonably be expected to result in a Material Adverse
Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to
occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither
the Company nor any ERISA Affiliate has incurred, or reasonably expects to
incur, any liability under Title IV of ERISA with respect to any Pension Plan
(other than premiums due and not delinquent under Section 4007 of ERISA); (iv)
neither the Company nor any ERISA Affiliate has incurred, or reasonably expects
to incur, any liability (and no event has occurred which, with the giving of
notice under Section 4219 of ERISA, would result in such liability) under
Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v)
neither the Company nor any ERISA Affiliate has engaged in a transaction that
could be subject to Section 4069 or 4212(c) of ERISA.
6.08 USE OF PROCEEDS; MARGIN REGULATIONS. The proceeds of the Loans are to
be used solely for the purposes set forth in and permitted by SECTION 7.12 and
SECTION 8.07. Neither the Company nor any Subsidiary is generally engaged in the
business of purchasing or selling Margin Stock or extending credit for the
purpose of purchasing or carrying Margin Stock.
6.09 TITLE TO PROPERTIES. The Company and each Subsidiary have good record
and marketable title in fee simple to, or valid leasehold interests in, all real
property necessary or used in the ordinary conduct of their respective
businesses, except for such defects in title as could not, individually or in
the aggregate, have a Material Adverse Effect. The property of the Company and
its Subsidiaries is subject to no Liens other than Permitted Liens.
6.10 TAXES. The Company and its Subsidiaries have filed all Federal and
other material tax returns and reports required to be filed, and have paid all
Federal and other material taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets
otherwise due and payable, except those which are being contested
58
in good faith by appropriate proceedings and for which adequate reserves have
been provided in accordance with GAAP. To the Company's knowledge as of the
Closing Date, there is no proposed tax assessment against the Company or any
Subsidiary.
6.11 FINANCIAL CONDITION. (a) The (x) audited consolidated financial
statements of the Company and its Subsidiaries dated December 31, 2001 and (y)
the unaudited consolidated financial statements (including, without limitation,
balances sheets, income and cash flow statements) of the Company and its
Subsidiaries dated June 30, 2002:
(i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein (subject to ordinary, good faith year end audit adjustments);
(ii) fairly present the financial condition of the Company and
its Subsidiaries as of the date thereof and results of operations for the
period covered thereby; and
(iii) except as specifically disclosed in SCHEDULE 6.11, show all
material indebtedness and other liabilities, direct or contingent, of the
Company and its consolidated Subsidiaries as of the date thereof, including
liabilities for taxes, material commitments and Contingent Obligations.
(b) Since December 31, 2001, there has been no Material Adverse
Effect.
6.12 ENVIRONMENTAL MATTERS.
(a) The on-going operations of the Company and each of its
Subsidiaries comply in all material respects with all Environmental Laws, except
such non-compliance which would not (if enforced in accordance with applicable
law) result in liability in excess of $250,000 in the aggregate.
(b) The Company and each of its Subsidiaries have obtained all
material licenses, permits, authorizations and registrations required under any
Environmental Law ("ENVIRONMENTAL PERMITS") and necessary for their respective
ordinary course operations, all such Environmental Permits are in good standing,
and the Company and each of its Subsidiaries are in compliance with all material
terms and conditions of such Environmental Permits.
(c) None of the Company, any of its Subsidiaries or any of their
respective present Property or operations, is subject to any outstanding written
order from or agreement with any Governmental Authority, nor subject to any
judicial or docketed administrative proceeding, respecting any Environmental
Law, Environmental Claim or Hazardous Material.
(d) There are no Hazardous Materials or other conditions or
circumstances existing with respect to any Property, or arising from operations
prior to the Closing Date, of the Company or any of its Subsidiaries that would
reasonably be expected to give rise to Environmental Claims with a potential
liability of the Company and its Subsidiaries in excess of $250,000 in the
aggregate for any such condition, circumstance or Property. In addition, (i)
neither the Company nor any of its Subsidiaries has any underground storage
tanks (x) that are
59
not properly registered or permitted under applicable Environmental Laws, or (y)
that are leaking or disposing of Hazardous Materials off-site, and (ii) the
Company and its Subsidiaries have met all notification requirements under Title
III of CERCLA and all other Environmental Laws.
6.13 COLLATERAL DOCUMENTS.
(a) The provisions of the Pledge and Security Agreement are effective
to create, in favor of the Collateral Agent for the benefit of the Lenders, a
legal, valid and enforceable security interest in all of the collateral
described therein; and the Collateral was delivered to the Collateral Agent or
its nominee in accordance with the terms thereof. The Lien of the Pledge and
Security Agreement constitutes a perfected, first priority security interest
other than Permitted Liens in all right, title and interest of the Company or
such Subsidiary, as the case may be, in the Collateral described therein, prior
and superior to all other Liens and interests; PROVIDED, HOWEVER, the Collateral
consisting of capital stock is not subject to any other Lien other than
Permitted Liens.
(b) The provisions of each of the Collateral Documents are effective
to create in favor of the Collateral Agent for the benefit of the Lenders, a
legal, valid and enforceable first priority security interest in all right,
title and interest of the Company and its Subsidiaries in the collateral
described therein, subject only to any Permitted Liens. With respect to the
pledge of Collateral consisting of equity interests in the Company's
Subsidiaries which are first tier Foreign Subsidiaries (as defined in the Pledge
and Security Agreement), such pledge shall be limited to a pledge of 65% of the
issued and outstanding shares or other units of equity interests PROVIDED,
HOWEVER, if the pledge of more sixty-five percent (65%) of such Foreign
Subsidiary would not result in materially adverse tax consequences to the
pledgor under Section 956 of the Internal Revenue Code, or if such materially
adverse tax consequences are no longer effective, then such pledged equity
interests shall constitute 100% or such other percentage of issued and
outstanding shares or other units of equity interests of such Foreign Subsidiary
and such Foreign Subsidiary shall execute and deliver the applicable Collateral
Documents. If any Excluded Subsidiary shall cease to be an Excluded Subsidiary
for any reason and to the extent any Excluded Subsidiary may do so without
violating federal, state or local laws or regulations applicable to it, the
Company shall promptly notify the Agent thereof and such Subsidiary shall
promptly execute and deliver the Collateral Documents and all other instruments
and documents necessary in the opinion of the Agent to become a Guarantor and
the Company shall cause such Subsidiary's outstanding capital stock to be
pledged to the Agent pursuant to the Collateral Documents. The chief executive
office and the principal books and records of the Company and each Guarantor
will be located at its address set forth on Exhibit A to the Pledge and Security
Agreement, and when financing statements have been filed in the appropriate
offices in the jurisdictions of organization for the Company and the Guarantors
and when such other actions as are each described in each of the Collateral
Documents have been taken, each of the Collateral Documents shall constitute a
perfected security interest in all right, title and interest of such Person, as
the case may be, in the Collateral described therein, and except for Permitted
Liens existing on the Closing Date and those Liens whose priority cannot be
superseded by the provisions hereof or of any Collateral Document and filings
hereunder or thereunder, a perfected first lien on, and security interest in,
all right, title and interest of such Person, as the case may be, in the
Collateral described in each Collateral Document.
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(c) All representations and warranties of the Company and any of its
Subsidiaries party thereto contained in the Collateral Documents are true and
correct.
6.14 REGULATED ENTITIES. None of the Company nor any Subsidiary that is not
an Excluded Subsidiary, is an "Investment Company" within the meaning of the
Investment Company Act of 1940. None of the Company nor any Subsidiary that is
not an Excluded Subsidiary is subject to regulation under the Public Utility
Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act,
any state public utilities code, or any other Federal or state statute or
regulation limiting its ability to incur Indebtedness.
6.15 NO BURDENSOME RESTRICTIONS. Neither the Company nor any Subsidiary is
a party to or bound by any Contractual Obligation, or subject to any restriction
in any Organization Document, or any Requirement of Law, which could reasonably
be expected to have a Material Adverse Effect.
6.16 SOLVENCY. The Company and its Subsidiaries, taken as a whole, are
Solvent.
6.17 LABOR RELATIONS. There are no strikes, lockouts or other labor
disputes against the Company or any of its Subsidiaries, or, to the best of the
Company's knowledge, threatened against or affecting the Company or any of its
Subsidiaries, and no significant unfair labor practice complaint is pending
against the Company or any of its Subsidiaries or, to the best knowledge of the
Company, threatened against any of them before any Governmental Authority which
in any such case could reasonably be expected to have a Material Adverse Effect.
6.18 COPYRIGHTS, PATENTS, TRADEMARKS, ETC. The Company or its Subsidiaries
own or are licensed or otherwise have the right to use all of the material
patents, trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other material rights that are reasonably
necessary for the operation of their respective businesses, without conflict
with the rights of any other Person. To the best knowledge of the Company, no
slogan or other advertising device, product, process, method, substance, part or
other material now employed, or now contemplated to be employed, by the Company
or any Subsidiary infringes upon any rights held by any other Person, and no
claim or litigation regarding any of the foregoing is pending or threatened,
which, in any case, could reasonably be expected to have a Material Adverse
Effect.
6.19 SUBSIDIARIES. As of the Closing Date, the Company has no Subsidiaries
other than those specifically disclosed in Part (A) of SCHEDULE 6.19 hereto and
has no equity investments in any other corporation or entity other than those
specifically disclosed in Part (B) of SCHEDULE 6.19. Such Schedule additionally
identifies all Excluded Subsidiaries existing as of the Closing Date and as
otherwise permitted pursuant to SECTION 8.04(f). No Excluded Subsidiary owns any
capital stock of any Subsidiary which is not also an Excluded Subsidiary.
6.20 BROKER'S; TRANSACTION FEES. Neither the Company nor any of its
Subsidiaries has any obligation to any Person in respect of any finder's,
broker's or investment banker's fee in connection with this Agreement or any
other Loan Document.
6.21 INSURANCE. The properties of the Company and its Subsidiaries are
insured with financially sound and reputable insurance companies not Affiliates
of the Company, in such amounts, with such deductibles and covering such risks
as are customarily carried by companies
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engaged in similar businesses and owning similar properties in localities where
the Company or such Subsidiary operates.
6.22 SWAP OBLIGATIONS. Neither the Company nor any of its Subsidiaries has
incurred any outstanding obligations under any Swap Contracts, other than
Permitted Swap Obligations. The Company has undertaken its own independent
assessment of its consolidated assets, liabilities and commitments and has
considered appropriate means of mitigating and managing risks associated with
such matters and has not relied on any swap counterparty or any Affiliate of any
swap counterparty in determining whether to enter into any Swap Contract.
6.23 FULL DISCLOSURE. None of the representations or warranties made by
the Company or any Subsidiary in the Loan Documents as of the date such
representations and warranties are made or deemed made, and none of the
statements contained in any exhibit, report, written statement or certificate
furnished by or on behalf of the Company or any Subsidiary in connection with
the Loan Documents (including the offering and disclosure materials delivered by
or on behalf of the Company to the Lenders prior to the Closing Date), contains
any untrue statement of a material fact or omits any material fact required to
be stated therein or necessary to make the statements made therein, in light of
the circumstances under which they are made, not misleading as of the time when
made or delivered (other than omissions that pertain to matters of a general
economic nature or matters of public knowledge that generally effect any of the
industry segments of the Company or its Subsidiaries); provided that, with
respect to projected financial information, the Company represents only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time.
6.24 INTERCOMPANY INDEBTEDNESS. Neither the Company nor any Subsidiary has
any intercompany Indebtedness which is evidenced by a promissory note, except
promissory notes which have been pledged and delivered to the Collateral Agent
pursuant to the Pledge and Security Agreement.
