EXHIBIT 10.1
AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
dated as of August 4, 2005
among
HEICO CORPORATION,
as Borrower
THE LENDERS FROM TIME TO TIME PARTY HERETO
and
SUNTRUST BANK,
as Administrative Agent,
WACHOVIA BANK, NATIONAL ASSOCIATION
as Syndication Agent,
and
HSBC BANK USA,
as Documentation Agent
----------
SUNTRUST CAPITAL MARKETS, INC.,
as Lead Arranger and Book Manager
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS; CONSTRUCTION......................................1
Section 1.1.Definitions................................................1
Section 1.2.Classifications of Loans and Borrowings...................22
Section 1.3.Accounting Terms and Determination........................22
Section 1.4.Terms Generally...........................................23
ARTICLE II AMOUNT AND TERMS OF THE COMMITMENTS...........................23
Section 2.1.General Description of Facilities.........................23
Section 2.2.Revolving Loans...........................................24
Section 2.3.Procedure for Revolving Borrowings........................24
Section 2.4.Swingline Commitment......................................24
Section 2.5.Procedure for Swingline Loan; Etc.........................25
Section 2.6.Funding of Borrowings.....................................26
Section 2.7.Interest Elections........................................27
Section 2.8.Optional Reduction and Termination of Commitments.........28
Section 2.9.Repayment of Loans........................................28
Section 2.10.Evidence of Indebtedness.................................28
Section 2.11.Optional Prepayments.....................................29
Section 2.12.Mandatory Prepayments....................................29
Section 2.13.Interest on Loans........................................30
Section 2.14.Fees.....................................................31
Section 2.15.Computation of Interest and Fees.........................32
Section 2.16.Inability to Determine Interest Rates....................32
Section 2.17.Illegality...............................................33
Section 2.18.Increased Costs..........................................33
Section 2.19.Funding Indemnity........................................34
Section 2.20.Taxes....................................................35
Section 2.21.Payments Generally; Pro Rata Treatment; Sharing of
Set-offs.................................................36
Section 2.22.Letters of Credit........................................38
Section 2.23.Mitigation of Obligations................................42
Section 2.24.Replacement of Lenders...................................42
Section 2.25.Increase of Commitments; Additional Lenders..............43
ARTICLE III CONDITIONS PRECEDENT TO LOANS AND LETTERS OF CREDIT...........44
Section 3.1.Conditions To Effectiveness...............................44
Section 3.2.Each Credit Event.........................................46
Section 0.0.Xxxxxxxx of Documents.....................................47
ARTICLE IV REPRESENTATIONS AND WARRANTIES................................48
Section 4.1.Corporate Existence; Compliance with Law;
Name History..............................................48
Section 4.2.Corporate Power and Authorization to Execute Loan
Documents; No Conflict; No Consent........................48
Section 4.3.Enforceable Obligations...................................49
Section 0.0.Xxxxxxxxx Condition.......................................49
Section 0.0.Xx Litigation.............................................50
Section 4.6.Investment Company Act; Regulation........................50
Section 4.7.Disclosure and No Untrue Statements.......................50
Section 4.8.Title to Assets; Leases in Good Standing..................51
Section 4.9.Payment of Taxes..........................................51
Section 0.00.Xx Default Under Agreement or Instruments;
Compliance with Laws.....................................51
Section 4.11.Patents, Trademarks, Licenses, Etc.......................52
Section 4.12.Government Contract......................................52
Section 4.13.ERISA Requirement........................................52
Section 4.14.Solvency.................................................52
Section 4.15.Location of Offices......................................53
Section 0.00.Xxxxxxxxx................................................53
Section 4.17.Labor Relations..........................................53
Section 4.18.OFAC.....................................................53
Section 4.19.Patriot Act..............................................53
ARTICLE V AFFIRMATIVE COVENANTS.........................................54
Section 0.0.Xxxxxxxxx Reports and Other Information...................54
Section 5.2.Payment of Indebtedness to Administrative Agent;
Payment of Other Obligations..............................55
Section 5.3.Conduct of Business; Maintenance of Existence and Rights..55
Section 5.4.Maintenance of Property...................................56
Section 5.5.Right of Inspection; Discussions..........................56
Section 5.6.Notices...................................................56
Section 5.7.Payment of Taxes; Liens...................................58
Section 0.0.Xxxxxxxxx of Properties...................................58
Section 5.9.True Books................................................58
Section 5.10.Observance of Laws.......................................59
Section 5.11.Further Assurances.......................................59
Section 5.12.ERISA Benefit Plans......................................59
Section 5.13.Withholding Taxes........................................59
Section 5.14.Change of Name, Principal Place of Business or Office....60
Section 5.15.Intentionally Omitted....................................60
Section 5.16.Use of Proceeds and Letters of Credit Affirmative
Covenants................................................60
Section 5.17.Additional Subsidiaries..................................60
Section 5.18.Additional Leased Locations..............................61
ARTICLE VI FINANCIAL COVENANTS...........................................62
Section 0.0.Xxxxxxxxx Covenants.......................................62
ARTICLE VII NEGATIVE COVENANTS............................................62
Section 7.1.Other Indebtedness........................................62
Section 7.2.Limitations on Mortgages, Liens, Etc......................64
Section 7.3.Guaranties................................................65
Section 7.4.Merger, Acquisition, Sale of Assets, Dissolution, Etc.....65
Section 0.0.Xxxxxxxxxxx, Loans, etc...................................67
Section 7.6.Federal Reserve Regulations...............................68
Section 7.7.Changes in Governing Documents, Accounting Methods,
Fiscal Year...............................................68
Section 0.0.Xxxxxxx Expenditures......................................68
Section 7.9.Dividends, Etc............................................69
Section 7.10.Intentionally Omitted....................................69
Section 7.11.HEICO Aerospace Holdings Corp............................69
Section 7.12.Transactions with Affiliates.............................70
Section 7.13.Restrictive Agreements...................................71
Section 0.00.Xxxx and Leaseback Transactions..........................71
Section 7.15.Hedging Transactions.....................................71
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ARTICLE VIII EVENTS OF DEFAULT.............................................72
Section 0.0.Xxxxxx of Default.........................................72
Section 8.2.Application of Proceeds from Collateral...................74
ARTICLE IX THE ADMINISTRATIVE AGENT......................................75
Section 9.1.Appointment of Administrative Agent.......................75
Section 9.2.Nature of Duties of Administrative Agent..................76
Section 9.3.Lack of Reliance on the Administrative Agent..............77
Section 9.4.Certain Rights of the Administrative Agent................77
Section 0.0.Xxxxxxxx by Administrative Agent..........................77
Section 9.6.The Administrative Agent in its Individual Capacity.......77
Section 9.7.Successor Administrative Agent............................77
Section 9.8.Authorization to Execute other Loan Documents.............78
ARTICLE X MISCELLANEOUS.................................................79
Section 10.1.Notices..................................................79
Section 10.2.Waiver; Amendments.......................................80
Section 10.3.Expenses; Indemnification................................81
Section 10.4.Successors and Assigns...................................83
Section 10.5.Governing Law; Jurisdiction; Consent to Service of
Process..................................................87
Section 10.6.WAIVER OF JURY TRIAL.....................................87
Section 10.7.Right of Setoff..........................................88
Section 10.8.Counterparts; Integration................................88
Section 10.9.Survival.................................................88
Section 10.10.Severability............................................89
Section 10.11.Confidentiality.........................................89
Section 10.12.Interest Rate Limitation................................90
Section 10.13.Waiver of Effect of Corporate Seal......................90
iii
Schedules
Schedule I - Applicable Margin and Applicable Commitment Fee
Percentage
Schedule 2.22 - Existing Letters of Credit
Schedule 4.5 - Litigation
Schedule 7.1 - Indebtedness
Schedule 7.2 - Liens
Schedule 7.5 - Investments
Exhibits
Exhibit A - Form of Syndicated Note
Exhibit B - Form of Swingline Note
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Subsidiary Guaranty Agreement
Exhibit 2.3 - Form of Notice of Revolving Borrowing
Exhibit 2.5 - Form of Notice of Swingline Loan
Exhibit 2.7 - Form of Continuation/Conversion
Exhibit 5.1(g) - Form of Compliance Certificate
iv
AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
THIS AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT (this
"Agreement") is made and entered into as of August 4, 2005, by and among HEICO
CORPORATION, a Florida corporation (the "Borrower"), the several banks and other
financial institutions and lenders from time to time party hereto (the
"Lenders"), and SUNTRUST BANK, in its capacity as administrative agent for the
Lenders (the "Administrative Agent"), as issuing bank (the "Issuing Bank") and
as swingline lender (the "Swingline Lender").
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders and the Administrative Agent
are parties to that certain Revolving Credit Agreement, dated as of May 15,
2003, as amended or modified prior to the date hereof (the "Existing Credit
Agreement"), pursuant to which the Lenders established a $120,000,000 revolving
credit facility in favor of the Borrower, with a letter of credit subfacility
and swingline subfacility;
WHEREAS, Borrower has requested that the Lenders increase the
commitments to $130,000,000 and make certain modifications to the Existing
Credit Agreement, which the Lenders are willing to do subject to the terms and
conditions hereof;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the Borrower, the Lenders, the Administrative Agent,
the Issuing Bank and the Swingline Lender agree that the New Lender shall become
a Lender hereunder and the Existing Credit Agreement is amended and restated as
follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION
SECTION 1.1. DEFINITIONS. In addition to the other terms
defined herein, the following terms used herein shall have the meanings set
forth herein (to be equally applicable to both the singular and plural forms of
the terms defined):
"Additional Lender" shall have the meaning given to such term in
Section 2.25.
"Adjusted LIBO Rate" shall mean, with respect to each Interest
Period for a Eurodollar Borrowing, the rate per annum obtained by dividing
(i) LIBOR for such Interest Period by (ii) a percentage equal to 1.00 minus the
Eurodollar Reserve Percentage.
"Administrative Agent" shall have the meaning set forth in the
introductory paragraph hereof.
"Administrative Questionnaire" shall mean, with respect to each
Lender, an administrative questionnaire in the form prepared by the
Administrative Agent and submitted to the Administrative Agent duly completed by
such Lender.
"Affiliate" shall mean, as to any Person, any other Person that
directly, or indirectly through one or more intermediaries, Controls, is
Controlled by, or is under common Control with, such Person. For the purposes of
this definition of Affiliate, the term "Control" shall mean the power, directly
or indirectly, either to (i) vote 10% or more of the securities having ordinary
voting power for the election of directors (or persons performing similar
functions) of a Person or (ii) direct or cause the direction of the management
and policies of a Person, whether through the ability to exercise voting power,
by contract or otherwise. The terms "Controlling," "Controlled by," and "under
common Control with" have the meanings correlative thereto. Notwithstanding the
foregoing, Lufthansa Technik AG and its Affiliates shall not be deemed
Affiliates of the Borrower and its Affiliates solely by virtue of Mr. Xxxxxxxx
Xxxxxxxxx, or any other designee of Lufthansa Technick AG, serving as an officer
or director of any such entity.
"AFI Option Agreement" shall mean that certain Stock Option
Agreement dated as of October 12, 2001, by and between Aviation Facilities,
Inc., a Florida corporation, and AFI Acquisition Corp., a Florida corporation.
"Aggregate Revolving Commitment Amount" shall mean the aggregate
principal amount of the Aggregate Revolving Commitments from time to time. On
the Closing Date, the Aggregate Revolving Commitment Amount equals $130,000,000.
"Aggregate Revolving Commitments" shall mean, collectively, all
Revolving Commitments of all Lenders at any time outstanding.
"Aggregate Subsidiary Threshold" shall mean an amount equal to
seventy-five percent (75%) of the total consolidated revenue and seventy-five
(75%) of the total consolidated assets, in each case of the Borrower and its
Subsidiaries for the most recent Fiscal Quarter as shown on the financial
statements most recently delivered or required to be delivered pursuant to
Section 5.1(a) or (b), as the case may be.
"Applicable Commitment Fee Percentage" shall mean, as of any
date, with respect to the commitment fee in Section 2.14(b), the percentage per
annum determined by reference to the applicable Leverage Ratio in effect on such
date as set forth on Schedule I; provided that a change in the Applicable
Commitment Fee Percentage resulting from a change in the Leverage Ratio shall be
effective on the second Business Day after which the Borrower delivers the
financial statements required by Section 5.1(a) or Section 5.1(b) and the
Compliance Certificate required by Section 5.1(g); provided, further, that if at
any time the Borrower shall have failed to deliver such financial statements and
such Compliance Certificate when so required, the Applicable Commitment Fee
Percentage shall be at Level I as set forth on Schedule I until such time as
such financial statements and certificate are delivered, at which time the
Applicable Commitment Fee Percentage shall be determined as provided above.
Notwithstanding the foregoing, the Applicable Commitment Fee Percentage from the
Closing Date until the financial statements and Compliance Certificate for the
Fiscal Quarter ending July 31, 2005 are delivered (or required to be delivered
if no such financial statements and Compliance Certificate are delivered) shall
be at Level I as set forth on Schedule I.
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"Applicable Lending Office" shall mean, for each Lender and for
each Type of Loan, the "Lending Office" of such Lender (or an Affiliate of such
Lender) designated for such Type of Loan in the Administrative Questionnaire
submitted by such Lender or such other office of such Lender (or an Affiliate of
such Lender) as such Lender may from time to time specify to the Administrative
Agent and the Borrower as the office by which its Loans of such Type are to be
made and maintained.
"Applicable Margin" shall mean, as of any date, (i) with respect
to all Revolving Loans outstanding on any date and the letter of credit fee, as
the case may be, a percentage per annum determined by reference to the
applicable Leverage Ratio in effect on such date as set forth on Schedule I;
provided that a change in the Applicable Margin resulting from a change in the
Leverage Ratio shall be effective on the second Business Day after which the
Borrower delivers the financial statements required by Section 5.1(a) or
Section 5.1(b) and the Compliance Certificate required by Section 5.1(g);
provided, further, that if at any time the Borrower shall have failed to deliver
such financial statements and such Compliance Certificate when so required, the
Applicable Margin shall be at Level I as set forth on Schedule I until such time
as such financial statements and certificate are delivered, at which time the
Applicable Margin shall be determined as provided above. Notwithstanding the
foregoing, the Applicable Margin from the Closing Date until the financial
statements and Compliance Certificate for the Fiscal Quarter ending July 31,
2005 are delivered (or required to be delivered if no such financial statements
and Compliance Certificate are delivered) shall be at Level I as set forth on
Schedule I.
"Approved Fund" shall mean 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 and that is administered or managed by (i) a Lender, (ii)
an Affiliate of a Lender or (iii) an entity or an Affiliate of an entity that
administers or manages a Lender.
"Assignment and Acceptance" shall mean an assignment and
acceptance entered into by a Lender and an assignee (with the consent of any
party whose consent is required by Section 10.4(b)) and accepted by the
Administrative Agent, in the form of Exhibit C attached hereto or any other form
approved by the Administrative Agent.
"Availability Period" shall mean the period from the Closing
Date to the Revolving Commitment Termination Date.
"Base Rate" shall mean the higher of (i) the per annum rate
which the Administrative Agent publicly announces from time to time to be its
prime lending rate, as in effect from time to time, and (ii) (A) the Federal
Funds Rate, as in effect from time to time, plus (B) one-half of one percent
(0.50%) per annum. The Administrative Agent's prime lending rate is a reference
rate and does not necessarily represent the lowest or best rate charged to
customers. The Administrative Agent may make commercial loans or other loans at
rates of interest at, above or below the Administrative Agent's prime lending
rate. Each change in the Administrative Agent's prime lending rate shall be
effective from and including the date such change is publicly announced as being
effective.
3
"Blocked Account" shall mean a deposit or disbursement bank
account in the name of any Loan Party with the Administrative Agent, with other
Lenders or with any other financial institutions that (together with the
applicable Loan Party) have executed and delivered to the Administrative Agent a
Blocked Account Agreement, in form and substance reasonably acceptable to the
Administrative Agent.
"Blocked Account Agreement" shall mean an agreement between the
Administrative Agent and a deposit account bank with respect to a deposit or
disbursement bank account in the name of any Loan Party, whereby, among other
things, the deposit account bank disclaims or subordinates in a manner
acceptable to the Administrative Agent any security interest in the applicable
deposit or disbursement bank account, acknowledges the Lien of the
Administrative Agent, on behalf of itself and Lenders, on such account, and
after the occurrence and during the continuance of an Event of Default agrees to
follow the instructions or entitlement orders of the Administrative Agent
without further consent by the affected Loan Party.
"Bond Documents" shall mean the HEICO Aerospace Corporation
Industrial Development Refunding Bonds - Series 1988 - Broward County, Florida
(March 28, 1988), and all other documents executed in connection therewith.
"Borrowing" shall mean a borrowing consisting of (i) Loans of
the same Class and Type, made, converted or continued on the same date and in
the case of Eurodollar Loans, as to which a single Interest Period is in effect,
or (ii) a Swingline Loan.
"Business Day" shall mean (i) any day other than a Saturday,
Sunday or other day on which commercial banks in Atlanta, Georgia are authorized
or required by law to close and (ii) if such day relates to a Borrowing of, a
payment or prepayment of principal or interest on, a conversion of or into, or
an Interest Period for, a Eurodollar Loan or a notice with respect to any of the
foregoing, any day on which dealings in Dollars are carried on in the London
interbank market.
"Capital Expenditures" shall mean for any period, without
duplication, (i) the additions to property, plant and equipment and other
capital expenditures of the Borrower and its Subsidiaries that are (or would be)
set forth on a consolidated statement of cash flows of the Borrower for such
period prepared in accordance with GAAP and (ii) Capital Lease Obligations
incurred by the Borrower and its Subsidiaries during such period.
"Capital Lease Obligations" of any Person shall mean all
obligations of such Person to pay rent or other amounts under any lease of (or
other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Capital Stock" of any Person shall mean any non-redeemable
capital stock (or in the case of a partnership or limited liability company, the
partners' or members' equivalent equity interest) of such Person, whether common
or preferred.
4
"Change in Control" shall mean, as applied to the Borrower, that
(a) the Xxxxxxxxx Reporting Group (as identified in the reports filed with the
United States Securities and Exchange Commission) shall cease beneficially to
own and control at least fifteen (15%) of the combined voting power of all
classes of Capital Stock of the Borrower, or (b) Laurans X. Xxxxxxxxx shall
cease to be employed as President and Chief Executive Officer of the Borrower or
shall cease actively to manage the Borrower and its Subsidiaries (however,
should Laurans X. Xxxxxxxxx die or become disabled, such death or disability
alone shall not constitute a Change in Control if and only if two of the three
of Xxxx X. Xxxxxxxxx, Xxxxxx X. Xxxxxxxxx and Xxxxxx X. Xxxxx continue to be
employed as executive officers of the Borrower and continue actively to manage
the Borrower and its Subsidiaries), or (c) during any period of twelve (12)
consecutive calendar months (i) more than fifty percent (50%) of the members of
the Board of Directors of the Borrower who were members on the first day of such
period shall have resigned or been removed or replaced, other than as a result
of death, disability, or change in personal circumstances (provided, however,
that any change in the size or membership of the Board of Directors of the
Borrower necessary or desirable in the Borrower's reasonable discretion to
comply with applicable laws including, without limitation, the Xxxxxxxx-Xxxxx
Act of 2002, or the rules and regulations of any securities exchange on which
the securities of the Borrower may be listed shall not be considered in
determining whether a "Change in Control" has occurred so long as such change is
approved by the then existing Board of Directors immediately prior to such
change), or (ii) any Person or "Group" (as defined in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended, but excluding (A) any employee
benefit or stock ownership plans of the Borrower, and (B) members of the Board
of Directors and executive officers of the Borrower as of the date of this
Agreement, members of the immediate families of such members and executive
officers, and family trusts and partnerships established by or for the benefit
of any of the foregoing individuals) shall have acquired more than fifty percent
(50%) of the combined voting power of all classes of common stock of the
Borrower, except that the Borrower's purchase of its common stock outstanding on
the date hereof which results in one or more of the Borrower's shareholders of
record as of the date of this Agreement controlling more than fifty percent
(50%) of the combined voting power of all classes of the common stock of the
Borrower shall not constitute a Change in Control.
"Change in Law" shall mean (i) the adoption of any applicable
law, rule or regulation after the date of this Agreement, (ii) any change in any
applicable law, rule or regulation, or any change in the interpretation or
application thereof, by any Governmental Authority after the date of this
Agreement, or (iii) compliance by any Lender (or its Applicable Lending Office)
or the Issuing Bank (or for purposes of Section 2.18(b), by such Lender's or the
Issuing Bank's holding company, if applicable) with any request, guideline or
directive (whether or not having the force of law) of any Governmental Authority
made or issued after the date of this Agreement.
"Class", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are Revolving
Loans or Swingline Loans and when used in reference to any Commitment, refers to
whether such Commitment is a Revolving Commitment or a Swingline Commitment.
"Closing Date" shall mean the date on which the conditions
precedent set forth in Section 3.1 and Section 3.2 have been satisfied or waived
in accordance with Section 10.2.
5
"Code" shall mean the Internal Revenue Code of 1986, as amended
and in effect from time to time.
"Collateral" shall mean all tangible and intangible personal
property or Real Estate of any Loan Party that is the subject of a Lien granted
pursuant to a Loan Document to the Administrative Agent for the benefit of the
Lenders to secure the whole or any part of the Obligations or any Guarantee
thereof, and shall include, without limitation, all casualty insurance proceeds
and condemnation awards with respect to any of the foregoing.
"Commitment" shall mean a Revolving Commitment or a Swingline
Commitment or any combination thereof (as the context shall permit or require).
"Compliance Certificate" shall mean a certificate from the
principal financial officer of the Borrower, in his capacity as such, in the
form of the certificate attached hereto as Exhibit 5.1(g), with regard to the
certifications required of such principal financial officer pursuant to
Section 5.1(g).
"Consistent Basis" shall mean, in reference to the application
of GAAP, that the accounting principles observed in the current period are
comparable in all material respects to those applied in the preceding period.
"Consolidated EBITDA" shall mean, for the Borrower and its
Subsidiaries for any period, an amount equal to the sum of (i) Consolidated Net
Income for such period plus (ii) to the extent deducted in determining
Consolidated Net Income for such period, (A) Consolidated Interest Expense,
(B) income tax expense determined on a consolidated basis in accordance with
GAAP, (C) depreciation and amortization determined on a consolidated basis in
accordance with GAAP, (D) minority interest expense determined on a consolidated
basis in accordance with GAAP and (E) non-cash expense for stock options and all
other non-cash charges, determined on a consolidated basis in accordance with
GAAP, in each case for such period.
"Consolidated Fixed Charges" shall mean, for the Borrower and
its Subsidiaries for any period, the sum (without duplication) of (i)
Consolidated Interest Expense for such period paid in cash, (ii) scheduled
principal payments made on Consolidated Total Funded Debt during such period,
and (iii) dividends and distributions to holders of Capital Stock, warrants and
related instruments paid in cash or property other than common stock during such
period.
"Consolidated Interest Expense" shall mean, for the Borrower and
its Subsidiaries for any period determined on a consolidated basis in accordance
with GAAP, the sum of (i) total interest expense, including without limitation
the interest component of any payments in respect of Capital Lease Obligations
capitalized or expensed during such period (whether or not actually paid during
such period) plus (ii) the net amount payable (or minus the net amount
receivable) under Hedging Obligations during such period (whether or not
actually paid or received during such period).
"Consolidated Net Income" shall mean, for the Borrower and its
Subsidiaries for any period, the net income (or loss) of the Borrower and its
Subsidiaries for such period determined on a consolidated basis in accordance
with GAAP but excluding therefrom (to the extent otherwise included therein)
(i) any extraordinary gains or losses, (ii) any gains attributable
6
to write-ups of assets, (iii) any equity interest of the Borrower or any
Subsidiary of the Borrower in the unremitted earnings of any Person that is not
a Subsidiary and (iv) any income (or loss) of any Person accrued prior to the
date it becomes a Subsidiary or is merged into or consolidated with the Borrower
or any Subsidiary on the date that such Person's assets are acquired by the
Borrower or any Subsidiary.
"Consolidated Net Worth" shall mean, as of any date, (i) the
total assets of the Borrower and its Subsidiaries that would be reflected on the
Borrower's consolidated balance sheet as of such date prepared in accordance
with GAAP, after eliminating all amounts properly attributable to minority
interests, if any, in the stock and surplus of Subsidiaries, minus (ii) the sum
of (x) the total liabilities of the Borrower and its Subsidiaries that would be
reflected on the Borrower's consolidated balance sheet as of such date prepared
in accordance with GAAP and (y) the amount of any write-up in the book value of
any assets resulting from a revaluation thereof or any write-up in excess of the
cost of such assets acquired reflected on the consolidated balance sheet of the
Borrower as of such date prepared in accordance with GAAP.
"Consolidated Total Funded Debt" shall mean and include, without
duplication, the following obligations of the Borrower and any of its
Subsidiaries: (i) any liability or obligation for borrowed money that under GAAP
is required to be shown on the balance sheet as a liability; (ii) Indebtedness
that is secured by any security interest on property owned by the Borrower or
any Subsidiary (such as capitalized leases, asset securitization vehicles,
conditional sales contracts and similar title retention arrangements),
irrespective of whether or not the Indebtedness secured thereby shall have been
assumed by the Borrower or such Subsidiary; (iii) Guarantees, endorsements
(other than endorsements of negotiable instruments for collection in the
ordinary course of business), and other contingent liabilities, whether direct
or indirect (such as by way of a letter of credit issued for the account of the
Borrower or a Subsidiary) in connection with the obligations for borrowed money,
stock, or dividends of any person; (iv) obligations under any contract providing
for the making of loans, advances, or capital contributions to any person in
order to enable such person primarily to maintain working capital, net worth, or
any other balance sheet condition or to pay debts, dividends, or expenses; and
(v) obligations under any contract which, in economic effect, is substantially
equivalent to a Guarantee of loans, advances or capital contributions of another
person, all as determined with respect to (i) through (v) above for the Borrower
and its Subsidiaries on a consolidated basis, in accordance with GAAP applied on
a Consistent Basis.
"Contractual Obligation" of any Person shall mean any provision
of any security issued by such Person or of any agreement, instrument or
undertaking under which such Person is obligated or by which it or any of the
property in which it has an interest is bound.
"Control Agreement" shall mean an agreement between the
Administrative Agent and (i) a securities intermediary with respect to
securities, whether certificated or uncertificated, securities entitlements and
other financial assets held in a securities account in the name of any Loan
Party, or (ii) a futures commission merchant or clearing house, as applicable,
with respect to commodity accounts and commodity contracts held by any Loan
Party, whereby, among other things, the issuer, securities intermediary or
futures commission merchant disclaims any security interest in the applicable
financial assets, acknowledges the Lien of the Administrative Agent, on behalf
of itself and Lenders, on such financial assets, and agrees, after the
occurrence and during
7
the continuance of an Event of Default, to follow the instructions or
entitlement orders of the Administrative Agent without further consent by the
affected Loan Party.
"Default" shall mean any condition or event that, with the
giving of notice or the lapse of time or both, would constitute an Event of
Default.
"Default Interest" shall have the meaning set forth in
Section 2.13(c).
"Dollar(s)" and the sign "$" shall mean lawful money of the
United States of America.
"Domestic Subsidiary" shall mean each Subsidiary that is not a
Foreign Subsidiary.
"Environmental Laws" shall mean all laws, rules, regulations,
codes, ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by or with any Governmental
Authority, relating in any way to the environment, preservation or reclamation
of natural resources, the management, Release or threatened Release of any
Hazardous Material or to health and safety matters.
"Environmental Liability" shall mean any liability, contingent
or otherwise (including any liability for damages, costs of environmental
investigation and remediation, costs of administrative oversight, fines, natural
resource damages, penalties or indemnities), of the Borrower or any Subsidiary
directly or indirectly resulting from or based upon (i) any actual or alleged
violation of any Environmental Law, (ii) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials,
(iii) any actual or alleged exposure to any Hazardous Materials, (iv) the
Release or threatened Release of any Hazardous Materials or (v) any contract,
agreement or other consensual arrangement pursuant to which liability is assumed
or imposed with respect to any of the foregoing.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time, and any successor statute.
"ERISA Affiliate" shall mean any trade or business (whether or
not incorporated), which, together with the Borrower, is treated as a single
employer under Section 414(b) or (c) of the Code or, solely for the purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.
"ERISA Event" shall mean (i) any "reportable event", as defined
in Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived);
(ii) the existence with respect to any Plan of an "accumulated funding
deficiency" (as defined in Section 412 of the Code or Section 302 of ERISA),
whether or not waived; (iii) the filing pursuant to Section 412(d) of the Code
or Section 303(d) of ERISA of an application for a waiver of the minimum funding
standard with respect to any Plan; (iv) the incurrence by the Borrower or any of
its ERISA Affiliates of any liability under Title IV of ERISA with respect to
the termination of any Plan; (v) the receipt by the Borrower or any ERISA
Affiliate from the PBGC or a plan administrator appointed by the PBGC of any
notice relating to an intention to terminate any Plan or Plans or to appoint a
trustee
8
to administer any Plan; (vi) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability with respect to the withdrawal or partial withdrawal
from any Plan or Multiemployer Plan; or (vii) the receipt by the Borrower or any
ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the
Borrower or any ERISA Affiliate of any notice, concerning the imposition of
Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in reorganization, within the meaning of Title IV
of ERISA.
"Eurodollar" when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, bears
interest at a rate determined by reference to the Adjusted LIBO Rate.
"Eurodollar Reserve Percentage" shall mean the aggregate of the
maximum reserve percentages (including, without limitation, any emergency,
supplemental, special or other marginal reserves) expressed as a decimal
(rounded upwards to the next 1/100th of 1%) in effect on any day to which the
Administrative Agent is subject with respect to the Adjusted LIBO Rate pursuant
to regulations issued by the Board of Governors of the Federal Reserve System
(or any Governmental Authority succeeding to any of its principal functions)
with respect to eurocurrency funding (currently referred to as "eurocurrency
liabilities" under Regulation D). Eurodollar Loans shall be deemed to constitute
eurocurrency funding and to be subject to such reserve requirements without
benefit of or credit for proration, exemptions or offsets that may be available
from time to time to any Lender under Regulation D. The Eurodollar Reserve
Percentage shall be adjusted automatically on and as of the effective date of
any change in any reserve percentage.
"Event of Default" shall have the meaning set forth in
Section 8.1.
"Excluded Taxes" shall mean with respect to the Administrative
Agent, any Lender, the Issuing Bank or any other recipient of any payment to be
made by or on account of any obligation of the Borrower hereunder, (i) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (ii) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which any Lender is located and (iii) in the case
of a Foreign Lender, any withholding tax that (x) is imposed on amounts payable
to such Foreign Lender at the time such Foreign Lender becomes a party to this
Agreement, (y) is imposed on amounts payable to such Foreign Lender at any time
that such Foreign Lender designates a new lending office, other than taxes that
have accrued prior to the designation of such lending office that are otherwise
not Excluded Taxes, and (z) is attributable to such Foreign Lender's failure to
comply with Section 2.20(e).
"Existing Credit Agreement" shall have the meaning given to such
term in the recitals to this Agreement.
"Existing Letters of Credit" means the letters of credit issued
and outstanding under the Existing Credit Agreement as set forth on
Schedule 2.22.
9
"Federal Funds Rate" shall mean, for any day, the rate per annum
(rounded upwards, if necessary, to the next 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with member banks
of the Federal Reserve System arranged by Federal funds brokers, as published by
the Federal Reserve Bank of New York on the next succeeding Business Day or if
such rate is not so published for any Business Day, the Federal Funds Rate for
such day shall be the average rounded upwards, if necessary, to the next 1/100th
of 1% of the quotations for such day on such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by the Administrative Agent.
"Fee Letter" shall mean that certain fee letter, dated as of
June 7, 2005, executed by SunTrust Capital Markets, Inc. and SunTrust Bank and
accepted by the Borrower.
"Fiscal Quarter" shall mean any fiscal quarter of the Borrower.
"Fiscal Year" shall mean any fiscal year of the Borrower.
"Fixed Charge Coverage Ratio" shall mean, as of any date, the
ratio of (a) (i) Consolidated EBITDA minus (ii) the actual amount paid by the
Borrower and its Subsidiaries in cash on account of Capital Expenditures and
income tax expense to (b) Consolidated Fixed Charges, in each case measured for
the four consecutive Fiscal Quarters ending on or immediately prior to such
date.
"Foreign Lender" shall mean any Lender that is not a United
States person under Section 7701(a)(3) of the Code.
"Foreign Subsidiary" shall mean any Subsidiary that is organized
under the laws of a jurisdiction other than one of the fifty states of the
United States or the District of Columbia.
"GAAP" shall mean generally accepted accounting principles in
the United States applied on a consistent basis and subject to the terms of
Section 1.3.
"Governmental Authority" shall mean the government of the United
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.
"Guarantee" of or by any Person (the "guarantor") shall mean any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
indirectly and including any obligation, direct or indirect, of the guarantor
(i) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (ii) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof,
(iii) to maintain working capital, equity capital or any other financial
statement condition or liquidity of the primary obligor so as to enable the
primary obligor to pay such Indebtedness or other obligation or (iv) as an
account party in respect of any letter of credit or
10
letter of guaranty issued in support of such Indebtedness or obligation;
provided that the term "Guarantee" shall not include endorsements for collection
or deposits in the ordinary course of business. The amount of any Guarantee
shall be deemed to be an amount equal to the stated or determinable amount of
the primary obligation in respect of which Guarantee is made (subject to any
limitations on the liability of the guarantor contained in such Guarantee) or,
if not so stated or determinable, the reasonably anticipated liability in
respect thereof (assuming such Person is required to perform thereunder) as
determined by such Person in good faith. The term "Guarantee" used as a verb has
a corresponding meaning.
"Hazardous Materials" shall mean all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls, radon gas, infectious or
medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.
"Hedging Obligations" shall mean, for any Person, any and all
obligations of such Person, whether absolute or contingent and howsoever and
whensoever created, arising, evidenced or acquired under (i) any and all Hedging
Transactions, (ii) any and all cancellations, buy backs, reversals, terminations
or assignments of any Hedging Transactions and (iii) any and all renewals,
extensions and modifications of any Hedging Transactions and any and all
substitutions for any Hedging Transactions, including without limitation any
promissory notes issued to pay the Net Xxxx-to-Market Exposure of any Hedging
Transactions that is terminated.
"Hedging Transaction" shall mean, for any Person, any
transaction (including an agreement with respect thereto) now existing or
hereafter entered into by such Person that is a rate swap, basis swap, forward
rate transaction, commodity swap, interest rate option, foreign exchange
transaction, cap transaction, floor transaction, collateral transaction, forward
transaction, currency swap transaction, cross-currency rate swap transaction,
currency option or any other similar transaction (including any option with
respect to any of these transactions) or any combination thereof, whether linked
to one or more interest rates, foreign currencies, commodity prices, equity
prices or other financial measures.
"IAS" shall mean Inertial Airline Services, Inc., an Ohio
corporation.
"Indebtedness" of any Person shall mean, without duplication
(i) all obligations of such Person for borrowed money, (ii) all obligations of
such Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such Person in respect of the deferred purchase price
of property or services (other than trade payables incurred in the ordinary
course of business and paid in accordance with the historical practices or to
the extent that any of such trade payables are being disputed in good faith and
by appropriate measures), (iv) all obligations of such Person under any
conditional sale or other title retention agreement(s) relating to property
acquired by such Person, (v) all Capital Lease Obligations of such Person,
(vi) all obligations, contingent or otherwise, of such Person in respect of
letters of credit, acceptances or similar extensions of credit, (vii) all
Guarantees of such Person of the type of Indebtedness described in clauses
(i) through (vi) above, (viii) all Indebtedness of a third party secured by any
Lien on property owned by such Person, whether or not such Indebtedness has been
assumed by such Person, (ix) all obligations of such Person, contingent or
otherwise, to
11
purchase, redeem, retire or otherwise acquire for value any common stock of such
Person, (x) Off-Balance Sheet Liabilities and (xi) all Hedging Obligations of
such Person. The Indebtedness of any Person shall include the Indebtedness of
any partnership or joint venture in which such Person is a general partner or a
joint venturer to the extent required to be consolidated in accordance with
GAAP, except to the extent that the terms of such Indebtedness provide that such
Person is not liable therefor.
"Indemnified Taxes" shall mean Taxes other than Excluded Taxes.
"Information Memorandum" shall mean the Confidential Information
Memorandum dated July 2005 relating to the Borrower and the transactions
contemplated by this Agreement and the other Loan Documents.
"Interest Period" shall mean (a) with respect to any Eurodollar
Borrowing, a period of one, two, three or six months; provided, that:
(i) the initial Interest Period for such Borrowing shall
commence on the date of such Borrowing (including the date of any
conversion from a Borrowing of another Type), and each Interest Period
occurring thereafter in respect of such Borrowing shall commence on the
day on which the next preceding Interest Period expires;
(ii) if any Interest Period would otherwise end on a day
other than a Business Day, such Interest Period shall be extended to the
next succeeding Business Day, unless such Business Day falls in another
calendar month, in which case such Interest Period would end on the next
preceding Business Day;
(iii) any Interest Period which 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 a calendar month; and
(iv) no Interest Period with respect to Revolving Loans may
extend beyond the Revolving Commitment Termination Date.
and (b) with respect to any Swingline Loan, a period of time agreed to by the
Borrower and the Swingline Lender.
"Issuing Bank" shall mean SunTrust Bank or any other Lender that
succeeds SunTrust Bank, each in its capacity as an issuer of Letters of Credit
pursuant to Section 2.22.
"LC Commitment" shall mean that portion of the Aggregate
Revolving Commitment Amount that may be used by the Borrower for the issuance of
Letters of Credit in an aggregate face amount not to exceed $15,000,000.
"LC Disbursement" shall mean a payment made by the Issuing Bank
pursuant to a Letter of Credit.
12
"LC Documents" shall mean the Letters of Credit and all
applications, agreements and instruments relating to the Letters of Credit.
"LC Exposure" shall mean, at any time, the sum of (i) the
aggregate undrawn amount of all outstanding Letters of Credit at such time, plus
(ii) the aggregate amount of all LC Disbursements that have not been reimbursed
by or on behalf of the Borrower at such time. The LC Exposure of any Lender
shall be its Pro Rata Share of the total LC Exposure at such time.
"Lenders" shall have the meaning set forth in the opening
paragraph of this Agreement and shall include, where appropriate, the Swingline
Lender and each additional Lender that joins this Agreement pursuant to
Section 2.25 or Section 10.4.
"Letter of Credit" shall mean any stand-by letter of credit
issued pursuant to Section 2.22 by the Issuing Bank for the account of the
Borrower pursuant to the LC Commitment and the Existing Letters of Credit.
"Leverage Ratio" shall mean, as of any date, the ratio of
(i) Consolidated Total Funded Debt as of such date to (ii) Consolidated EBITDA
for the four consecutive Fiscal Quarters ending on or immediately prior to such
date, adjusted to include, on a pro forma basis, Consolidated EBITDA of any
Person acquired by the Borrower or its Subsidiaries during such period assuming
the consummation of such acquisition occurred on the first day of such period.
"LIBOR" shall mean, for any applicable Interest Period with
respect to any Eurodollar Loan, the British Bankers' Association Interest
Settlement Rate per annum for deposits in Dollars for a period equal to such
Interest Period appearing on the display designated as Page 3750 on the Dow
Xxxxx Markets Service (or such other page on that service or such other service
designated by the British Bankers' Association for the display of such
Association's Interest Settlement Rates for Dollar deposits) as of 11:00 a.m.
(London, England time) on the day that is two Business Days prior to the first
day of the Interest Period or if such Page 3750 is unavailable for any reason at
such time, the rate which appears on the Reuters Screen ISDA Page as of such
date and such time; provided that if the Administrative Agent determines that
the relevant foregoing sources are unavailable for the relevant Interest Period,
LIBOR shall mean the rate of interest determined by the Administrative Agent to
be the average (rounded upward, if necessary, to the nearest 1/100th of 1%) of
the rates per annum at which deposits in Dollars are offered to the
Administrative Agent two (2) Business Days preceding the first day of such
Interest Period by leading banks in the London interbank market as of 10:00 a.m.
(London, England time) for delivery on the first day of such Interest Period,
for the number of days comprised therein and in an amount comparable to the
amount of the Eurodollar Loan of the Administrative Agent.
"Lien" shall mean any mortgage, pledge, security interest, lien
(statutory or otherwise), charge, encumbrance, hypothecation, assignment,
deposit arrangement, or other arrangement having the practical effect of the
foregoing or any preference, priority or other security agreement or similar
preferential arrangement of any kind or nature whatsoever (including any
conditional sale or other title retention agreement and any capital lease having
the same economic effect as any of the foregoing).
13
"Loan Documents" shall mean, collectively, this Agreement, the
Notes (if any), the LC Documents, the Subsidiary Guaranty Agreement, the
Security Documents, all Notices of Borrowing, all Notices of
Conversion/Continuation and any and all other instruments, agreements, documents
and certificates executed in connection with any of the foregoing.
"Loan Parties" shall mean the Borrower and the Subsidiary Loan
Parties.
"Loans" shall mean all Revolving Loans and Swingline Loans in
the aggregate or any of them, as the context shall require.
"Material Adverse Effect" shall mean, with respect to any event,
act, condition or occurrence of whatever nature (including any adverse
determination in any litigation, arbitration, or governmental investigation or
proceeding), whether singularly or in conjunction with any other event or
events, act or acts, condition or conditions, occurrence or occurrences whether
or not related, a material adverse change in, or a material adverse effect on,
(i) the business, results of operations, financial condition, assets or
liabilities of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Loan Parties to perform their respective obligations under the
Loan Documents taken as a whole, (iii) the rights and remedies of the
Administrative Agent, the Issuing Bank, Swingline Lender, and the Lenders under
any of the Loan Documents or (iv) the legality, validity or enforceability of
any of the Loan Documents. For the avoidance of doubt, the term "Material
Adverse Effect," wherever it appears in the Loan Documents, shall be construed
to apply to the Borrower and its Subsidiaries taken as a whole and not to the
Borrower or any particular Subsidiary individually.
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" shall have the meaning set forth in
Section 4001(a)(3) of ERISA.
"Net Xxxx-to-Market Exposure" of any Person shall mean, as of
any date of determination with respect to any Hedging Obligation, the excess (if
any) of all unrealized losses over all unrealized profits of such Person arising
from such Hedging Obligation. "Unrealized losses" shall mean the fair market
value of the cost to such Person of replacing the Hedging Transaction giving
rise to such Hedging Obligation as of the date of determination (assuming the
Hedging Transaction were to be terminated as of that date), and "unrealized
profits" means the fair market value of the gain to such Person of replacing
such Hedging Transaction as of the date of determination (assuming such Hedging
Transaction were to be terminated as of that date).
"Net Proceeds" shall mean 100% of all cash or cash equivalent
proceeds received by the Borrower or any Subsidiary (other than from the
Borrower or any Subsidiary) from (i) the issuance of any common or preferred
stock or any other debt or equity securities, or any other additions to the
equity, or contributions to the capital, of the Borrower or any Subsidiary;
provided that in the event the Borrower or any Subsidiary makes an acquisition
permitted hereunder in which the acquisition consideration consists of an
issuance of capital stock of the Borrower or a Subsidiary and cash is acquired
as part of the assets of such acquired company, such cash shall not be included
in Net Proceeds, (ii) any sale, lease, sale and leaseback, assignment, or other
disposition of any asset or property of the Borrower or any Subsidiary
14
(other than the sale of inventory or equipment in the ordinary course of
business), or (iii) any insurance proceeds or condemnation awards relating to
any asset or property owned or leased by the Borrower or any Subsidiary; in each
case net of all reasonable out-of-pocket costs incurred and paid by the Borrower
or such Subsidiary in connection with such transaction (in each case paid to
non-Affiliates); provided that any capital injected into any Subsidiary by HEICO
Aerospace Holdings Corp.'s current shareholder, Lufthansa Technik AG, shall not
be included in Net Proceeds unless such capital injection has the effect of
increasing Lufthansa Technik AG's voting control of such Subsidiary to, or
occurs at any time when Lufthansa Technik AG holds voting control in such
Subsidiary of, thirty percent (30%) or more of the outstanding Capital Stock of
such Subsidiary.
"New Lender" shall mean Citibank, F.S.B.
"Non-Guarantor Subsidiary Net Worth" shall mean, for any
Subsidiary that is not a Subsidiary Loan Party, an amount equal to (A) the total
assets of such Subsidiary that would be reflected on such Subsidiary's
consolidated balance sheet as of such date prepared in accordance with GAAP,
minus (B) the total liabilities of such Subsidiary that would be reflected on
such Subsidiary's consolidated balance sheet as of such date prepared in
accordance with GAAP.
"Notes" shall mean, collectively, the Syndicated Notes and the
Swingline Note.
"Notice of Conversion/Continuation" shall mean the notice given
by the Borrower to the Administrative Agent in respect of the conversion or
continuation of an outstanding Borrowing as provided in Section 2.7(b).
"Notice of Revolving Borrowing" shall have the meaning set forth
in Section 2.3.
"Notice of Swingline Loan" shall have the meaning set forth in
Section 2.5.
"Notices of Borrowing" shall mean, collectively, the Notices of
Revolving Borrowing and the Notices of Swingline Loan.
"Obligations" shall mean all amounts owing by the Borrower to
the Administrative Agent, the Issuing Bank or any Lender (including the
Swingline Lender) pursuant to or in connection with this Agreement or any other
Loan Document, including without limitation, all principal, interest (including
any interest accruing after the filing of any petition in bankruptcy or the
commencement of any insolvency, reorganization or like proceeding relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding), all reimbursement obligations, fees, expenses,
indemnification and reimbursement payments, costs and expenses (including all
reasonable fees and expenses of counsel to the Administrative Agent, the Issuing
Bank and any Lender (including the Swingline Lender) incurred pursuant to this
Agreement or any other Loan Document), whether direct or indirect, absolute or
contingent, liquidated or unliquidated, now existing or hereafter arising
hereunder or thereunder, and all Hedging Obligations owing to the Administrative
Agent, any Lender or any of their Affiliates relating to Indebtedness
outstanding under this Agreement, and all obligations and liabilities incurred
in connection with collecting
15
and enforcing the foregoing, together with all renewals, extensions,
modifications or refinancings thereof.
"Off-Balance Sheet Liabilities" of any Person shall mean (i) any
repurchase obligation or liability of such Person with respect to accounts or
notes receivable sold by such Person that do not create a liability on the
balance sheet of such Person (in accordance with GAAP), (ii) any liability of
such Person under any sale and leaseback transactions that do not create a
liability on the balance sheet of such Person, (iii) any Synthetic Lease
Obligation or (iv) any obligation arising with respect to any other transaction
which is the functional equivalent of or takes the place of borrowing but which
does not constitute a liability on the balance sheet of such Person.
"Original Closing Date" means May 15, 2003.
"OSHA" shall mean the Occupational Safety and Health Act of
1970, as amended from time to time, and any successor statute.
"Other Taxes" shall mean any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement or any other
Loan Document.
"Participant" shall have the meaning set forth in
Section 10.4(d).
"Patent Security Agreements" shall mean the Patent Security
Agreements made in favor of the Administrative Agent, on behalf of itself and
Lenders, by each applicable Loan Party.
"Payment Office" shall mean the office of the Administrative
Agent located at 000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx 00000, or such
other location as to which the Administrative Agent shall have given written
notice to the Borrower and the other Lenders.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
referred to and defined in ERISA, and any successor entity performing similar
functions.
"Perfection Certificate" shall have the meaning assigned to such
term in the Security Agreement.
"Permitted Encumbrances" shall mean:
(i) Liens imposed by law for taxes not yet due or which are
being contested in good faith by appropriate proceedings and with
respect to which adequate reserves are being maintained in accordance
with GAAP;
(ii) statutory Liens of landlords, carriers, warehousemen,
mechanics, materialmen and similar Liens arising by operation of law in
the ordinary course of business for amounts not yet due or which are
being contested in good faith by
16
appropriate proceedings and with respect to which adequate reserves are
being maintained in accordance with GAAP;
(iii) pledges and deposits made in the ordinary course of
business in compliance with workers' compensation, unemployment
insurance and other social security laws or regulations;
(iv) deposits to secure the performance of bids, trade
contracts, leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature, in each case
in the ordinary course of business;
(v) judgment and attachment liens not giving rise to an
Event of Default or Liens created by or existing from any litigation or
legal proceeding that are currently being contested in good faith by
appropriate proceedings and with respect to which adequate reserves are
being maintained in accordance with GAAP;
(vi) bankers' Liens of a bank or financial institution
arising by operation of law with respect to funds, securities or other
assets on deposit in such bank or financial institution;
(vii) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payment of customs duties in
connection with the importation of goods; and
(viii) easements, zoning restrictions, rights-of-way and
similar encumbrances on real property imposed by law or arising in the
ordinary course of business that do not secure any monetary obligations
and do not materially detract from the value of the affected property or
materially interfere with the ordinary conduct of business of the
Borrower and its Subsidiaries taken as a whole;
provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"Permitted Investments" shall mean:
(i) direct obligations of, or obligations the principal of
and interest on which are unconditionally guaranteed by, the United
States (or by any agency thereof to the extent such obligations are
backed by the full faith and credit of the United States), in each case
maturing within one year from the date of acquisition thereof;
(ii) commercial paper having the highest rating, at the time
of acquisition thereof, of S&P or Moody's and in either case maturing
within 270 days from the date of acquisition thereof;
(iii) certificates of deposit, bankers' acceptances and time
deposits maturing within 365 days of the date of acquisition thereof
issued or guaranteed by or placed with, and money market deposit
accounts issued or offered by, any domestic office of any commercial
bank organized under the laws of the United States or any state thereof
which has a combined capital and surplus and undivided profits of not
less than $500,000,000;
17
(iv) fully collateralized repurchase agreements with a term
of not more than 30 days for securities described in clause (i) above
and entered into with a financial institution satisfying the criteria
described in clause (iii) above; and
(v) mutual funds investing solely in any one or more of the
Permitted Investments described in clauses (i) through (iv) above.
"Permitted Real Estate Debt" shall mean (i) debt incurred or
assumed by the Borrower or its Subsidiaries which was incurred for the purpose
of financing all or any part of the cost of acquisition or improvement of any
Real Estate for use in the ordinary course of business of such Person in
compliance with this Agreement and (ii) other debt incurred or assumed by the
Borrower or its Subsidiaries in an amount not in excess of $10,000,000 at any
time outstanding for the Borrower and its Subsidiaries on a consolidated basis
that is secured by Real Estate; provided that in the case of clause (ii) above
the Administrative Agent shall also have a second-priority Lien on such Real
Estate as security for the payment of the Obligations, in form and substance
satisfactory to the Administrative Agent.
"Permitted Subordinated Indebtedness" shall mean any
Indebtedness of the Borrower or any Subsidiary (i) that is expressly
subordinated to the Obligations on terms satisfactory to the Administrative
Agent and the Required Lenders in their sole discretion, (ii) that matures by
its terms no earlier than six months after the Revolving Commitment Termination
Date with no scheduled principal payments permitted prior to such maturity, and
(iii) that is evidenced by an indenture or other similar agreement that is in a
form satisfactory to the Administrative Agent and the Required Lenders.
"Person" shall mean any individual, partnership, firm,
corporation, association, joint venture, limited liability company, trust or
other entity, or any Governmental Authority.
"Plan" shall mean any employee pension benefit plan (other than
a Multiemployer Plan) subject to the provisions of Title IV of ERISA or
Section 412 of the Code or Section 302 of ERISA, and in respect of which the
Borrower or any ERISA Affiliate is (or, if such plan were terminated, would
under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
"Pledge Agreement" shall mean that certain Pledge Agreement,
dated as of the Original Closing Date and reaffirmed pursuant to the
Reaffirmation of Pledge Agreement delivered pursuant to Section 3.1(b), executed
by the Borrower and certain of its Subsidiaries in favor of the Administrative
Agent for the benefit of the Lenders, together with all other pledge agreements,
share charges and similar instruments executed by a Loan Party in connection
herewith on the date hereof or after the Closing Date.
"Projections" shall mean the Borrower's forecasted consolidated
and consolidating: (a) balance sheets; (b) profit and loss statements; (c) cash
flow statements; and (d) capitalization statements, all prepared on a
segment-by-segment or division-by-division basis, if applicable, and otherwise
consistent with the historical financial statements of Borrower, together with
appropriate supporting details and a statement of underlying assumptions.
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"Pro Rata Share" shall mean, with respect to any Commitment of
any Lender at any time, and all Loans, other Revolving Credit Exposure, or any
payments or prepayments related thereto, a percentage, the numerator of which
shall be such Lender's Commitment (or if such Commitments have been terminated
or expired or the Loans have been declared to be due and payable, such Lender's
Revolving Credit Exposure), and the denominator of which shall be the sum of
such Commitments of all Lenders (or if such Commitments have been terminated or
expired or the Loans have been declared to be due and payable, the Revolving
Credit Exposure of all Lenders).
"Real Estate" shall mean all real property owned or leased by
the Borrower and its Subsidiaries.
"Regulation D" shall mean Regulation D of the Board of Governors
of the Federal Reserve System, as the same may be in effect from time to time,
and any successor regulations.
"Related Parties" shall mean, with respect to any specified
Person, such Person's Affiliates and the respective directors, officers,
employees, agents and advisors of such Person and such Person's Affiliates.
"Release" shall mean any release, spill, emission, leaking,
dumping, injection, pouring, deposit, disposal, discharge, dispersal, leaching
or migration into the environment (including ambient air, surface water,
groundwater, land surface or subsurface strata) or within any building,
structure, facility or fixture.
"Required Lenders" shall mean, at any time, Lenders holding
66 2/3% or more of the aggregate outstanding Revolving Commitments at such time,
or if the Revolving Commitments have terminated, then Lenders holding 66 2/3% or
more of the Revolving Credit Exposure.
"Requirement of Law" for any Person shall mean the articles or
certificate of incorporation, bylaws, partnership certificate and agreement, or
limited liability company certificate of organization and agreement, as the case
may be, and other organizational and governing documents of such Person, and any
law, treaty, rule or regulation, or determination of a Governmental Authority,
in each case applicable to or binding upon such Person or any of its property or
to which such Person or any of its property is subject.
"Responsible Officer" shall mean any of the president, the chief
executive officer, the chief operating officer, the chief financial officer, the
treasurer or a vice president of the Borrower or such other representative of
the Borrower as may be designated in writing by any one of the foregoing with
the consent of the Administrative Agent; and, with respect to the Compliance
Certificate only, the chief financial officer of the Borrower.
"Revolving Commitment" shall mean, with respect to each Lender,
the obligation of such Lender to make Revolving Loans to the Borrower and to
participate in Letters of Credit and Swingline Loans in an aggregate principal
amount not exceeding the amount set forth with respect to such Lender on Annex
I, as such Annex I may be amended pursuant to Section 2.25, or in the case of a
Person becoming a Lender after the Closing Date through an assignment of an
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existing Revolving Commitment, the amount of the assigned "Revolving Commitment"
as provided in the Assignment and Acceptance executed by such Person as an
assignee, as the same may be increased or deceased pursuant to terms hereof.
"Revolving Commitment Termination Date" shall mean the earliest
of (i) August 4, 2010, (ii) the date on which the Revolving Commitments are
terminated pursuant to Section 2.8 and (iii) the date on which all amounts
outstanding under this Agreement have been declared or have automatically become
due and payable (whether by acceleration or otherwise).
"Revolving Credit Exposure" shall mean, with respect to any
Lender at any time, the sum of the outstanding principal amount of such Lender's
Revolving Loans, LC Exposure and Swingline Exposure.
"Revolving Loan" shall mean a loan made by a Lender (other than
the Swingline Lender) to the Borrower under its Revolving Commitment, which may
either be a Base Rate Loan or a Eurodollar Loan.
"Security Agreement" shall mean that certain Amended and
Restated Security Agreement, dated as of the date hereof, executed by the
Borrower and each Subsidiary Loan Party in favor of the Administrative Agent for
the benefit of the Lenders, and each other security agreement executed from time
to time in connection herewith.
"Security Documents" shall mean, collectively, the Security
Agreement, the Pledge Agreements, any Control Agreements, any Blocked Account
Agreements, any Patent Security Agreements, any Trademark Security Agreements,
the Perfection Certificate, and all other instruments and agreements now or
hereafter securing the whole or any part of the Obligations or any Guarantee
thereof, all UCC financing statements, fixture financing statements, stock
powers, and all other documents, instruments, agreements and certificates
executed and delivered by any Loan Party to the Administrative Agent and the
Lenders in connection with the foregoing.
"S&P" shall mean Standard & Poor's, a Division of the
XxXxxx-Xxxx Companies.
"Solvent" means, with respect to any Person, that as of the date
of determination, both (a)(i) the then fair saleable value of the property of
such Person is (y) greater than the total amount of liabilities (including
contingent obligations to the extent required to be reflected as liabilities in
the financial statements of such Person pursuant to GAAP) of such Person and
(z) greater than the amount that will be required to pay the probable
liabilities of such Person's then existing debts as they become absolute and
matured considering all financing alternatives and potential asset sales
reasonably available to such Person; (ii) such Person's capital is not
unreasonably small in relation to its business or any contemplated or undertaken
transaction; and (iii) such Person does not intend to incur, or believe or
reasonably should believe that it will incur, debts beyond its ability to pay
such debts as they become due and (b) such Person is solvent within the meaning
given that term and similar terms under applicable laws relating to fraudulent
transfers.
"Subsidiary" shall mean, with respect to any Person (the
"parent"), any corporation, partnership, joint venture, limited liability
company, association or other entity the
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accounts of which would be consolidated with those of the parent in the parent's
consolidated financial statements if such financial statements were prepared in
accordance with GAAP as of such date, as well as any other corporation,
partnership, joint venture, limited liability company, association or other
entity (i) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power, or in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or (ii) that is, as of such date,
otherwise controlled (whether pursuant to (i) above, by contractual agreement,
or any combination thereof) by the parent or one or more subsidiaries of the
parent or by the parent and one or more subsidiaries of the parent. Unless
otherwise indicated, all references to "Subsidiary" hereunder shall mean a
Subsidiary of the Borrower. For purposes of this definition, "control", with
respect to any Person, shall mean the power, directly or indirectly, to select a
majority of the directors (or other Persons performing similar functions) of
such Person.
"Subsidiary Guaranty Agreement" shall mean the Subsidiary
Guaranty Agreement, dated as of the Original Closing Date, and reaffirmed
pursuant to the Reaffirmation of Guaranty and IP Security Agreements delivered
pursuant to Section 3.1(b), made by the Subsidiary Loan Parties in favor of the
Administrative Agent for the benefit of the Lenders.
"Subsidiary Guaranty Supplement" shall mean each supplement
substantially in the form of Annex I to the Subsidiary Guaranty Agreement
executed and delivered by a Subsidiary of the Borrower.
"Subsidiary Loan Party" shall mean any Subsidiary of the
Borrower that guarantees the Obligations. For the avoidance of doubt,
"Subsidiary Loan Party" shall exclude Parts Advantage, LLC and HEICO
International Corporation.
"Swingline Commitment" shall mean the commitment of the
Swingline Lender to make Swingline Loans in an aggregate principal amount at any
time outstanding not to exceed $10,000,000.
"Swingline Exposure" shall mean, with respect to each Lender,
the principal amount of the Swingline Loans in which such Lender is legally
obligated either to make a Base Rate Loan or to purchase a participation in
accordance with Section 2.5, which shall equal such Lender's Pro Rata Share of
all outstanding Swingline Loans.
"Swingline Lender" shall mean SunTrust Bank.
"Swingline Loan" shall mean a loan made to the Borrower by the
Swingline Lender under the Swingline Commitment.
"Swingline Note" shall mean the promissory note of the Borrower
payable to the order of the Swingline Lender in the principal amount of the
Swingline Commitment, substantially the form of Exhibit B.
"Swingline Rate" shall mean, for any Interest Period agreed to
by the Swingline Lender and the Borrower, the rate offered by the Swingline
Lender and accepted by the
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Borrower. The Borrower is under no obligation to accept such rate and the
Swingline Lender is under no obligation to provide it.
"Syndicated Note" shall mean a promissory note of the Borrower
payable to the order of a requesting Lender in the principal amount of such
Lender's Revolving Commitment, in substantially the form of Exhibit A,
evidencing such Lender's Revolving Commitment and its Revolving Credit Exposure
thereunder.
"Synthetic Lease" shall mean a lease transaction under which the
parties intend that (i) the lease will be treated as an "operating lease" by the
lessee pursuant to Statement of Financial Accounting Standards No. 13, as
amended and (ii) the lessee will be entitled to various tax and other benefits
ordinarily available to owners (as opposed to lessees) of like property.
"Synthetic Lease Obligations" shall mean, with respect to any
Person, the sum of (i) all remaining rental obligations of such Person as lessee
under Synthetic Leases which are attributable to principal and, without
duplication, (ii) all rental and purchase price payment obligations of such
Person under such Synthetic Leases assuming such Person exercises the option to
purchase the lease property at the end of the lease term.
"Taxes" shall mean any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Trademark Security Agreements" shall mean the Trademark
Security Agreements made in favor of the Administrative Agent, on behalf of
itself and Lenders, by each applicable Loan Party.
"Type" when used in reference to a Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Base
Rate.
"Uniform Commercial Code" or "UCC" shall mean the Uniform
Commercial Code as in effect from time to time in the State of Florida.
"Withdrawal Liability" shall mean liability to a Multiemployer
Plan as a result of a complete or partial withdrawal from such Multiemployer
Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.2. CLASSIFICATIONS OF LOANS AND BORROWINGS. For
purposes of this Agreement, Loans may be classified and referred to by Class
(e.g. a "Revolving Loan" ) or by Type (e.g. a "Eurodollar Loan" or "Base Rate
Loan") or by Class and Type (e.g. "Revolving Eurodollar Loan"). Borrowings also
may be classified and referred to by Class (e.g. "Revolving Borrowing") or by
Type (e.g. "Eurodollar Borrowing") or by Class and Type (e.g. " Revolving
Eurodollar Borrowing").