ARTICLE VII
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Majority Lenders waive compliance in
writing:
7.01 FINANCIAL STATEMENTS. The Company shall deliver to the Agent, in form
and detail satisfactory to the Agent and the Majority Lenders, with sufficient
copies for the Agent and each Lender:
(a) as soon as available, but not later than 90 days after the end of
each fiscal year, to the extent prepared to comply with SEC requirements, a copy
of SEC Form 10-K's filed by the Company with the SEC for such fiscal year, or if
no such Form 10-K was filed by the Company for such fiscal year, a copy of the
audited consolidated balance sheet of the Company and its Subsidiaries as at the
end of such year and the related consolidated statements of income or operations
and shareholders' equity and cash flows for such year, setting forth in each
case in
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comparative form the figures for the previous fiscal year, and in any case
accompanied by the opinion of KPMG LLP or another nationally-recognized
independent public accounting firm ("INDEPENDENT AUDITOR") which report shall
state that such consolidated financial statements present fairly the financial
position for the periods indicated in conformity with GAAP applied on a basis
consistent with prior years. Such opinion shall not be qualified or limited
because of a restricted or limited examination by the Independent Auditor of any
material portion of the Company's or any Subsidiary's records. Concurrently with
the delivery of the foregoing financial statements, a copy of the unaudited
combined consolidated balance sheet of the Excluded Subsidiaries as at the end
of such year and the related combined consolidated statements of income or
operations of the Excluded Subsidiaries for such year, setting forth in each
case in comparative form the figures for the previous fiscal year, which
unaudited combined consolidated financial statements shall have been prepared in
accordance with GAAP;
(b) as soon as available, but not later than 45 days after the end of
each of the first three fiscal quarters of each fiscal year, to the extent
prepared to comply with SEC requirements, a copy of the SEC Form 10-Qs filed by
the Company with the SEC for such fiscal quarter, or if no such Form 10-Q was
filed by the Company for such fiscal quarter, a copy of the unaudited
consolidated balance sheet of the Company and its Subsidiaries as of the end of
such quarter and the related consolidated statements of income and shareholders'
equity and cash flows for the period commencing on the first day and ending on
the last day of such quarter, and in any case certified by the chief executive
officer and chief financial officer as fairly presenting, in accordance with
GAAP (subject to ordinary, good faith year-end audit adjustments), the financial
position and the results of operations of the Company and the Subsidiaries; and
concurrently with the delivery of the foregoing unaudited financial statements,
a copy of the unaudited combined consolidated balance sheet of the Excluded
Subsidiaries as of the end of such quarter and the related combined consolidated
statements of income of the Excluded Subsidiaries for the period commencing on
the first day and ending on the last day of such quarter, and in any case
certified by the chief executive officer and chief financial officer as fairly
presenting, in accordance with GAAP (subject to ordinary, good faith year-end
audit adjustments), the financial position and the results of operations of the
Excluded Subsidiaries; and
(c) as soon as available, but not later than 30 days after the end of
each calendar month of each fiscal year, a copy of the unaudited consolidated
statements of income for the period commencing on the first day and ending on
the last day of such calendar month, and certified by a Responsible Officer as
fairly presenting (subject to ordinary, good faith year-end audit adjustments)
the results described therein of the Company and the Subsidiaries and
concurrently with the delivery of the foregoing unaudited financial statements,
a copy of the unaudited combined consolidated statements of income for the
period commencing on the first day and ending on the last day of such calendar
month, and certified by a Responsible Officer as fairly presenting (subject to
ordinary, good faith year-end audit adjustments) the results described therein
of the Excluded Subsidiaries.
7.02 CERTIFICATES; OTHER INFORMATION. The Company shall furnish to the
Agent, with sufficient copies for each Lender:
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(a) concurrently with the delivery of the financial statements
referred to in SECTION 7.01(a), a certificate of the Independent Auditor stating
that in making the examination necessary therefor no knowledge was obtained of
any Default or Event of Default, except as specified in such certificate;
(b) concurrently with the delivery of the financial statements
referred to in SECTIONS 7.01(a) and (b) a Compliance Certificate executed by a
Responsible Officer;
(c) promptly, copies of all financial statements and reports that the
Company sends to its shareholders, and copies of all financial statements and
regular, periodical or special reports (including Forms 10K, 10Q and 8K) that
the Company or any Subsidiary may make to, or file with, the SEC;
(d) as soon as available, but in any event not later than February 15
of each calendar year, a copy of the plan and forecast (including a projected
consolidated balance sheet, income statement and cash flow statement by business
services and insurance segments) of the Company and its Subsidiaries for the
next fiscal year and on each February 15 of each calendar year, a copy of
projected quarterly EBITDA of the Company and its Subsidiaries, in each case for
its then current fiscal year ("BUDGETED EBITDA"); and
(e) concurrently with the delivery of the financial statements
referred to in SECTIONS 7.01(a) and (b) a Reconciliation Certificate executed by
a Responsible Officer.
(f) ACCOUNT RECEIVABLE AND ACCOUNT PAYABLE AGING REPORT. Within thirty
(30) days after the end of each calendar month, an account receivable aging
report (the "ACCOUNT RECEIVABLE AGING REPORT") of the Company and its
Subsidiaries by business region, and an account payable aging report (the
"ACCOUNT PAYABLE AGING REPORT") of the Company and its Subsidiaries by business
region. Each Account Receivable Aging Report and Account Payable Aging Report
shall include such detail as the Agent may reasonably require and shall be
signed by the president or the chief financial officer or treasurer of the
Company; and
(g) promptly, such additional information regarding the business,
financial or corporate affairs of the Company or any Subsidiary as the Agent, at
the request of any Lender, may from time to time request.
(h) thirty (30) days following the end of each month, a Borrowing Base
Certificate (together with supporting information with respect to the
information set forth therein, including, without limitation, Receivables owed
by Affiliates of the Company or its Subsidiaries, Insurance Company Payables,
Insurance Company Pre-Billed Receivables and Account Debtors subject to
Insolvency Proceedings, in such detail as reasonably requested by the Agent)
calculating the Borrowing Base as of the end of such previous month ended.
7.03 NOTICES. The Company shall promptly notify the Agent and each Lender:
(a) of the occurrence of any Default or Event of Default;
(b) of any matter that has resulted or may reasonably be expected in
the opinion of a Responsible Officer to result in a Material Adverse Effect,
including (i) breach or
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non-performance of, or any default under, a Contractual Obligation of the
Company or any Subsidiary; (ii) any dispute, litigation, investigation,
proceeding or suspension between the Company or any Subsidiary and any
Governmental Authority; or (iii) the commencement of, or any material
development in, any litigation or proceeding affecting the Company or any
Subsidiary; including pursuant to any applicable Environmental Laws;
(c) of the occurrence of any of the following events affecting the
Company or any ERISA Affiliate (but in no event more than 10 days after such
event), and deliver to the Agent and each Lender a copy of any notice with
respect to such event that is filed with a Governmental Authority and any notice
delivered by a Governmental Authority to the Company or any ERISA Affiliate with
respect to such event:
(i) an ERISA Event;
(ii) a material increase in the Unfunded Pension Liability of any
Pension Plan;
(iii) the adoption of, or the commencement of contributions to,
any Plan subject to Section 412 of the Code by the Company or any ERISA
Affiliate; or
(iv) the adoption of any amendment to a Plan subject to
Section 412 of the Code, if such amendment results in a material increase in
contributions or Unfunded Pension Liability.
(d) of any material change in accounting policies or financial
reporting practices by the Company or any of its consolidated Subsidiaries;
(e) upon the request from time to time of the Agent, the Swap
Termination Values, together with a description of the method by which such
values were determined, relating to any then-outstanding Swap Contracts to which
the Company or any of its Subsidiaries is party; and
(f) the issuance of any order, the taking of any action or any request
for an extraordinary audit for cause by any Governmental Authority.
Each notice under this Section shall be accompanied by a written statement
by a Responsible Officer setting forth details of the occurrence referred to
therein, and stating what action the Company or any affected Subsidiary proposes
to take with respect thereto and at what time. Each notice under SECTION 7.03(a)
shall describe with particularity any and all clauses or provisions of this
Agreement or other Loan Document that have been (or foreseeably will be)
breached or violated.
7.04 PRESERVATION OF CORPORATE EXISTENCE, ETC. The Company shall, and shall
cause each Subsidiary to:
(a) preserve and maintain in full force and effect its corporate
existence and good standing under the laws of its state or jurisdiction of
incorporation (except as permitted by SECTION 8.03);
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(b) preserve and maintain in full force and effect all material
governmental rights, privileges, qualifications, permits, licenses and
franchises necessary or desirable in the normal conduct of its business, except
in connection with transactions permitted by SECTION 8.03 and sales of assets
permitted by SECTION 8.02;
(c) use reasonable efforts, in the ordinary course of business, to
preserve its business organization and goodwill; and
(d) preserve or renew all of its registered patents, trademarks, trade
names and service marks, the non-preservation of which could reasonably be
expected to have a Material Adverse Effect.
7.05 MAINTENANCE OF PROPERTY. The Company shall maintain, and shall cause
each Subsidiary to maintain, and preserve all its property which is used or
useful in its business in good working order and condition, ordinary wear and
tear excepted and make all necessary repairs thereto and renewals and
replacements thereof.
7.06 INSURANCE. The Company shall (i) maintain, and shall cause each
Subsidiary to maintain, with financially sound and reputable independent
insurers, insurance with respect to its properties and business against loss or
damage of the kinds customarily insured against by Persons engaged in the same
or similar business, of such types and in such amounts as are customarily
carried under similar circumstances by such other Persons and (ii) maintain such
other insurance with respect to the Collateral for the benefit of the Collateral
Agent as required pursuant to the Pledge and Security Agreement.
7.07 PAYMENT OF OBLIGATIONS. The Company shall, and shall cause each
Subsidiary to, pay and discharge as the same shall become due and payable, all
their respective obligations and liabilities, including:
(a) all tax liabilities, assessments and governmental charges or
levies upon it or its properties or assets, unless the same are being contested
in good faith by appropriate proceedings and adequate reserves in accordance
with GAAP are being maintained by the Company or such Subsidiary;
(b) all lawful claims which, if unpaid, would by law become a Lien
(other than a Permitted Lien) upon its property; and
(c) all indebtedness, as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness, unless the payment of such indebtedness is being contested in
good faith by appropriate proceedings and adequate reserves in accordance with
GAAP are being maintained by the Company or such Subsidiary.
7.08 COMPLIANCE WITH LAWS. The Company shall comply, and shall cause each
Subsidiary to comply, in all material respects with all Requirements of Law of
any Governmental Authority having jurisdiction over it or its business
(including the Federal Fair Labor Standards Act), except such as may be
contested in good faith or as to which a bona fide dispute may exist.
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7.09 COMPLIANCE WITH ERISA. The Company shall, and shall cause each of its
ERISA Affiliates to: (a) maintain each Plan in compliance in all material
respects with the applicable provisions of ERISA, the Code and other federal or
state law; (b) cause each Plan which is qualified under Section 401(a) of the
Code to maintain such qualification unless such Plan is terminated; and (c) make
all required contributions to any Plan subject to Section 412 of the Code.
7.10 INSPECTION OF PROPERTY AND BOOKS AND RECORDS. The Company shall
maintain and shall cause each Subsidiary to maintain proper books of record and
account, in which full, true and correct entries in conformity with GAAP
consistently applied shall be made of all financial transactions and matters
involving the assets and business of the Company and such Subsidiary. The
Company shall permit, and shall cause each Subsidiary to permit, representatives
and independent contractors of the Agent or any Lender to visit and inspect any
of their respective properties, to examine their respective corporate, financial
and operating records, and make copies thereof or abstracts therefrom, and to
discuss their respective affairs, finances and accounts with their respective
directors, officers, and independent public accountants, all at the expense of
the Company and at such reasonable times during normal business hours and as
often as may be reasonably desired, upon reasonable advance notice to the
Company; PROVIDED, HOWEVER, when an Event of Default exists the Agent or any
Lender may do any of the foregoing at the expense of the Company at any time
without advance notice. Without limiting the foregoing, the Company shall
permit, and shall cause each Subsidiary to permit, the Agent (or its independent
contractors and other third party examiners) access to the Company and its
Subsidiaries' books of records and account to verify, examine and appraise the
Company and its Subsidiaries' Receivables at the Company's expense, provided
such inspections shall not occur more than twice per calendar year, PROVIDED,
HOWEVER, when an Event of Default or Default shall have occurred and is
continuing, the Agent may do any of the foregoing at the expense of the Company
as often as it deems reasonably necessary at any time without advance notice.