SECTION 1.3. ACCOUNTING TERMS AND DETERMINATION. Unless
otherwise defined or specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared, in
accordance with GAAP as in effect from time to time, applied on
22
a basis consistent with the most recent audited consolidated financial statement
of the Borrower delivered pursuant to Section 5.1(a); provided that if the
Borrower notifies the Administrative Agent that the Borrower wishes to amend any
provision hereof to eliminate the effect of any change in GAAP on the operation
of such provision (or if the Administrative Agent notifies the Borrower that the
Required Lenders wish to amend any provision hereof for such purpose), then such
provision shall be interpreted on the basis of GAAP in effect immediately before
the relevant change in GAAP became effective, until either such notice is
withdrawn or such provision is amended in a manner satisfactory to the Borrower
and the Required Lenders.
SECTION 1.4. TERMS GENERALLY. The definitions of terms herein
shall apply equally to the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
The word "will" shall be construed to have the same meaning and effect as the
word "shall". In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including" and the word
"to" means "to but excluding". Unless the context requires otherwise (i) any
definition of or reference to any agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document
as it was originally executed or as it may from time to time be amended,
restated, supplemented or otherwise modified (subject to any restrictions on
such amendments, supplements or modifications set forth herein), (ii) any
reference herein to any Person shall be construed to include such Person's
successors and permitted assigns, (iii) the words "hereof", "herein" and
"hereunder" and words of similar import shall be construed to refer to this
Agreement as a whole and not to any particular provision hereof, (iv) all
references to Articles, Sections, Exhibits and Schedules shall be construed to
refer to Articles, Sections, Exhibits and Schedules to this Agreement, (v) all
references to a specific time shall be construed to refer to the time in the
city and state of the Administrative Agent's principal office, unless otherwise
indicated and (vi) the words "material," "in any material respect," "materially"
and words of similar import, wherever they may appear in the Loan Documents,
shall be construed to qualify the obligations or representations and warranties,
as applicable, of the Borrower and its Subsidiaries taken as a whole and not of
the Borrower or any particular Subsidiary, individually. All certifications of
officers of the Borrower and its Subsidiaries shall be deemed to be in their
corporate (and not individual) capacities.
ARTICLE II
AMOUNT AND TERMS OF THE COMMITMENTS
SECTION 2.1. GENERAL DESCRIPTION OF FACILITIES. Subject to
and upon the terms and conditions herein set forth, (i) the Lenders hereby
establish in favor of the Borrower a revolving credit facility pursuant to which
each Lender severally agrees (to the extent of such Lender's Revolving
Commitment) to make Revolving Loans to the Borrower in accordance with
Section 2.2, (ii) the Issuing Bank agrees to issue Letters of Credit in
accordance with Section 2.22, (iii) the Swingline Lender agrees to make
Swingline Loans in accordance with Section 2.4, and (iv) each Lender agrees to
purchase a participation interest in the Letters of Credit and the
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Swingline Loans pursuant to the terms and conditions hereof; provided that in no
event shall the aggregate principal amount of all outstanding Revolving Credit
Exposure exceed at any time the Aggregate Revolving Commitment Amount from time
to time in effect.
SECTION 2.2. REVOLVING LOANS. Subject to the terms and
conditions set forth herein, each Lender severally agrees to make Revolving
Loans, ratably in proportion to its Pro Rata Share, to the Borrower, from time
to time during the Availability Period, in an aggregate principal amount
outstanding at any time that will not result in (a) such Lender's Revolving
Credit Exposure exceeding such Lender's Revolving Commitment, or (b) the sum of
the aggregate Revolving Credit Exposures of all Lenders exceeding the Aggregate
Revolving Commitment Amount. During the Availability Period, the Borrower shall
be entitled to borrow, prepay and reborrow Revolving Loans in accordance with
the terms and conditions of this Agreement; provided that the Borrower may not
borrow or reborrow should there exist a Default or Event of Default.
SECTION 2.3. PROCEDURE FOR REVOLVING BORROWINGS. The Borrower
shall give the Administrative Agent written notice (or telephonic notice
promptly confirmed in writing) of each Revolving Borrowing substantially in the
form of Exhibit 2.3 attached hereto (a "Notice of Revolving Borrowing")
(x) prior to 12:00 noon at least one (1) Business Day prior to the requested
date of each Base Rate Borrowing and (y) prior to 12:00 noon at least three
(3) Business Days prior to the requested date of each Eurodollar Borrowing. Each
Notice of Revolving Borrowing shall be irrevocable and shall specify: (i) the
aggregate principal amount of such Borrowing, (ii) the date of such Borrowing
(which shall be a Business Day), (iii) the Type of such Revolving Loan
comprising such Borrowing and (iv) in the case of a Eurodollar Borrowing, the
duration of the initial Interest Period applicable thereto (subject to the
provisions of the definition of Interest Period). Each Revolving Borrowing shall
consist entirely of Base Rate Loans or Eurodollar Loans, as the Borrower may
request. The aggregate principal amount of each Eurodollar Borrowing shall be
not less than $5,000,000 or a larger multiple of $1,000,000, and the aggregate
principal amount of each Base Rate Borrowing shall not be less than $1,000,000
or a larger multiple of $100,000; provided that Base Rate Loans made pursuant to
Section 2.5(b) or Section 2.22(d) may be made in lesser amounts as provided
therein. At no time shall the total number of Eurodollar Borrowings outstanding
at any time exceed six. Promptly following the receipt of a Notice of Revolving
Borrowing in accordance herewith, the Administrative Agent shall advise each
Lender of the details thereof and the amount of such Lender's Revolving Loan to
be made as part of the requested Revolving Borrowing.
SECTION 2.4. SWINGLINE COMMITMENT. Subject to the terms and
conditions set forth herein, the Swingline Lender agrees to make Swingline Loans
to the Borrower, from time to time during the Availability Period, in an
aggregate principal amount outstanding at any time not to exceed the lesser of
(i) the Swingline Commitment then in effect and (ii) the difference between the
Aggregate Revolving Commitment Amount and the aggregate Revolving Credit
Exposures of all Lenders; provided that the Swingline Lender shall not be
required to make a Swingline Loan to refinance an outstanding Swingline Loan.
The Borrower shall be entitled to borrow, repay and reborrow Swingline Loans in
accordance with the terms and conditions of this Agreement.
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SECTION 2.5. PROCEDURE FOR SWINGLINE LOAN; ETC. (a) The
Borrower shall give the Administrative Agent written notice (or telephonic
notice promptly confirmed in writing) of each Swingline Loan substantially in
the form of Exhibit 2.5 attached hereto ("Notice of Swingline Loan") prior to
10:00 a.m. (Atlanta, Georgia time) on the requested date of each Swingline Loan.
Each Notice of Swingline Loan shall be irrevocable and shall specify: (i) the
principal amount of such Swingline Loan, (ii) the date of such Swingline Loan
(which shall be a Business Day) and (iii) the account of the Borrower to which
the proceeds of such Swingline Loan should be credited. The Administrative Agent
will promptly advise the Swingline Lender of each Notice of Swingline Loan. Each
Swingline Loan shall accrue interest at the Swingline Rate or any other interest
rate as agreed between the Borrower and the Swingline Lender and shall have an
Interest Period (subject to the definition thereof) as agreed between the
Borrower and the Swingline Lender. The aggregate principal amount of each
Swingline Loan shall be not less than $100,000 or a larger multiple of $50,000,
or such other minimum amounts agreed to by the Swingline Lender and the
Borrower. The Swingline Lender will make the proceeds of each Swingline Loan
available to the Borrower in Dollars in immediately available funds at the
account specified by the Borrower in the applicable Notice of Swingline Loan not
later than 1:00 p.m. (Atlanta, Georgia time) on the requested date of such
Swingline Loan.
(b) The Swingline Lender, at any time and from time to time
in its sole discretion, may, on behalf of the Borrower (which hereby irrevocably
authorizes and directs the Swingline Lender to act on its behalf), give a Notice
of Revolving Borrowing to the Administrative Agent requesting the Lenders
(including the Swingline Lender) to make Base Rate Loans in an amount equal to
the unpaid principal amount of any Swingline Loan. Each Lender will make the
proceeds of its Base Rate Loan included in such Borrowing available to the
Administrative Agent for the account of the Swingline Lender in accordance with
Section 2.6, which will be used solely for the repayment of such Swingline Loan.
(c) If for any reason a Base Rate Borrowing may not be (as
determined in the sole discretion of the Administrative Agent), or is not, made
in accordance with the foregoing provisions, then each Lender (other than the
Swingline Lender) shall purchase an undivided participating interest in such
Swingline Loan in an amount equal to its Pro Rata Share thereof on the date that
such Base Rate Borrowing should have occurred. On the date of such required
purchase, each Lender shall promptly transfer, in immediately available funds,
the amount of its participating interest to the Administrative Agent for the
account of the Swingline Lender. If such Swingline Loan bears interest at a rate
other than the Base Rate, such Swingline Loan shall automatically become a Base
Rate Loan on the effective date of any such participation and interest shall
become payable on demand.
(d) Each Lender's obligation to make a Base Rate Loan
pursuant to Section 2.5(b) or to purchase the participating interests pursuant
to Section 2.5(c) shall be absolute and unconditional and shall not be affected
by any circumstance, including without limitation (i) any setoff, counterclaim,
recoupment, defense or other right that such Lender or any other Person may have
or claim against the Swingline Lender, the Borrower or any other Person for any
reason whatsoever, (ii) the existence of a Default or an Event of Default or the
termination of any Lender's Revolving Commitment, (iii) the existence (or
alleged existence) of any event or condition which has had or could reasonably
be expected to have a Material Adverse Effect, (iv) any breach of this Agreement
or any other Loan Document by the Borrower, the
25
Administrative Agent or any Lender or (v) any other circumstance, happening or
event whatsoever, whether or not similar to any of the foregoing. If such amount
is not in fact made available to the Swingline Lender by any Lender, the
Swingline Lender shall be entitled to recover such amount on demand from such
Lender, together with accrued interest thereon for each day from the date of
demand thereof (i) at the Federal Funds Rate until the second Business Day after
such demand and (ii) at the Base Rate at all times thereafter. Until such time
as such Lender makes its required payment, the Swingline Lender shall be deemed
to continue to have outstanding Swingline Loans in the amount of the unpaid
participation for all purposes of the Loan Documents. In addition, such Lender
shall be deemed to have assigned any and all payments made of principal and
interest on its Loans and any other amounts due to it hereunder, to the
Swingline Lender to fund the amount of such Lender's participation interest in
such Swingline Loans that such Lender failed to fund pursuant to this
Section 2.5, until such amount has been purchased in full.
SECTION 2.6. FUNDING OF BORROWINGS.
(a) Each Lender will make available each Loan to be made by
it hereunder on the proposed date thereof by wire transfer in immediately
available funds by 11:00 a.m. (Atlanta, Georgia time) to the Administrative
Agent at the Payment Office; provided that the Swingline Loans will be made as
set forth in Section 2.5. The Administrative Agent will make such Loans
available to the Borrower by promptly crediting the amounts that it receives, in
like funds by the close of business on such proposed date, to an account
maintained by the Borrower with the Administrative Agent or at the Borrower's
option, by effecting a wire transfer of such amounts to an account designated by
the Borrower to the Administrative Agent.
(b) Unless the Administrative Agent shall have been notified
by any Lender prior to 5:00 p.m. (Atlanta, Georgia time) one (1) Business Day
prior to the date of a Borrowing in which such Lender is to participate that
such Lender will not make available to the Administrative Agent such Lender's
share of such Borrowing, the Administrative Agent may assume that such Lender
has made such amount available to the Administrative Agent on such date, and the
Administrative Agent, in reliance on such assumption, may make available to the
Borrower on such date a corresponding amount. If such corresponding amount is
not in fact made available to the Administrative Agent by such Lender on the
date of such Borrowing, the Administrative Agent shall be entitled to recover
such corresponding amount on demand from such Lender together with interest at
the Federal Funds Rate until the second Business Day after such demand and
thereafter at the Base Rate. If such Lender does not pay such corresponding
amount forthwith upon the Administrative Agent's demand therefor, the
Administrative Agent shall promptly notify the Borrower, and the Borrower shall
immediately pay such corresponding amount to the Administrative Agent together
with interest at the rate specified for such Borrowing. Nothing in this
subsection shall be deemed to relieve any Lender from its obligation to fund its
Pro Rata Share of any Borrowing hereunder or to prejudice any rights which the
Borrower may have against any Lender as a result of any default by such Lender
hereunder.
(c) All Revolving Borrowings shall be made by the Lenders on
the basis of their respective Pro Rata Shares. No Lender shall be responsible
for any default by any other Lender in its obligations hereunder, and each
Lender shall be obligated to make its Loans
26
provided to be made by it hereunder, regardless of the failure of any other
Lender to make its Loans hereunder.
(d) The Borrower will use the proceeds of all Loans to fund
future acquisitions and capital expenditures permitted hereunder, to provide
working capital and for other general corporate purposes of the Borrower and its
Subsidiaries.
SECTION 2.7. INTEREST ELECTIONS.
(a) Each Borrowing initially shall be of the Type specified
in the applicable Notice of Borrowing, and in the case of a Eurodollar
Borrowing, shall have an initial Interest Period as specified in such Notice of
Borrowing. Thereafter, the Borrower may elect to convert such Borrowing into a
different Type or to continue such Borrowing, and in the case of a Eurodollar
Borrowing, may elect Interest Periods therefor, all as provided in this
Section 2.7. The Borrower may elect different options with respect to different
portions of the affected Borrowing, in which case each such portion shall be
allocated ratably among the Lenders holding Loans comprising such Borrowing, and
the Loans comprising each such portion shall be considered a separate Borrowing.
This Section 2.7 shall not apply to Swingline Loans, which may not be converted
or continued.
(b) To make an election pursuant to this Section 2.7, the
Borrower shall give the Administrative Agent prior written notice (or telephonic
notice promptly confirmed in writing) of each Borrowing substantially in the
form of Exhibit 2.7 attached hereto (a "Notice of Conversion/Continuation") that
is to be converted or continued, as the case may be, (x) prior to 12:00 p.m.
(Atlanta, Georgia time) at least one (1) Business Day prior to the requested
date of a conversion into a Base Rate Borrowing and (y) prior to 12:00 p.m.
(Atlanta, Georgia time) at least three (3) Business Days prior to a continuation
of or conversion into a Eurodollar Borrowing. Each such Notice of
Conversion/Continuation shall be irrevocable and shall specify (i) the Borrowing
to which such Notice of Continuation/Conversion applies and if different options
are being elected with respect to different portions thereof, the portions
thereof that are to be allocated to each resulting Borrowing (in which case the
information to be specified pursuant to clauses (iii) and (iv) shall be
specified for each resulting Borrowing); (ii) the effective date of the election
made pursuant to such Notice of Continuation/Conversion, which shall be a
Business Day, (iii) whether the resulting Borrowing is to be a Base Rate
Borrowing or a Eurodollar Borrowing; and (iv) if the resulting Borrowing is to
be a Eurodollar Borrowing, the Interest Period applicable thereto after giving
effect to such election, which shall be a period contemplated by the definition
of "Interest Period". If any such Notice of Continuation/Conversion requests a
Eurodollar Borrowing but does not specify an Interest Period, the Borrower shall
be deemed to have selected an Interest Period of one month. The principal amount
of any resulting Borrowing shall satisfy the minimum borrowing amount for
Eurodollar Borrowings and Base Rate Borrowings set forth in Section 2.3.
(c) If, on the expiration of any Interest Period in respect
of any Eurodollar Borrowing, the Borrower shall have failed to deliver a Notice
of Conversion/ Continuation, then, unless such Borrowing is repaid as provided
herein, the Borrower shall be deemed to have elected to convert such Borrowing
to a Base Rate Borrowing. No Borrowing may be converted into, or continued as, a
Eurodollar Borrowing if a Default or an Event of Default exists, unless
27
the Administrative Agent and each of the Lenders shall have otherwise consented
in writing. No conversion of any Eurodollar Loans shall be permitted except on
the last day of the Interest Period in respect thereof.
(d) Upon receipt of any Notice of Conversion/Continuation,
the Administrative Agent shall promptly notify each Lender of the details
thereof and of such Lender's portion of each resulting Borrowing.
SECTION 2.8. OPTIONAL REDUCTION AND TERMINATION OF
COMMITMENTS.
(a) Unless previously terminated in accordance with the
terms hereof, all Revolving Commitments (including the LC Commitments and the
Swingline Commitment) shall terminate on the Revolving Commitment Termination
Date.
(b) Upon at least three (3) Business Days' prior written
notice (or telephonic notice promptly confirmed in writing) to the
Administrative Agent (which notice shall be irrevocable), the Borrower may
reduce the Aggregate Revolving Commitments in part or terminate the Aggregate
Revolving Commitments in whole; provided that (i) any partial reduction shall
apply to reduce proportionately and permanently the Revolving Commitment of each
Lender, (ii) any partial reduction pursuant to this Section 2.8 shall be in an
amount of at least $1,000,000 and any larger multiple of $1,000,000, and
(iii) no such reduction shall be permitted which would reduce the Aggregate
Revolving Commitment Amount to an amount less than the outstanding Revolving
Credit Exposures of all Lenders. Any such reduction in the Aggregate Revolving
Commitment Amount below the aggregate principal amount of the Swingline
Commitment and the LC Commitment shall result in a reduction (rounded to the
next lowest integral multiple of $100,000) in the Swingline Commitment and the
LC Commitment, proportionate to the unused portion of each such Commitment.
SECTION 2.9. REPAYMENT OF LOANS.
(a) The outstanding principal amount of all Revolving Loans
shall be due and payable (together with accrued and unpaid interest thereon and
Fees related thereto) on the Revolving Commitment Termination Date.
(b) The principal amount of each Swingline Loan shall be due
and payable (together with accrued and unpaid interest thereon) on the earlier
of (i) the last day of the Interest Period applicable to such Swingline Loan and
(ii) the Revolving Commitment Termination Date.
SECTION 2.10. EVIDENCE OF INDEBTEDNESS. (a) Each Lender shall
maintain in accordance with its usual practice appropriate records evidencing
the indebtedness of the Borrower to such Lender resulting from each Loan made by
such Lender from time to time, including the amounts of principal and interest
payable thereon and paid to such Lender from time to time under this Agreement.
The Administrative Agent shall maintain appropriate records in which shall be
recorded (i) the Revolving Commitment of each Lender, (ii) the amount of each
Loan made hereunder by each Lender, the Class and Type thereof and the Interest
Period applicable thereto, (iii) the date of each continuation thereof pursuant
to Section 2.7, (iv) the date of each conversion of all or a portion thereof to
another Type pursuant to Section 2.7, (v) the date
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and amount of any principal or interest due and payable or to become due and
payable from the Borrower to each Lender hereunder in respect of such Loans and
(vi) both the date and amount of any sum received by the Administrative Agent
hereunder from the Borrower in respect of the Loans and each Lender's Pro Rata
Share thereof. Absent manifest error, the entries made in such records shall be
prima facie evidence of the existence and amounts of the obligations of the
Borrower therein recorded; provided that the failure or delay of any Lender or
the Administrative Agent in maintaining or making entries into any such record
or any error therein shall not in any manner affect the obligation of the
Borrower to repay the Loans (both principal and unpaid accrued interest) of such
Lender in accordance with the terms of this Agreement.
(b) At the request of any Lender (including the Swingline
Lender) at any time, the Borrower agrees that it will execute and deliver to
such Lender a Syndicated Note and, in the case of the Swingline Lender only, a
Swingline Note, payable to the order of such Lender.
SECTION 2.11. OPTIONAL PREPAYMENTS. The Borrower shall have
the right at any time and from time to time to prepay any Borrowing, in whole or
in part, without premium or penalty, by giving irrevocable written notice (or
telephonic notice promptly confirmed in writing) to the Administrative Agent no
later than (i) in the case of prepayment of any Eurodollar Borrowing, 11:00 a.m.
(Atlanta, Georgia time) not less than three (3) Business Days prior to any such
prepayment, (ii) in the case of any prepayment of any Base Rate Borrowing,
11:00 a.m. (Atlanta, Georgia time) not less than one Business Day prior to the
date of such prepayment, and (iii) in the case of Swingline Loans, prior to
11:00 a.m. (Atlanta, Georgia time) on the date of such prepayment. Each such
notice shall be irrevocable and shall specify the proposed date of such
prepayment and the principal amount of each Borrowing or portion thereof to be
prepaid. Upon receipt of any such notice, the Administrative Agent shall
promptly notify each affected Lender of the contents thereof and of such
Lender's Pro Rata Share of any such prepayment. If such notice is given, the
aggregate amount specified in such notice shall be due and payable on the date
designated in such notice, together with accrued interest to such date on the
amount so prepaid in accordance with Section 2.13(d); provided that if a
Eurodollar Borrowing is prepaid on a date other than the last day of an Interest
Period applicable thereto, the Borrower shall also pay all amounts required
pursuant to Section 2.19. Each partial prepayment of any Loan (other than a
Swingline Loan) shall be in an amount that would be permitted in the case of an
advance of a Revolving Borrowing of the same Type pursuant to Section 2.2 or in
the case of a Swingline Loan pursuant to Section 2.4. Each prepayment of a
Borrowing shall be applied ratably to the Loans comprising such Borrowing.
SECTION 2.12. MANDATORY PREPAYMENTS.
(a) If at any time the aggregate outstanding principal
amount of Revolving Loans exceeds the Aggregate Revolving Commitments the
Borrower shall immediately repay the Swingline Loans and the Revolving Loans in
an amount equal to such excess, together with all accrued and unpaid interest on
such excess amount and any amounts due under Section 2.19. Each prepayment of a
Borrowing shall be applied ratably to the Swingline Loans, to the full extent
thereof, then to the Revolving Base Rate Loans to the full extent thereof, and
then to Revolving Eurodollar Loans to the full extent thereof.
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(b) Immediately upon receipt by any Loan Party of proceeds
of any sale or disposition by such Loan Party of any of its assets (excluding
sales of inventory in the ordinary course of business), or the receipt of any
condemnation awards or insurance proceeds relating to any asset or property
owned or leased by any Loan Party (except to the extent that (i) the proceeds of
such insurance or condemnation award are used to repair or replace the asset or
property to which they relate and for which they were received and (ii) the
Borrower and its Subsidiary Loan Parties, as the case may be, make diligent
efforts to complete such repair or replacement in a commercially reasonable
timeframe (provided that a Default or Event of Default shall not have occurred
and be continuing), and except as otherwise required by the Bond Documents), the
Borrower shall prepay the Loans in an amount equal to the Net Proceeds of all
such awards and proceeds.
(c) If any Loan Party incurs any Indebtedness or issues any
equity securities (other than Indebtedness permitted under Section 7.1, and
equity securities issued by a Subsidiary Loan Party to the Borrower or another
Subsidiary Loan Party), then no later than the Business Day following the date
of receipt of the Net Proceeds thereof, the Borrower shall prepay the Loans in
an amount equal to all such Net Proceeds.
(d) Any prepayments made by the Borrower pursuant to
Section 2.12(b) or Section 2.12(c) above shall be applied as follows: first, to
Administrative Agent's fees and reimbursable expenses then due and payable
pursuant to any of the Loan Documents; second, to all other Fees and
reimbursable expenses of the Lenders and the Issuing Bank then due and payable
pursuant to any of the Loan Documents, pro rata to the Lenders and the Issuing
Bank based on their respective pro rata shares of such Fees and expenses; third,
to interest then due and payable on the Loans made to the Borrower, pro rata to
the Lenders based on their respective Pro Rata Shares of such Loans; fourth to
the principal balance of the Swingline Loans, to the Swingline Lender; fifth, to
the principal balance of the Revolving Loans, pro rata to the Lenders based on
their respective Pro Rata Shares of the Revolving Loans; and if a Default or
Event of Default has occurred and is continuing, sixth to the outstanding amount
of any LC Exposure to provide cash collateral therefor in the manner set forth
in Section 2.22(g), until all such LC Exposure has been fully cash
collateralized in the manner set forth in Section 2.22(g). The Revolving
Commitments of the Lenders shall not be permanently reduced by the amount of any
prepayments made pursuant to clauses fourth, fifth and sixth above unless a
Default or Event of Default has occurred and is continuing. The prepayment
requirements set forth in Sections 2.12(b) and (c) shall be subject to a
cumulative exception, at the option of the Borrower, in an aggregate amount not
to exceed $2,500,000 during any twelve month period.
SECTION 2.13. INTEREST ON LOANS.
(a) The Borrower shall pay interest on each Base Rate Loan
at the Base Rate in effect from time to time and on each Eurodollar Loan at the
Adjusted LIBO Rate for the applicable Interest Period in effect for such Loan,
plus, in each case, the Applicable Margin in effect from time to time.
(b) The Borrower shall pay interest on each Swingline Loan
at the Swingline Rate in effect from time to time.
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(c) Notwithstanding clauses (a) and (b) above, while an
Event of Default exists, at the option of the Required Lenders, and after
acceleration, the Borrower shall pay interest ("Default Interest") with respect
to all Eurodollar Loans at the rate otherwise applicable for the then-current
Interest Period plus an additional 2% per annum until the last day of such
Interest Period, and thereafter, and with respect to all Base Rate Loans, all
Swingline Loans and all other Obligations hereunder (other than Loans), at an
all-in rate in effect for Base Rate Loans, plus an additional 2% per annum.
(d) Interest on the principal amount of all Loans shall
accrue from and including the date such Loans are made to but excluding the date
of any repayment thereof. Interest on all outstanding Base Rate Loans and
Swingline Loans shall be payable quarterly in arrears on the last day of each
March, June, September and December and on the Revolving Commitment Termination
Date. Interest on all outstanding Eurodollar Loans shall be payable on the last
day of each Interest Period applicable thereto, and, in the case of any
Eurodollar Loans having an Interest Period in excess of three months, on each
day which occurs every three months after the initial date of such Interest
Period, and on the Revolving Commitment Termination Date. Interest on any Loan
which is converted into a Loan of another Type or which is repaid or prepaid
shall be payable on the date of such conversion or on the date of any such
repayment or prepayment (on the amount repaid or prepaid) thereof. All Default
Interest shall be payable on demand.
(e) The Administrative Agent shall determine each interest
rate applicable to the Loans hereunder and shall promptly notify the Borrower
and the Lenders of such rate in writing (or by telephone, promptly confirmed in
writing). Any such determination shall be conclusive and binding for all
purposes, absent manifest error.
SECTION 2.14. FEES.
(a) The Borrower shall pay to the Administrative Agent for
its own account fees in the amounts and at the times previously agreed upon in
writing by the Borrower and the Administrative Agent.
(b) The Borrower agrees to pay to the Administrative Agent
for the ratable benefit of the Lenders a commitment fee, which shall accrue at
the Applicable Commitment Fee Percentage per annum (determined daily in
accordance with Schedule I) on the average daily amount of the unused Revolving
Commitments of the Lenders during the Availability Period. For purposes of
computing commitment fees with respect to the Revolving Commitments, the
Revolving Commitment of each Lender shall be deemed used to the extent of the
outstanding Revolving Loans and LC Exposure, but not Swingline Exposure, of such
Lender.
(c) The Borrower agrees to pay (i) to the Administrative
Agent, for the account of each Lender, a letter of credit fee with respect to
its participation in each Letter of Credit, which shall accrue at a rate per
annum equal to the Applicable Margin for Eurodollar Loans then in effect on the
average daily amount of such Lender's LC Exposure attributable to such Letter of
Credit during the period from and including the date of issuance of each Letter
of Credit to but excluding the date on which such Letter of Credit expires or is
drawn in full (including without limitation any LC Exposure that remains
outstanding after the Revolving
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Commitment Termination Date) and (ii) to the Issuing Bank for its own account a
fronting fee, which shall accrue at the rate of 0.10% per annum on the average
daily amount of the LC Exposure during the Availability Period (or until the
date that such Letter of Credit is irrevocably cancelled, whichever is later),
as well as the Issuing Bank's standard fees with respect to issuance, amendment,
renewal or extension of any Letter of Credit or processing of drawings
thereunder. Notwithstanding the foregoing, if the Required Lenders elect to
increase interest on the Loans to the Default Interest pursuant to
Section 2.13(c), the letter of credit fees payable pursuant to clause (i) above
shall automatically be increased by an additional 2% per annum.
(d) The Borrower shall pay to the Administrative Agent, for
the ratable benefit of each Lender, the closing fee previously agreed upon by
the Borrower and the Administrative Agent, which shall be due and payable on the
Closing Date.
(e) Accrued fees (other than the closing fee referenced in
paragraph (d)) shall be payable quarterly in arrears on the last day of each
March, June, September and December, commencing on September 30, 2005 and on the
Revolving Commitment Termination Date (and if later, the date the Loans and LC
Exposure shall be repaid in their entirety); provided, further, that any such
fees accruing after the Revolving Commitment Termination Date shall be payable
on demand.
SECTION 2.15. COMPUTATION OF INTEREST AND FEES. Interest
hereunder based on the Base Rate or the Swingline Rate shall be computed on the
basis of a year of 365 days (or 366 days in a leap year) and paid for the actual
number of days elapsed (including the first day but excluding the last day). All
other computations of interest and fees hereunder shall be computed on the basis
of a year of 360 days and paid for the actual number of days (including the
first day but excluding the last day) occurring in the period for which such
interest or fees are payable (to the extent computed on the basis of days
elapsed). Each determination by the Administrative Agent of an interest rate or
fee hereunder shall be made in good faith and, except for manifest error, shall
be final, conclusive and binding for all purposes.
SECTION 2.16. INABILITY TO DETERMINE INTEREST RATES. If prior
to the commencement of any Interest Period for any Eurodollar Borrowing,
(i) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower absent
manifest error) that, by reason of circumstances affecting the relevant
interbank market, adequate means do not exist for ascertaining LIBOR for
such Interest Period, or
(ii) the Administrative Agent shall have received notice from
the Required Lenders that the Adjusted LIBO Rate does not adequately and
fairly reflect the cost to such Lenders of making, funding or
maintaining their (or its, as the case may be) Eurodollar Loans for such
Interest Period,
the Administrative Agent shall give written notice (or telephonic notice,
promptly confirmed in writing) to the Borrower and to the Lenders as soon as
practicable thereafter. In the case of Eurodollar Loans, until the
Administrative Agent shall notify the Borrower and the Lenders that
32
the circumstances giving rise to such notice no longer exist, (i) the
obligations of the Lenders to make Eurodollar Revolving Loans or to continue or
convert outstanding Loans as or into Eurodollar Loans shall be suspended and
(ii) all such affected Loans shall be converted into Base Rate Loans on the last
day of the then current Interest Period applicable thereto unless the Borrower
prepays such Loans in accordance with this Agreement. Unless the Borrower
notifies the Administrative Agent at least one Business Day before the date of
any Eurodollar Revolving Borrowing for which a Notice of Revolving Borrowing has
previously been given that it elects not to borrow on such date, then such
Revolving Borrowing shall be made as a Base Rate Borrowing.
SECTION 2.17. ILLEGALITY. If any Change in Law shall make it
unlawful or impossible for any Lender to make, maintain or fund any Eurodollar
Loan and such Lender shall so notify the Administrative Agent, the
Administrative Agent shall promptly give notice thereof to the Borrower and the
other Lenders, whereupon until such Lender notifies the Administrative Agent and
the Borrower that the circumstances giving rise to such suspension no longer
exist, the obligation of such Lender to make Eurodollar Revolving Loans, or to
continue or convert outstanding Loans as or into Eurodollar Loans, shall be
suspended. In the case of the making of a Eurodollar Revolving Borrowing, such
Lender's Revolving Loan shall be made as a Base Rate Loan as part of the same
Revolving Borrowing for the same Interest Period and if the affected Eurodollar
Loan is then outstanding, such Loan shall be converted to a Base Rate Loan
either (i) on the last day of the then current Interest Period applicable to
such Eurodollar Loan if such Lender may lawfully continue to maintain such Loan
to such date or (ii) immediately if such Lender shall determine that it may not
lawfully continue to maintain such Eurodollar Loan to such date. Notwithstanding
the foregoing, the affected Lender shall, prior to giving such notice to the
Administrative Agent, designate a different Applicable Lending Office if such
designation would avoid the need for giving such notice and if such designation
would not otherwise be disadvantageous to such Lender in the good faith exercise
of its discretion.
SECTION 2.18. INCREASED COSTS.
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement that is not otherwise included in the
determination of the Adjusted LIBO Rate hereunder against assets of,
deposits with or for the account of, or credit extended by, any Lender
(except any such reserve requirement reflected in the Adjusted LIBO
Rate) or the Issuing Bank; or
(ii) impose on any Lender or on the Issuing Bank or the
eurodollar interbank market any other condition affecting this Agreement
or any Eurodollar Loans made by such Lender or any Letter of Credit or
any participation therein;
and the result of either of the foregoing is to increase the cost to such Lender
of making, converting into, continuing or maintaining a Eurodollar Loan or to
increase the cost to such Lender or the Issuing Bank of participating in or
issuing any Letter of Credit or to reduce the amount received or receivable by
such Lender or the Issuing Bank hereunder (whether of principal, interest or any
other amount), then the Borrower shall promptly pay, upon written
33
notice from and demand by such Lender on the Borrower (with a copy of such
notice and demand to the Administrative Agent), to the Administrative Agent for
the account of such Lender, within five Business Days after the date of such
notice and demand, additional amount or amounts sufficient to compensate such
Lender or the Issuing Bank, as the case may be, for such additional costs
incurred or reduction suffered.
(b) If any Lender or the Issuing Bank shall have determined
that on or after the date of this Agreement any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on such
Lender's or the Issuing Bank's capital (or on the capital of such Lender's or
the Issuing Bank's parent corporation) as a consequence of its obligations
hereunder or under or in respect of any Letter of Credit to a level below that
which such Lender or the Issuing Bank or such Lender's or the Issuing Bank's
parent corporation could have achieved but for such Change in Law (taking into
consideration such Lender's or the Issuing Bank's policies or the policies of
such Lender's or the Issuing Bank's parent corporation with respect to capital
adequacy) then, from time to time, within five (5) Business Days after receipt
by the Borrower of written demand by such Lender (with a copy thereof to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amounts as will compensate such Lender or the Issuing Bank or such Lender's or
the Issuing Bank's parent corporation for any such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting
forth the amount or amounts necessary to compensate such Lender or the Issuing
Bank or such Lender's or the Issuing Bank's parent corporation, as the case may
be, specified in paragraph (a) or (b) of this Section 2.18 shall be delivered to
the Borrower (with a copy to the Administrative Agent) and shall be conclusive,
absent manifest error. The Borrower shall pay any such Lender or the Issuing
Bank, as the case may be, such amount or amounts within 10 days after receipt
thereof.
(d) Failure or delay on the part of any Lender or the
Issuing Bank to demand compensation pursuant to this Section 2.18 shall not
constitute a waiver of such Lender's or the Issuing Bank's right to demand such
compensation; provided that the Borrower shall not be required to compensate a
Lender or the Issuing Bank under this Section 2.18 for any increased costs or
reductions incurred more than twelve (12) months prior to the date that such
Lender or the Issuing Bank, as the case may be, notifies the Borrower of such
increased costs or reductions and of such Lender's or the Issuing Bank's
intention to claim compensation therefor; provided, further, that if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
such twelve-month period shall be extended to include the period of such
retroactive effect.
SECTION 2.19. FUNDING INDEMNITY. In the event of (a) the
payment of any principal of a Eurodollar Loan other than on the last day of the
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion or continuation of a Eurodollar Loan other than on
the last day of the Interest Period applicable thereto, or (c) the failure by
the Borrower to borrow, prepay, convert or continue any Eurodollar Loan on the
date specified in any applicable notice (regardless of whether such notice is
withdrawn or revoked), then, in any such event, the Borrower shall compensate
each Lender, within five (5) Business Days after written demand from such
Lender, for any loss, cost or expense (other than lost profits) attributable to
such event. In the case of a Eurodollar Loan, such loss, cost or expense shall
be deemed to include an amount determined by such Lender to be the excess, if
any, of (A) the
34
amount of interest that would have accrued on the principal amount of such
Eurodollar Loan if such event had not occurred at the Adjusted LIBO Rate
applicable to such Eurodollar Loan for the period from the date of such event to
the last day of the then current Interest Period therefor (or in the case of a
failure to borrow, convert or continue, for the period that would have been the
Interest Period for such Eurodollar Loan) over (B) the amount of interest that
would accrue on the principal amount of such Eurodollar Loan for the same period
if the Adjusted LIBO Rate were set on the date such Eurodollar Loan was prepaid
or converted or the date on which the Borrower failed to borrow, convert or
continue such Eurodollar Loan. A certificate as to any additional amount payable
under this Section 2.19, showing a calculation of the amount payable in
reasonable detail to the extent reasonably practicable, submitted to the
Borrower by any Lender (with a copy to the Administrative Agent) shall be
conclusive, absent manifest error.
SECTION 2.20. TAXES.
(a) Any and all payments by or on account of any obligation
of the Borrower hereunder shall be made free and clear of and without deduction
for any Indemnified Taxes or Other Taxes; provided that if the Borrower shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments, then
(i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.20) the Administrative Agent, any Lender or the Issuing
Bank (as the case may be) shall receive an amount equal to the sum it would have
received had no such deductions been made, (ii) the Borrower shall make such
deductions and (iii) the Borrower shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to
the relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent,
each Lender and the Issuing Bank, within ten (10) Business Days after written
demand therefor, for the full amount of any Indemnified Taxes or Other Taxes
paid by the Administrative Agent, such Lender or the Issuing Bank, as the case
may be, on or with respect to any payment by or on account of any obligation of
the Borrower hereunder (including Indemnified Taxes or Other Taxes imposed or
asserted on or attributable to amounts payable under this Section 2.20) and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A
certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender or the Issuing Bank, or by the Administrative Agent on its
own behalf or on behalf of a Lender or the Issuing Bank, shall be conclusive,
absent manifest error.
(d) As soon as practicable after any payment of Indemnified
Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.
35
(e) Any Foreign Lender that is entitled to an exemption from
or reduction of withholding tax under the Code or any treaty to which the United
States is a party, with respect to payments under this Agreement shall deliver
to the Borrower (with a copy to the Administrative Agent), at the time or times
prescribed by applicable law, such properly completed and executed documentation
prescribed by applicable law or reasonably requested by the Borrower as will
permit such payments to be made without withholding or at a reduced rate.
Without limiting the generality of the foregoing, each Foreign Lender agrees
that it will deliver to the Administrative Agent and the Borrower (or in the
case of a Participant, to the Lender from which the related participation shall
have been purchased), as appropriate, two (2) duly completed copies of
(i) Internal Revenue Service Form W-8 ECI, or any successor form thereto,
certifying that the payments received from the Borrower hereunder are
effectively connected with such Foreign Lender's conduct of a trade or business
in the United States; or (ii) Internal Revenue Service Form W-8 BEN, or any
successor form thereto, certifying that such Foreign Lender is entitled to
benefits under an income tax treaty to which the United States is a party which
reduces the rate of withholding tax on payments of interest; or (iii) Internal
Revenue Service Form W-8 BEN, or any successor form prescribed by the Internal
Revenue Service, together with a certificate (A) establishing that the payment
to the Foreign Lender qualifies as "portfolio interest" exempt from U.S.
withholding tax under Code section 871(h) or 881(c), and (B) stating that
(1) the Foreign Lender is not a bank for purposes of Code section 881(c)(3)(A),
or the obligation of the Borrower hereunder is not, with respect to such Foreign
Lender, a loan agreement entered into in the ordinary course of its trade or
business, within the meaning of that section; (2) the Foreign Lender is not a
10% shareholder of the Borrower within the meaning of Code section 871(h)(3) or
881(c)(3)(B); and (3) the Foreign Lender is not a controlled foreign corporation
that is related to the Borrower within the meaning of Code section 881(c)(3)(C);
or (iv) such other Internal Revenue Service forms as may be applicable to the
Foreign Lender, including Forms W-8 IMY or W-8 EXP. Each such Foreign Lender
shall deliver to the Borrower and the Administrative Agent such forms on or
before the date that it becomes a party to this Agreement (or in the case of a
Participant, on or before the date such Participant purchases the related
participation). In addition, each such Foreign Lender shall deliver such forms
promptly upon the obsolescence or invalidity of any form previously delivered by
such Foreign Lender. Each such Foreign Lender shall promptly notify the Borrower
and the Administrative Agent at any time that it determines that it is no longer
in a position to provide any previously delivered certificate to the Borrower
(or any other form of certification adopted by the Internal Revenue Service for
such purpose).
SECTION 2.21. PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING
OF SET-OFFS.
(a) The Borrower shall make each payment required to be made
by it hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.18, Section 2.19 or
Section 2.20, or otherwise) prior to 11:00 a.m. (Atlanta, Georgia time), on the
date when due, in immediately available funds, free and clear of any defenses,
rights of set-off, counterclaim, or withholding or deduction of taxes. Any
amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at the Payment Office, except payments
to be made directly to the Issuing Bank or Swingline Lender as expressly
provided herein and except that payments pursuant to Sections 2.18, 2.19, 2.20
and
36
10.3 shall be made directly to the Persons entitled thereto. The Administrative
Agent shall distribute any such payments received by it for the account of any
other Person to the appropriate recipient promptly following receipt thereof. If
any payment hereunder shall be due on a day that is not a Business Day, the date
for payment shall be extended to the next succeeding Business Day, and, in the
case of any payment accruing interest, interest thereon shall be made payable
for the period of such extension. All payments hereunder shall be made in
Dollars.
(b) If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such funds
shall be applied (i) first, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second, towards
payment of principal and unreimbursed LC Disbursements then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal and unreimbursed LC Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of set-off
or counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Revolving Loans or participations in LC Disbursements or
Swingline Loans that would result in such Lender receiving payment of a greater
proportion of the aggregate amount of its Revolving Loans and participations in
LC Disbursements and Swingline Loans and accrued interest thereon than the
proportion received by any other Lender, then the Lender receiving such greater
proportion (each a "Purchasing Lender") shall purchase (for cash at face value)
participations in the Revolving Loans and participations in LC Disbursements and
Swingline Loans of other Lenders to the extent necessary so that the benefit of
all such payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective
Revolving Loans and participations in LC Disbursements and Swingline Loans;
provided that (i) if any such participations are purchased and all or any
portion of the payment giving rise thereto is recovered or the Purchasing Lender
is otherwise required to return or restore any such payment, such participations
shall be rescinded and each other Lender shall, promptly after request from the
Administrative Agent or the Purchasing Lender, return to the Purchasing Lender
the purchase price for such participation to the extent of such recovery or the
amount otherwise returned or restored by the Purchasing Lender, without
interest, and (ii) the provisions of this paragraph shall not be construed to
apply to any payment made by the Borrower pursuant to and in accordance with the
express terms of this Agreement or any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Loans or participations in LC Disbursements or Swingline Loans to any assignee
or participant, other than to the Borrower or any Subsidiary or Affiliate
thereof (as to which the provisions of this paragraph shall apply). The Borrower
consents to the foregoing and agrees, to the extent it may effectively do so
under applicable law, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against the Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower in the amount of such participation.
(d) Unless the Administrative Agent shall have received
notice from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the
37
account of the Lenders or the Issuing Bank hereunder that the Borrower will not
make such payment, the Administrative Agent may assume that the Borrower has
made such payment on such date in accordance herewith and may, in reliance upon
such assumption, distribute to the Lenders or the Issuing Bank, as the case may
be, the amount or amounts due. In such event, if the Borrower has not in fact
made such payment, then each of the Lenders or the Issuing Bank, as the case may
be, severally agrees to repay to the Administrative Agent forthwith on demand
the amount so distributed to such Lender or Issuing Bank with interest thereon,
for each day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to
be made by it pursuant to Section 2.5(b), Section 2.6(b), Section 2.22(d),
Section 2.22(e), or Section10.3(d), then the Administrative Agent may, in its
discretion (notwithstanding any contrary provision hereof), apply any amounts
thereafter received by the Administrative Agent for the account of such Lender
to satisfy such Lender's obligations under such Sections until all such
unsatisfied obligations are fully paid.
SECTION 2.22. LETTERS OF CREDIT.
(a) During the Availability Period, the Issuing Bank, in
reliance upon the agreements of the other Lenders pursuant to Section 2.22(d),
agrees to issue, at the request of the Borrower, Letters of Credit for the
account of the Borrower on the terms and conditions hereinafter set forth;
provided that (i) each Letter of Credit shall expire on the earlier of (A) the
date one year after the date of issuance of such Letter of Credit (or in the
case of any renewal or extension thereof, one year after such renewal or
extension) and (B) the date that is at least one (1) Business Day prior to the
Revolving Commitment Termination Date; (ii) each Letter of Credit shall be in a
stated amount of at least $50,000; and (iii) the Borrower may not request any
Letter of Credit, if, after giving effect to such issuance (A) the aggregate LC
Exposure would exceed the LC Commitment or (B) the aggregate Revolving Credit
Exposure of all Lenders would exceed the Aggregate Revolving Commitment Amount.
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
without recourse a participation in such Letter of Credit equal to such Lender's
Pro Rata Share of the aggregate amount available to be drawn under such Letter
of Credit. Each issuance of a Letter of Credit shall be deemed to utilize the
Revolving Commitment of each Lender by an amount equal to the amount of such
participation.
(b) To request the issuance of a Letter of Credit (or any
amendment, renewal or extension of an outstanding Letter of Credit), the
Borrower shall give the Issuing Bank and the Administrative Agent irrevocable
written notice at least three (3) Business Days prior to the requested date of
such issuance specifying the date (which shall be a Business Day) such Letter of
Credit is to be issued (or amended, extended or renewed, as the case may be),
the expiration date of such Letter of Credit, the amount of such Letter of
Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare, amend, renew or extend such Letter
of Credit. In addition to the satisfaction of the conditions in Article III, the
issuance of such Letter of Credit (or any amendment which increases the amount
of such Letter
38
of Credit) will be subject to the further conditions that such Letter of Credit
shall be in such form and contain such terms as the Issuing Bank shall approve
and that the Borrower shall have executed and delivered any additional
applications, agreements and instruments relating to such Letter of Credit as
the Issuing Bank shall reasonably require; provided, that in the event of any
conflict between such applications, agreements or instruments and this
Agreement, the terms of this Agreement shall control.
(c) At least two Business Days prior to the issuance of any
Letter of Credit, the Issuing Bank will confirm with the Administrative Agent
(by telephone or in writing) that the Administrative Agent has received such
notice and if not, the Issuing Bank will provide the Administrative Agent with a
copy thereof. Unless the Issuing Bank has received notice from the
Administrative Agent on or before the Business Day immediately preceding the
date the Issuing Bank is to issue the requested Letter of Credit (1) directing
the Issuing Bank not to issue the Letter of Credit because such issuance is not
then permitted hereunder because of the limitations set forth in Section 2.22(a)
or (2) that one or more conditions specified in Article III are not then
satisfied, then, subject to the terms and conditions hereof, the Issuing Bank
shall, on the requested date, issue such Letter of Credit in accordance with the
Issuing Bank's usual and customary business practices.
(d) The Issuing Bank shall examine all documents purporting
to represent a demand for payment under a Letter of Credit promptly following
its receipt thereof. The Issuing Bank shall notify the Borrower and the
Administrative Agent of such demand for payment and whether the Issuing Bank has
made or will make a LC Disbursement thereunder; provided that any failure to
give or delay in giving such notice shall not relieve the Borrower of its
obligation to reimburse the Issuing Bank and the Lenders with respect to such LC
Disbursement. The Borrower shall be irrevocably and unconditionally obligated to
reimburse the Issuing Bank for any LC Disbursements paid by the Issuing Bank in
respect of such drawing, without presentment, demand or other formalities of any
kind. Unless the Borrower shall have notified the Issuing Bank and the
Administrative Agent prior to 11:00 a.m. (Atlanta, Georgia time) on the Business
Day immediately prior to the date on which such drawing is honored that the
Borrower intends to reimburse the Issuing Bank for the amount of such drawing in
funds other than from the proceeds of Revolving Loans, the Borrower shall be
deemed to have timely given a Notice of Revolving Borrowing to the
Administrative Agent requesting the Lenders to make a Base Rate Borrowing on the
date on which such drawing is honored in an exact amount due to the Issuing
Bank; provided that for purposes solely of such Borrowing, the conditions
precedent set forth in Section 3.2 hereof shall not be applicable. The
Administrative Agent shall notify the Lenders of such Borrowing in accordance
with Section 2.3, and each Lender shall make the proceeds of its Base Rate Loan
included in such Borrowing available to the Administrative Agent for the account
of the Issuing Bank in accordance with Section 2.6. The proceeds of such
Borrowing shall be applied directly by the Administrative Agent to reimburse the
Issuing Bank for such LC Disbursement.
(e) If for any reason a Base Rate Borrowing may not be (as
determined in the sole discretion of the Administrative Agent), or is not, made
in accordance with the foregoing provisions, then each Lender (other than the
Issuing Bank) shall be obligated to fund the participation that such Lender
purchased pursuant to subsection (a) in an amount equal to its Pro Rata Share of
such LC Disbursement on and as of the date which such Base Rate Borrowing
39
should have occurred. Each Lender's obligation to fund its participation shall
be absolute and unconditional and shall not be affected by any circumstance,
including without limitation (i) any setoff, counterclaim, recoupment, defense
or other right that such Lender or any other Person may have against the Issuing
Bank or any other Person for any reason whatsoever, (ii) the existence of a
Default or an Event of Default or the termination of the Aggregate Revolving
Commitments, (iii) any adverse change in the condition (financial or otherwise)
of the Borrower or any of its Subsidiaries, (iv) any breach of this Agreement by
the Borrower or any other Lender, (v) any amendment, renewal or extension of any
Letter of Credit or (vi) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing. On the date that such
participation is required to be funded, each Lender shall promptly transfer, in
immediately available funds, the amount of its participation to the
Administrative Agent for the account of the Issuing Bank. Whenever, at any time
after the Issuing Bank has received from any such Lender the funds for its
participation in a LC Disbursement, the Issuing Bank (or the Administrative
Agent on its behalf) receives any payment on account thereof, the Administrative
Agent or the Issuing Bank, as the case may be, will distribute to such Lender
its Pro Rata Share of such payment; provided that if such payment is required to
be returned for any reason to the Borrower or to a trustee, receiver,
liquidator, custodian or similar official in any bankruptcy proceeding, such
Lender will return to the Administrative Agent or the Issuing Bank any portion
thereof previously distributed by the Administrative Agent or the Issuing Bank
to it.
(f) To the extent that any Lender shall fail to pay any
amount required to be paid pursuant to paragraphs (d) and (e) of this
Section 2.22 on the due date therefor, such Lender shall pay interest to the
Issuing Bank (through the Administrative Agent) on such amount from such due
date to the date such payment is made at a rate per annum equal to the Federal
Funds Rate; provided that if such Lender shall fail to make such payment to the
Issuing Bank within three (3) Business Days of such due date, then,
retroactively to the due date, such Lender shall be obligated to pay interest on
such amount at the rate set forth in Section 2.13(c).
(g) If any Event of Default shall occur and be continuing,
on the Business Day that the Borrower receives notice from the Administrative
Agent or the Required Lenders demanding the deposit of cash collateral pursuant
to this paragraph, the Borrower shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Issuing Bank and the Lenders, an amount in cash equal to the LC
Exposure as of such date plus any accrued and unpaid fees thereon; provided that
the obligation to deposit such cash collateral shall become effective
immediately, and such deposit shall become immediately due and payable, without
demand or notice of any kind, upon the occurrence of any Event of Default with
respect to the Borrower described in clause (f) or (g) of Section 8.1. Such
deposit shall be held by the Administrative Agent as collateral for the payment
and performance of the obligations of the Borrower under this Agreement. The
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account. Borrower agrees to execute any
documents and/or certificates that may be necessary to effectuate the intent of
this paragraph. Other than any interest earned on the investment of such
deposits, which investments shall be made at the option and sole discretion of
the Administrative Agent and at the Borrower's risk and expense, such deposits
shall not bear interest. Interest and profits, if any, on such investments shall
accumulate in such account. Moneys in such account shall be applied by the
Administrative Agent to reimburse the Issuing Bank for LC Disbursements for
which it had not been reimbursed and to the extent so applied,
40
shall be held for the satisfaction of the reimbursement obligations of the
Borrower for the LC Exposure at such time or, if the maturity of the Loans has
been accelerated, with the consent of the Required Lenders, be applied to
satisfy other obligations of the Borrower under this Agreement and the other
Loan Documents. If the Borrower is required to provide an amount of cash
collateral hereunder as a result of the occurrence of an Event of Default, such
amount (to the extent not so applied as aforesaid) shall be returned to the
Borrower within three Business Days after all Events of Default have been cured
or waived.
(h) Promptly following the end of each calendar quarter, the
Issuing Bank shall deliver (through the Administrative Agent) to each Lender and
the Borrower a report describing the aggregate Letters of Credit outstanding at
the end of such Fiscal Quarter. Upon the request of any Lender from time to
time, the Issuing Bank shall deliver to such Lender any other information
reasonably requested by such Lender with respect to each Letter of Credit then
outstanding.
(i) The Borrower's obligation to reimburse LC Disbursements
hereunder shall be absolute, unconditional and irrevocable and shall be
performed strictly in accordance with the terms of this Agreement under all
circumstances whatsoever and irrespective of any of the following circumstances:
(i) Any lack of validity or enforceability of any
Letter of Credit or this Agreement;
(ii) The existence of any claim, set-off, defense or
other right which the Borrower or any Subsidiary or Affiliate of the
Borrower may have at any time against a beneficiary or any transferee of
any Letter of Credit (or any Persons or entities for whom any such
beneficiary or transferee may be acting), any Lender (including the
Issuing Bank) or any other Person, whether in connection with this
Agreement or the Letter of Credit or any document related hereto or
thereto or any unrelated transaction;
(iii) Any draft or other document presented under a
Letter of Credit proving to be forged, fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in any
respect;
(iv) Payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document to the Issuing
Bank that does not comply with the terms of such Letter of Credit;
(v) Any other event or circumstance whatsoever,
whether or not similar to any of the foregoing, that might, but for the
provisions of this Section 2.22, constitute a legal or equitable
discharge of, or provide a right of setoff against, the Borrower's
obligations hereunder; or
(vi) The existence of a Default or an Event of
Default.
Neither the Administrative Agent, the Issuing Bank, the Lenders nor any Related
Party of any of the foregoing shall have any liability or responsibility by
reason of or in connection with the issuance or transfer of any Letter of Credit
or any payment or failure to make any payment
41
thereunder (irrespective of any of the circumstances referred to above), or any
error, omission, interruption, loss or delay in transmission or delivery of any
draft, notice or other communication under or relating to any Letter of Credit
(including any document required to make a drawing thereunder), any error in
interpretation of technical terms or any consequence arising from causes beyond
the control of the Issuing Bank; provided that the foregoing shall not be
construed to excuse the Issuing Bank from liability to the Borrower to the
extent of any actual direct damages (as opposed to special, indirect (including
claims for lost profits or other consequential damages), or punitive damages,
claims in respect of which are hereby waived by the Borrower to the extent
permitted by applicable law) suffered by the Borrower that are caused by the
Issuing Bank's failure to exercise due care when determining whether drafts or
other documents presented under a Letter of Credit comply with the terms
thereof. The parties hereto expressly agree, that in the absence of gross
negligence or willful misconduct on the part of the Issuing Bank (as finally
determined by a court of competent jurisdiction), the Issuing Bank shall be
deemed to have exercised due care in each such determination. In furtherance of
the foregoing and without limiting the generality thereof, the parties agree
that, with respect to documents presented that appear on their face to be in
substantial compliance with the terms of a Letter of Credit, the Issuing Bank
may, in its sole discretion, either accept and make payment upon such documents
without responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.
(j) Each Letter of Credit shall be subject to the Uniform
Customs and Practices for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500, as the same may be amended from time to
time, and, to the extent not inconsistent therewith, the governing law of this
Agreement set forth in Section 10.5.
SECTION 2.23. MITIGATION OF OBLIGATIONS. If any Lender
requests compensation under Section 2.18, or if the Borrower is required to pay
any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 2.20, then such Lender shall use
reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations hereunder to
another of its offices, branches or affiliates, if, in the sole judgment of such
Lender, such designation or assignment (i) would eliminate or reduce amounts
payable under Section 2.18 or Section 2.20, as the case may be, in the future
and (ii) would not subject such Lender to any unreimbursed cost or expense and
would not otherwise be disadvantageous to such Lender. The Borrower hereby
agrees to pay all costs and expenses incurred by any Lender in connection with
such designation or assignment.
SECTION 2.24. REPLACEMENT OF LENDERS. If any Lender requests
compensation under Section 2.18, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority of the account of
any Lender pursuant to Section 2.20, or if any Lender defaults in its obligation
to fund Loans hereunder, then the Borrower may, at its sole expense and effort,
upon notice to such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and subject to the
restrictions set forth in Section 10.4(b) all its interests, rights and
obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) the Borrower shall have received the prior
written consent of the Administrative Agent, which consent shall not be
unreasonably
42
withheld, (ii) such Lender shall have received payment of an amount equal to the
outstanding principal amount of all Loans owed to it, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder, from the assignee
(in the case of such outstanding principal and accrued interest) and from the
Borrower (in the case of all other amounts) and (iii) in the case of a claim for
compensation under Section 2.18 or payments required to be made pursuant to
Section 2.20, such assignment will result in a reduction in such compensation or
payments. A Lender shall not be required to make any such assignment and
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment
and delegation cease to apply.
SECTION 2.25. INCREASE OF COMMITMENTS; ADDITIONAL LENDERS.
(a) So long as no Event of Default has occurred and is
continuing, from time to time after the Closing Date, Borrower may, upon at
least 30 days' written notice to the Administrative Agent (who shall promptly
provide a copy of such notice to each Lender), propose to increase the Aggregate
Commitments by an amount not to exceed $45,000,000 (the amount of any such
increase, the "Additional Commitment Amount"). Each Lender shall have the right
for a period of 15 days following receipt of such notice, to elect by written
notice to the Borrower and the Administrative Agent to increase its Revolving
Commitment by a principal amount equal to its Pro Rata Share of the Additional
Commitment Amount. No Lender (or any successor thereto) shall have any
obligation to increase its Revolving Commitment or its other obligations under
this Agreement and the other Loan Documents, and any decision by a Lender to
increase its Revolving Commitment shall be made in its sole discretion
independently from any other Lender.
(b) If any Lender shall not elect to increase its Revolving
Commitment pursuant to subsection (a) of this Section 2.25, the Borrower may
designate another bank or other financial institution (which may be, but need
not be, one or more of the existing Lenders) which at the time agrees to, in the
case of any such Person that is an existing Lender, increase its Revolving
Commitment and in the case of any other such Person (an "Additional Lender"),
become a party to this Agreement; provided, however, that any new bank or
financial institution must be acceptable to the Administrative Agent, which
acceptance will not be unreasonably withheld or delayed. The sum of the
increases in the Revolving Commitments of the existing Lenders pursuant to this
subsection (b) plus the Revolving Commitments of the Additional Lenders shall
not in the aggregate exceed the previously unsubscribed amount of the Additional
Commitment Amount pursuant to subsection (a).
(c) An increase in the aggregate amount of the Revolving
Commitments pursuant to this Section 2.25 shall become effective upon the
receipt by the Administrative Agent of an supplement or joinder in form and
substance satisfactory to the Administrative Agent executed by the Borrower and
by each Additional Lender and by each other Lender whose Revolving Commitment is
to be increased, setting forth the new Revolving Commitments of such Lenders and
setting forth the agreement of each Additional Lender to become a party to this
Agreement and to be bound by all the terms and provisions hereof, together with
Notes evidencing such increase in the Commitments, and such evidence of
appropriate corporate authorization on the part of the Borrower with respect to
the increase in the Revolving
43
Commitments and such opinions of counsel for the Borrower with respect to the
increase in the Revolving Commitments as the Administrative Agent may reasonably
request.
(d) Upon the acceptance of any such agreement by the
Administrative Agent, the Aggregate Revolving Commitment Amount shall
automatically be increased by the amount of the Revolving Commitments added
through such agreement and Annex I shall automatically be deemed amended to
reflect the Revolving Commitments of all Lenders after giving effect to the
addition of such Revolving Commitments.
(e) Upon the effectiveness of any increase in the aggregate
amount of the Revolving Commitments pursuant to this Section 2.25 that is not
pro rata among all Lenders, (x) the Revolving Loans shall be reallocated among
the Lenders (including all Additional Lenders), such reallocation to be
accomplished by Additional Lenders and the Lenders increasing their Revolving
Commitments funding additional Revolving Loans, the proceeds of which shall be
applied by the Administrative Agent to repay the Revolving Loans of the
remaining Lenders such that after giving effect thereto, the Revolving Loans are
held by the Lenders in proportion to their respective Revolving Commitments
after giving effect to such increase, and (ii) the amount of the participations
held by each Lender (including each Additional Lender) in each Letter of Credit
then outstanding shall be adjusted automatically such that, after giving effect
to such adjustments, the Lenders shall hold participations in each such Letter
of Credit in proportion to their respective Revolving Commitments. The Borrower
acknowledges and agrees that after giving effect to the foregoing reallocations,
the Borrower shall owe the Revolving Credit Exposure pro rata to the Lenders
based on their Revolving Commitments in effect after such increase.