7.11 ENVIRONMENTAL LAWS. The Company shall, and shall cause each Subsidiary
to, conduct its operations and keep and maintain its property in compliance with
all Environmental Laws.
7.12 USE OF PROCEEDS. The Company shall use the proceeds of the Loans for
working capital and other general corporate purposes, including Permitted
Acquisitions and the payment of fees and expenses relating thereto, in each case
not in contravention of any Requirement of Law or of any Loan Document.
7.13 SOLVENCY. The Company and its Subsidiaries, taken as a whole, shall at
all times be Solvent.
7.14 FURTHER ASSURANCES.
(a) The Company shall ensure that all written information, exhibits
and reports furnished to the Agent or the Lenders pursuant to the Loan Documents
do not and will not contain any untrue statement of a material fact and do not
and will not omit to state any material fact or any fact necessary to make the
statements contained therein not materially misleading in light of the
circumstances in which made; provided that with respect to projected
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financial information, the Company represents only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time. The Company will promptly disclose to the Agent and the Lenders and
correct any defect or error that may be discovered therein or in any Loan
Document or in the execution, acknowledgment or recordation thereof.
(b) Promptly upon request the Agent or the Majority Lenders, the
Company shall (and shall cause any of its Subsidiaries to) do, execute,
acknowledge, deliver, record, re-record, file, re-file, register and
re-register, any and all such further acts, deeds, conveyances, security
agreements, mortgages, assignments, estoppel certificates, financing statements
and continuations thereof, termination statements, notices of assignment,
transfers, certificates, assurances and other instruments the Agent or such
Lenders, as the case may be, may reasonably require from time to time in order
(i) to carry out more effectively the purposes of this Agreement or any other
Loan Document, (ii) to subject any of the properties, rights or interests
covered by any of the Collateral Documents to the Liens created by any of the
Collateral Documents, (iii) to perfect and maintain the validity, effectiveness
and priority of any of the Collateral Documents and the Liens intended to be
created thereby, and (iv) to better assure, convey, grant, assign, transfer,
preserve, protect and confirm to the Collateral Agent and Lenders the rights
granted or now or hereafter intended to be granted to the Collateral Agent and
the Lenders under any Loan Document or under any other document executed in
connection therewith.
7.15 NEW SUBSIDIARIES. If the Company or any domestic Subsidiary (other
than an Excluded Subsidiary) proposes to create, acquire or capitalize any
domestic Subsidiary (other than an Excluded Subsidiary) in accordance with the
terms and provisions hereof (whether pursuant to a Permitted Acquisition or
otherwise), it shall first (or substantially concurrently with such creation,
acquisition or capitalization) (a) (1) execute and deliver, and cause such
Subsidiary (other than Excluded Subsidiaries) to execute and deliver, to Agent a
Pledge and Security Agreement, a Guaranty and all other appropriate Collateral
Documents reasonably requested by the Agent or (2) execute and deliver a joinder
agreement acceptable in form and substance to the Agent with respect to each of
the applicable Collateral Documents as the Agent shall require in its sole
discretion and (b) execute and deliver, and cause such Subsidiary (other than
Excluded Subsidiaries) to execute and deliver, to the Agent appropriate
corporate resolutions, opinions and other documentation reasonably requested by
the Agent in form and substance reasonably satisfactory to the Agent, in each
case, to provide the Agent with a first priority perfected security interest on
the Collateral granted thereby and Lien thereon, PROVIDED, HOWEVER, to the
extent, such Collateral consists of equity interests in a first tier Foreign
Subsidiary (as defined in the Pledge and Security Agreement) the pledge of such
equity interests shall be limited to a pledge of 65% of the issued and
outstanding shares or other units of such equity interests (PROVIDED FURTHER,
HOWEVER, if the pledge of more sixty-five percent (65%) of such Foreign
Subsidiary would not result in materially adverse tax consequences to the
pledgor under Section 956 of the Internal Revenue Code, and only to the extent
such materially adverse tax consequences remain effective, then such pledged
equity interest shall constitute 100% or such other percentage of issued and
outstanding shares or other units of equity interests of such Foreign
Subsidiary). If the foregoing materially adverse tax consequences should no
longer be effective, such Foreign Subsidiary shall execute the Collateral
Documents. If the Company or any Subsidiary, should acquire, create or
capitalize any new Subsidiary, the Company shall promptly notify the Agent
thereof and provided an updated SCHEDULE 6.19 listing such new
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Subsidiary. If any Excluded Subsidiary shall cease to be an Excluded Subsidiary
for any reason and to the extent any Excluded Subsidiary may do so without
violating federal, state or local laws or regulations applicable to it, the
Company shall promptly notify the Agent thereof and such Subsidiary shall
promptly execute and deliver the Collateral Documents and all other instruments
and documents necessary in the opinion of the Agent to become a Guarantor and
the Company shall cause such Subsidiary's outstanding capital stock to be
pledged to the Agent pursuant to the Collateral Documents.
ARTICLE VIII
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Majority Lenders waive compliance in
writing:
8.01 LIMITATION ON LIENS. The Company shall not, and shall not suffer or
permit any Subsidiary to, directly or indirectly, make, create, incur, assume or
suffer to exist any Lien upon or with respect to any part of its property,
whether now owned or hereafter acquired, other than the following ("PERMITTED
LIENS"):
(a) any Lien existing on property of the Company or any Subsidiary on
the Closing Date; PROVIDED that the aggregate outstanding principal amount of
Indebtedness secured by all such Liens (together with Indebtedness secured by
Liens permitted by SECTIONS 8.01(i), (j) and (m) and Indebtedness and Contingent
Obligations permitted by SECTION 8.05(d), and SECTION 8.08(g)) shall not at any
time exceed an amount equal to 4% of the total assets of the Company and its
Subsidiaries on a consolidated basis;
(b) any Lien created under any Loan Document;
(c) Liens for taxes, fees, assessments or other governmental charges
which are not delinquent or remain payable without penalty, or to the extent
that non-payment thereof is permitted by SECTION 7.07, provided that no notice
of lien has been filed or recorded under the Code;
(d) carriers', warehousemen's, mechanics', landlords', materialmen's,
repairmen's or other similar Liens arising in the ordinary course of business
which are not delinquent or remain payable without penalty or which are being
contested in good faith and by appropriate proceedings, which proceedings have
the effect of preventing the forfeiture or sale of the property subject thereto;
(e) Liens (other than any Lien imposed by ERISA) consisting of pledges or
deposits required in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other social security, old age, pension
or similar legislation;
(f) Liens on the property of the Company or its Subsidiaries securing
(i) the non-delinquent performance of bids, trade contracts (other than for
borrowed money), leases,
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statutory obligations, (ii) contingent obligations on surety and appeal bonds,
and (iii) other non-delinquent obligations of a like nature; in each case,
incurred in the ordinary course of business;
(g) Liens consisting of judgment or judicial attachment liens,
provided that the enforcement of such Liens is effectively stayed and all such
liens in the aggregate at any time outstanding for the Company and its
Subsidiaries do not exceed $1,000,000;
(h) easements, rights-of-way, zoning restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount, and which do not interfere with the
ordinary conduct of the businesses of the Company and its Subsidiaries;
(i) purchase money security interests on any property acquired or held
by the Company or its Subsidiaries in the ordinary course of business, securing
Indebtedness incurred or assumed for the purpose of financing all or any part of
the cost of acquiring such property; PROVIDED THAT (i) any such Lien attaches to
such property concurrently with or within 180 days after the acquisition
thereof, (ii) such Lien attaches solely to the property so acquired in such
transaction and (iii) the aggregate outstanding principal amount of Indebtedness
secured by all such purchase money security interests (together with
Indebtedness secured by Liens permitted by SECTIONS 8.01(a), (j) and (m) and
Indebtedness and Contingent Obligations permitted by SECTION 8.05(D) and SECTION
8.08(g)) shall not at any time exceed an amount equal to 4% of the total assets
of the Company and its Subsidiaries on a consolidated basis;
(j) Liens securing Capital Lease Obligations on assets subject to such
Capital Leases, provided that the attributable principal portion of such Capital
Lease Obligations secured by all such Capital Leases (together with Indebtedness
with respect to Liens permitted by SECTIONS 8.01(a), (i), and (m) and
Indebtedness and Contingent Obligations permitted by SECTION 8.05(d) and SECTION
8.08(g)) shall not at any time exceed an amount equal to 4% of the total assets
of the Company and its Subsidiaries on a consolidated basis;
(k) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights and
remedies as to deposit accounts or other funds maintained with a creditor
depository institution; PROVIDED THAT (i) such deposit account is not a
dedicated cash collateral account and is not subject to restrictions against
access by the Company in excess of those set forth by regulations promulgated by
the FRB, and (ii) such deposit account is not intended by the Company or any
Subsidiary to provide collateral to the depository institution;
(l) Liens comprised of cash or Cash Equivalents with respect to the
Company's reimbursement obligations under Existing Letters of Credit; and
(m) Liens on assets of Persons which become Subsidiaries after the
date of this Agreement, PROVIDED, HOWEVER, that (x) such Liens existed at the
time the respective Persons became Subsidiaries and were not created in
anticipation thereof, (y) such Liens attach only to equipment and real property
of such Subsidiary and proceeds thereof and (z) the aggregate outstanding
principal amount of Indebtedness secured by all such Liens (together with
Indebtedness secured by Liens permitted by SECTIONS 8.01(a), (i) and (j) and
Indebtedness and
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Contingent Obligations permitted by SECTION 8.05(d) and SECTION 8.08(g)) shall
not at any time exceed an amount equal to 4% of the total assets of the Company
and its Subsidiaries on a consolidated basis; and
(n) Liens consisting of pledges of cash collateral or government
securities to secure on a xxxx-to-market basis Permitted Swap Obligations only,
provided that the aggregate value of such collateral so pledged by the Company
and the Subsidiaries together in favor of any counterparty does not at any time
exceed $1,000,000.
In addition, neither the Company nor any of its Subsidiaries shall become a
party to any agreement, note, indenture or other instrument, or take any other
action, which would prohibit the creation of a first priority Lien on any of its
properties or other assets in favor of the Collateral Agent for the benefit of
itself and the Lenders, as collateral for the Obligations, except with respect
to specific equipment secured by Indebtedness or Capital Leases permitted under
SECTIONS 8.01(i) or (j) or with respect to software licenses or similar
contracts which constitute property or assets of the Company or any of its
Subsidiaries which by the express terms thereof prohibit the creation of a first
priority Lien in favor of the Collateral Agent on such software licenses or
similar contracts.
8.02 DISPOSITION OF ASSETS. The Company shall not, and shall not suffer or
permit any Subsidiary to, directly or indirectly, sell, assign, lease, convey,
transfer or otherwise dispose of (whether in one or a series of transactions)
any property (including accounts and notes receivable, with or without recourse)
or enter into any agreement to do any of the foregoing, except:
(a) dispositions of inventory, or used, worn-out or surplus equipment
(including, without limitation, demonstration or pilot plants), all in the
ordinary course of business;
(b) the sale of equipment to the extent that such equipment is
exchanged for credit against the purchase price of similar replacement
equipment, or the proceeds of such sale are reasonably promptly applied to the
purchase price of such replacement equipment within ninety (90) days of each
such sale;
(c) each Specified Asset Sale;
(d) dispositions not otherwise permitted hereunder which are made for
fair market value; provided that (i) at the time of any disposition, no Event of
Default shall exist or shall result from such disposition, (ii) not less than
80% of the aggregate sales price from such disposition shall be paid in cash or
Cash Equivalents, and (iii) the aggregate value of all assets so sold by the
Company and its Subsidiaries, together, shall not exceed (x) 5% of the net
tangible assets of the Company and its Subsidiaries on a consolidated basis
during any twelve month period with net tangible assets to be measured as of the
beginning of such period, and (y) 15% of the net tangible assets of the Company
and its Subsidiaries on a consolidated basis during the term of this Agreement,
with net tangible assets to be measured as of the Closing Date;
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(e) transfer of cash or Cash Equivalents not otherwise prohibited by
the Loan Documents;
(f) Investments permitted under SECTION 8.04 and dispositions pursuant
to a merger or other consolidation permitted under SECTION 8.03; and
(g) transfer of inventory, equipment or other assets from the Company
to any Subsidiary which is not an Excluded Subsidiary or to the Company or any
other such Subsidiary from any Subsidiary.
8.03 CONSOLIDATIONS AND MERGERS. The Company shall not, and shall not
suffer or permit any Subsidiary to, merge, consolidate with or into, or convey,
transfer, lease or otherwise dispose of (whether in one transaction or in a
series of transactions all or substantially all of its assets whether now owned
or hereafter acquired) to or in favor of any Person, except:
(a) any Subsidiary (other than an Excluded Subsidiary) may merge with
the Company (PROVIDED that the Company shall be the continuing or surviving
corporation), or with any one or more Subsidiaries (other than an Excluded
Subsidiary), PROVIDED that if any transaction shall be between a Subsidiary and
a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be the continuing
or surviving corporation it being understood and agreed that, notwithstanding
the prohibition contained in this clause, an Excluded Subsidiary shall be
permitted to constitute part of a transaction permitted by this clause in the
event that such transaction would remove or eliminate the condition that caused
such Excluded Subsidiary to be an Excluded Subsidiary;
(b) any Subsidiary (other than an Excluded Subsidiary) may sell all or
substantially all of its assets (upon voluntary liquidation or otherwise), to
the Company or another Wholly-Owned Subsidiary (other than an Excluded
Subsidiary) it being understood and agreed that, notwithstanding the prohibition
contained in this clause, an Excluded Subsidiary shall be permitted to
constitute part of a transaction permitted by this clause in the event that such
transaction would remove or eliminate the condition that caused such Excluded
Subsidiary to be an Excluded Subsidiary;
(c) any Subsidiary may merge with or consolidate into any Person
(other than an Excluded Subsidiary), PROVIDED that (i) at the time of such
merger or consolidation, no Default or Event of Default shall exist or result
after giving effect to the consummation of such merger or consolidation and (ii)
either (x) such Subsidiary shall be the continuing or surviving corporation as a
Wholly-Owned Subsidiary of the Company or (y) such Person shall become a
Subsidiary of the Company as a result thereto; it being understood and agreed
that, notwithstanding the prohibition contained in this clause, an Excluded
Subsidiary shall be permitted to constitute part of a transaction permitted by
this clause in the event that such transaction would remove or eliminate the
condition that caused such Excluded Subsidiary to be an Excluded Subsidiary; and
(d) any Excluded Subsidiary may merge with or consolidate into any one
or more Excluded Subsidiaries.
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8.04 LOANS AND INVESTMENTS. The Company shall not purchase or acquire, or
suffer or permit any Subsidiary to purchase or acquire, or make any commitment
therefor, any capital stock, equity interest, or any obligations or other
securities of, or any interest in, any Person, or make or commit to make any
Acquisitions, or make or commit to make any advance, loan, extension of credit
or capital contribution to or any other investment in, any Person including any
Affiliate of the Company (collectively, "INVESTMENTS"), except for:
(a) Investments held by the Company or Subsidiary in the form of cash
and/or Cash Equivalents;
(b) extensions of credit in the nature of accounts receivable or notes
receivable arising from the sale or lease of goods or services in the ordinary
course of business;
(c) unsecured extensions of credit by the Company to any Subsidiary
(other than an Excluded Subsidiary) or by any such Subsidiary to another such
Subsidiary or the Company, provided, that to the extent that any such extension
of credit pursuant to this CLAUSE (c) shall be evidenced by a promissory note,
such promissory note shall be pledged and immediately delivered to the
Collateral Agent pursuant to the Pledge and Security Agreement and shall be
subordinated in a manner acceptable to the Agent;
(d) Investments incurred in order to consummate Permitted
Acquisitions;
(e) Investments constituting Permitted Swap Obligations or payments or
advances under Swap Contracts relating to Permitted Swap Obligations;
(f) Investments made by the Company or any Subsidiary which is not an
Excluded Subsidiary after the date of this Agreement in any Subsidiary (other
than an Excluded Subsidiary) in the form of a capital contribution;
(g) advances, loans, or other extensions of credit to employees with
respect to payroll, relocation and travel expenses on behalf of the Company and
its Subsidiaries (other than Excluded Subsidiaries) in the ordinary course of
business and consistent with past practice and which shall not exceed $1,100,000
in the aggregate at any time outstanding;
(h) other Investments existing as of the Closing Date and listed on
SCHEDULE 8.04;
(i) Investments of a Person that becomes a Subsidiary after the date
of this Agreement as a result of an Acquisition so long as (x) such Investment
existed at the time such Person became a Subsidiary and was not created in
anticipation thereof and (y) such Investment would otherwise be permitted
pursuant to this SECTION 8.04;
(j) equity interests, notes, chattel paper and securities received in
settlement of debts created in the ordinary course of business and owed to the
Company or its Subsidiaries or received in satisfaction of judgements or
pursuant to a plan of reorganization or similar arrangement upon the bankruptcy
or insolvency of a debtor, and promptly (but in any event, within thirty (30)
days of receipt of such equity interests, notes, chattel paper or securities)
pledged (and if certificated or evidenced by an instrument or chattel paper,
delivered) to the
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Collateral Agent pursuant to a pledge agreement in form and substance reasonably
satisfactory to the Collateral Agent;
(k) other Investments (other than repurchases of capital stock of the
Company or any of its Subsidiaries); PROVIDED, that, the aggregate amount of
consideration paid, loaned, advanced, or commitments incurred, with respect to
all such Investments during any fiscal year of the Company does not exceed the
amount of $3,000,000, PROVIDED, HOWEVER, that the amount of permitted
Investments under this CLAUSE (k) may be increased for any fiscal year ending on
or after December 31, 2004 by an amount, equal to the lesser of (i) $2,000,000
and (ii) the amount, if any, by which $3,000,000 exceeds the amount of any such
Investments made during the then immediately preceding fiscal year;
(l) Investments which constitute redemptions and repurchases permitted
under SECTION 8.10;
(m) Investments consisting of prepaid expenses, lease, utilities,
workers' compensation performance and similar deposits made in the ordinary
course of business and consistent with past practice;
(n) Investments consisting of non-cash consideration received by the
Company or its Subsidiaries from dispositions permitted under SECTION 8.02(d)
and promptly (but in any event, within thirty (30) days of receipt thereof)
pledged (and, if certificated securities or evidenced by an instrument,
delivered) to the Collateral Agent pursuant to a pledge agreement in form and
substance reasonably satisfactory to the Collateral Agent; and
(o) Investments consisting of Contingent Obligations permitted
pursuant to SECTION 8.08.
8.05 LIMITATION ON INDEBTEDNESS. The Company shall not, and shall not
suffer or permit any Subsidiary to, create, incur, assume, suffer to exist, or
otherwise become or remain directly or indirectly liable with respect to, any
Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement and the other
Loan Documents;
(b) Indebtedness consisting of Contingent Obligations permitted
pursuant to SECTION 8.08;
(c) Indebtedness existing on the Closing Date and set forth in
SCHEDULE 8.05;
(d) other Indebtedness (together with Indebtedness secured by Liens
permitted by SECTION 8.01(a), (i), (j), (m) and Contingent Obligations permitted
by 8.08(g)) in an aggregate outstanding principal amount not to exceed at any
time an amount equal to 4% of the total assets of the Company and its
Subsidiaries on a consolidated basis;
(e) Indebtedness incurred in connection with leases permitted pursuant
to SECTION 8.09;
74
(f) Indebtedness permitted to be incurred pursuant to SECTION 8.04(C);
(g) Existing Letters of Credit, excluding any replacements, renewals
or extensions thereof; and
(h) unsecured Indebtedness under notes to sellers containing terms
satisfactory to the Agent and fully subordinated to the Loans and the other
Obligations on terms satisfactory to the Agent.
8.06 TRANSACTIONS WITH AFFILIATES. The Company shall not, and shall not
suffer or permit any Subsidiary to, enter into any transaction with any
Affiliate of the Company (other than a Subsidiary which is not an Excluded
Subsidiary), except upon fair and reasonable terms no less favorable to the
Company or such Subsidiary than would obtain in a comparable arm's-length
transaction with a Person not an Affiliate of the Company or such Subsidiary.
8.07 USE OF PROCEEDS. The Company shall not, and shall not suffer or permit
any Subsidiary to, use any portion of the Loan proceeds or any Letter of Credit,
directly or indirectly, (i) to purchase or carry Margin Stock in violation of
any applicable legal and regulatory requirements including, without limitation,
Regulations T, U and X, the Securities Act of 1933, and the Securities Exchange
Act of 1934 and the regulations promulgated thereunder, (ii) to repay or
otherwise refinance indebtedness of the Company or others incurred to purchase
or carry Margin Stock, or (iii) to acquire any security in any transaction that
is subject to Section 13 or 14 of the Exchange Act.
8.08 CONTINGENT OBLIGATIONS. The Company shall not, and shall not suffer or
permit any Subsidiary to, create, incur, assume or suffer to exist any
Contingent Obligations except:
(a) endorsements for collection or deposit in the ordinary course of
business;
(b) Permitted Swap Obligations;
(c) Contingent Obligations (x) of the Company and its Subsidiaries
existing as of the Closing Date and listed in SCHEDULE 8.08, (y) of the Company
with respect to payments to be made by a Subsidiary of the Company pursuant to
operating leases entered into by such Subsidiary in the ordinary course of
business and (z) of the Company's Subsidiaries pursuant to the Guaranty;
(d) Contingent Obligations with respect to Surety Instruments incurred
in the ordinary course of business;
(e) Contingent Obligations of a Person that becomes a Subsidiary after
the date of this Agreement as a result of a Permitted Acquisition so long as
such Contingent Obligation existed at the time such Person became a Subsidiary
and was not created in anticipation thereof;
(f) guarantees with respect to permitted Indebtedness and Capital
Leases permitted under SECTION 8.05;
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(g) Contingent Obligations incurred by the Company in connection with
a Permitted Acquisition; PROVIDED that the aggregate maximum amount of such
Contingent Obligations (together with Indebtedness secured by Liens permitted by
SECTIONS 8.01(a), (i), (j), (m) and Indebtedness and Contingent Obligations
permitted by SECTION 8.05(d)) does not to exceed at any time an amount equal to
4% of the total assets of the Company and its Subsidiaries on a consolidated
basis.
8.09 LEASE OBLIGATIONS. The Company shall not, and shall not suffer or
permit any Subsidiary to, create or suffer to exist any obligations for the
payment of rent for any property under lease or agreement to lease, except for:
(a) leases of the Company and of Subsidiaries in existence on the
Closing Date and any renewal, extension or refinancing thereof;
(b) operating leases entered into by the Company or any Subsidiary
after the Closing Date in the ordinary course of business; and
(c) Capital Leases permitted under SECTION 8.01(j).