ARTICLE III
CONDITIONS PRECEDENT TO LOANS AND LETTERS OF CREDIT
SECTION 3.1. CONDITIONS TO EFFECTIVENESS. The obligations of
the Lenders (including the Swingline Lender) to make Loans and the obligation of
the Issuing Bank to issue any Letter of Credit hereunder shall not become
effective until the first date on which each of the following conditions is
satisfied (or waived in accordance with Section 10.2).
(a) The Administrative Agent shall have received all fees
and other amounts due and payable on or prior to the Closing Date, including
reimbursement or payment of all out-of-pocket expenses (including reasonable
fees, charges and disbursements of counsel to the Administrative Agent) required
to be reimbursed or paid by the Borrower hereunder, under any other Loan
Document and under any agreement with the Administrative Agent or SunTrust
Capital Markets, Inc., as Arranger.
(b) The Administrative Agent (or its counsel) shall have
received the following:
(i) a counterpart of this Agreement signed by or on
behalf of each party hereto or written evidence satisfactory to the
Administrative Agent (which may
44
include telecopy transmission of a signed signature page of this
Agreement) that such party has signed a counterpart of this Agreement;
(ii) if requested by any Lender, a duly executed
Syndicated Note payable to such Lender, and a duly executed Swingline
Note payable to the Swingline Lender;
(iii) the Reaffirmation to Guaranty and IP Security
Agreements, duly executed by each Domestic Subsidiary of the Borrower,
other than Parts Advantage, LLC and HEICO International Corporation,
dated the Closing Date and in form and substance reasonably satisfactory
to the Administrative Agent;
(iv) the Amended and Restated Security Agreement,
duly executed by the Borrower and each Subsidiary Loan Party, together
with (A) a Perfection Certificate duly completed and executed by the
Borrower, (B) duly executed notices to landlords with respect to this
Credit Agreement in form and substance satisfactory to the
Administrative Agent and (C) a certified copy of all material real
property leases;
(v) the Reaffirmation to Pledge Agreement, duly
executed by the Borrower and each of its Domestic Subsidiaries that owns
another Subsidiary of Borrower, dated the Closing Date and in form and
substance satisfactory to the Administrative Agent;
(vi) a certificate of the Secretary or Assistant
Secretary of each Loan Party, (a) certifying that its articles or
certificate of incorporation or formation, as applicable, its bylaws or
operating agreement, true and correct copies of which were previously
delivered to the Administrative Agent have not been amended, restated,
supplemented, modified or revoked since the date delivered to
Administrative Agent and remain in full force and effect on the date
hereof, and (b) attaching and certifying copies of the resolutions of
its boards of directors, or partnership agreement or limited liability
company operating agreement, or comparable organizational documents and
authorizations, authorizing the execution, delivery and performance of
the Loan Documents to which it is a party and certifying the name, title
and true signature of each officer of such Loan Party executing the Loan
Documents to which it is a party;
(vii) certificates of good standing or existence, as
may be available from the Secretary of State of the jurisdiction of
organization of such Loan Party and each other jurisdiction where the
failure of any Loan Party to be qualified to do business as a foreign
corporation or limited liability company, as the case may be, could
reasonably be expected to have a Material Adverse Effect;
(viii) favorable written opinions from counsel to the
Loan Parties, addressed to the Administrative Agent and each of the
Lenders, and covering such matters relating to the Loan Parties, the
Loan Documents and the transactions contemplated therein as the
Administrative Agent shall reasonably request;
45
(ix) a certificate, dated the Closing Date and signed
by a Responsible Officer, confirming compliance with the conditions set
forth in paragraphs (a), (b) and (c) of Section 3.2;
(x) if any Revolving Loan will be funded on the
Closing Date, a Notice of Borrowing and funds disbursement agreement
each duly executed by the Borrower;
(xi) certified copies of all consents, approvals,
authorizations, registrations and filings and orders required to be made
or obtained under any Requirement of Law, or by any material Contractual
Obligation of each Loan Party, in connection with the execution,
delivery, performance, validity and enforceability of the Loan Documents
or any of the transactions contemplated thereby, and such consents,
approvals, authorizations, registrations, filings and orders shall be in
full force and effect and all applicable waiting periods shall have
expired and no investigation or inquiry by any Governmental Authority
related thereto shall be ongoing;
(xii) copies of (A) the internally prepared quarterly
financial statements of Borrower and its Subsidiaries on a consolidated
basis for the Fiscal Quarter ending on April 30, 2005, and (B) the
audited consolidated financial statements for Borrower and its
Subsidiaries for the Fiscal Years ended 2002, 2003 and 2004;
(xiii) a certificate, dated the Closing Date and signed
by the chief financial officer of each Loan Party, confirming the
solvency of each Loan Party before and after giving effect to all
transactions contemplated by the Transaction Documents; and
(xiv) Control Agreements from (i) all securities
intermediaries with respect to all securities accounts and securities
entitlements of any Loan Party, and (ii) all futures commission agents
and clearing houses with respect to all commodities contracts and
commodities accounts held by any Loan Party, to the extent that the
aggregate balance in such accounts on the Closing Date exceeds
$5,000,000, in each case in form and substance reasonably satisfactory
to the Administrative Agent.
SECTION 3.2. EACH CREDIT EVENT. The obligation of each Lender
to make a Loan on the occasion of any Borrowing and of the Issuing Bank to
issue, amend, renew or extend any Letter of Credit is subject to the
satisfaction of the following conditions:
(a) at the time of and immediately after giving effect to
such Borrowing or the issuance, amendment, renewal or extension of such Letter
of Credit, as applicable, no Default or Event of Default shall exist;
(b) all representations and warranties of each Loan Party
set forth in the Loan Documents shall be true and correct in all material
respects on and as of the date of such Borrowing or the date of issuance,
amendment, extension or renewal of such Letter of Credit, in each case before
and after giving effect thereto (except to the extent such representations and
warranties relate solely to an earlier date and except for changes therein
expressly permitted or expressly contemplated by the Loan Documents);
46
(c) since the date of the annual financial statements of the
Borrower described in Section 4.4, there shall have been no change which has had
or could reasonably be expected to have a Material Adverse Effect;
(d) after giving effect to such Borrowing or Letter of
Credit, the Revolving Credit Exposure will not exceed the Aggregate Revolving
Commitment Amount;
(e) the Borrower shall have delivered the required Notice of
Borrowing; and
(f) the Administrative Agent shall have received such other
documents, certificates or information as the Administrative Agent or the
Required Lenders may reasonably request, all in form and substance reasonably
satisfactory to the Administrative Agent or the Required Lenders.
Each Borrowing and each issuance, amendment, extension or renewal of any
Letter of Credit shall be deemed to constitute a representation and warranty by
the Borrower on the date thereof as to the matters specified in paragraphs (a),
(b), (c) and (d) of this Section 3.2.
SECTION 3.3. DELIVERY OF DOCUMENTS. All of the Loan
Documents, certificates, legal opinions and other documents and papers referred
to in this Article III, unless otherwise specified, shall be delivered to the
Administrative Agent for the account of each of the Lenders and, except for the
Notes, in sufficient counterparts or copies for each of the Lenders and shall be
in form and substance reasonably satisfactory in all respects to the
Administrative Agent.
SECTION 3.4. EFFECT OF AMENDMENT AND RESTATEMENT. Upon this
Agreement becoming effective pursuant to Section 3.1, from and after the Closing
Date: (a) all terms and conditions of the Existing Credit Agreement and any
other Loan Document (as defined in the Existing Credit Agreement), as amended by
this Agreement and the other Loan Documents being executed and delivered on the
Closing Date, shall be and remain in full force and effect, as so amended, and
shall constitute the legal, valid, binding and enforceable obligations of the
Loan Parties party thereto to Lenders and Administrative Agent; (b) the terms
and conditions of the Existing Credit Agreement shall be amended as set forth
herein and, as so amended, shall be restated in their entirety, but only with
respect to the rights, duties and obligations among Borrower, Lenders and
Administrative Agent accruing from and after the Closing Date; (c) all
indemnification obligations of the Loan Parties under the Existing Credit
Agreement or any other Loan Document (as defined in the Existing Credit
Agreement) shall survive the execution and delivery of this Agreement and shall
continue in full force and effect for the benefit of Lenders, Administrative
Agent, and any other Person indemnified under the Existing Credit Agreement or
such other Loan Document at any time prior to the Closing Date; (d) the
Obligations incurred under the Existing Credit Agreement shall, to the extent
outstanding on the Closing Date, continue outstanding under this Agreement and
shall not be deemed to be paid, released, discharged or otherwise satisfied by
the execution of this Agreement, and this Agreement shall not constitute a
refinancing, substitution or novation of such Obligations or any of the other
rights, duties and obligations of the parties hereunder; (e) any and all
references in the Loan Documents to the Existing Credit Agreement shall, without
further action of the parties, be deemed a reference to the Existing Credit
Agreement, as amended and restated by this Agreement, and as this Agreement
shall be further amended or amended and restated from time
47
to time hereafter; and (f) any and all references to the "Closing Date" in the
Subsidiary Guaranty Agreement, the Pledge Agreement, the Patent Security
Agreements and the Trademark Security Agreements shall, without further action
of the parties, be deemed a reference to the Original Closing Date.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Administrative Agent
and each Lender as follows:
SECTION 4.1. CORPORATE EXISTENCE; COMPLIANCE WITH LAW; NAME
HISTORY. Each of the Borrower and its Subsidiaries is a corporation or limited
liability company duly incorporated or organized (as applicable), validly
existing, and in good standing under the laws of the jurisdiction of its
incorporation or organization. Each of the Borrower and its Subsidiaries has all
requisite power (corporate and otherwise) to own and operate its properties and
to carry on its business as now being conducted, and, except where the failure
to do so could not reasonably be expected to have a Material Adverse Effect
(i) is duly qualified as a foreign corporation or limited liability company to
do business in every jurisdiction in which the nature of its business or the
ownership of its properties makes such qualification necessary and is in good
standing in such jurisdictions, and (ii) has all licenses and permits necessary
to carry on and conduct its business in all states and localities wherein it now
operates. Each of the Borrower and its Subsidiaries is, and for so long as this
Agreement remains in effect will remain, in compliance with all other
requirements of law, rule, or regulation applicable to it or to its business,
including without limitation any and all city, county, state, or federal legal
or regulatory requirements, requirements of any governmental protective
agencies, Federal Aviation Administration, Office of Safety and Health
Administration, Federal and State land sales statutes, regulations governing
Developments of Regional Impact (DRI's), any and all equal opportunity laws or
regulations, and any and all court or regulatory orders, or other legal,
judicial, or regulatory requirements applicable to it or its business, except in
each case where the failure to be in such compliance could not reasonably be
expected to have a Material Adverse Effect. As of the Closing Date, the Borrower
does not have any direct or indirect Subsidiaries, except for those described in
the Perfection Certificate. As of the Closing Date and except as set forth in
the Perfection Certificate, neither the Borrower nor any of its Subsidiaries has
merged, changed its name, or done business under a fictitious name during the
past five years.
SECTION 4.2. CORPORATE POWER AND AUTHORIZATION TO EXECUTE
LOAN DOCUMENTS; NO CONFLICT; NO CONSENT. Each of the Borrower and the Subsidiary
Loan Parties has the corporate or other requisite power and authority to execute
and deliver the Loan Documents to be executed by it and to perform its
obligations thereunder and has taken all corporate or other requisite action
necessary to authorize the execution, delivery, and performance of such Loan
Documents and to authorize the transactions contemplated thereby. The execution,
delivery, and performance by each of the Borrower and each Subsidiary Loan Party
of the Loan Documents to be executed by it does not: (a) contravene, conflict
with, result in
48
the breach of, or constitute a violation of or default under (i) the certificate
of incorporation or organization, bylaws, operating agreement or other governing
document of the Borrower or such Subsidiary Loan Party, (ii) any applicable law,
rule, regulation, judgment, order, writ, injunction, or decree of any court or
Governmental Authority or (iii) any indenture or any material agreement or
instrument to which the Borrower or any Subsidiary Loan Party is a party or by
which the Borrower or any Subsidiary Loan Party or any of its property may be
bound or affected; or (b) result in the creation of any Lien upon any property
or assets of the Borrower or any Subsidiary Loan Party pursuant to any of the
foregoing (except Liens created under the Loan Documents). No consent, license,
or authorization of, or filing with, or notice to, any Person or entity
(including, without limitation, any Governmental Authority), is necessary or
required in connection with the execution, delivery, performance, validity, or
enforceability of the Loan Documents and the transactions as contemplated
thereunder, except for (i) consents, licenses, authorizations, filings, and
notices which have already been obtained or performed and of which
Administrative Agent has been provided written notice, or which are referred to
or disclosed in the Loan Documents and (ii) filings necessary to perfect Liens
created under the Loan Documents. Any consents, licenses, authorizations,
filings, or notices which have been obtained remain in full force and effect.
SECTION 4.3. ENFORCEABLE OBLIGATIONS. The Loan Documents
constitute legal, valid, and binding agreements and obligations of the Borrower
and each Subsidiary Loan Party, enforceable against the Borrower and each
Subsidiary Loan Party in accordance with their respective terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
SECTION 4.4. FINANCIAL CONDITION.
(a) The consolidated financial statements (including the
notes thereto) as of the Fiscal Year ended October 31, 2004 and the Fiscal
Quarter ended April 30, 2005, of the Borrower and its Subsidiaries, copies of
which have been furnished to Administrative Agent and Lenders, are correct,
complete in all material respects, and fairly present, in all material respects,
the financial condition of the Borrower and its Subsidiaries as of the date of
the financial statements and present the results of the operations of the
Borrower and its Subsidiaries, taken as a whole, for the period covered thereby
in conformity with GAAP applied on a Consistent Basis, subject to non-material
changes resulting from normal, recurring year-end adjustments.
(b) The financial statements described above have been
prepared in accordance with GAAP applied on a Consistent Basis maintained
throughout the period involved.
(c) Since October 31, 2004, there have been no changes with
respect to the Borrower and its Subsidiaries which have had or could reasonably
be expected to have, singly or in the aggregate, a Material Adverse Effect.
(d) The Borrower and its Subsidiaries, when taken as a
whole, do not have any material direct or contingent liabilities, liabilities
for taxes, long-term leases, or unusual
49
forward or long-term commitments as of the date of this Agreement which are not
disclosed by, provided for, or reserved against in the foregoing financial
statements or referred to in notes thereto, and at the date of this Agreement
there are no material unrealized or anticipated losses of the Borrower and its
Subsidiaries, when taken as a whole.
SECTION 4.5. NO LITIGATION.
(a) Except as set forth in Schedule 4.5, there is no suit or
proceeding at law or in equity or other proceeding or investigation (including
proceedings by or before any court, arbitrator, governmental or administrative
commission, board, bureau, or other administrative agency) pending, or to the
knowledge of the Borrower threatened, against the Borrower, against any of its
Subsidiaries, or against any of its or their properties, existence, or revenues
(i) which, individually or in the aggregate could reasonably be expected to be
adversely determined, and if adversely determined, could reasonably be expected
to have a Material Adverse Effect, or (ii) regardless of outcome, which would be
required to be disclosed in notes to any consolidated balance sheets as of the
date hereof of the Borrower and its Subsidiaries prepared in reasonable detail
in accordance with GAAP, or (iii) which in any manner draws into question the
validity or enforceability of this Agreement or any other Loan Document.
(b) Except as set forth in Schedule 4.5, neither the
Borrower nor any of its Subsidiaries (i) has failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or
other approval required under any Environmental Law, (ii) has become liable for
any Environmental Liability, (iii) has received notice of any claim asserting
that the Borrower or any of its Subsidiaries may be liable for any Environmental
Liability or (iv) knows of any basis for any Environmental Liability for which
the Borrower or any of its Subsidiaries could reasonably be expected to become
liable, in each case if the effect thereof could reasonably be expected to
result in a Material Adverse Effect.
SECTION 4.6. INVESTMENT COMPANY ACT; REGULATION.
(a) Neither the Borrower nor any of its Subsidiaries is an
"investment company," an "affiliated person" of, or "promoter" or "principal
underwriter" for, any "investment company," or a company "controlled" by an
"investment company," and neither the Borrower nor any of its Subsidiaries is an
"investment advisor" or an "affiliated person" of an "investment advisor" (as
each of the quoted terms is defined or used in the Investment Company Act of
1940, as amended). Neither the making of the Loans, nor the establishment of the
credits hereunder, nor the application of the proceeds or repayment thereof by
the Borrower, nor the consummation of the other transactions contemplated
hereby, will violate the provisions of the foregoing Act or any rule,
regulation, or order promulgated thereunder.
(b) Neither the Borrower nor any of its Subsidiaries is
subject to regulation under any state or local public utilities code or federal,
state, or local statute or regulation limiting the ability of the Borrower or
any Subsidiary to incur indebtedness for money borrowed.
SECTION 4.7. DISCLOSURE AND NO UNTRUE STATEMENTS. No
representation or warranty or statement made by the Borrower or by any
Subsidiary Loan Party in the Loan
50
Documents or in any schedule or exhibit thereto, or in any certificate, report,
statement, or other document or written information furnished to the
Administrative Agent in connection with or prior to the Loan Documents (when
taken as a whole and as modified or supplemented by other written information so
furnished), or which will be made or furnished by the Borrower or any Subsidiary
Loan Party from time to time in connection with the Loan Documents, contains any
misrepresentation or untrue statement of any material fact or omits to state a
material fact or any fact necessary to make the statements contained herein or
therein not materially misleading; provided that with respect to projected
financial information, the Borrower represents only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time. There is no fact known to the Borrower which could reasonably be expected
to have a Material Adverse Effect, which has not been set forth or referred to
in the Loan Documents or otherwise disclosed in writing to Administrative Agent.
SECTION 4.8. TITLE TO ASSETS; LEASES IN GOOD STANDING.
The Borrower and each of its Subsidiaries has good and marketable title in fee
to such of its fixed assets as are real property and good and marketable title
to its other properties and assets, including the properties and assets
reflected in the financial statements and notes thereto described in Section
4.4, except where the failure to have such title could not reasonably be
expected to have a Material Adverse Effect, and except for such assets as have
been disposed of in the ordinary course of business. All such properties and
assets are free and clear of all Liens, mortgages, pledges, security interests,
charges, title retention agreements, or other Liens of any kind, except those
permitted under Section 7.2, if any. Each of the Borrower and its Subsidiaries
enjoys peaceful and undisturbed possession under all leases, the termination of
which could be reasonably expected to have a Material Adverse Effect, and all
such leases are valid, subsisting, and in full force and effect and neither the
Borrower nor any Subsidiary is in violation of any material term of any such
lease. The total fair market value, in the aggregate, of all of the assets of
the Borrower's Subsidiary HEICO Aerospace Holdings Corp. is less than
$2,500,000, and at all times hereunder will be less than $2,500,000, in each
case, excluding the value of Capital Stock of its direct Subsidiaries, and
except as permitted pursuant to Section 7.11.
SECTION 4.9. PAYMENT OF TAXES. Each of the Borrower and, to
the extent required, its Subsidiaries, has filed or caused to be filed all
federal, state, and local tax returns which are required to be filed by it and
has paid or caused to be paid all taxes as shown on said returns or on any
assessment received by it, to the extent that such taxes have become due, other
than taxes being contested in good faith by appropriate proceedings diligently
conducted and for which adequate reserves have been established in accordance
with GAAP or except to the extent that the total liability for such taxes does
not exceed $2,500,000, and no controversy in respect of additional taxes of the
Borrower or its Subsidiaries which will have or is reasonably likely to have a
Material Adverse Effect, is pending, or, to the knowledge of the Borrower,
threatened.
SECTION 4.10. NO DEFAULT UNDER AGREEMENT OR INSTRUMENTS;
COMPLIANCE WITH LAWS. Each of the Borrower and its Subsidiaries is in full
compliance with and is not in default in the performance, observance, or
fulfillment of any obligations, covenants, or conditions contained in any
agreement or instrument to which it is a party, except where such failure could
not reasonably be expected to have a Material Adverse Effect. The Borrower and
each Subsidiary is in compliance with all Requirements of Law and all judgments,
decrees and orders
51
of any Governmental Authority, except where non-compliance, either singly or in
the aggregate, could not reasonably be expected to result in a Material Adverse
Effect.
SECTION 4.11. PATENTS, TRADEMARKS, LICENSES, ETC. Each of the
Borrower and each of its Subsidiaries owns, possesses, or has the right to use,
and holds free from burdensome restrictions or known conflicts with the rights
of others, all patents, patent rights, licenses, Parts Manufacturing Approvals
(PMA's) issued by the Federal Aviation Administration, trademarks and service
marks, trademark and service xxxx rights, trade names, trade name rights, and
copyrights, and all rights with respect to the foregoing, necessary to conduct
its business as now conducted, and is in full compliance with the terms and
conditions, if any, of all such patents, patent rights, licenses, trademarks and
service marks, trademark and service xxxx rights, trade names, trade name
rights, or copyrights and the terms and conditions of any agreements relating
thereto, except, in each case where such failure could not reasonably be
expected to have a Material Adverse Effect.
SECTION 4.12. GOVERNMENT CONTRACT. Neither the Borrower nor
any Subsidiary of the Borrower is subject to the renegotiation of any government
contract in any material amount, except where such renegotiations could not
reasonably be expected to have a Material Adverse Effect.
SECTION 4.13. ERISA REQUIREMENT. As of the Closing Date,
except as previously disclosed to Administrative Agent in writing, neither the
Borrower nor any Subsidiary has in force any pension plan subject to Title IV of
ERISA. As of the Closing Date, neither the Borrower nor any Subsidiary has ever
terminated a pension plan subject to Title IV of ERISA. In addition, as of the
Closing Date, neither the Borrower nor any predecessor of the Borrower, nor any
Subsidiary or any predecessor of such Subsidiary, is now or was formerly during
the five year period immediately preceding the effective date of this Agreement
a participating employer in any multi-employer plan within the meaning of
Section 4001(a)(3) of ERISA. Each employee benefit plan maintained by the
Borrower or any Subsidiary which is subject to the requirements of ERISA
substantially complies with all of the requirements of ERISA, except to the
extent that any such noncompliance would not result in a liability to the
Borrower or any Subsidiary in excess of $5,000,000, in the aggregate, and those
plans which are subject to being "qualified" under Sections 401(a) and 501(a) of
the Internal Revenue Code of 1986, as amended from time to time, have since
their adoption been "qualified" and have received favorable determination
letters from the Internal Revenue Service so holding (or have remaining a period
of time under any Internal Revenue Service pronouncement in which to apply for
such determination letters). To the best knowledge of the Borrower, there is no
matter which could reasonably be expected to adversely and materially affect the
qualified tax exempt status of any such trust or plan, and except as previously
disclosed to Administrative Agent or as permitted by Section 5.12, there are no
deficiencies for any such plan or trust. To the best knowledge of the Borrower,
no employee benefit plan sponsored by the Borrower or any Subsidiary has engaged
in a non-exempt "prohibited transaction" as defined in ERISA.
SECTION 4.14. SOLVENCY. The Borrower is, and on and after the
consummation of the transactions contemplated herein will be, Solvent. Each
Subsidiary Loan Party of the Borrower is, and on and after the consummation of
the transactions contemplated herein will be, Solvent.
52
SECTION 4.15. LOCATION OF OFFICES. As of the Closing Date, the
Perfection Certificate contains a true and correct statement with respect to the
Borrower and each Subsidiary Loan Party of its chief executive office and
principal place of business. As of the Closing Date, the chief executive office,
the principal place of business, and the office where all books and records of
the Borrower and each Subsidiary Loan Party of the Borrower are kept is at the
location described with respect to the Borrower or such Subsidiary Loan Party on
the Perfection Certificate.
SECTION 4.16. INSURANCE. The properties of the Borrower and
its Subsidiaries are insured with financially sound and reputable insurance
companies which are not Affiliates of the Borrower, in such amounts with such
deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where
the Borrower or any applicable Subsidiary operates.
SECTION 4.17. LABOR RELATIONS. There are no strikes, lockouts
or other material labor disputes or grievances against the Borrower or any of
its Subsidiaries, or, to the Borrower's knowledge, threatened against or
affecting the Borrower or any of its Subsidiaries, and no significant unfair
labor practice, charges or grievances are pending against the Borrower or any of
its Subsidiaries, or to the Borrower's knowledge, threatened against any of them
before any Governmental Authority, except to the extent such proceedings could
not reasonably be expected to have a Material Adverse Effect. All payments due
from the Borrower or any of its Subsidiaries pursuant to the provisions of any
collective bargaining agreement have been paid or accrued as a liability on the
books of the Borrower or any such Subsidiary, except where the failure to do so
could not reasonably be expected to have a Material Adverse Effect.
SECTION 4.18. OFAC. No Credit Party (i) is a person whose
property or interest in property is blocked or subject to blocking pursuant to
Section 1 of Executive Order 13224 of September 23, 2001 Blocking Property and
Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support
Terrorism (66 Fed. Reg. 49079 (2001)), (ii) engages in any dealings or
transactions prohibited by Section 2 of such executive order, or is otherwise
associated with any such person in any manner violative of Section 2, or
(iii) is a person on the list of Specially Designated Nationals and Blocked
Persons or subject to the limitations or prohibitions under any other U.S.
Department of Treasury's Office of Foreign Assets Control regulation or
executive order.
SECTION 4.19. PATRIOT ACT. Each Credit Party is in compliance,
in all material respects, with (i) the Trading with the Enemy Act, as amended,
and each of the foreign assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling
legislation or executive order relating thereto, and (ii) the Uniting And
Strengthening America By Providing Appropriate Tools Required To Intercept And
Obstruct Terrorism (USA Patriot Act of 2001) (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (as amended from time to time, the "Patriot
Act"). No part of the proceeds of the Loans will be used, directly or
indirectly, for any payments to any governmental official or employee, political
party, official of a political party, candidate for political office, or anyone
else acting in an official capacity, in order to obtain, retain or direct
business or obtain any improper advantage, in violation of the United States
Foreign Corrupt Practices Act of 1977, as amended.
53
ARTICLE V
AFFIRMATIVE COVENANTS
The Borrower covenants and agrees that so long as any Lender
has a Commitment hereunder, any Letter of Credit remains outstanding or any
Obligation remains unpaid or outstanding:
SECTION 5.1. FINANCIAL REPORTS AND OTHER INFORMATION.
The Borrower will deliver or cause to be delivered to Administrative Agent the
following:
(a) As soon as practicable and in any event within
forty-five (45) days after the end of each of the first, second and third Fiscal
Quarters, then current financial statements of the Borrower and its Subsidiaries
for such Fiscal Quarter, including without limitation a balance sheet as of the
last day of such quarter, a statement of income for such quarter and cumulative
year-to-date, and related statement of cash flows for such Fiscal Quarter for
the Borrower and its Subsidiaries, all in reasonable detail and satisfactory in
scope to Required Lenders and certified by the chief financial officer of the
Borrower as to the fairness, completeness and accuracy in all material respects
of such financial statements and that the same have been prepared in accordance
with GAAP applied on a Consistent Basis, subject to changes resulting from
normal year-end adjustments;
(b) As soon as practicable and in any event within ninety
(90) days after the end of each Fiscal Year, the then current audited financial
statements of the Borrower and its Subsidiaries for such Fiscal Year, including
the balance sheet as of the end of such Fiscal Year, and related statements of
income, retained earnings, and cash flows for such Fiscal Year for the Borrower
and its Subsidiaries, setting forth in each case in comparative form figures for
the corresponding period in the preceding Fiscal Year, all in reasonable detail
and satisfactory in scope to Required Lenders and, with respect to consolidated
financial statements for the Borrower, certified by and containing an
unqualified opinion of Deloitte & Touche LLP, or other independent certified
public accountants of recognized national standing, which accountants shall be
selected by the Borrower and satisfactory to the Administrative Agent, and
certified by the chief financial officer of the Borrower as to the fairness,
completeness and accuracy in all material respects of such financial statements
and that the same have been prepared in accordance with GAAP applied on a
Consistent Basis;
(c) Together with delivery of the items required in clause
(b), a detailed report of the Borrower's projections of its revenues, expenses,
results of operations, cash flows and financial position for the next Fiscal
Year, in such degree of specificity as may be reasonably requested by
Administrative Agent, and including without limitation projected income
statements, balance sheets and cash flow statements for each quarter of the next
Fiscal Year for the Borrower and its Subsidiaries;
(d) Within thirty (30) days after receipt thereof, copies of
any management audit letters provided to the Borrower by the independent
certified public accountant who prepared Borrower's financial statements;
54
(e) As soon as practicable and in any event within
forty-five (45) days after the end of each Fiscal Quarter, a copy of any
quarterly 10-Q report or any other report filed by the Borrower with the United
States Securities and Exchange Commission during or for such quarter, if any;
(f) As soon as practicable and in any event within ninety
(90) days after the end of each Fiscal Year, a copy of the annual 10-K report
filed by the Borrower with the United States Securities and Exchange Commission
if any;
(g) Together with each delivery of the items required by
clauses (a) and (b) above, a Compliance Certificate executed by the principal
financial officer of the Borrower, (i) containing computations in reasonable
detail indicating compliance with Sections 6.1(a), (b) and (c) hereof,
(ii) certifying that the financial statements referred to in clauses (a) and (b)
have been filed with the United States Securities and Exchange Commission, the
certifications to the United States Securities and Exchange Commission required
under Sections 302(a) and 906(a) of the Xxxxxxxx-Xxxxx Act of 2002, as amended,
have been made, and such certifications are true and correct, (iii) certifying
the matters contained in Sections 3.2 (a), (b) and (c) hereof as of such date
(or specifying all exceptions thereto and what actions the Borrower is taking or
proposes to take with respect thereto), (iv) stating whether any change in GAAP
or the application thereof has occurred since the date of the Borrower's audited
financial statements delivered in connection with Section 4.4 or Section 5.1
hereto, as applicable, and, if any change has occurred, specifying the effect of
such change on the financial statements accompanying such certificate and
(v) certifying that the financial statements fairly present the financial
condition of the Borrower and its Subsidiaries in all material respects; and
(h) With reasonable promptness, such additional financial or
other data relating to the Borrower or any of its Subsidiaries as Administrative
Agent may from time to time reasonably request.
Administrative Agent and the Lenders are hereby authorized to deliver
upon request a copy of any financial statements or any other information
relating to the business, properties, or financial condition of the Borrower or
any of its Subsidiaries which may be furnished to them or come to their
attention pursuant to the Loan Documents or otherwise, to any regulatory body or
agency having jurisdiction over Administrative Agent or the Lenders or to any
Person which shall, or shall have the right or obligation to, succeed to all or
any part of Administrative Agent's or the Lenders' interest in the Loan
Documents, subject to the provisions of Section 10.11 hereof.
SECTION 5.2. PAYMENT OF INDEBTEDNESS TO ADMINISTRATIVE AGENT;
PAYMENT OF OTHER OBLIGATIONS. (a) The Borrower will make full and timely payment
of the principal of and interest on the Indebtedness owed hereunder, subject to
the grace periods set forth in Section 8.1, if any; and (b) the Borrower will
make full and timely payment of all other sums to Administrative Agent, in its
capacity as such, whether now existing or hereafter arising, subject to any
applicable grace periods.