8.10 RESTRICTED PAYMENTS. The Company shall not, and shall not suffer or
permit any Subsidiary to, declare or make any dividend payment or other
distribution of assets, properties, cash, rights, obligations or securities on
account of any shares of any class of its capital stock, or purchase, redeem or
otherwise acquire for value any shares of its capital stock or any warrants,
rights or options to acquire such shares, now or hereafter outstanding, except
that (a) any Subsidiary may declare and make dividend payments or other
distributions to the Company or to its immediate parent Subsidiary of the
Company and (b) redemptions and repurchases made by the Company or of its
Subsidiaries of the capital stock of the Company, PROVIDED (i) that the amount
of such redemptions and repurchases does not exceed an amount equal to fifty
percent (50%) of Net Income for the twelve (12) month period then most recently
ended and with respect to the last month of such period the Agent and the
Lenders shall have received the monthly financial information required pursuant
to SECTION 7.01(c), (ii) the Company is and shall be in compliance after giving
effect to such redemptions and repurchases with SECTIONS 8.14 through 8.16, and
(iii) no Default or Event of Default has occurred and is continuing or would
occur after giving effect to such redemptions or repurchases.
8.11 ERISA. The Company shall not, and shall not suffer or permit any
of its Subsidiaries to, (a) terminate any Plan subject to Title IV of ERISA so
as to result in any material (in the opinion of the Majority Lenders) liability
to the Company or any ERISA Affiliate, (b) permit to exist any ERISA Event or
any other event or condition, which presents the risk of a material (in the
opinion of the Majority Lenders) liability to the Company or any ERISA
Affiliate, (c) make a complete or partial withdrawal (within the meaning of
ERISA Section 4201) from any Multiemployer Plan so as to result in any material
(in the opinion of the Majority Lenders) liability to the Company or any ERISA
Affiliate, (d) enter into any new Plan or modify any existing Plan so as to
increase its obligations thereunder which could result in any material (in the
opinion of the Majority Lenders) liability to the Company or any ERISA
Affiliate, or (e) permit the present value of all nonforfeitable accrued
benefits under any Plan (using the actuarial assumptions utilized by the PBGC
upon termination of a Plan) materially (in
76
the opinion of the Majority Lenders) to exceed the fair market value of Plan
assets allocable to such benefits, all determined as of the most recent
valuation date for each such Plan.
8.12 CHANGE IN BUSINESS. The Company shall not, and shall not suffer or
permit any Subsidiary to, engage in any material line of business substantially
different from those lines of business, and reasonable extensions thereof,
carried on by the Company and its Subsidiaries taken as a whole on the Closing
Date.
8.13 ACCOUNTING CHANGES. The Company shall not, and shall not suffer or
permit any Subsidiary to, make any significant change in accounting treatment or
reporting practices, except as required by GAAP or change the fiscal year of the
Company or of any Subsidiary.
8.14 MINIMUM TANGIBLE NET WORTH. The Company shall not permit its
consolidated Tangible Net Worth at any time after the Closing Date to be less
than an amount equal to the sum of (a) $120,000,000 plus (b) 50% of the
Company's positive net income as determined in accordance with GAAP (with no
deduction for net losses), if any, for each fiscal quarter ending after the
Closing Date and prior to any date of determination hereunder plus (c) an amount
equal to 100% of the net cash and non-cash proceeds of any equity securities
issued by the Company or its Subsidiaries after the Closing Date and prior to
any date of determination hereunder.
8.15 LEVERAGE RATIO. The Company shall not, at any time, permit its
Leverage Ratio to be greater than 2.00:1.0.
8.16 FIXED CHARGE COVERAGE RATIO. The Company shall not, as of the last day
of each fiscal quarter ending during any period set forth below, permit its
Fixed Charge Coverage Ratio for the four fiscal quarters then ended as of such
day (taken as one accounting period) to be less than the ratio set forth below
opposite such period:
Fiscal Quarters Ending During Period Ratio
------------------------------------ ------
Closing Date through March 31, 2003 1.35:1.0
April 1, 2003 through December 31, 2003 1.40:1.0
January 1, 2004 and thereafter 1.45:1.0.
8.17 NO IMPAIRMENT OF INTERCOMPANY TRANSFERS. The Company shall not, and
shall not permit any Subsidiary to, directly or indirectly enter into or become
bound by any agreement, instrument, indenture or other obligation (other than
this Agreement and the other Loan Documents) that could directly or indirectly
restrict, prohibit or require the consent of any Person with respect to the
payment of dividends or distributions or the making or repayment of intercompany
loans or the transfer of assets by a Subsidiary of the Company to the Company or
such Subsidiaries' shareholders, except for restrictions with respect to a
Subsidiary imposed pursuant to an agreement entered into for the disposition of
all or substantially all of the equity or
77
Property of such Subsidiary (or the Property subject to such disposition)
permitted under SECTION 8.02 pending the closing of such disposition.
8.18 EXCLUDED SUBSIDIARIES. The Company shall not permit any Excluded
Subsidiary to own the capital stock of any Subsidiary that is not an Excluded
Subsidiary.
ARTICLE IX
EVENTS OF DEFAULT
9.01 EVENT OF DEFAULT. Any of the following shall constitute an "EVENT OF
DEFAULT":
(a) NON-PAYMENT. The Company fails to pay, (i) when and as required to
be paid herein, any amount of principal of any Loan or of any L/C Obligation, or
(ii) within five days after the same becomes due, any interest, fee or any other
amount payable hereunder or under any other Loan Document; or
(b) REPRESENTATION OR WARRANTY. Any information contained in any
Borrowing Base Certificate is untrue or incorrect in any respect (other than
inadvertent, immaterial errors not exceeding $100,000 in the aggregate in any
Borrowing Base Certificate), or any representation or warranty by the Company or
any Subsidiary made or deemed made herein, in any other Loan Document, or which
is contained in any certificate, document or financial or other statement by the
Company, any Subsidiary, or any Responsible Officer, furnished at any time under
this Agreement, or in or under any other Loan Document, is incorrect in any
material respect on or as of the date made or deemed made; or
(c) SPECIFIC DEFAULTS. The Company fails to perform or observe any
term, covenant or agreement contained in any of SECTION 7.01, 7.02, 7.03 (a),
(b), or (c), 7.04 or 7.08 or in Article VIII; or
(d) OTHER DEFAULTS. The Company or any Subsidiary party thereto fails
to perform or observe any other term or covenant contained in this Agreement or
any other Loan Document, and such default shall continue unremedied for a period
of 30 days after the earlier of (i) the date upon which a Responsible Officer
knew or reasonably should have known of such failure or (ii) the date upon which
written notice thereof is given to the Company by the Agent or any Lender; or
(e) CROSS-DEFAULT. (i) The Company or any Subsidiary (A) fails to make
any payment in respect of any Indebtedness or Contingent Obligation (other than
in respect of Swap Contracts), having an aggregate principal amount (including
undrawn committed or available amounts and including amounts owing to all
creditors under any combined or syndicated credit arrangement) of more than
$5,000,000 when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) and such failure continues after the
applicable grace or notice period, if any, specified in the relevant document on
the date of such failure; or (B) fails to perform or observe any other condition
or covenant, or any other event shall occur or condition exist with respect to
the obligations of the Company or such Subsidiary, under any agreement or
instrument relating to any Indebtedness or Contingent Obligation of more than
$5,000,000, and such failure continues after the applicable grace or notice
period, if any,
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specified in the relevant document on the date of such failure if the effect of
such failure, event or condition is to cause, or to permit the holder or holders
of such Indebtedness or beneficiary or beneficiaries of such Indebtedness (or a
trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause such Indebtedness to be declared to be due and payable
prior to its stated maturity, or such Contingent Obligation to become payable or
cash collateral in respect thereof to be demanded; or (ii) there occurs under
any Swap Contract an Early Termination Date (as defined in such Swap Contract)
resulting from (1) any event of default under such Swap Contract as to which the
Company or any Subsidiary is the Defaulting Party (as defined in such Swap
Contract) or (2) any Termination Event (as so defined) as to which the Company
or any Subsidiary is an Affected Party (as so defined), and, in either event,
the Swap Termination Value owed by the Company or such Subsidiary as a result
thereof is greater than $5,000,000; or
(f) INSOLVENCY; VOLUNTARY PROCEEDINGS. The Company or any Subsidiary
(i) ceases or fails to be solvent, or generally fails to pay, or admits in
writing its inability to pay, its debts as they become due, subject to
applicable grace periods, if any, whether at stated maturity or otherwise; (ii)
commences any Insolvency Proceeding with respect to itself; or (iii) takes any
action to effectuate or authorize any of the foregoing; or
(g) INVOLUNTARY PROCEEDINGS. (i) Any involuntary Insolvency Proceeding
is commenced or filed against the Company or any Subsidiary, or any writ,
judgment, warrant of attachment, execution or similar process, is issued or
levied against a substantial part of the Company's or any Subsidiary's
properties, and any such proceeding or petition shall not be dismissed, or such
writ, judgment, warrant of attachment, execution or similar process shall not be
released, vacated or fully bonded within 60 days after commencement, filing or
levy; (ii) the Company or any Subsidiary admits the material allegations of a
petition against it in any Insolvency Proceeding, or an order for relief (or
similar order under non-U.S. law) is ordered in any Insolvency Proceeding; or
(iii) the Company or any Subsidiary acquiesces in the appointment of a receiver,
trustee, custodian, conservator, liquidator, mortgagee in possession (or agent
therefor), or other similar Person for itself or a substantial portion of its
property or business; or
(h) ERISA. (i) An ERISA Event shall occur with respect to a Pension
Plan or Multiemployer Plan which has resulted or could reasonably be expected to
result in liability of the Company under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $1,000,000,
(ii) the aggregate amount of Unfunded Pension Liability among all Pension Plans
at any time exceeds $1,000,000; or (iii) the Company or any ERISA Affiliate
shall fail to pay when due, after the expiration of any applicable grace period,
any installment payment with respect to its withdrawal liability under Section
4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of
$1,000,000, or (iv) the Company or any ERISA Affiliate shall fail to pay when
due any required installment or any other payment required under Section 412 of
the Code in an aggregate amount in excess of $1,000,000; or
(i) MONETARY JUDGMENTS. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against the
Company or any Subsidiary involving in the aggregate a liability (to the extent
not covered by independent third-
79
party insurance or reinsurance as to which the insurer does not dispute
coverage) as to any single or related series of transactions, incidents or
conditions, of $1,000,000 or more, and the same shall remain unsatisfied,
unvacated and unstayed pending appeal for a period of 30 days after the entry
thereof; or
(j) NON-MONETARY JUDGMENTS. Any non-monetary judgment, order or decree
is entered against the Company or any Subsidiary which does or would reasonably
be expected to have a Material Adverse Effect, and there shall be any period of
30 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or
(k) COLLATERAL. (i) Any Collateral Document shall for any reason cease
to be valid and generally binding on or enforceable against the Company or any
Subsidiary of the Company party thereto or the Company or any Subsidiary of the
Company shall so state in writing or bring an action to limit its obligations or
liabilities thereunder; or (ii) any Collateral Document shall for any reason
(other than pursuant to the terms thereof or as a result of the failure of the
Collateral Agent to file appropriate continuation statements or to take other
required actions except to the extent permitted by the terms thereof) cease to
create a valid security interest in the Collateral purported to be covered
thereby or such security interest shall for any reason cease to be a perfected
and first priority security interest subject only to Permitted Liens; or
(l) CHANGE OF CONTROL. There occurs any Change of Control; or
(m) GUARANTOR DEFAULTS. Any Guarantor fails in any material respect to
perform or observe any term, covenant or agreement in the Guaranty or the
Guaranty is for any reason partially (including with respect to future advances)
or wholly revoked or invalidated, or otherwise ceases to be in full force and
effect (other than pursuant to the terms thereof), or any Guarantor or any other
Person contests in any manner the validity or enforceability thereof or denies
that it has any further liability or obligation thereunder; or any event
described at clauses (f) or (g) of this Section occurs with respect to such
Guarantor.
9.02 REMEDIES. If any Event of Default occurs, the Agent shall, at the
request of, or may, with the consent of, the Majority Lenders:
(a) declare the commitment of each Lender to make Loans and any
obligation of the Issuing Bank to Issue Letters of Credit to be terminated,
whereupon such commitments and obligation shall be terminated;
(b) declare an amount equal to the maximum aggregate amount that is or
at any time thereafter may become available for drawing under any outstanding
Letters of Credit (whether or not any beneficiary shall have presented, or shall
be entitled at such time to present, the drafts or other documents required to
draw under such Letters of Credit) to be immediately due and payable, and
declare the unpaid principal amount of all outstanding Loans, all interest
accrued and unpaid thereon, and all other amounts owing or payable hereunder or
under any other Loan Document to be immediately due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Company; and
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(c) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
law;
PROVIDED, HOWEVER, that upon the occurrence of any event specified in SECTIONS
9.01(f) or (g) (in the case of CLAUSE (i) of SECTION 9.01(g) upon the expiration
of the 60-day period mentioned therein), the obligation of each Lender to make
Loans and any obligation of the Issuing Bank to Issue Letters of Credit shall
automatically terminate and the unpaid principal amount of all outstanding Loans
and all interest and other amounts as aforesaid shall automatically become due
and payable without further act of the Agent, the Issuing Bank or any Lender.
9.03 RIGHTS NOT EXCLUSIVE. The rights provided for in this Agreement and
the other Loan Documents are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.
ARTICLE X
THE AGENT
10.01 APPOINTMENT AND AUTHORIZATION; "AGENT".
(a) Each Lender hereby irrevocably (subject to SECTION 10.09)
appoints, designates and authorizes the Agent (including, without limitation, in
its capacity as Collateral Agent) to take such action on its behalf under the
provisions of this Agreement and each other Loan Document and to exercise such
powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere in this Agreement or in any other Loan Document, the Agent
shall not have any duties or responsibilities, except those expressly set forth
herein, nor shall the Agent have or be deemed to have any fiduciary relationship
with any Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against the Agent. Without limiting the generality
of the foregoing sentence, the use of the term "agent" in this Agreement with
reference to the Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties.
(b) The Issuing Bank shall act on behalf of the Lenders 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 Agent may agree at the request of
the Majority Lenders 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 Agent in this ARTICLE X 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 "Agent", as used in this ARTICLE X, included the
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Issuing Bank with respect to such acts or omissions, and (ii) as additionally
provided in this Agreement with respect to the Issuing Bank.
10.02 DELEGATION OF DUTIES. The Agent may execute any of its duties under
this Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.
10.03 LIABILITY OF AGENT. None of the Agent-Related Persons shall (i) be
liable to the Lenders for any action taken or omitted to be taken by any of them
under or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct), or (ii) be responsible in any manner to any of the Lenders for any
recital, statement, representation or warranty made by the Company or any
Subsidiary or Affiliate of the Company, or any officer thereof, contained in
this Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by the
Agent under or in connection with, this Agreement or any other Loan Document, or
the validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document, or for any failure of the Company or any
other party to any Loan Document to perform its obligations hereunder or
thereunder. No Agent-Related Person shall be under any obligation to any Lender
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of the Company or any
of the Company's Subsidiaries or Affiliates.
10.04 RELIANCE BY AGENT.
(a) The Agent shall be entitled to rely, and shall be fully protected
in relying, upon any writing, resolution, notice, consent, certificate,
affidavit, letter, telegram, facsimile, telex or telephone message, statement or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel to the Company), independent
accountants and other experts selected by the Agent. The Agent shall be fully
justified in failing or refusing to take any action under this Agreement or any
other Loan Document unless it shall first receive such advice or concurrence of
the Majority Lenders as it deems appropriate and, if it so requests, it shall
first be indemnified to its satisfaction by the Lenders against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. The Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement or any
other Loan Document in accordance with a request or consent of the Majority
Lenders and such request and any action taken or failure to act pursuant thereto
shall be binding upon all of the Lenders.
(b) For purposes of determining compliance with the conditions
specified in SECTION 5.01, each Lender that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by the Agent to such Lender for consent,
approval, acceptance or satisfaction, or required thereunder to be consented to
or approved by or acceptable or satisfactory to the Lender.
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10.05 NOTICE OF DEFAULT. The Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default, except with respect
to defaults in the payment of principal, interest and fees required to be paid
to the Agent for the account of the Lenders, unless the Agent shall have
received written notice from a Lender or the Company referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". The Agent will notify the Lenders of its
receipt of any such notice. The Agent shall take such action with respect to
such Default or Event of Default as may be requested by the Majority Lenders in
accordance with ARTICLE IX; PROVIDED, HOWEVER, that unless and until the Agent
has received any such request, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable or in the best interest
of the Lenders.
10.06 CREDIT DECISION. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Agent hereinafter taken, including any review of the affairs of the
Company and its Subsidiaries, shall be deemed to constitute any representation
or warranty by any Agent-Related Person to any Lender. Each Lender represents to
the Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition and creditworthiness of the
Company and its Subsidiaries, and all applicable lender regulatory laws relating
to the transactions contemplated hereby, and made its own decision to enter into
this Agreement and to extend credit to the Company and its Subsidiaries
hereunder. Each Lender also represents that it will, independently and without
reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigations as
it deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of the Company.
Except for notices, reports and other documents expressly herein required to be
furnished to the Lenders by the Agent, the Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of the Company which may come into the possession
of any of the Agent-Related Persons.
10.07 INDEMNIFICATION OF AGENT. Whether or not the transactions
contemplated hereby are consummated, the Lenders shall indemnify upon demand the
Agent-Related Persons (to the extent not reimbursed by or on behalf of the
Company and without limiting the obligation of the Company to do so), pro rata,
from and against any and all Indemnified Liabilities; provided, HOWEVER, that no
Lender shall be liable for the payment to the Agent-Related Persons of any
portion of such Indemnified Liabilities resulting solely from such Person's
gross negligence or willful misconduct. Without limitation of the foregoing,
each Lender shall reimburse the Agent upon demand for its ratable share of any
costs or out-of-pocket expenses (including Attorney Costs) incurred by the 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 respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that the Agent is not
reimbursed for such expenses by or on behalf of the Company.
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The undertaking in this Section shall survive the payment of all Obligations
hereunder and the resignation or replacement of the Agent.
10.08 AGENT IN INDIVIDUAL CAPACITY. Bank of America and its Affiliates may
make loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Company and its
Subsidiaries and Affiliates as though Bank of America were not the Agent or the
Issuing Lender hereunder and without notice to or consent of the Lenders. The
Lenders acknowledge that, pursuant to such activities, Bank of America or its
Affiliates may receive information regarding the Company or its Affiliates
(including information that may be subject to confidentiality obligations in
favor of the Company or such Subsidiary) and acknowledge that the Agent shall be
under no obligation to provide such information to them. With respect to its
Loans, Bank of America shall have the same rights and powers under this
Agreement as any other Lender and may exercise the same as though it were not
the Agent.
10.09 SUCCESSOR AGENT. The Agent may, and at the request of the Majority
Lenders shall, resign as Agent upon 30 days' notice to the Lenders. If the Agent
resigns under this Agreement, the Majority Lenders shall appoint from among the
Lenders a successor agent for the Lenders which successor agent shall be
approved by the Company. If no successor agent is appointed prior to the
effective date of the resignation of the Agent, the Agent may appoint, after
consulting with the Lenders and the Company, a successor agent from among the
Lenders. Upon the acceptance of its appointment as successor agent hereunder,
such successor agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term "Agent" shall mean such successor agent and the
retiring Agent's appointment, powers and duties as Agent shall be terminated.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this ARTICLE X and SECTIONS 11.04 and 11.05 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this
Agreement. If no successor agent has accepted appointment as Agent by the date
which is 30 days following a retiring Agent's notice of resignation, the
retiring Agent's resignation shall nevertheless thereupon become effective and
the Lenders shall perform all of the duties of the Agent hereunder until such
time, if any, as the Majority Lenders appoint a successor agent as provided for
above. Notwithstanding the foregoing, however, Bank of America may not be
removed as the Agent at the request of the Majority Lenders unless Bank of
America shall also simultaneously be replaced as "Issuing Bank" hereunder
pursuant to documentation in form and substance reasonably satisfactory to Bank
of America.
10.10 WITHHOLDING TAX.
(a) If any Lender is a "foreign corporation, partnership or trust"
within the meaning of the Code and such Lender claims exemption from, or a
reduction of, U.S. withholding tax under Sections 1441 or 1442 of the Code, such
Lender agrees with and in favor of the Agent, to deliver to the Agent:
(i) if such Lender claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, two properly
completed and executed copies of IRS Form W-8BEN before the payment of
any interest in the first calendar year
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and before the payment of any interest in each third succeeding
calendar year during which interest may be paid under this Agreement;
(ii) if such Lender claims that interest paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such
Lender, two properly completed and executed copies of IRS Form W-8ECI
before the payment of any interest is due in the first taxable year of
such Lender and in each succeeding taxable year of such Lender during
which interest may be paid under this Agreement; and
(iii) such other form or forms as may be required under the Code
or other laws of the United States as a condition to exemption from,
or reduction of, United States withholding tax.
Such Lender agrees to promptly notify the Agent of any change in circumstances
which would modify or render invalid any claimed exemption or reduction.
(b) If any Lender claims exemption from, or reduction of, withholding
tax under a United States tax treaty by providing IRS Form W-8BEN and such
Lender sells, assigns, grants a participation in, or otherwise transfers all or
part of the Obligations of the Company to such Lender, such Lender agrees to
notify the Agent of the percentage amount in which it is no longer the
beneficial owner of Obligations of the Company to such Lender. To the extent of
such percentage amount, the Agent will treat such Lender's IRS Form W-8BEN as no
longer valid.
(c) If any Lender claiming exemption from United States withholding
tax by filing IRS Form W-8ECI with the Agent sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations of the
Company to such Lender, such Lender agrees to undertake sole responsibility for
complying with the withholding tax requirements imposed by Sections 1441 and
1442 of the Code.
(d) If any Lender is entitled to a reduction in the applicable
withholding tax, the Agent may withhold from any interest payment to such Lender
an amount equivalent to the applicable withholding tax after taking into account
such reduction. However, if the forms or other documentation required by clause
(a) of this Section are not delivered to the Agent, then the Agent may withhold
from any interest payment to such Lender not providing such forms or other
documentation an amount equivalent to the applicable withholding tax imposed by
Sections 1441 and 1442 of the Code, without reduction.
(e) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Agent did not properly
withhold tax from amounts paid to or for the account of any Lender (because the
appropriate form was not delivered or was not properly executed, or because such
Lender failed to notify the Agent of a change in circumstances which rendered
the exemption from, or reduction of, withholding tax ineffective, or for any
other reason) such Lender shall indemnify the Agent fully for all amounts paid,
directly or indirectly, by the Agent as tax or otherwise, including penalties
and interest, and including any taxes imposed by any jurisdiction on the amounts
payable to the Agent under this
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Section, together with all costs and expenses (including Attorney Costs). The
obligation of the Lenders under this Section shall survive the payment of all
Obligations and the resignation or replacement of the Agent.
10.11 COLLATERAL AND GUARANTY MATTERS. The Lenders irrevocably authorize
the Collateral Agent, at its option and in its discretion:
(a) to release any Lien on any property granted to or held by the
Collateral Agent under any Loan Document (i) upon termination of the Revolving
Loan Commitments and payment in full of all Obligations (other than contingent
indemnification obligations) and the expiration or termination of all Letters of
Credit, (ii) that is sold or to be sold as part of or in connection with any
sale permitted hereunder or under any other Loan Document, or (iii) subject to
SECTION 11.01, if approved, authorized or ratified in writing by the Majority
Lenders;
(b) to subordinate any Lien on any property granted to or held by the
Collateral Agent under any Loan Document to the holder of any Lien on such
property that is permitted by SECTIONS 8.01(i), (j) or (m); and
(c) to release any Guarantor from its obligations under the Guaranty
if such Person ceases to be a Subsidiary as a result of a transaction permitted
hereunder.
Upon request by the Collateral Agent at any time, the Majority Lenders will
confirm in writing the Collateral Agent's authority to release or subordinate
its interest in particular types or items of property, or to release any
Guarantor from its obligations under the Guaranty pursuant to this SECTION
10.11.