SECTION 5.3. CONDUCT OF BUSINESS; MAINTENANCE OF EXISTENCE
AND RIGHTS. The Borrower and each of its Subsidiaries will do or cause to be
done all things necessary to preserve and to keep in full force and effect its
corporate existence and rights and privileges as a
55
corporation and its material franchises, licenses, trade names, patents,
trademarks, and permits which are necessary for the continuance of its business;
provided, that nothing in this Section 5.3 shall prohibit any merger,
consolidation, liquidation or dissolution permitted under Section 7.4.
SECTION 5.4. MAINTENANCE OF PROPERTY. The Borrower and each
of its Subsidiaries will maintain its property in good condition and repair in
all material respects and, from time to time, make all necessary and proper
repairs, renewals, replacements, additions, and improvements thereto, so that
the business carried on may be properly and advantageously conducted at all
times in accordance with prudent business management; provided, however, that
(i) nothing contained herein shall prevent the Borrower or such Subsidiary from
selling or abandoning items of property in the ordinary course of business or as
otherwise specifically permitted herein, or with concurrent written notice to
Administrative Agent, in the discretion of the officers or directors of the
Borrower or such Subsidiary, from terminating any joint venture or any
non-material operation and (iii) Subsidiaries that are not Subsidiary Loan
Parties shall only be required to comply with the foregoing to the extent that a
failure to do so could reasonably be expected to give rise to a Material Adverse
Effect.
SECTION 5.5. RIGHT OF INSPECTION; DISCUSSIONS. The Borrower
and each of its Subsidiaries will permit any Person designated by Administrative
Agent or the Required Lenders to visit and inspect any of the properties,
corporate books, records, papers, and financial reports of the Borrower or such
Subsidiary, including the making of any copies thereof and abstracts therefrom,
and to discuss its affairs, finances, and accounts with its principal officers,
all at such reasonable times during normal business hours and with prior notice
and as often as Administrative Agent or the Required Lenders may reasonably
request. The Borrower and each of its Subsidiaries will also permit
Administrative Agent or the Required Lenders, or their designated
representatives, to audit or appraise, at Administrative Agent's or such
Required Lenders' expense, any of its assets or financial and business records,
provided that upon the occurrence and continuance of an Event of Default, such
audit or appraisal shall be at the Borrower's expense. Any designated
representative of Administrative Agent or Required Lenders shall agree to be
bound by the provisions of Section 10.11 hereof.
SECTION 5.6. NOTICES. The Borrower will reasonably promptly
(and in no case longer than one Business Day after a Responsible Officer of the
Borrower has knowledge thereof with respect to subsection (a) below, and in no
case longer than three Business Days after a Responsible Officer of the Borrower
has knowledge thereof in all other cases) give notice in writing to
Administrative Agent of:
(a) the occurrence of any Event of Default (or event which
would constitute an Event of Default but for the requirement that notice be
given or time elapse or both) hereunder in which case such notice shall specify
the nature thereof, the period of existence thereof, and the action that the
Borrower proposes to take with respect thereto;
(b) the occurrence of any casualty to any facility of the
Borrower or any of its Subsidiaries or any other force majeure (including,
without limitation, any strike or other labor disturbance) affecting the
operation or value of any such facility, and whether or not such casualty or
force majeure is covered by insurance, which casualty, facility, or force
majeure could reasonably be expected to give rise to a Material Adverse Effect;
56
(c) the commencement or any material change in the nature or
status of any litigation, dispute, or proceeding, or the instituting of any
attachment, levy, execution, or other process by or against any assets of the
Borrower or any of its Subsidiaries, in each case or in the aggregate, which
could reasonably be expected to have a Material Adverse Effect;
(d) the occurrence of a change in, modification to,
cancellation or early termination of, or default in (or event which would
constitute a default but for the requirement that notice be given or time elapse
or both) any obligation, contract, or agreement of the Borrower or any of its
Subsidiaries with any other Person, in each case or in the aggregate, which
could reasonably be expected to give rise to a Material Adverse Effect;
(e) without the waiver or prior written consent of the
Administrative Agent in its sole and absolute discretion, any proposed
acquisition by the Borrower or any Subsidiary, which notice shall be given at
least five (5) days before the proposed closing of any such acquisition with a
total acquisition price of less than $15,000,000 or at least ten (10) days
before the proposed closing of any such acquisition with a total acquisition
price of equal to or more than $15,000,000, or with an acquisition price which
when added to the total acquisition prices of all other acquisitions during any
four consecutive Fiscal Quarters of the Borrower in which the closing of such
transaction will occur will amount to an aggregate of $15,000,000 or more;
(f) without the waiver or prior written consent of the
Administrative Agent in its sole and absolute discretion, any proposed
incorporation or formation of any proposed or potential Subsidiary, which notice
shall be given at least three (3) days (or such lesser period as may be
consented to in writing by Administrative Agent) before such incorporation or
formation;
(g) without the waiver or prior written consent of the
Administrative Agent in its sole and absolute discretion, any transaction listed
in Section 7.4 (not otherwise covered by clause (e) above), which notice shall
be given at least fifteen (15) days before such transaction is consummated;
(h) any assessment in an amount in excess of $2,500,000 by
any taxing authority for unpaid taxes which are due and payable;
(i) the occurrence of any event or any other development by
which the Borrower or any of its Subsidiaries (i) fails to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or
other approval required under any Environmental Law, (ii) becomes liable for any
Environmental Liability, (iii) receives notice of any claim asserting that the
Borrower or any Subsidiary may be liable for any Environmental Liability, or
(iv) becomes aware of any basis for any Environmental Liability for which the
Borrower or any Subsidiary could reasonably be expected to become liable, and in
each of the preceding clauses, which individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect;
(j) the receipt of any notice of termination of any real
property lease by the landlord after a default under such lease by the Borrower
or a Subsidiary Loan Party, as the case may be, if the Collateral located on
such leased property has a fair market value of $2,500,000
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or more, which notice shall be given within five (5) days of receipt thereof
from the landlord; and
(k) any other development that results in, or could
reasonably be expected to result in, a Material Adverse Effect.
Each notice delivered under this Section 5.6 shall be accompanied by a
written statement of a Responsible Officer setting forth the details of the
event or development requiring such notice and any action taken or proposed to
be taken with respect thereto. Notwithstanding any contrary provision herein or
in any other Loan Document, the Administrative Agent may (but shall not be
required to) waive any notice requirement herein or in any other Loan Document.
SECTION 5.7. PAYMENT OF TAXES; LIENS. The Borrower and each
of its Subsidiaries will pay or cause to be paid when due, subject to any
permitted extensions, all taxes, assessments, and other governmental charges
which may lawfully be levied or assessed (a) upon the income or profits of the
Borrower or such Subsidiary; (b) upon any property, real, personal or mixed,
belonging to the Borrower or such Subsidiary, or upon any part thereof; or
(c) by reason of employee benefit plans sponsored by the Borrower or such
Subsidiary, and will also pay or cause to be paid when due, subject to any
permitted extensions, any lawful claims for labor, material, or supplies which,
if unpaid, might become a lien or charge against any property of the Borrower or
such Subsidiary except to the extent that the failure to make such payments,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect; provided, however, the Borrower or such Subsidiary
shall not be required to pay any such tax, assessment, charge, levy, or claim
that is past due so long as the validity thereof shall be actively contested in
good faith by appropriate proceedings and the Borrower or such Subsidiary shall
have set aside on its books adequate reserves (determined in accordance with
GAAP) with respect to any such tax, assessment, charge, levy, or claim so
contested; but provided, further, that any such tax, assessment, charge, levy,
or claim shall be paid forthwith upon the commencement of proceedings to
foreclose any lien securing the same.
SECTION 5.8. INSURANCE OF PROPERTIES. The Borrower and each
of its Subsidiaries will keep its business and properties insured at all times
by insurance companies selected by it and acceptable to Administrative Agent
against the risks for which provision for such insurance is usually made by
other Persons engaged in a similar business similarly situated (including
without limitation insurance for fire and other hazards, insurance against
vandalism and theft, liability on account of damage to persons or property,
business interruption, products liability, and insurance under all applicable
xxxxxxx'x compensation laws) and to the same extent thereto and carry such other
types and amounts of insurance as are usually carried by Persons engaged in the
same or a similar business similarly situated, subject to a standard
loss-payee's and additional insured's endorsement in favor of Administrative
Agent for the benefit of the Lenders (subject to any requirements in the Bond
Documents with respect to the collateral covered by the Bond Documents, to the
extent applicable), and upon request deliver to Administrative Agent a
certificate from the insurer setting forth the nature of the risks covered by
such insurance, the amount carried with respect to each risk, and the name of
the insurer.
SECTION 5.9. TRUE BOOKS. The Borrower and each of its
Subsidiaries will keep proper and true books of record and account, satisfactory
to Administrative Agent, in which
58
entries that are full, true, and correct in all material respects will be made
of all of its dealings and transactions customarily recorded in the books of
businesses of types substantially similar to that of the Borrower or such
Subsidiary, and establish on its books such reserves as may be required by GAAP
with respect to all taxes, assessments, charges, levies, and claims referred to
in Section 5.7 hereof, and with respect to its business in general, and will, to
the extent required by GAAP, include such reserves in any interim as well as
year-end financial statements.
SECTION 5.10. OBSERVANCE OF LAWS. The Borrower and each of its
Subsidiaries will conform to and duly observe in all material respects, all
laws, regulations, and other valid requirements of any Governmental Authority
with respect to the conduct of its business, including without limitation all
laws, rules and regulations referenced in Section 4.1.
SECTION 5.11. FURTHER ASSURANCES. The Borrower will, and will
cause each of the Subsidiary Loan Parties to, make, execute, endorse,
acknowledge and deliver any amendments, modifications or supplements to, and
restatements of, this Agreement and any other Loan Document, and any other
agreements, instruments or documents, and take any and all such actions, as may
from time to time be reasonably requested by the Administrative Agent to perfect
and maintain the validity and priority of the Liens granted pursuant to the
Security Documents and to effect, confirm or further assure or protect and
reserve the interests, rights and remedies of the Administrative Agent and the
Lenders under this Agreement and the other Loan Documents (including without
limitation, any and all instruments necessary or appropriate to affect the
guarantee of the Obligations by all Guarantors created or acquired after the
date hereof).
SECTION 5.12. ERISA BENEFIT PLANS. The Borrower and each of
its Subsidiaries will substantially comply with all requirements of ERISA
applicable to it, except to the extent that the failure to so comply shall not
result in a liability to the Borrower and its Subsidiaries in excess of
$5,000,000 in the aggregate. The Borrower and each of its Subsidiaries will
furnish to Administrative Agent as soon as possible and in any event within 10
days after the Borrower or such Subsidiary or a duly appointed administrator of
a plan (as defined in ERISA) knows or has reason to know that any reportable
event, funding deficiency, or prohibited transaction (as defined in ERISA) with
respect to any plan has occurred, a statement of the chief financial officer of
the Borrower describing in reasonable detail such reportable event, funding
deficiency, or prohibited transaction and any action which the Borrower or such
Subsidiary proposes to take with respect thereto, together with a copy of the
notice of such event given to the PBGC or the Internal Revenue Service or a
statement that said notice will be filed with the annual report of the United
States Department of Labor with respect to such plan if such filing has been
authorized.
SECTION 5.13. WITHHOLDING TAXES. Except to the extent that the
total liability of the Borrower and its Subsidiaries shall exceed $500,000 in
the aggregate, the Borrower and each of its Subsidiaries will pay, as and when
due, subject to any permitted extensions, all employee withholding, FICA, and
other tax payments required by federal, state, and local governments with
respect to wages paid to employees; provided, however, the Borrower or such
Subsidiary shall not be required to pay any such tax payment that is past due so
long as the validity thereof shall be actively contested in good faith by
appropriate proceedings and the Borrower or such Subsidiary shall have set aside
on its books adequate reserves (determined in accordance with GAAP) with respect
to any such tax payment, so contested; but provided, further, that any such
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tax, assessment, charge, levy, or claim shall be paid forthwith upon the
commencement of proceedings to foreclose any lien securing the same.
SECTION 5.14. CHANGE OF NAME, PRINCIPAL PLACE OF BUSINESS OR
OFFICE. The Borrower will notify Administrative Agent in writing of any change
in the name of the Borrower or any Subsidiary Loan Party, the principal place of
business of the Borrower or any Subsidiary Loan Party, or the office where the
books and records of the Borrower or any Subsidiary Loan Party, in each case
within ten (10) days before any such change made, unless waived by the
Administrative Agent in its sole and absolute discretion.
SECTION 5.15. INTENTIONALLY OMITTED.
SECTION 5.16. USE OF PROCEEDS AND LETTERS OF CREDIT
AFFIRMATIVE COVENANTS. The Borrower will use the proceeds of all Loans as
provided in Section 2.6(d). No part of the proceeds of any Loan will be used,
whether directly or indirectly, for any purpose that would violate any rule or
regulation of the Board of Governors of the Federal Reserve System, including
Regulations T, U or X. All Letters of Credit will be used for general corporate
purposes.
SECTION 5.17. ADDITIONAL SUBSIDIARIES.
(a) Subject to the waiver by the Administrative Agent of any
of the notice requirements below in its sole and absolute discretion, if any
Domestic Subsidiary is acquired or formed after the Closing Date, (x) the
Borrower will, promptly and not later than ten (10) Business Days thereafter,
notify the Administrative Agent thereof and (y) within fifteen (15) days
thereafter, the Borrower shall cause such Person (i) to join the Subsidiary
Guaranty Agreement as a new Subsidiary Loan Party by executing and delivering to
the Administrative Agent a Subsidiary Guaranty Supplement (provided, however, if
such Domestic Subsidiary is non-wholly owned, then any Investment in such
non-wholly owned Domestic Subsidiary shall continue to be subject to Section 7.5
hereof and no such Guarantee or Liens shall be required), (ii) to grant Liens in
favor of the Administrative Agent in all of its personal property by joining the
Security Agreement, executing and delivering a Patent Security Agreement and
Trademark Security Agreement (as applicable) with respect to material
intellectual property or as requested by the Administrative Agent, and filing,
or at the request of the Administrative Agent authorizing the filing of, all
such UCC financing statements or similar instruments required by the
Administrative Agent to perfect Liens in favor of the Administrative Agent and
granted under any of the Loan Documents (subject to the proviso in clause
(i) above), (iii) if such Subsidiary owns Capital Stock in another Person, to
become a party to a Pledge Agreement to pledge such Capital Stock (subject to
the proviso in clause (i) above), provided, however, that if such Person is a
Foreign Subsidiary, such pledge shall not exceed 65% of the outstanding equity
interests in such Person, and (iv) to deliver all such other documentation
(including without limitation, lien searches, legal opinions, and certified
organizational documents) and to take all such other actions as such Domestic
Subsidiary would have been required to deliver and, subject to the proviso in
clause (i) above, take pursuant to Section 3.1 if such Domestic Subsidiary had
been a Loan Party on the Closing Date. In addition, subject to the proviso in
clause (i) above, within fifteen (15) days after the date such Person becomes a
Domestic Subsidiary of the Borrower, the Borrower shall, or shall cause its
Subsidiary owning such Person, to pledge all of the Capital Stock of such Person
owned by the Borrower or such Subsidiary to the
60
Administrative Agent as security for the Obligations by executing and delivering
a supplement to the Pledge Agreement or a new pledge agreement reasonably
consistent with the Pledge Agreement, each in form and substance satisfactory to
the Administrative Agent, and to deliver the original certificates, if any,
evidencing such Capital Stock to the Administrative Agent, together with
appropriate stock powers executed in blank; provided, however, that if such
Domestic Subsidiary is non-wholly owned and the Loan Party which owns Capital
Stock in such Person is contractually prohibited from pledging such Capital
Stock in favor of the Administrative Agent as required hereunder, then any
Investment in such Domestic Subsidiary shall continue to be subject to
Section 7.5 and no such pledge shall be required. The Borrower agrees that,
following the delivery of any Security Documents required to be executed and
delivered by this Section 5.17, the Administrative Agent shall have a valid and
enforceable, first priority perfected Lien on the property required to be
pledged pursuant to this Section 5.17, free and clear of all Liens other than
Liens permitted under Section 7.2. All actions to be taken pursuant to this
Section 5.17 shall be at the expense of the Borrower or the applicable Loan
Party, and shall be taken to the reasonable satisfaction of the Administrative
Agent. In the event that a proposed acquisition or investment by the Borrower or
a Subsidiary is in compliance with Section 7.4 and this Section 5.17, and the
consent of the Required Lenders would otherwise be required to effectuate such
acquisition or investment, then the Administrative Agent may, in its sole and
absolute discretion, if it determines that the item as to which such consent
would otherwise be required, is not material, waive such consent requirements.
Notwithstanding the foregoing, the Administrative Agent may, in its sole and
absolute discretion, waive any of the foregoing requirements with respect to any
Foreign Subsidiary to the extent that the assets of such Foreign Subsidiary is
less than 5% of the consolidated assets of the Borrower and all of its
Subsidiaries as of the last day of the immediately preceding Fiscal Year and the
revenue of such Foreign Subsidiary is less than 5% of the consolidated revenue
of the Borrower and all of its Subsidiaries for the immediately preceding Fiscal
Year.
(b) If, at any time, the consolidated revenue and assets of
the Loan Parties (excluding all intercompany Investments, intercompany
receivables and other intercompany assets in Subsidiaries that are not Loan
Parties) are less than the Aggregate Subsidiary Threshold, then the Borrower
shall cause one or more other non-wholly owned or Foreign Subsidiaries to become
additional Subsidiary Loan Parties, as provided for in this Section 5.17, so
that after including the revenue and assets of such additional Subsidiary Loan
Parties, the consolidated revenue and assets of the Loan Parties (excluding all
intercompany Investments, intercompany receivables and other intercompany assets
in Subsidiaries that are not Loan Parties) would equal or exceed the Aggregate
Subsidiary Threshold; provided, further, that (i) any Subsidiary that owns
capital stock of a Subsidiary Loan Party and (ii) any wholly owned Domestic
Subsidiary, shall be required to become a Subsidiary Loan Party. Supplements to
the Subsidiary Guaranty Agreement, Security Agreement and Pledge Agreement shall
be executed and delivered to the Administrative Agent within thirty (30) days
after the date that any Subsidiary is required to become a Subsidiary Loan Party
pursuant to the foregoing sentence, and (ii) all other requirements of
Section 5.17(a) shall be executed and delivered to the Administrative Agent
within sixty (60) days after the date that any Subsidiary is required to become
a Subsidiary Loan Party pursuant to the foregoing sentence.
SECTION 5.18. ADDITIONAL LEASED LOCATIONS. To the extent
otherwise permitted hereunder, if any Loan Party proposes to lease any Real
Estate, it shall first provide to the
61
Administrative Agent a copy of such lease, and if the total fair market value of
all Collateral at such location shall at any time exceed $2,000,000, or if the
total fair market value of all Collateral at locations that are not subject to a
landlord's agreement shall at any time exceed $10,000,000, then such Loan Party
shall deliver a landlord's agreement, from the landlord of such leased property
where such Collateral will be stored or located, which agreement shall be
reasonably satisfactory in form and substance to the Administrative Agent.
ARTICLE VI
FINANCIAL COVENANTS
SECTION 6.1. FINANCIAL COVENANTS. The Borrower covenants and
agrees that so long as any Lender has a Commitment hereunder, any Letter of
Credit remains outstanding or any Obligation remains unpaid or outstanding, the
Borrower will at all times hereunder, in accordance with GAAP applied on a
Consistent Basis, maintain with respect to the Borrower and its Subsidiaries, on
a consolidated basis:
(a) A Leverage Ratio of not greater than 3.00 to 1.00, which
Leverage Ratio shall be maintained and reported as of the last day of each
Fiscal Quarter;
(b) A Fixed Charge Coverage Ratio of greater than or equal
to 2.75 to 1.00, which Fixed Charge Coverage Ratio shall be maintained and
reported as of the last day of each Fiscal Quarter; and
(c) A Consolidated Net Worth of the Borrower and its
Subsidiaries greater than or equal to the sum of (i) 85% of the Consolidated Net
Worth as of October 31, 2004, plus (ii) 75% of cumulative positive Consolidated
Net Income accrued since the Fiscal Quarter ending October 31, 2004, plus
(iii) 100% of the Net Proceeds from any equity offering received by the
Borrower, less (iv) to the extent IAS is impaired, the related impairment charge
determined in accordance with GAAP up to $10,000,000 calculated quarterly on the
last day of each Fiscal Quarter, which Consolidated Net Worth shall be
maintained and reported as of the last day of each Fiscal Quarter.
ARTICLE VII
NEGATIVE COVENANTS
The Borrower covenants and agrees that so long as any Lender
has a Commitment hereunder, any Letter of Credit remains outstanding or any
Obligation remains unpaid or outstanding:
SECTION 7.1. OTHER INDEBTEDNESS. The Borrower will not and
will not permit any of its Subsidiaries to, directly or indirectly, create,
incur, assume, or permit to exist any Indebtedness, except:
62
(a) Indebtedness under the Loan Documents and the Bond
Documents;
(b) Indebtedness existing on the date hereof and set forth
on Schedule 7.1 and extensions, renewals, modifications (provided that such
modifications are not adverse to the Lenders), refinancings and replacements of
any such Indebtedness that do not increase the outstanding principal amount
thereof (immediately prior to giving effect to such extension, renewal,
modification, refinancing or replacement) or shorten the maturity or the
weighted average life thereof;
(c) obligations with respect to Capital Lease Obligations
incurred in the ordinary course of business to finance Capital Expenditures
(other than expenditures for equipment purchases or equipment leases permitted
under Section 7.1(d)), provided that such indebtedness shall be incurred within
180 days after the making of the Capital Expenditures financed thereby;
(d) Indebtedness incurred in the ordinary course of business
of the Borrower and its Subsidiaries in connection with the purchase of
equipment or vehicles, whether or not secured by purchase money security
interests therein; provided that the aggregate amount of all such Indebtedness,
when aggregated with all Indebtedness incurred under Section 7.1(f) (but not
including the Indebtedness incurred under Section 7.1(i)) does not exceed
$20,000,000 at any time outstanding;
(e) Permitted Real Estate Debt;
(f) any other unsecured Indebtedness or any Permitted
Subordinated Indebtedness of the Borrower and all Subsidiaries on a consolidated
basis; provided that the aggregate amount of all such Indebtedness and Permitted
Subordinated Indebtedness, when aggregated with all Indebtedness incurred under
Section 7.1(d) (but not including the Indebtedness incurred under
Section 7.1(i)), does not exceed $20,000,000 at any time outstanding; provided,
further, that any Indebtedness in the form of Guarantees (excluding Guarantees
of the Obligations) shall be subject to the limitations set forth in
Section 7.3;
(g) Indebtedness of the Borrower owing to any Subsidiary and
of any Subsidiary owing to the Borrower or any other Subsidiary; provided that
any such Indebtedness that is owed to a Subsidiary that is not a Subsidiary Loan
Party shall be subject to Section 7.5;
(h) Indebtedness of any Person which becomes a Subsidiary or
is otherwise acquired by the Borrower or its Subsidiaries (whether by merger,
consolidation or otherwise) after the date of this Agreement; provided that
(i) such Indebtedness exists at the time that such Person becomes a Subsidiary
(or is otherwise acquired) and is not created in contemplation of or in
connection with such Person becoming a Subsidiary (or being otherwise acquired)
and (ii) the aggregate principal amount of such Indebtedness created, incurred
or assumed hereunder shall not exceed $30,000,000 during any trailing
twelve-month period; and
(i) Indebtedness incurred by any non-wholly owned Subsidiary
that is not a Subsidiary Loan Party of the Borrower so long as the aggregate
principal amount of such Indebtedness committed or incurred by such Subsidiary,
when aggregated with all preferred stock or other preferred equity interests
issued by such Subsidiary pursuant to the following
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paragraph, does not exceed 50% of the Non-Guarantor Subsidiary Net Worth of such
Subsidiary.
The Borrower will not, and will not permit any Subsidiary to, issue any
preferred stock or other preferred equity interests that (i) matures or is
mandatorily redeemable pursuant to a sinking fund obligation or otherwise,
(ii) is or may become redeemable or repurchaseable by the Borrower or such
Subsidiary at the option of the holder thereof, in whole or in part or (iii) is
convertible or exchangeable at the option of the holder thereof for Indebtedness
or preferred stock or any other preferred equity interests described in this
paragraph, on or prior to, in the case of clause (i), (ii) or (iii), the date
that is 91 days after the Revolving Commitment Termination Date; provided,
however, that any non-wholly owned Subsidiary that is not a Subsidiary Loan
Party may issue such preferred stock or other preferred equity interests so long
as the aggregate amount of such preferred stock or other preferred equity
interests issued by such Subsidiary, when aggregated with Indebtedness committed
or incurred by such Subsidiary pursuant to Section 7.1(i) above, does not exceed
50% of the Non-Guarantor Subsidiary Net Worth of such Subsidiary.
SECTION 7.2. LIMITATIONS ON MORTGAGES, LIENS, ETC. The
Borrower will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create, incur, assume, or suffer or permit to exist any Lien (but
excluding Liens, if any, evidenced by operating leases) upon or with respect to
any of its assets, or assign or otherwise convey any right to receive income,
except the following:
(a) Capital Lease Obligations described in Section 7.1(c)
hereof;
(b) Permitted Encumbrances;
(c) purchase money security interests described in
Section 7.1(d) hereof;
(d) Liens on assets acquired after the date hereof if such
Liens were in place at the time of acquisition, to the extent permitted pursuant
to Section 7.4;
(e) Liens securing Permitted Real Estate Debt;
(f) Liens set forth on Schedule 7.2;
(g) Liens with respect to Investments consisting of fully
collateralized repurchase agreements constituting Permitted Investments
permitted under Section 7.5;
(h) Liens not otherwise permitted by this Section 7.2 so
long as neither (i) the aggregate principal amount of the obligations secured
thereby nor (ii) the aggregate fair market value (determined, in the case of
each such Lien, as of the date such Lien is incurred) of the assets subject
thereto exceeds (as to the Borrower and all Subsidiaries) $1,000,000 at any one
time; provided that the Borrower shall discharge any such Lien within two (2)
Business Days after a Responsible Officer becomes aware thereof;
(i) Liens securing Indebtedness permitted pursuant to
Section 7.1(b) and Section 7.1(h) or created pursuant to the Bond Documents;
provided that the principal amount of
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the Indebtedness secured thereby is not increased and that any such Lien is
limited to the assets originally encumbered thereby;
(j) Liens granted to the Borrower or HEICO Aerospace
Holdings Corp. securing loans to Parts Advantage, LLC permitted by
Section 7.5(f)(ii); and
(k) Liens granted by any non-wholly owned Subsidiary that is
not a Subsidiary Loan Party of the Borrower to secure Indebtedness of such
Subsidiary permitted by Section 7.1(i).
SECTION 7.3. GUARANTIES. The Borrower will not, and will not
permit any of its Subsidiaries to, directly or indirectly, Guarantee, or
otherwise in any way extend credit or become responsible for or remain liable or
contingently liable in connection with any Indebtedness or other obligations of
any other Person or entity except to the extent only that the following do not
cause a violation of Section 6.1: (i) Guarantees and endorsements made in
connection with the deposit of negotiable instruments and other items for
collection or credit in the ordinary course of business, (ii) Guarantees by the
Borrower or any Subsidiary of debts incurred by suppliers of the Borrower or its
Subsidiaries or others having business relationships with the Borrower or its
Subsidiaries for business purposes of the Borrower or any Subsidiary,
(iii) Guarantees by the Borrower or any of its Subsidiaries made in the ordinary
course of business or to support obligations incurred in the ordinary course of
business, (iv) Guarantees by the Borrower or any of its Subsidiaries of
obligations that the Borrower or any Subsidiary are otherwise permitted to incur
hereunder in connection with any acquisition or other transaction permitted by
Section 7.4; provided that Guarantees by any Loan Party of Indebtedness of any
Subsidiary that is not a Subsidiary Loan Party shall be subject to Section 7.5,
and (v) Guarantees by non-wholly owned Subsidiaries that are not Subsidiary Loan
Parties to the extent permitted by Section 7.1(i).
SECTION 7.4. MERGER, ACQUISITION, SALE OF ASSETS,
DISSOLUTION, ETC. The Borrower will not, and will not permit any of its
Subsidiaries to, directly or indirectly:
(a) enter into any one or more mergers, consolidations or
acquisitions unless after giving effect thereto,
(i) no Default or Event of Default has occurred and is
continuing, and the Borrower would be in pro forma compliance with the
covenants set forth in Article VI;
(ii) with respect to any merger or consolidation, (A) the
Borrower is the surviving entity and no Default exists or would result
therefrom including, without limitation, violation of covenants
contained in Article VI hereof, or (B) if the Borrower is not a party
to such merger or consolidation, a Subsidiary is the surviving entity,
or was formed solely for the purposes of acquiring another Person in
connection with a merger or acquisition completed in compliance with
this Section 7.4;
(iii) the aggregate cash purchase price for all such mergers,
consolidations and acquisitions paid by the Borrower and its
Subsidiaries would not exceed Fifty Million Dollars ($50,000,000) in any
trailing twelve-month period (provided, however, that until
65
July 31, 2006 such twelve month period shall be deemed to be the period
commencing on the Closing Date and ending on the relevant date of
termination);
(iv) the aggregate cash purchase price for all such mergers,
consolidations and acquisitions paid by the Borrower and its
Subsidiaries during the period commencing on the Closing Date and ending
on the Revolving Commitment Termination Date would not exceed
$200,000,000; and
(v) the consolidated revenue and assets of the Loan Parties
(excluding all intercompany Investments, intercompany receivables and
other intercompany assets in Subsidiaries that are not Loan Parties)
equal or exceed the Aggregate Subsidiary Threshold.
(b) except to a Loan Party or as otherwise specifically
permitted herein, transfer, sell, assign, lease, or otherwise dispose of all or
a substantial part of its properties or assets or any assets or properties
necessary for the proper conduct of its business or any Capital Stock of any
Subsidiary, or permit any Subsidiary Loan Party to issue any Capital Stock to
any Person other than to the Borrower or another Subsidiary Loan Party, other
than:
(i) the transfer, sale, assignment, lease or other
disposition of properties or assets constituting all or a substantial
part of the properties or assets of the Borrower or any Subsidiary or
necessary for the proper conduct of the business of the Borrower or any
Subsidiary having a total aggregate fair market value of $5,000,000 or
less in any Fiscal Year;
(ii) the transfer, sale, assignment, lease or other
disposition of properties or assets constituting all or a substantial
part of the properties or assets of any Subsidiary that is not a
Subsidiary Loan Party or necessary for the proper conduct of the
business of any Subsidiary that is not a Subsidiary Loan Party having a
total aggregate fair market value of $10,000,000 or less in any Fiscal
Year; and
(iii) subject to the provisions of this Agreement, the
issuance of Capital Stock by a Subsidiary Loan Party to a Person other
than to Loan Parties in an equity offering or private issuance to raise
equity capital or establish a joint venture; provided that at no time
shall Lufthansa Technik AG own more than 30% of the outstanding common
stock, or more than 30% of the voting control, of any Subsidiary Loan
Party;
(c) except to a Loan Party, transfer, sell, assign,
discount, lease, or otherwise dispose of any of its notes or other instruments,
accounts receivable, or contract rights with or without recourse, except for
collection in the ordinary course of business;
(d) change the scope or nature of its business except that
the Borrower may expand its business by internal growth or acquisitions,
(A) into any business substantially similar or related to the types of
businesses it or any Subsidiary currently conducts or (B) into other lines of
business, provided that revenues generated from such other lines of business
shall not constitute more than fifteen percent (15%) of the net sales of the
Borrower and its Subsidiaries, on a consolidated basis, during any Fiscal
Quarter and provided that such other
66
businesses or lines of business singly or in the aggregate could not reasonably
be expected to have a Material Adverse Effect;
(e) wind up, liquidate, or dissolve itself or its business
(except that if no Default or Event of Default has occurred and is continuing,
(i) any Subsidiary may be liquidated into any Loan Party and (ii) any Subsidiary
that is not a Subsidiary Loan Party may liquidate or dissolve if the Borrower
determines in good faith that such liquidation or dissolution is in the best
interest of the Borrower and could not reasonably be expected to give rise to a
Material Adverse Effect); or
(f) agree to any of the foregoing;
provided, however, nothing contained in this Section 7.4 shall prohibit or
otherwise restrict the ability of a Subsidiary Loan Party to sell or otherwise
transfer its receivables or any other assets to another Loan Party.
SECTION 7.5. INVESTMENTS, LOANS, ETC. The Borrower will not,
and will not permit any Subsidiary to, purchase, hold or acquire (including
pursuant to any merger with any Person that was not a wholly-owned Subsidiary
prior to such merger), any common stock, evidence of indebtedness or other
securities (including any option, warrant, or other right to acquire any of the
foregoing) of, make or permit to exist any loans or advances to, Guarantee any
obligations of, or make or permit to exist any investment or any other interest
in, any other Person or purchase or otherwise acquire (in one transaction or a
series of transactions) any assets of any other Person (all of the foregoing
being collectively called "Investments"), except:
(a) Investments (other than Permitted Investments) existing
on the date hereof (including Investments in Subsidiaries) and set forth on
Schedule 7.5;
(b) Permitted Investments;
(c) mergers, consolidations or acquisitions made in
compliance with Section 7.4;
(d) Guarantees constituting Indebtedness permitted by
Section 7.3;
(e) loans, advances or equity investments made by the
Borrower to or in any Subsidiary, or made by any Subsidiary to or in the
Borrower or any other Subsidiary; provided, however, that after giving effect
thereto, the consolidated revenue and assets of the Loan Parties (excluding all
intercompany Investments, intercompany receivables and other intercompany assets
in Subsidiaries that are not Loan Parties) equal or exceed the Aggregate
Subsidiary Threshold;
(f) (i) after the date hereof, except for Investments in
Parts Advantage, LLC, make Investments of more than Five Million Dollars
($5,000,000) in any Person, or enter into other equity alliances or equity
contractual arrangements with any Person, or make an aggregate of more than
Twenty-Five Million Dollars ($25,000,000) of such Investments during the period
from the Closing Date through and including the Revolving Credit Termination
Date or (ii) make equity investments of more than Ten Million Dollars
($10,000,000) in the aggregate in, or
67
loans of more than Five Million Dollars ($5,000,000) in the aggregate to, Parts
Advantage, LLC; provided, however, that the foregoing limitations shall not
apply to transactions executed pursuant to the AFI Option Agreement;
(g) Investments received in connection with a bankruptcy or
reorganization of, or settlement of delinquent accounts and disputes with,
customers and suppliers, in each case in the ordinary course of business;
(h) loans or advances to employees, officers or directors of
the Borrower or any Subsidiary in the ordinary course of business for travel,
relocation and related expenses; provided, however, that the aggregate
outstanding amount of all such loans and advances does not exceed $1,000,000 at
any time;
(i) Capital Expenditures permitted by Section 7.8;
(j) Investments by the Borrower or any of its Subsidiaries
in any Subsidiary Loan Party; and
(k) Hedging Transactions entered into in compliance with
Section 7.15.
SECTION 7.6. FEDERAL RESERVE REGULATIONS. The Borrower
represents that neither it nor any of its Subsidiaries is engaged, and covenants
that neither it nor any of its Subsidiaries will become engaged, as one of its
principal or important activities in extending credit for the purpose of
purchasing or carrying margin stock. If requested by Administrative Agent, the
Borrower will furnish to Administrative Agent in connection with any Loan or
Loans hereunder, a statement in conformity with the requirements of Federal
Reserve Form U-1 or other forms referred to in said regulations. In addition,
the Borrower and each of its Subsidiaries covenants that no part of the proceeds
of any of the Loans hereunder will be used for the purchase of commodity future
contracts (or margins therefor for short sales) for any commodity not required
for the normal raw material inventory of the Borrower or such Subsidiary.
SECTION 7.7. CHANGES IN GOVERNING DOCUMENTS, ACCOUNTING
METHODS, FISCAL YEAR. The Borrower will not, or permit any Subsidiary to
(a) amend, in a manner materially adverse to the Lenders, its certificate of
incorporation or bylaws from that in existence on the date of this Agreement, or
(b) change in any material respect its accounting methods or practices or
depreciation or amortization policy or rates (except as provided in and pursuant
to the requirements of Section 1.3), except in each case as required to comply
with law or with GAAP (subject to the requirements of Section 1.3). The Borrower
shall give notice to Administrative Agent of any such amendment or change
permitted hereunder.
SECTION 7.8. CAPITAL EXPENDITURES. The Borrower will not make
or be committed to make, or permit any of its Subsidiaries to make or be
committed to make, any Capital Expenditure (excluding acquisitions of
businesses), by purchase or capitalized lease, other than Capital Expenditures
which would not cause the aggregate amount of all such Capital Expenditures,
when aggregated with all Sale and Leaseback Transactions without duplication,
calculated at the end of each Fiscal Quarter for the four consecutive Fiscal
Quarters then ended to exceed the aggregate amount of Twenty Million Dollars
($20,000,000), unless the Required
68
Lenders shall have given their prior written consent to such amount of Capital
Expenditures and Sale and Leaseback Transactions as is in excess of $20,000,000
during such four quarter period.
SECTION 7.9. DIVIDENDS, ETC. Without the prior written
consent of the Required Lenders, the Borrower will not declare or pay any cash
dividends in any Fiscal Year in an aggregate amount in excess of the greater of
(a) twenty percent (20%) of Consolidated Net Income (if greater than $0) for the
preceding Fiscal Year or (b) $0.05 per share of Capital Stock of the Borrower
per annum. Without the prior written consent of the Required Lenders, the
Borrower shall not, and shall not permit any of its Subsidiaries to, (without
duplication) (i) purchase, redeem, retire or otherwise acquire for value any
Capital Stock of the Borrower now or hereafter outstanding for an aggregate
amount of consideration in excess of $20,000,000 during any trailing
twelve-month period or in excess of $30,000,000, in the aggregate, during the
period from the Closing Date through and including the Revolving Credit
Termination Date; (ii) return any capital to the stockholders of the Borrower as
such, or make any other payment or distribution of assets to the stockholders of
the Borrower as such except as permitted in the first sentence of this
Section 7.9; or (iii) make any payment or prepayment of principal of, premium,
if any, or interest on, or redeem, defease or otherwise retire, any Indebtedness
of the Borrower or any Subsidiary Loan Party before its scheduled due date,
except for payments, prepayments, redemptions, defeasances or retirements of
less than $2,500,000 of such Indebtedness during any trailing twelve month
period; provided that nothing herein shall prevent the Borrower from
contributing proceeds of Loans to Subsidiary Loan Parties hereunder either in
the form of equity contributions (for issuance of additional shares of
Subsidiary stock to the Borrower or otherwise) or in the form of unsecured
inter-company loans subordinated to the Obligations and the Administrative
Agent's Liens on the Collateral. Notwithstanding the foregoing, upon the
occurrence and during the continuance of a Default or Event of Default, the
Borrower shall not, and shall not permit any Subsidiary to: (a) redeem, retire,
purchase or otherwise acquire, directly or indirectly, for value or set apart
any sum for the redemption, retirement, purchase or other acquisition of,
directly or indirectly, any shares of its common stock or warrants or options to
purchase any shares of its common stock; or (b) declare any dividends or make
any other distribution with respect to its stock (whether by reduction of
capital or otherwise), without Administrative Agent's prior written consent.
Nothing herein shall prevent or otherwise restrict (a) the Borrower or any
Subsidiary from declaring and paying dividends or other distributions with
respect to any class of its Capital Stock payable solely in additional shares of
such class of stock or (b) any Subsidiary from declaring and paying cash
dividends or distributions, or repaying intercompany Indebtedness owed to, its
shareholders on a pro rata basis.
SECTION 7.10. INTENTIONALLY OMITTED.
SECTION 7.11. HEICO AEROSPACE HOLDINGS CORP. Notwithstanding
anything else contained in this Agreement, the Borrower will not, and will not
permit any Subsidiary to, convey, transfer, assign, or otherwise deliver title
or ownership (whether by merger, consolidation, reorganization or otherwise) of
any assets or properties of any kind to HEICO Aerospace Holdings Corp. and will
not permit HEICO Aerospace Holdings Corp. to acquire (whether by purchase,
conveyance, transfer, assignment, merger, consolidation, acquisition, or any
other means) or to hold any assets or property with a fair market value greater
than $2,500,000 in the aggregate (other than the Capital Stock of the direct
Subsidiaries of HEICO Aerospace Holdings Corp.) at any time hereunder until the
sooner to occur of the following:
69
(i) Administrative Agent for the benefit of the Lenders receives from Lufthansa
Technik AG a written waiver, release and consent, in form and substance
satisfactory to the Administrative Agent, waiving, releasing and terminating the
provision contained in Article 18 of that certain Shareholders Agreement dated
as of October 30, 1997 by and among HEICO Aerospace Holdings Corp., HEICO
Aerospace Corporation, and all of the shareholders of HEICO Aerospace Holdings
Corp., including Lufthansa Technik AG, and any similar contractual provisions or
(ii) Lufthansa Technik AG ceases to be a shareholder of HEICO Aerospace Holdings
Corp. and the foregoing Shareholders Agreement and all similar contractual
provisions have been terminated and released pursuant to documentation in form
and substance satisfactory to the Administrative Agent. Notwithstanding this
Section 7.11 or Section 7.9, the direct Subsidiaries of HEICO Aerospace Holdings
Corp. may (i) declare and pay cash dividends to HEICO Aerospace Holdings Corp.,
provided and only to the extent that HEICO Aerospace Holdings Corp. shall have
declared dividends to its common stockholders in the same amount and shall
immediately pay such cash dividends to the common stockholders of HEICO
Aerospace Holding Corp. within one (1) day of the time such dividends are
received by HEICO Aerospace Holdings Corp., such that no cash remains in HEICO
Aerospace Holdings Corp. for longer than one (1) day and (ii) no more frequently
than quarterly, may fund any payment of taxes required to be made directly by
HEICO Aerospace Holdings Corp., provided that the Borrower shall cause HEICO
Aerospace Holdings Corp. to pay such taxes immediately upon receipt of any such
funds, such that no cash remains in HEICO Aerospace Holdings Corp. for longer
than one (1) day. Notwithstanding this Section 7.11, upon obtaining the prior
written consent of the Administrative Agent in each case on a case by case
basis, which consent shall not be unreasonably withheld, the Borrower or any
Subsidiary Loan Party that is a direct or indirect Subsidiary of HEICO Aerospace
Holdings Corp. (i) may, on the closing date of any acquisition permitted
hereunder and made by HEICO Aerospace Holdings Corp., fund through HEICO
Aerospace Holdings Corp. the cash portion of the acquisition purchase price to
be paid at the closing of such acquisition, provided that the Borrower shall
cause HEICO Aerospace Holdings Corp. to pay such cash acquisition price
immediately upon receipt of any such funds, such that no such cash shall remain
in HEICO Aerospace Holdings Corp. for longer than twenty-four (24) hours.
SECTION 7.12. TRANSACTIONS WITH AFFILIATES. The Borrower will
not, and will not permit any of its Subsidiaries to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire any
property or assets from, or otherwise engage in any other transactions with, any
of its Affiliates, except (a) at prices and on terms and conditions not less
favorable to the Borrower or such Subsidiary than could be obtained on an
arm's-length basis from unrelated third parties (provided that the foregoing
restriction shall not apply to employment agreements with Affiliates approved in
good faith by the Board of Directors of the Borrower or any compensation or
similar committee of the Board of Directors), (b) transactions between or among
the Borrower and any Subsidiary Loan Party not involving any other Affiliates,
(c) any payment permitted by Section 7.9, (d) customary fees paid to members of
the Board of Directors of the Borrower and its Subsidiaries for their services
as directors not in excess of fees paid to directors who are not Affiliates of
the Borrower or any Subsidiary and (e) transactions with Parts Advantage, LLC or
any other entity that the Borrower or its Subsidiaries has invested in pursuant
to Section 7.5(f), in each case, entered into in good faith and in the best
interests of the Borrower.
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SECTION 7.13. RESTRICTIVE AGREEMENTS. The Borrower will not,
and will not permit any Subsidiary Loan Party to, directly or indirectly, enter
into, incur or permit to exist any agreement that prohibits, restricts or
imposes any condition upon (a) the ability of any Loan Party to create, incur or
permit any Lien upon any of its assets or properties, whether now owned or
hereafter acquired, or (b) the ability of any Subsidiary Loan Party to pay
dividends or other distributions with respect to its common stock, to make or
repay loans or advances to the Borrower or any other Subsidiary Loan Party, to
guarantee Indebtedness of the Borrower or any other Subsidiary Loan Party or to
transfer any of its property or assets to the Borrower or any Subsidiary Loan
Party of the Borrower; provided that (i) the foregoing shall not apply to
restrictions or conditions imposed (A) by law, (B) by this Agreement or any
other Loan Document, (C) the Bond Documents, (D) existing operating agreements
or shareholders' agreements in respect of non-wholly owned entities (in the case
of this clause (D), each as in effect on the date hereof), and (E) agreements
governing Indebtedness permitted under Section 7.1(i) to the extent that such
restrictions or conditions apply only to the non-wholly owned Subsidiary
incurring such Indebtedness, (ii) the foregoing shall not apply to customary
restrictions and conditions contained in agreements relating to the sale of a
Subsidiary Loan Party pending such sale, provided that such restrictions and
conditions apply only to the Subsidiary Loan Party that is sold and such sale is
permitted hereunder, (iii) clause (a) shall not apply to restrictions or
conditions imposed by any agreement relating to secured Indebtedness permitted
by this Agreement if such restrictions and conditions apply only to the property
or assets securing such Indebtedness, (iv) clause (a) shall not apply to
customary provisions in leases restricting the assignment thereof and (v) this
Section 7.13 shall not apply to agreements relating to Investments in joint
ventures, equity investments or non-wholly owned Subsidiaries made in compliance
with Section 7.5(e) or (f).
SECTION 7.14. SALE AND LEASEBACK TRANSACTIONS. Except as
permitted under Section 7.1(c), the Borrower will not, and will not permit any
of the Subsidiaries to, enter into any arrangement, directly or indirectly,
whereby it shall sell or transfer any property, real or personal, used or useful
in its business, whether now owned or hereinafter acquired, and thereafter rent
or lease such property or other property that it intends to use for
substantially the same purpose or purposes as the property sold or transferred
("Sale and Lease Back Transactions"), other than (i) Sale and Lease Back
Transactions that do not exceed $10,000,000 during any four consecutive Fiscal
Quarters, or $20,000,000 during the period from the Closing Date to the
Revolving Commitment Termination Date and (ii) Sale and Lease Back Transactions
by non-wholly owned Subsidiaries that are not Subsidiary Loan Parties to the
extent permitted by Section 7.1(i).
SECTION 7.15. HEDGING TRANSACTIONS. The Borrower will not, and
will not permit any of the Subsidiaries to, enter into any Hedging Transaction,
other than Hedging Transactions entered into in the ordinary course of business
to hedge or mitigate risks to which the Borrower or any Subsidiary is exposed in
the conduct of its business or the management of its liabilities. Solely for the
avoidance of doubt, the Borrower acknowledges that a Hedging Transaction entered
into for speculative purposes or of a speculative nature (which shall be deemed
to include any Hedging Transaction under which the Borrower or any of the
Subsidiaries is or may become obliged to make any payment (i) in connection with
the purchase by any third party of any common stock or any Indebtedness or
(ii) as a result of changes in the market value
71
of any common stock or any Indebtedness) is not a Hedging Transaction entered
into in the ordinary course of business to hedge or mitigate risks.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. EVENTS OF DEFAULT. If any of the following
events (each an "Event of Default") shall occur:
(a) The Borrower fails to make payment of Obligations owed
to Administrative Agent or any Lenders under the Loan Documents when due and
payable, or fails to make any other payment to Administrative Agent or Lenders
as contemplated thereunder either by the terms hereof or otherwise, and, in the
case of interest, fees or other amounts (other than principal of any Loan), such
failure continues for three Business Days after such interest, fee or other
amount is due.
(b) Any representation or warranty made, or deemed to be
made pursuant to Section 3.2 hereof, made by the Borrower or any of its
Subsidiaries or any executive officer of the Borrower or any of its Subsidiaries
in this Agreement, in any of the Loan Documents, or in any writing furnished in
connection with or pursuant to the Loan Documents, or any report, certificate,
financial statement, or other written information provided by the Borrower or
any of its Subsidiaries or any executive officer of the Borrower or any of its
Subsidiaries to Administrative Agent or a Lender in connection with or pursuant
to the Loan Documents, shall be false or misleading in any material respect on
the date when made or when deemed made.
(c) The Borrower or any of its Subsidiaries shall fail to
observe or perform any covenant or agreement contained in Section 5.3 (with
respect to the Borrower's existence), Section 5.6(a), Article VI or Article VII.
(d) The Borrower or any of its Subsidiaries fails to fully
and promptly perform when due any agreement, covenant, term, or condition
binding on it, other than as described in clauses (a), (b) and (c) above,
contained in this Agreement or any other Loan Document, or otherwise a part of
the transactions covered hereby, if such failure continues for thirty (30) days
after written notice thereof has been provided to the Borrower by Administrative
Agent or the Required Lenders.
(e) The Borrower or any Subsidiary Loan Party (whether as
primary obligor or as guarantor or other surety) shall fail to pay any principal
of, or premium or interest on, any Indebtedness (other than the Indebtedness
evidenced by the Loan Documents) that has an outstanding principal amount,
notional amount, or total amount of Indebtedness in excess of $5,000,000, or any
Subsidiary that is not a Subsidiary Loan Party (whether as primary obligor or as
guarantor or other surety) shall fail to pay any principal of, or premium or
interest on, any Indebtedness (other than the Indebtedness evidenced by the Loan
Documents) that has an outstanding principal amount, notional amount, or total
amount of Indebtedness in excess of $10,000,000, when and as the same shall
become due and payable (whether at scheduled
72
maturity, required prepayment, acceleration, demand or otherwise), and such
failure shall continue after the applicable grace period, if any, specified in
the agreement or instrument evidencing or governing such Indebtedness; or any
other event shall occur or condition shall exist under any agreement or
instrument relating to such Indebtedness and shall continue after the applicable
grace period, if any, specified in such agreement or instrument, if the effect
of such event or condition is to accelerate, or permit the acceleration of, the
maturity of such Indebtedness; or any such Indebtedness shall be declared to be
due and payable, or required to be prepaid or redeemed (other than by a
regularly scheduled required prepayment or redemption), purchased or defeased,
or any offer to prepay, redeem, purchase or defease such Indebtedness shall be
required to be made, in each case prior to the stated maturity thereof.
(f) The Borrower or any Subsidiary liquidates or dissolves
(except as expressly permitted under the Loan Documents); the Borrower or any
Subsidiary files or commences a voluntary petition, case, proceeding, or other
action seeking reorganization, arrangement, readjustment of its debts, or any
other relief under any existing or future law of any jurisdiction, domestic or
foreign, state or federal, relating to bankruptcy, insolvency, reorganization,
or relief of debtors, or the Borrower or any Subsidiary takes any other action
indicating its consent to, approval of, or acquiescence in, any such petition,
case, proceeding, or other action seeking to have an order for relief entered
with respect to it or its debts; the Borrower or any Subsidiary applies for, or
consents to or acquiesces in, the appointment of a receiver, trustee, custodian,
or other similar official for the Borrower or any Subsidiary or for all or a
substantial part of its property; the Borrower or any Subsidiary makes an
assignment for the benefit of creditors; or the Borrower or any Subsidiary is
unable to pay its debts as they mature or admits in writing its inability to pay
its debts as they mature.
(g) An involuntary petition, case, proceeding, or other
action is commenced against the Borrower or any Subsidiary under the Bankruptcy
Code or seeking reorganization, arrangement, readjustment of its debts, or any
other relief under any existing or future law of any jurisdiction, domestic or
foreign, state or federal, relating to bankruptcy, insolvency, reorganization,
or relief of debtors; a receiver, trustee, custodian, or other similar official
is involuntarily appointed for the Borrower or any Subsidiary or for all or a
substantial part of the Borrower's or such Subsidiary's property or assets; or
any case, proceeding, or other action seeking issuance of a warrant of
attachment, execution, distraint, or similar process against all or a
substantial part of the Borrower's or such Subsidiary's assets or property
results in the entry of an order for such relief; and any of the foregoing
continues for sixty (60) days without being vacated, discharged, stayed, bonded,
or dismissed.
(h) The occurrence of any Change in Control.
(i) A judgment is entered against the Borrower or any
Subsidiary for the payment of damages or money in excess of Five Million Dollars
($5,000,000) (not paid or fully covered by insurance, provided that the
insurance carrier has acknowledged coverage in form and substance acceptable to
the Administrative Agent) or otherwise having a Material Adverse Effect, if the
same is not discharged or if a writ of execution or similar process is issued
with respect thereto and is not bonded or stayed within thirty (30) days.
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(j) A writ of attachment or garnishment is issued against,
or a lien is imposed by operation of law on, any property of the Borrower or any
Subsidiary, and the lesser of the amount of the claim or the value of the
affected property is in excess of $5,000,000, if the lien is not discharged
within sixty (60) days after it has attached (not counting for this purpose any
period for so long as enforcement thereof is stayed and bonded during appeal
with adequate reserves provided therefor pursuant to GAAP).
(k) Any act or omission (formal or informal) of the Borrower
or any Subsidiary Loan Party, or its officers, directors, or shareholders
leading to, or resulting in, the termination, invalidation (partial or total),
revocation, suspension, interruption, or unenforceability of its corporate
existence, rights, licenses, franchises, or permits, which act or omission will
have a Material Adverse Effect, or the transfer or disposition (whether by sale,
lease, or otherwise) to any Person of all or a substantial part of its property
(except as specifically permitted pursuant to Section 7.4(c) or otherwise in any
Loan Document).
(l) An ERISA Event shall have occurred that, in the opinion
of the Required Lenders, when taken together with other ERISA Events that have
occurred, could reasonably be expected to result in liability to the Borrower
and the Subsidiaries in an aggregate amount exceeding $5,000,000.
(m) An Event of Default under any other Loan Document shall
occur.
(n) any material provision of the Subsidiary Guaranty
Agreement or any Security Document shall for any reason cease to be valid and
binding on, or enforceable against, any Subsidiary Loan Party, or any Subsidiary
Loan Party shall so state in writing, or any Subsidiary Loan Party shall seek to
terminate its Subsidiary Guaranty Agreement.
then, and in every such event (other than an event with respect to the
Borrower described in clause (f) or (g) of this Section 8.1) and at any time
thereafter during the continuance of such event, the Administrative Agent may,
and upon the written request of the Required Lenders shall, by notice to the
Borrower, take any or all of the following actions, at the same or different
times: (i) terminate the Commitments, whereupon the Commitment of each Lender
shall terminate immediately, (ii) declare the principal of and any accrued
interest on the Loans, and all other Obligations owing hereunder, to be,
whereupon the same shall become, due and payable immediately, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower, (iii) exercise all remedies contained in any
other Loan Document, and (iv) exercise any other remedies available at law or in
equity; and that, if an Event of Default specified in either clause (f) or (g)
with respect to the Borrower shall occur, the Commitments shall automatically
terminate and the principal of the Loans then outstanding, together with accrued
interest thereon, and all fees, and all other Obligations shall automatically
become due and payable, without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Borrower.
SECTION 8.2. APPLICATION OF PROCEEDS FROM COLLATERAL.
Notwithstanding any other provisions of this Agreement, after the occurrence and
during the continuance of an Event of Default, all amounts collected or received
(including by way of set-off) by the Administrative Agent or any Lender on
account of amounts outstanding under any of the Loan Documents or in
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respect of the Collateral shall be paid over or delivered as follows: first, to
the fees, indemnities and reimbursable expenses of the Administrative Agent, the
Swingline Lender and the Issuing Bank then due and payable pursuant to any of
the Credit Documents, until the same shall have been paid in full, allocated pro
rata in accordance with the respective unpaid fees, indemnities and expenses;
second, to the reimbursable expenses, if any, of the Lenders then due and
payable pursuant to any of the Credit Documents, until the same shall have been
paid in full, allocated pro rata among the Lenders based on their respective pro
rata shares of the unpaid expenses; third, to accrued and unpaid interest and
fees due and payable to the Lenders under the terms of this Agreement, until the
same shall have been paid in full, allocated pro rata among the Lenders based on
their respective pro rata shares of such unpaid interest and fees; fourth, to
the aggregate outstanding principal amount of the Loans, the LC Exposure and the
Net Xxxx-to-Market Exposure of Hedging Obligations incurred in connection with
this Agreement, until the same shall have been paid in full, allocated pro rata
among the Lenders and those Affiliates of Lenders that hold Net Xxxx-to-Market
Exposure based on their respective pro rata shares of the aggregate amount of
such Loans, LC Exposure and Net Xxxx-to-Market Exposure; provided, however, that
all amounts allocated to the contingent LC Exposure pursuant to clause fourth
shall be distributed to the Administrative Agent, rather than to any Lenders,
and held by the Administrative Agent in an account in the name of the
Administrative Agent for the benefit of the Issuing Bank and the Lenders as cash
collateral for such contingent LC Exposure, such account to be administered in
accordance with Section 2.22(g). Notwithstanding anything to the contrary
contained herein or in any other Loan Document, the net proceeds realized by the
Administrative Agent upon a sale or other disposition of the Collateral of HEICO
Aerospace Holdings Corp., or any part thereof, after deduction of the expenses
of retaking, holding, preparing for sale, selling or the like, and reasonable
attorneys' fees and other expenses incurred by the Administrative Agent shall be
applied to payment of (or held as a reserve against) the Obligations, whether or
not then due, and in such order of application as provided herein,
notwithstanding the existence of any other security interests in the Collateral,
subject to the provisions of Article 18 of that certain Shareholders Agreement
dated as of October 30, 1997 by and among HEICO Aerospace Holdings Corp., the
Borrower and Lufthansa Technik AG, as in effect on the date hereof, or as
otherwise amended from time to time in a manner that is not adverse to the
interests of the Lenders and the Administrative Agent, if applicable and to the
extent legally enforceable, and the Administrative Agent shall account to HEICO
Aerospace Holdings Corp. for any surplus realized upon such sale or other
disposition, after satisfaction of all creditors, and HEICO Aerospace Holdings
Corp. shall remain liable for any deficiency.
ARTICLE IX
THE ADMINISTRATIVE AGENT
SECTION 9.1. APPOINTMENT OF ADMINISTRATIVE AGENT.
(a) Each Lender irrevocably appoints SunTrust Bank as the
Administrative Agent and authorizes it to take such actions on its behalf and to
exercise such powers as are delegated to the Administrative Agent under this
Agreement and the other Loan Documents, together with all such actions and
powers that are reasonably incidental thereto. The Administrative Agent may
perform any of its duties hereunder or under the other Loan Documents by or
through any one or more sub-agents or attorneys-in-fact appointed by the
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Administrative Agent. The Administrative Agent and any such sub-agent or
attorney-in-fact may perform any and all of its duties and exercise its rights
and powers through their respective Related Parties. The exculpatory provisions
set forth in this Article shall apply to any such sub-agent or attorney-in-fact
and the Related Parties of the Administrative Agent, any such sub-agent and any
such attorney-in-fact and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities as Administrative Agent.
(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 Administrative Agent may
agree at the request of the Required Lenders to act for the Issuing Bank with
respect thereto; provided that the Issuing Bank shall have all the benefits and
immunities (i) provided to the Administrative Agent in this Article IX with
respect to any acts taken or omissions suffered by the Issuing Bank in
connection with Letters of Credit issued by it or proposed to be issued by it
and the application and agreements for letters of credit pertaining to the
Letters of Credit as fully as if the term "Administrative Agent" as used in this
Article IX included the Issuing Bank with respect to such acts or omissions and
(ii) as additionally provided in this Agreement with respect to the Issuing
Bank.
SECTION 9.2. NATURE OF DUTIES OF ADMINISTRATIVE AGENT. The
Administrative Agent shall not have any duties or obligations except those
expressly set forth in this Agreement and the other Loan Documents. Without
limiting the generality of the foregoing, (a) the Administrative Agent shall not
be subject to any fiduciary or other implied duties, regardless of whether a
Default or an Event of Default has occurred and is continuing, (b) the
Administrative Agent shall not have any duty to take any discretionary action or
exercise any discretionary powers, except those discretionary rights and powers
expressly contemplated by the Loan Documents that the Administrative Agent is
required to exercise in writing by the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 10.2), and (c) except as expressly set forth in the Loan
Documents, the Administrative Agent shall not have any duty to disclose, and
shall not be liable for the failure to disclose, any information relating to the
Borrower or any of its Subsidiaries that is communicated to or obtained by the
Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken by
it, its sub-agents or attorneys-in-fact with the consent or at the request of
the Required Lenders (or such other number or percentage of the Lenders as shall
be necessary under the circumstances as provided in Section 10.2) or in the
absence of its own gross negligence or willful misconduct. The Administrative
Agent shall not be responsible for the negligence or misconduct of any
sub-agents or attorneys-in-fact selected by it with reasonable care. The
Administrative Agent shall not be deemed to have knowledge of any Default or
Event of Default unless and until written notice thereof (which notice shall
include an express reference to such event being a "Default" or "Event of
Default" hereunder) is given to the Administrative Agent by the Borrower or any
Lender, and the Administrative Agent shall not be responsible for or have any
duty to ascertain or inquire into (i) any statement, warranty or representation
made in or in connection with any Loan Document, (ii) the contents of any
certificate, report or other document delivered hereunder or thereunder or in
connection herewith or therewith, (iii) the performance or observance of any of
the covenants, agreements, or other terms and conditions set forth in any Loan
Document, (iv) the validity, enforceability, effectiveness or genuineness of any
Loan Document or any other
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agreement, instrument or document, or (v) the satisfaction of any condition set
forth in Article III or elsewhere in any Loan Document, other than to confirm
receipt of items expressly required to be delivered to the Administrative Agent.