ARTICLE XI
MISCELLANEOUS
11.01 AMENDMENTS AND WAIVERS. No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent to any departure by
the Company or any other Guarantor therefrom, shall be effective unless in
writing signed by the Majority Lenders and the Company or the applicable
Guarantor, as the case may be, and acknowledged by the Agent, and each such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; PROVIDED, HOWEVER, that no such amendment,
waiver or consent shall:
(a) waive any condition set forth in SECTION 5.01 (except for 5.01(e))
without the written consent of each Lender;
(b) extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to SECTION 9.02) without the written consent of
such Lender;
(c) postpone any date fixed by this Agreement or any other Loan
Document for any payment (other than pursuant to SECTION 2.07) of principal,
interest, fees or other amounts
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due to the Lenders (or any of them) hereunder or under any other Loan Document
without the written consent of each Lender directly affected thereby;
(d) reduce the principal of, or the rate of interest specified herein
on, any Loan or L/C Borrowing, or (subject to clause (v) of the second proviso
to this SECTION 11.01) any fees or other amounts payable hereunder or under any
other Loan Document without the written consent of each Lender directly affected
thereby; PROVIDED, HOWEVER, that only the consent of the Majority Lenders shall
be necessary (i) to amend the definition of "Default Rate" or to waive any
obligation of the Company to pay interest at the Default Rate or (ii) to amend
any financial covenant hereunder (or any defined term used therein) even if the
effect of such amendment would be to reduce the rate of interest on any Loan or
L/C Borrowing or to reduce any fee payable hereunder; or
(e) change SECTION 2.14 in a manner that would alter the pro rata
sharing of payments required thereby without the written consent of each Lender;
(f) change any provision of this Section or the definition of
"Majority Lenders" or any other provision hereof specifying the number or
percentage of Lenders required to amend, waive or otherwise modify any rights
hereunder or make any determination or grant any consent hereunder, without the
written consent of each Lender
(g) release any Guarantor (other than pursuant to this Agreement or
the Collateral Documents) from the Guaranty without the written consent of each
Lender or release the Agent's Liens and security interests in all or
substantially all of the Collateral except as otherwise may be provided in this
Agreement or in the Collateral Documents or except where the consent of the
Majority Lenders only is provided for;
and, PROVIDED FURTHER, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Issuing Bank in addition to the Lenders required
above, affect the rights or duties of the Issuing Bank under this Agreement or
any Letter of Credit Application relating to any Letter of Credit issued or to
be issued by it; (ii) no amendment, waiver or consent shall, unless in writing
and signed by the Swing Line Bank in addition to the Lenders required above,
affect the rights or duties of the Swing Line Bank under this Agreement; (iii)
no amendment, waiver or consent shall, unless in writing and signed by the Agent
in addition to the Lenders required above, affect the rights or duties of the
Agent under this Agreement or any other Loan Document; and (iv) SECTION 11.08(g)
may not be amended, waived or otherwise modified without the consent of each
Granting Lender all or any part of whose Loans are being funded by an SPC at the
time of such amendment, waiver or other modification; and (v) the Fee Letter may
be amended, or rights or privileges thereunder waived, in a writing executed
only by the parties thereto. Notwithstanding anything to the contrary herein, no
Defaulting Lender shall have any right to approve or disapprove any amendment,
waiver or consent hereunder, except that the Commitment of such Lender may not
be increased or extended without the consent of such Lender.
11.02 NOTICES.
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(a) All notices, requests, consents, approvals, waivers and other
communications shall be in writing (including, unless the context expressly
otherwise provides, by facsimile transmission, provided that any matter
transmitted by facsimile (i) shall be immediately confirmed by a telephone call
to the recipient at the number specified on SCHEDULE 11.02, and (ii) shall be
followed promptly by delivery of a hard copy original thereof) and mailed, faxed
or delivered, to the address or facsimile number specified for notices on
SCHEDULE 11.02; or, as directed to the Company or the Agent, to such other
address as shall be designated by such party in a written notice to the other
parties, and as directed to any other party, at such other address as shall be
designated by such party in a written notice to the Company and the Agent.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered for
overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or if mailed, upon the third Business Day after the date
deposited into the U.S. mail, or if delivered, upon delivery; except that
notices pursuant to ARTICLE II, III or X to the Agent shall not be effective
until actually received by the Agent, and notices pursuant to ARTICLE III to the
Issuing Bank shall not be effective until actually received by the Issuing Bank
at the address specified for the "Issuing Bank" on the applicable signature page
hereof.
(c) Any agreement of the Agent and the Lenders herein to receive
certain notices by telephone or facsimile is solely for the convenience and at
the request of the Company. The Agent and the Lenders shall be entitled to rely
on the authority of any Person purporting to be a Person authorized by the
Company to give such notice and the Agent and the Lenders shall not have any
liability to the Company or other Person on account of any action taken or not
taken by the Agent or the Lenders in reliance upon such telephonic or facsimile
notice. The obligation of the Company to repay the Loans and L/C Obligations
shall not be affected in any way or to any extent by any failure by the Agent
and the Lenders to receive written confirmation of any telephonic or facsimile
notice or the receipt by the Agent and the Lenders of a confirmation which is at
variance with the terms understood by the Agent and the Lenders to be contained
in the telephonic or facsimile notice.
11.03 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no delay
in exercising, on the part of the Agent or any Lender, any right, remedy, power
or privilege hereunder, shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege.
11.04 COSTS AND EXPENSES. The Company shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse Bank of America (including in its capacity as
Agent and Issuing Bank) within five Business Days after demand (subject to
SECTION 5.01(e)) for all costs and expenses incurred by Bank of America
(including in its capacity as Agent and Issuing Bank) in connection with the
development, preparation, delivery, administration (including, without
limitation, field examinations) and execution of, and any amendment, supplement,
waiver or modification to (in each case, whether or not consummated), this
Agreement, any Loan Document and any other
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documents prepared in connection herewith or therewith, and the consummation of
the transactions contemplated hereby and thereby, including reasonable Attorney
Costs incurred by Bank of America (including in its capacity as Agent and
Issuing Bank) with respect thereto; and
(b) pay or reimburse the Agent and each Lender within five Business
Days after demand (subject to SECTION 5.01(e)) for all costs and expenses
(including Attorney Costs) incurred by them in connection with the enforcement,
attempted enforcement, or preservation of any rights or remedies under this
Agreement or any other Loan Document during the existence of an Event of Default
or after acceleration of the Loans (including in connection with any "workout"
or restructuring regarding the Loans, and including in any Insolvency Proceeding
or appellate proceeding).
11.05 COMPANY INDEMNIFICATION. Whether or not the transactions contemplated
hereby are consummated, the Company shall indemnify, defend and hold the
Agent-Related Persons, and each Lender and each of its respective officers,
directors, employees, counsel, agents and attorneys-in-fact (each, an
"INDEMNIFIED PERSON") harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses and disbursements (including Attorney Costs) of any kind or
nature whatsoever which may at any time (including at any time following
repayment of the Loans, the termination of the Letters of Credit and the
termination, resignation or replacement of the Agent or replacement of any
Lender) be imposed on, incurred by or asserted against any such Person in any
way relating to or arising out of the Company entering into this Agreement or
any document contemplated by or referred to herein, or the transactions
contemplated hereby, or any action taken or omitted by any such Person under or
in connection with any of the foregoing, including with respect to any
investigation, litigation or proceeding (including any Insolvency Proceeding or
appellate proceeding) related to or arising out of any act or failure to act of
the Company or any of its Subsidiaries in connection with this Agreement or the
Loans or Letters of Credit the use of the proceeds thereof, whether or not any
Indemnified Person is a party thereto (all the foregoing, collectively, the
"INDEMNIFIED LIABILITIES"); PROVIDED, that the Company shall have no obligation
hereunder to any Indemnified Person with respect to Indemnified Liabilities
resulting from the gross negligence or willful misconduct of such Indemnified
Person. The agreements in this Section shall survive payment of all other
Obligations.
11.06 PAYMENTS SET ASIDE. To the extent that the Company makes a payment to
the Agent or the Lenders, or the Agent or the Lenders exercise their right of
set-off, and such payment or the proceeds of such set-off or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required (including pursuant to any settlement entered into by the
Agent or such Lender in its discretion) to be repaid to a trustee, receiver or
any other party, in connection with any Insolvency Proceeding or otherwise, then
(a) to the extent of such recovery the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Lender severally agrees to pay to the Agent upon demand its pro rata share
of any amount so recovered from or repaid by the Agent.
11.07 SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that the Company may not assign
or otherwise transfer any of its rights or
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obligations hereunder without the prior written consent of each Lender and no
Lender may assign or otherwise transfer any of its rights or obligations
hereunder except (i) to an Eligible Assignee in accordance with the provisions
of SECTION 11.08, (ii) by way of participation in accordance with the provisions
of SECTION 11.08, or (iii) by way of pledge or assignment of a security interest
subject to the restrictions of SECTION 11.08, or (iv) to an SPC in accordance
with the provisions of SECTION 11.08 (and any other attempted assignment or
transfer by any party hereto shall be null and void). Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in SECTION 11.08 and, to the extent
expressly contemplated hereby, the Indemnitees) any legal or equitable right,
remedy or claim under or by reason of this Agreement.
11.08 ASSIGNMENTS, PARTICIPATIONS, ETC.
(a) Any Lender may at any time assign to one or more Eligible
Assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans (including for
purposes of this subsection (b), participations in L/C Obligations and in Swing
Line Loans) at the time owing to it); PROVIDED that (i) except in the case of an
assignment of the entire remaining amount of the assigning Lender's Commitment
and the Loans at the time owing to it or in the case of an assignment to a
Lender or an Affiliate of a Lender or an Approved Fund with respect to a Lender,
the aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) subject to each such assignment, determined as of the
date of the Assignment and Acceptance with respect to such assignment is
delivered to the Agent or, if the "Trade Date" is specified in the Assignment
and Acceptance, as of the Trade Date, shall not be less than $5,000,000 unless
the Agent, and so long as no Default or Event of Default has occurred and is
continuing, the Company otherwise consents (each such consent not to be
unreasonably withheld or delayed); (ii) each partial assignment shall be made as
an assignment of a proportionate part of all the assigning Lender's rights and
obligations under this Agreement with respect to the Loans or the Commitment
assigned, except that this clause (ii) shall not apply to rights in respect of
Swing Line Loans; (iii) any assignment of a Commitment must be approved by the
Agent, the Issuing Bank and the Swing Line Bank unless the Person that is the
proposed assignee is itself a Lender (whether or not the proposed assignee would
otherwise qualify as an Eligible Assignee); and (iv) the parties to each
assignment shall execute and deliver to the Agent an Assignment and Acceptance,
together with a processing and recordation fee of $3,500. Subject to acceptance
and recording thereof by the Agent pursuant to SECTION 11.08, from and after the
effective date specified in each Assignment and Acceptance, the Eligible
Assignee thereunder shall be a party to this Agreement and, to the extent of the
interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of SECTIONS 4.01,
4.03, 4.04, 11.04 and 11.05 with respect to facts and circumstances occurring
prior to the effective date of such assignment). Upon request, the Company (at
its expense) shall execute and deliver a Note to the assignee Lender. Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this subsection shall be treated for purposes of this
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Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with SECTION 11.08(d).
(b) From and after the date that the Agent notifies the assignor
Lender that it has received (and provided its consent with respect to) an
executed Assignment and Acceptance and payment of the above-referenced
processing fee, (i) the Eligible Assignee thereunder shall be a party hereto
and, to the extent that rights and obligations hereunder have been assigned to
it pursuant to such Assignment and Acceptance, shall have the rights and
obligations of a Lender under the Loan Documents, and (ii) the assignor Lender
shall, to the extent that rights and obligations hereunder and under the other
Loan Documents have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights and be released from its obligations under the
Loan Documents.
(c) Within five Business Days after its receipt of notice by the Agent
that it has received an executed Assignment and Acceptance and payment of the
processing fee, (and provided that it consents to such assignment in accordance
with SECTION 11.08(a)), the Company shall execute and deliver to the Agent, new
Notes (if requested by the Eligible Assignee) evidencing such Eligible
Assignee's assigned Loans and Commitment and, if the assignor Lender has
retained a portion of its Loans and its Commitment, replacement Notes in the
principal amount of the Loans retained by the assignor Lender (such Notes to be
in exchange for, but not in payment of, the Notes held by such Lender).
Immediately upon each Eligible Assignee's making its processing fee payment
under the Assignment and Acceptance, this Agreement shall be deemed to be
amended to the extent, but only to the extent, necessary to reflect the addition
of the Eligible Assignee and the resulting adjustment of the Commitments arising
therefrom. The Commitment allocated to each Eligible Assignee shall reduce such
Commitments of the assigning Lender PRO TANTO.
(d) Any Lender may at any time, without the consent of, or notice to,
the Company or the Agent, sell participations to any Person (other than a
natural person or the Company or any of the Company's Affiliates or
Subsidiaries) (each, a "PARTICIPANT") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and/or the Loans (including such Lender's participations in L/C
Obligations and/or Swing Line Loans) owing to it); PROVIDED that (i) such
Lender's obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Company, the Issuing Bank, the
Agent and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement. Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; PROVIDED that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, waiver or other modification described in the first proviso to
SECTION 11.01 that directly affects such Participant. Subject to SECTION
11.08(f), the Company agrees that each Participant shall be entitled to the
benefits of SECTIONS 4.01, 4.03 and 4.04 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to SECTION 11.08(a),
PROVIDED that if because of circumstances in effect on the effective date of any
sale of a participating interest, the Company would, under SECTION 4.01, be
obligated to make any
91
payment to or for the account of the applicable Lender, the Company shall only
be obligated to make such payment to the extent that it would then have been
obligated to make such payment to such Lender if it had not sold such
participating interest. To the extent permitted by law, each Participant also
shall be entitled to the benefits of SECTION 11.10 as though it were a Lender,
PROVIDED such Participant agrees to be subject to SECTION 2.14 as though it were
a Lender.
(e) Notwithstanding any other provision in this Agreement, any Lender
may at any time create a security interest in, or pledge, all or any portion of
its rights under and interest in this Agreement and the Note held by it in favor
of any Federal Reserve Bank in accordance with Regulation A of the FRB or U.S.
Treasury Regulation 31 CFR ss.203.14, and such Federal Reserve Bank may enforce
such pledge or security interest in any manner permitted under applicable law.
(f) No assignee, participant or other transferee of any Lender's
rights shall be entitled to receive any greater payment under ARTICLE IV than
such Lender would have been entitled to receive with respect to the rights
transferred or by reason of the provisions of ARTICLE IV requiring such Lender
to designate a different Applicable Lending Office under certain circumstances
or at a time when the circumstances giving rise to such greater payment did not
exist.
(g) Notwithstanding anything to the contrary contained herein, any
Lender (a "GRANTING LENDER") may grant to a special purpose funding vehicle
identified as such in writing from time to time by the Granting Lender to the
Agent and the Company (an "SPC") the option to provide all or any part of any
Revolving Loan that such Granting Lender would otherwise be obligated to make
pursuant to this Agreement; PROVIDED that (i) nothing herein shall constitute a
commitment by any SPC to fund any Revolving Loan, and (ii) if an SPC elects not
to exercise such option or otherwise fails to make all or any part of such
Revolving Loan, the Granting Lender shall be obligated to make such Revolving
Loan pursuant to the terms hereof. Each party hereto hereby agrees that (i)
neither the grant to any SPC nor the exercise by any SPC of such option shall
increase the costs or expenses or otherwise increase or change the obligations
of the Company under this Agreement (including its obligations under SECTIONS
4.01, 4.03 and 4.04), (ii) no SPC shall be liable for any indemnity or similar
payment obligation under this Agreement for which a Lender would be liable, and
(iii) the Granting Lender shall for all purposes, including the approval of any
amendment, waiver or other modification of any provision of any Loan Document,
remain the lender of record hereunder. The making of a Revolving Loan by an SPC
hereunder shall utilize the Commitment of the Granting Lender to the same
extent, and as if, such Revolving Loan were made by such Granting Lender. In
furtherance of the foregoing, each party hereto hereby agrees (which agreement
shall survive the termination of this Agreement) that, prior to the date that is
one year and one day after the payment in full of all outstanding commercial
paper or other senior debt of any SPC, it will not institute against, or join
any other Person in instituting against, such SPC any bankruptcy,
reorganization, arrangement, insolvency, or liquidation proceeding under the
laws of the United States or any State thereof. Notwithstanding anything to the
contrary contained herein, any SPC may (i) with notice to, but without prior
consent of the Company and the Agent and with the payment of a processing fee of
$3,500, assign all or any portion of its right to receive payment with respect
to any Revolving Loan to the Granting Lender and (ii) disclose on a confidential
basis any non-public information
92
relating to its funding of Revolving Loans to any rating agency, commercial
paper dealer or provider of any surety or Guarantee or credit or liquidity
enhancement to such SPC.
(h) Notwithstanding anything to the contrary contained herein, any
Lender that is a Fund may create a security interest in all or any portion of
the Loans owing to it and the Note, if any, held by it to the trustee for
holders of obligations owed, or securities issued, by such Fund as security for
such obligations or securities, PROVIDED that unless and until such trustee
actually becomes a Lender in compliance with the other provisions of this
SECTION 11.08, (i) no such pledge shall release the pledging Lender from any of
its obligations under the Loan Documents and (ii) such trustee shall not be
entitled to exercise any of the rights of a Lender under the Loan Documents even
though such trustee may have acquired ownership rights with respect to the
pledged interest through foreclosure or otherwise.
11.09 CONFIDENTIALITY. Each Lender agrees to take and to cause its
Affiliates to take normal and reasonable precautions and exercise due care to
maintain the confidentiality of all information identified as "confidential" or
"secret" by the Company and provided to it or to which it otherwise is granted
access by the Company or any Subsidiary, or by the Agent on the Company's or
such Subsidiary's behalf, under this Agreement or any other Loan Document, and
neither it nor any of its Affiliates shall use any such information other than
in connection with or in enforcement of this Agreement and the other Loan
Documents or in connection with other business now or hereafter existing or
contemplated with the Company or any Subsidiary or to disclose it to any third
person; except to the extent such information (i) was or becomes generally
available to the public other than as a result of disclosure by the Lender, or
(ii) was or becomes available on a non-confidential basis from a source other
than the Company, provided that such source is not bound by a confidentiality
agreement with the Company known to the Lender; PROVIDED, HOWEVER, that any
Lender may disclose such information (A) at the request or pursuant to any
requirement of any Governmental Authority to which the Lender is subject or in
connection with an examination of such Lender by any such authority; (B)
pursuant to subpoena or other court process; (C) when required to do so in
accordance with the provisions of any applicable Requirement of Law; (D) to the
extent reasonably required in connection with any litigation or proceeding to
which the Agent, any Lender or their respective Affiliates may be party; (E) to
the extent reasonably required in connection with the exercise of any remedy
hereunder or under any other Loan Document; (F) to such Lender's independent
auditors and other professional advisors; (G) to any Participant or Eligible
Assignee, actual or potential, provided that such Person agrees in writing to
keep such information confidential to the same extent required of the Lenders
hereunder; (H) as to any Lender or its Affiliate, as expressly permitted under
the terms of any other document or agreement regarding confidentiality to which
the Company or any Subsidiary is party or is deemed party with such Lender or
such Affiliate; and (I) to its Affiliates; PROVIDED that such Lender shall
provide notice to the Company of any requirement to disclose to a person who
does not have an obligation to such Lender (or pursuant to applicable law or
applicable court order) to keep such information confidential (it being
understood and agreed that the failure to provide such notice shall not
constitute a violation by such Lender of this SECTION 11.09).
11.10 SET-OFF. In addition to any rights and remedies of the Lenders
provided by law, if an Event of Default exists or the Loans have been
accelerated, each Lender is authorized at any time and from time to time,
without prior notice to the Company, any such notice being waived
93
by the Company to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held by, and other indebtedness at any time owing by, such Lender to or
for the credit or the account of the Company against any and all Obligations
owing to such Lender, now or hereafter existing, irrespective of whether or not
the Agent or such Lender shall have made demand under this Agreement or any Loan
Document and although such Obligations may be contingent or unmatured. Each
Lender agrees promptly to notify the Company and the Agent after any such
set-off and application made by such Lender; PROVIDED, HOWEVER, that the failure
to give such notice shall not affect the validity of such set-off and
application.
11.11 NOTIFICATION OF ADDRESSES, LENDING OFFICES, ETC. Each Lender shall
notify the Agent in writing of any changes in the address to which notices to
the Lender should be directed, of addresses of any Lending Office, of payment
instructions in respect of all payments to be made to it hereunder and of such
other administrative information as the Agent shall reasonably request.
11.12 COUNTERPARTS. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of said counterparts taken together shall be deemed to
constitute but one and the same instrument.
11.13 SEVERABILITY. The illegality or unenforceability of any provision of
this Agreement or any instrument or agreement required hereunder shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required hereunder.
11.14 NO THIRD PARTIES BENEFITED. This Agreement is made and entered into
for the sole protection and legal benefit of the Company, the Lenders, the Agent
and the Agent-Related Persons, and their permitted successors and assigns, and
no other Person shall be a direct or indirect legal beneficiary of, or have any
direct or indirect cause of action or claim in connection with, this Agreement
or any of the other Loan Documents.
11.15 GOVERNING LAW AND JURISDICTION.
(a) THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF ILLINOIS; PROVIDED THAT THE PARTIES
SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF ILLINOIS OR
OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH OF THE COMPANY, THE AGENT AND THE LENDERS
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE COMPANY, THE AGENT AND THE LENDERS
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF
94
FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY
DOCUMENT RELATED HERETO. THE COMPANY, THE AGENT AND THE LENDERS EACH WAIVE
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE
BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.
11.16 WAIVER OF JURY TRIAL. THE COMPANY, THE LENDERS AND THE AGENT EACH
WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION,
PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST
ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER
WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANY, THE
LENDERS AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE
TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE
PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED
BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING
WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF
THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF.
THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
11.17 ENTIRE AGREEMENT. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Company,
the Lenders and the Agent, and supersedes all prior or contemporaneous
agreements and understandings of such Persons, verbal or written, relating to
the subject matter hereof and thereof.
[Signature Pages Follow]
95
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Chicago, Illinois by their proper and duly
authorized officers as of the day and year first above written.
CENTURY BUSINESS SERVICES, INC.
By
------------------------------------------
Name:
Title:
BANK OF AMERICA, N.A., AS AGENT
By
------------------------------------------
Name:
Title:
BANK OF AMERICA, N.A., INDIVIDUALLY AS A
LENDER AND AS THE ISSUING BANK
By
------------------------------------------
Name:
Title:
Signature Page to Credit Agreement
FIFTH THIRD BANK
By
------------------------------------------
Name:
Title:
Signature Page to Credit Agreement
HUNTINGTON NATIONAL BANK
By
------------------------------------------
Name:
Title:
Signature Page to Credit Agreement
U.S. BANK, N.A.
By
------------------------------------------
Name:
Title:
Signature Page to Credit Agreement
SCHEDULE 2.01
REVOLVING LOAN COMMITMENTS
AND PRO RATA SHARES
Revolving Loan Pro Rata
Lender Commitment Share
------ --------- -----
$ %
Bank of America, N.A. $21,000,000 28.767123288%
Fifth Third Bank $20,000,000 27.397260274%
U.S. Bank, N.A. $20,000,000 27.397260274%
Huntington National Bank $12,000,000 16.438356164%
----------- -------------
TOTAL: $73,000,000 100%
=========== ====