The Administrative Agent may consult with legal counsel (including counsel for
the Borrower) concerning all matters pertaining to such duties.
SECTION 9.3. LACK OF RELIANCE ON THE ADMINISTRATIVE AGENT.
Each of the Lenders, the Swingline Lender and the Issuing Bank acknowledges that
it has, independently and without reliance upon the Administrative Agent or any
other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each of the Lenders, the Swingline Lender and the Issuing Bank also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, continue to make its own decisions in
taking or not taking of any action under or based on this Agreement, any related
agreement or any document furnished hereunder or thereunder.
SECTION 9.4. CERTAIN RIGHTS OF THE ADMINISTRATIVE AGENT. If
the Administrative Agent shall request instructions from the Required Lenders
with respect to any action or actions (including the failure to act) in
connection with this Agreement, the Administrative Agent shall be entitled to
refrain from such act or taking such act, unless and until it shall have
received instructions from such Lenders; and the Administrative Agent shall not
incur liability to any Person by reason of so refraining. Without limiting the
foregoing, no Lender shall have any right of action whatsoever against the
Administrative Agent as a result of the Administrative Agent acting or
refraining from acting hereunder in accordance with the instructions of the
Required Lenders where required by the terms of this Agreement.
SECTION 9.5. RELIANCE BY ADMINISTRATIVE AGENT. The
Administrative Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed, sent or made by the proper Person. The Administrative
Agent may also rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person and shall not incur any liability
for relying thereon. The Administrative Agent may consult with legal counsel
(including counsel for the Borrower), independent public accountants and other
experts selected by it and shall not be liable for any action taken or not taken
by it in accordance with the advice of such counsel, accountants or experts.
SECTION 9.6. THE ADMINISTRATIVE AGENT IN ITS INDIVIDUAL
CAPACITY. The bank serving as the Administrative Agent shall have the same
rights and powers under this Agreement and any other Loan Document in its
capacity as a Lender as any other Lender and may exercise or refrain from
exercising the same as though it were not the Administrative Agent; and the
terms "Lenders", "Required Lenders", "holders of Notes", or any similar terms
shall, unless the context clearly otherwise indicates, include the
Administrative Agent in its individual capacity. The bank acting as the
Administrative Agent and its Affiliates may accept deposits from, lend money to,
and generally engage in any kind of business with the Borrower or any Subsidiary
or Affiliate of the Borrower as if it were not the Administrative Agent
hereunder.
SECTION 9.7. SUCCESSOR ADMINISTRATIVE AGENT.
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(a) The Administrative Agent may resign at any time by
giving notice thereof to the Lenders and the Borrower. Upon any such
resignation, the Required Lenders shall have the right to appoint a successor
Administrative Agent, subject to the approval by the Borrower provided that no
Default or Event of Default shall exist at such time. If no successor
Administrative Agent shall have been so appointed, and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives notice
of resignation, then the retiring Administrative Agent may, on behalf of the
Lenders and the Issuing Bank, appoint a successor Administrative Agent, which
shall be a commercial bank organized under the laws of the United States of
America or any state thereof or a bank which maintains an office in the United
States, having a combined capital and surplus of at least $500,000,000.
(b) Upon the acceptance of its appointment as the
Administrative Agent hereunder by a successor, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under
this Agreement and the other Loan Documents. If within 45 days after written
notice is given of the retiring Administrative Agent's resignation under this
Section 9.7 no successor Administrative Agent shall have been appointed and
shall have accepted such appointment, then on such 45th day (i) the retiring
Administrative Agent's resignation shall become effective, (ii) the retiring
Administrative Agent shall thereupon be discharged from its duties and
obligations under the Loan Documents and (iii) the Required Lenders shall
thereafter perform all duties of the retiring Administrative Agent under the
Loan Documents until such time as the Required Lenders appoint a successor
Administrative Agent as provided above. After any retiring Administrative
Agent's resignation hereunder, the provisions of this Article IX shall continue
in effect for the benefit of such retiring Administrative Agent and its
representatives and agents in respect of any actions taken or not taken by any
of them while it was serving as the Administrative Agent.
SECTION 9.8. AUTHORIZATION TO EXECUTE OTHER LOAN DOCUMENTS.
Each Lender hereby authorizes the Administrative Agent to execute on behalf of
all Lenders all Loan Documents other than this Agreement, including without
limitation all Security Documents
SECTION 9.9. SYNDICATION AGENT; DOCUMENTATION AGENT. Each
Lender hereby designates Wachovia Bank, National Association as Syndication
Agent and agrees that the Syndication Agent shall have no duties or obligations
under any Loan Documents to any Lender or any Loan Party. Each Lender hereby
designates HSBC Bank USA as Documentation Agent and agrees that the
Documentation Agent shall have no duties or obligations under any Loan Documents
to any Lender or any Loan Party.
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ARTICLE X
MISCELLANEOUS
SECTION 10.1. NOTICES.
(a) Except in the case of notices and other communications
expressly permitted to be given by telephone, all notices and other
communications to any party herein to be effective shall be in writing and shall
be delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
To the Borrower: HEICO Corporation
0000 Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Telecopy Number: (000) 000-0000
With a copy to: Akerman Senterfitt
0 X.X. Xxxxx Xxxxxx
00xx Xxxxx
Xxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxxx, Esq.
Telecopy Number: (000) 000-0000
To the Administrative
Agent or Swingline Lender: SunTrust Bank
000 X. Xxxxxxx Xxxxxx
18th Floor, Suite 1850
Xxxxx, Xxxxxxx 00000
Attention: Xx. Xxxxxx Xxxxxxxxx
Telecopy Number: 813-224-2833
With a copy to: SunTrust Bank
Agency Services
000 Xxxxxxxxx Xxxxxx, X. E./
25th Floor
Atlanta, Georgia 30308
Attention: Ms. Xxxx Xxxxxxxx
Telecopy Number: (000) 000-0000
and
King & Spalding
191 Peachtree Street, N.E.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Telecopy Number: (000) 000-0000
To the Issuing Bank: SunTrust Bank
00 Xxxx Xxxxx, X. E./Mail
Code 3706
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxxx
Telecopy Number: (000) 000-0000
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To the Swingline Lender: SunTrust Bank
Agency Services
000 Xxxxxxxxx Xxxxxx, X.X./00xx
Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Ms. Xxxx Xxxxxxxx
Telecopy Number: (000) 000-0000
To any other Lender: the address set forth in the
Administrative Questionnaire or
the Assignment and Acceptance
Agreement executed by such Lender
Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All such notices
and other 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 mail or if
delivered, upon delivery; provided that notices delivered to the Administrative
Agent, the Issuing Bank or the Swingline Bank shall not be effective until
actually received by such Person at its address specified in this Section 10.1.
(b) Any agreement of the Administrative Agent and the
Lenders herein to receive certain notices by telephone or facsimile is solely
for the convenience and at the request of the Borrower. The Administrative Agent
and the Lenders shall be entitled to rely on the authority of any Person
purporting to be a Person authorized by the Borrower to give such notice and the
Administrative Agent and Lenders shall not have any liability to the Borrower or
other Person on account of any action taken or not taken by the Administrative
Agent or the Lenders in reliance upon such telephonic or facsimile notice. The
obligation of the Borrower to repay the Loans and all other Obligations
hereunder shall not be affected in any way or to any extent by any failure of
the Administrative Agent and the Lenders to receive written confirmation of any
telephonic or facsimile notice or the receipt by the Administrative Agent and
the Lenders of a confirmation which is at variance with the terms understood by
the Administrative Agent and the Lenders to be contained in any such telephonic
or facsimile notice.
SECTION 10.2. WAIVER; AMENDMENTS.
(a) No failure or delay by the Administrative Agent, the
Issuing Bank or any Lender in exercising any right or power hereunder or any
other Loan Document, and no course of dealing between the Borrower and the
Administrative Agent or any Lender, shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power or any abandonment or
discontinuance of steps to enforce such right or power, preclude any other or
further exercise thereof or the exercise of any other right or power hereunder
or thereunder. The rights and remedies of the Administrative Agent, the Issuing
Bank and the Lenders hereunder and under the other Loan Documents are cumulative
and are not exclusive of any rights or remedies provided by law. No waiver of
any provision of this Agreement or any other Loan Document or consent to any
departure by the Borrower therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) of this Section 10.2, and then such
waiver or
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consent shall be effective only in the specific instance and for the purpose for
which given. Without limiting the generality of the foregoing, the making of a
Loan or the issuance of a Letter of Credit shall not be construed as a waiver of
any Default or Event of Default, regardless of whether the Administrative Agent,
any Lender or the Issuing Bank may have had notice or knowledge of such Default
or Event of Default at the time.
(b) No amendment or waiver of any provision of this
Agreement or the other Loan Documents, nor consent to any departure by any Loan
Party therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Borrower and the Required Lenders or the Borrower and
the Administrative Agent with the consent of the Required Lenders (which consent
shall be deemed given if the Administrative Agent has the right of waiver
expressly granted herein without further consent by any Lender) and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided that no amendment or waiver shall:
(i) increase the Commitment of any Lender without the written consent of such
Lender, (ii) reduce the principal amount of any Loan or LC Disbursement or
reduce the rate of interest thereon, or reduce any fees payable hereunder,
without the written consent of each Lender affected thereby, (iii) postpone the
date fixed for any payment of any principal of, or interest on, any Loan or LC
Disbursement or interest thereon or any fees hereunder or reduce the amount of,
waive or excuse any such payment, or postpone the scheduled date for the
termination or reduction of any Commitment, without the written consent of each
Lender affected thereby (except for such payments due pursuant to Section 2.12),
(iv) change Section 2.22 (b) or Section 2.22(c) in a manner that would alter the
pro rata sharing of payments required thereby, without the written consent of
each Lender, (v) change any of the provisions of this Section 10.2 or the
definition of "Required Lenders" or any other provision hereof specifying the
number or percentage of Lenders which are required to waive, amend or modify any
rights hereunder or make any determination or grant any consent hereunder,
without the consent of each Lender; (vi) release any guarantor or limit the
liability of any such guarantor under any guaranty agreement, without the
written consent of each Lender; (vii) release all or substantially all
Collateral securing any of the Obligations, without the written consent of each
Lender; provided, further, that no such agreement shall amend, modify or
otherwise affect the rights, duties or obligations of the Administrative Agent,
the Swingline Bank or the Issuing Bank without the prior written consent of such
Person. Notwithstanding anything contained herein to the contrary, this
Agreement may be amended and restated without the consent of any Lender (but
with the consent of the Borrower and the Administrative Agent) if, upon giving
effect to such amendment and restatement, such Lender shall no longer be a party
to this Agreement (as so amended and restated), the Commitments of such Lender
shall have terminated (but such Lender shall continue to be entitled to the
benefits of Sections 2.18, 2.19, 2.20 and 10.3), and such Lender shall have no
other commitment or other obligation hereunder and shall have been paid in full
all principal, interest and other amounts owing to it or accrued for its account
under this Agreement.
SECTION 10.3. EXPENSES; INDEMNIFICATION.
(a) The Borrower shall pay (i) all reasonable and customary,
out-of-pocket costs and expenses of the Administrative Agent and its Affiliates,
including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent and its Affiliates, in connection with the syndication of
the credit facilities provided for herein, the preparation and
81
administration of the Loan Documents and any amendments, modifications or
waivers thereof (whether or not the transactions contemplated in this Agreement
or any other Loan Document shall be consummated), (ii) all reasonable and
customary out-of-pocket expenses incurred by the Issuing Bank in connection with
the issuance, amendment, renewal or extension of any Letter of Credit or any
demand for payment thereunder and (iii) all out-of-pocket costs and expenses
(including, without limitation, the reasonable fees, charges and disbursements
of outside counsel and the allocated cost of inside counsel) incurred by the
Administrative Agent, the Issuing Bank or any Lender in connection with the
enforcement or protection of its rights in connection with this Agreement or any
other Loan Document, including its rights under this Section 10.3, or in
connection with the Loans made or any Letters of Credit issued hereunder,
including all such out-of-pocket expenses incurred during any workout,
restructuring or negotiations in respect of such Loans or Letters of Credit.
(b) The Borrower shall indemnify the Administrative Agent,
the Issuing Bank and each Lender, and each Related Party of any of the foregoing
(each, an "Indemnitee") against, and hold each of them harmless from, any and
all costs, losses, liabilities, claims, damages and related expenses, including
the reasonable fees, charges and disbursements of any counsel for any
Indemnitee, which may be incurred by or asserted against any Indemnitee by any
third party, the Borrower or another Loan Party, arising out of, in connection
with or as a result of (i) the execution or delivery of this Agreement or any
other agreement or instrument contemplated hereby, the performance by the
parties hereto of their respective obligations hereunder or the consummation of
any of the transactions contemplated hereby, (ii) any Loan or Letter of Credit
or any actual or proposed use of the proceeds therefrom (including any refusal
by the Issuing Bank to honor a demand for payment under a Letter of Credit if
the documents presented in connection with such demand do not strictly comply
with the terms of such Letter of Credit), (iii) any actual or alleged presence
or release of Hazardous Materials on or from any property owned by the Borrower
or any Subsidiary or any Environmental Liability related in any way to the
Borrower or any Subsidiary or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory, whether brought by a third party, the
Borrower or any other Loan Party, and regardless of whether any Indemnitee is a
party thereto; provided that the Borrower shall not be obligated to indemnify
any Indemnitee for any of the foregoing (i) arising primarily out of such
Indemnitee's gross negligence or willful misconduct as determined by a court of
competent jurisdiction in a final, nonappealable judgment or (ii) resulting from
a claim brought by a Loan Party against an Indemnitee for breach in bad faith of
such Indemnitee's obligations hereunder or under any other Loan Document, if
such Loan Party has obtained a final and nonappealable judgment in its favor on
such claim as determined by a court of competent jurisdiction. The foregoing
provisions shall be in addition to any right that Indemnitee shall have at
common law or otherwise. No Indemnitee shall be liable for any damages arising
from the use by others of information or others obtained through internet,
Intralinks(R), or other similar transmission services in connection with this
Agreement. No Indemnitee shall have any liability (whether direct or indirect,
in contract or tort or otherwise) to the Borrower or any other Loan Party
arising out of, related to or in connection with the transactions contemplated
by the Loan Documents, except to the extent that such liability shall be finally
judicially determined by a court of competent jurisdiction to have resulted from
such Indemnitee's gross negligence or willful misconduct. No Indemnitee shall be
responsible or liable for special, indirect, consequential or punitive damages
which may be alleged to arise in any manner in connection with this
82
Agreement or the Loan Documents or any transaction contemplated hereby. The
foregoing indemnification and limitation on liability shall survive and continue
for the benefit of the Indemnitees.
(c) The Borrower shall pay, and hold the Administrative
Agent and each of the Lenders harmless from and against, any and all present and
future stamp, documentary, and other similar taxes with respect to this
Agreement and any other Loan Documents, any collateral described therein, or any
payments due thereunder, and save the Administrative Agent and each Lender
harmless from and against any and all liabilities with respect to or resulting
from any delay or omission to pay such taxes.
(d) To the extent that the Borrower fails to pay any amount
required to be paid to the Administrative Agent, the Issuing Bank or the
Swingline Lender under clauses (a), (b) or (c) hereof, each Lender severally
agrees to pay to the Administrative Agent, the Issuing Bank or the Swingline
Lender, as the case may be, such Lender's Pro Rata Share (determined as of the
time that the unreimbursed expense or indemnity payment is sought) of such
unpaid amount; provided that the unreimbursed expense or indemnified payment,
claim, damage, liability or related expense, as the case may be, was incurred by
or asserted against the Administrative Agent, the Issuing Bank or the Swingline
Lender in its capacity as such.
(e) To the extent permitted by applicable law, the Borrower
shall not assert, and hereby waives, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive damages
(as opposed to actual or direct damages) arising out of, in connection with or
as a result of, this Agreement or any agreement or instrument contemplated
hereby, the transactions contemplated therein, any Loan or any Letter of Credit
or the use of proceeds thereof.
(f) All amounts due under this Section 10.3 shall be payable
promptly after written demand therefor.
SECTION 10.4. SUCCESSORS AND ASSIGNS.
(a) 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 Borrower may not assign or
otherwise transfer any of its rights or 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 assignee in
accordance with the provisions of paragraph (b) of this Section 10.4, (ii) by
way of participation in accordance with the provisions of paragraph (d) of this
Section 10.4 or (iii) by way of pledge or assignment of a security interest
subject to the restrictions of paragraph (f) of this Section 10.4 (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 paragraph
(d) of this Section 10.4 and, to the extent expressly contemplated hereby, the
Related Parties of each of the Administrative Agent and the Lenders) any legal
or equitable right, remedy or claim under or by reason of this Agreement.
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(b) Any Lender may at any time assign to one or more
assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans at the time owing to
it); provided that any such assignment shall be subject to the following
conditions:
(i) Minimum Amounts.
(A) 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, an Affiliate of a Lender or an Approved Fund, no
minimum amount need be assigned; and
(B) in any case not described in paragraph (b)(i)(A)
of this Section 10.4, the aggregate amount of the Commitment
(which for this purpose includes Loans and Revolving Credit
Exposure outstanding thereunder) or, if the applicable
Commitment is not then in effect, the principal outstanding
balance of the Loans and Revolving Credit Exposure of the
assigning Lender subject to each such assignment (determined as
of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Administrative Agent or, if
"Trade Date" is specified in the Assignment and Acceptance, as
of the Trade Date) shall not be less than $1,000,000, unless
each of the Administrative Agent and, so long as no Event of
Default has occurred and is continuing, the Borrower otherwise
consents (each such consent not to be unreasonably withheld or
delayed).
(ii) Proportionate Amounts. 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, Revolving Credit Exposure or the Commitment assigned.
(iii) Required Consents. No consent shall be required for any
assignment except to the extent required by paragraph (b)(i)(B) of this
Section 10.4 and, in addition:
(A) the consent of the Borrower (such consent not to
be unreasonably withheld or delayed) shall be required unless
(x) an Event of Default has occurred and is continuing at the
time of such assignment or (y) such assignment is to a Lender,
an Affiliate of a Lender or an Approved Fund;
(B) the consent of the Administrative Agent (such
consent not to be unreasonably withheld or delayed) shall be
required for assignments to a Person that is not a Lender with a
Commitment; and
(C) the consent of the Issuing Bank (such consent
not to be unreasonably withheld or delayed) shall be required
for any assignment that increases the obligation of the assignee
to participate in exposure under one or more Letters of Credit
(whether or not then outstanding), and the consent of the
Swingline Lender (such consent not to be unreasonably withheld
or delayed) shall be required for any assignment in respect of
the Revolving Credit Commitments.
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(iv) Assignment and Acceptance. The parties to each
assignment shall deliver to the Administrative Agent (A) a duly executed
Assignment and Acceptance, (B) a processing and recordation fee of
$1,000, (C) an Administrative Questionnaire unless the assignee is
already a Lender and (D) the documents required under Section 2.20(e) if
such assignee is a Foreign Lender.
(v) No Assignment to Borrower. No such assignment shall
be made to the Borrower or any of the Borrower's Affiliates or
Subsidiaries.
(vi) No Assignment to Natural Persons. No such
assignment shall be made to a natural person.
Subject to acceptance and recording thereof by the Administrative Agent pursuant
to paragraph (c) of this Section 10.4, from and after the effective date
specified in each Assignment and Acceptance, the 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 2.18, 2.19, 2.20 and 10.3 with
respect to facts and circumstances occurring prior to the effective date of such
assignment. Any assignment or transfer by a Lender of rights or obligations
under this Agreement that does not comply with this paragraph shall be treated
for purposes of this Agreement as a sale by such Lender of a participation in
such rights and obligations in accordance with paragraph (d) of this
Section 10.4. If the consent of the Borrower to an assignment is required
hereunder (including a consent to an assignment which does not meet the minimum
assignment thresholds specified above), the Borrower shall be deemed to have
given its consent ten Business Days after the date notice thereof has actually
been delivered by the assigning Lender (through the Administrative Agent) to the
Borrower, unless such consent is expressly refused by the Borrower prior to such
tenth Business Day.
(c) The Administrative Agent, acting solely for this purpose
as an agent of the Borrower, shall maintain at one of its offices in Atlanta,
Georgia a copy of each Assignment and Acceptance delivered to it and a register
for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amount of the Loans and Revolving Credit Exposure
owing to, each Lender pursuant to the terms hereof from time to time (the
"Register"). The entries in the Register shall be conclusive, and the Borrower,
the Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(d) Any Lender may at any time, without the consent of, or
notice to, the Borrower, the Administrative Agent, the Swingline Bank or the
Issuing Bank sell participations to any Person (other than a natural person, the
Borrower or any of the Borrower's Affiliates or Subsidiaries) (each, a
"Participant") in all or a portion of such Lender's rights and/or obligations
85
under this Agreement (including all or a portion of its Commitment and/or the
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 Borrower, the Administrative Agent, the Lenders, Issuing Bank and
Swingline Lender shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement.
(e) 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, modification or waiver with respect to the
following to the extent affecting such Participant: (i) increase the Commitment
of any Lender without the written consent of such Lender, (ii) reduce the
principal amount of any Loan or LC Disbursement or reduce the rate of interest
thereon, or reduce any fees payable hereunder, without the written consent of
each Lender affected thereby, (iii) postpone the date fixed for any payment of
any principal of, or interest on, any Loan or LC Disbursement or interest
thereon or any fees hereunder or reduce the amount of, waive or excuse any such
payment, or postpone the scheduled date for the termination or reduction of any
Commitment, without the written consent of each Lender affected thereby,
(iv) change Section 2.22(b) or Section 2.22(c) in a manner that would alter the
pro rata sharing of payments required thereby, without the written consent of
each Lender, (v) change any of the provisions of this Section 10.4 or the
definition of "Required Lenders" or any other provision hereof specifying the
number or percentage of Lenders which are required to waive, amend or modify any
rights hereunder or make any determination or grant any consent hereunder,
without the consent of each Lender; (vi) release any guarantor or limit the
liability of any such guarantor under any guaranty agreement without the written
consent of each Lender except to the extent such release is expressly provided
under the terms of the Guaranty Agreement; or (vii) release all or substantially
all Collateral securing any of the Obligations. Subject to paragraph (e) of this
Section 10.4, the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 2.18, 2.19, and 2.20 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section 10.4. To the extent permitted by law, each Participant also shall
be entitled to the benefits of Section 10.7 as though it were a Lender, provided
that such Participant agrees to be subject to Section 10.7 as though it were a
Lender.
(f) A Participant shall not be entitled to receive any
greater payment under Sections 2.18 and 2.20 than the applicable Lender would
have been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with the Borrower's prior written consent. A Participant that would be a Foreign
Lender if it were a Lender shall not be entitled to the benefits of Section 2.20
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with
Section 2.20(e) as though it were a Lender.
Any Lender may at any time pledge or assign a security interest in all or any
portion of its rights under this Agreement to secure obligations of such Lender,
including without limitation any pledge or assignment to secure obligations to a
Federal Reserve Bank; provided that no such
86
pledge or assignment shall release such Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.
SECTION 10.5. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE
OF PROCESS.
(a) This Agreement and the other Loan Documents shall be
construed in accordance with and be governed by the law (without giving effect
to the conflict of law principles thereof) of the State of Florida.
(b) The Borrower hereby irrevocably and unconditionally
submits, for itself and its property, to the non-exclusive jurisdiction of the
United States courts located within Broward County in the State of Florida, and
of any state court of the State of Florida located in Broward County and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or any other Loan Document or the transactions
contemplated hereby or thereby, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such Florida state court or, to the extent permitted by
applicable law, such Federal court. Each of the parties hereto agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or any other Loan Document shall
affect any right that the Administrative Agent, the Issuing Bank or any Lender
may otherwise have to bring any action or proceeding relating to this Agreement
or any other Loan Document against the Borrower or its properties in the courts
of any jurisdiction.
(c) The Borrower irrevocably and unconditionally waives any
objection which it may now or hereafter have to the laying of venue of any such
suit, action or proceeding described in paragraph (b) of this Section 10.5 and
brought in any court referred to in paragraph (b) of this Section 10.5. Each of
the parties hereto irrevocably waives, to the fullest extent permitted by
applicable law, the defense of an inconvenient forum to the maintenance of such
action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to the
service of process in the manner provided for notices in Section 10.1. Nothing
in this Agreement or in any other Loan Document will affect the right of any
party hereto to serve process in any other manner permitted by law.
SECTION 10.6. WAIVER OF JURY TRIAL. EACH PARTY HERETO
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER, AND (B)
87
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.6.
SECTION 10.7. RIGHT OF SETOFF. In addition to any rights now
or hereafter granted under applicable law and not by way of limitation of any
such rights, each Lender and the Issuing Bank shall have the right, at any time
or from time to time upon the occurrence and during the continuance of an Event
of Default, without prior notice to the Borrower, any such notice being
expressly waived by the Borrower to the extent permitted by applicable law, to
set off and apply against all deposits (general or special, time or demand,
provisional or final) of the Borrower at any time held or other obligations at
any time owing by such Lender and the Issuing Bank to or for the credit or the
account of the Borrower against any and all Obligations held by such Lender or
the Issuing Bank, as the case may be, irrespective of whether such Lender or the
Issuing Bank shall have made demand hereunder and although such Obligations may
be unmatured. Each Lender and the Issuing Bank agree promptly to notify the
Administrative Agent and the Borrower after any such set-off and any application
made by such Lender and the Issuing Bank, as the case may be; provided that the
failure to give such notice shall not affect the validity of such set-off and
application. Each Lender and the Issuing Bank agrees to apply all amounts
collected from any such set-off to the Obligations before applying such amounts
to any other Indebtedness or other obligations owed by the Borrower and any of
its Subsidiaries to such Lender or Issuing Bank.
SECTION 10.8. COUNTERPARTS; INTEGRATION. This Agreement may be
executed by one or more of the parties to this Agreement on any number of
separate counterparts (including by telecopy), and all of said counterparts
taken together shall be deemed to constitute one and the same instrument. This
Agreement, the Fee Letter, the other Loan Documents, and any separate letter
agreement(s) relating to any fees payable to the Administrative Agent constitute
the entire agreement among the parties hereto and thereto regarding the subject
matters hereof and thereof and supersede all prior agreements and
understandings, oral or written, regarding such subject matters.
SECTION 10.9. SURVIVAL. All covenants, agreements,
representations and warranties made by the Borrower herein and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement shall be considered to have been relied upon by the other parties
hereto and shall survive the execution and delivery of this Agreement and the
making of any Loans and issuance of any Letters of Credit, regardless of any
investigation made by any such other party or on its behalf and notwithstanding
that the Administrative Agent, the Issuing Bank or any Lender may have had
notice or knowledge of any Default or incorrect representation or warranty at
the time any credit is extended hereunder, and shall continue in full force and
effect as long as the principal of or any accrued interest on any Loan or any
fee or any other amount payable under this Agreement is outstanding and unpaid
or any Letter of Credit is outstanding and so long as the Commitments have not
expired or terminated. The provisions of Sections 2.18, 2.19, 2.20, and 10.3 and
Article IX shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof. All
representations and warranties made
88
herein, in the certificates, reports, notices, and other documents delivered
pursuant to this Agreement shall survive the execution and delivery of this
Agreement and the other Loan Documents, and the making of the Loans and the
issuance of the Letters of Credit.
SECTION 10.10. SEVERABILITY. Any provision of this Agreement
or any other Loan Document held to be illegal, invalid or unenforceable in any
jurisdiction, shall, as to such jurisdiction, be ineffective to the extent of
such illegality, invalidity or unenforceability without affecting the legality,
validity or enforceability of the remaining provisions hereof or thereof; and
the illegality, invalidity or unenforceability of a particular provision in a
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
SECTION 10.11. CONFIDENTIALITY.
(a) Each of the Administrative Agent, the Issuing Bank and
each Lender shall exercise their best efforts not to make any disclosure of
confidential information obtained in connection with or pursuant to the Loan
Documents (or permit any such disclosure of confidential information by their
respective Related Parties); provided that the foregoing shall not be construed
to, now or in the future, apply to any information reflected in any publicly
recorded document, information obtained from sources other than the Borrower,
its officers, directors, employees, representatives, or agents, or otherwise in
the public domain nor shall it be construed to prevent the Administrative Agent,
the Issuing Bank or any Lender from (i) making any disclosure of any information
(A) if required to do so by any applicable law or regulation or if normally
engaged in pursuant to accepted banking practice solely for purposes of
monitoring, negotiating, maintaining or enforcing the Loan Documents and not
contrary to confidentiality and privacy requirements of applicable statutory and
case law, (B) to any governmental agency or regulatory body having authority to
regulate or oversee any aspect of the Administrative Agent's, Issuing Bank's or
such Lender's business or any of its Subsidiaries or Affiliates in connection
with the exercise of such authority, (C) pursuant to subpoena, (D) to the extent
the Administrative Agent, Issuing Bank or such Lender or their respective
counsel deems necessary or appropriate to do so to enforce any remedy provided
for in the Loan Documents or otherwise available by law, (ii) subject to the
requirements of this Section 10.11, making such disclosures as such Lender
reasonably deems necessary or appropriate to any bank or financial institution
(and/or counsel thereto) which is a prospective assignee or participant under
Section 10.4 (each such bank or financial institution, a "Prospective Lender")
or (iii) making, on a confidential basis, such disclosures as the Administrative
Agent, Issuing Bank or such Lender deems necessary or appropriate to the
Administrative Agent's, Issuing Bank or such Lender's counsel or accountants
(including outside auditors).
(b) Each Lender agrees that prior to (i) disclosing to any
Prospective Lender any information which the Lenders have agreed hereunder to
hold as confidential or (ii) entering into an agreement granting to a
Prospective Lender an interest in the Loans, the Prospective Lender shall
execute an agreement in form and substance similar to the provisions of this
Section 10.11 for the benefit of the Borrower and shall deliver the same to the
Borrower; provided that in no event shall such Lender or the Administrative
Agent be liable for any breach of such agreement by the Prospective Lender.
89
SECTION 10.12. INTEREST RATE LIMITATION. Notwithstanding
anything herein to the contrary, if at any time the interest rate applicable to
any Loan, together with all fees, charges and other amounts which may be treated
as interest on such Loan under applicable law (collectively, the "Charges"),
shall exceed the maximum lawful rate of interest (the "Maximum Rate") which may
be contracted for, charged, taken, received or reserved by a Lender holding such
Loan in accordance with applicable law, the rate of interest payable in respect
of such Loan hereunder, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest and
Charges that would have been payable in respect of such Loan but were not
payable as a result of the operation of this Section 10.12 shall be cumulated
and the interest and Charges payable to such Lender in respect of other Loans or
periods shall be increased (but not above the Maximum Rate therefor) until such
cumulated amount, together with interest thereon at the Federal Funds Rate to
the date of repayment, shall have been received by such Lender.
SECTION 10.13. WAIVER OF EFFECT OF CORPORATE SEAL. The
Borrower represents and warrants that neither it nor any other Loan Party is
required to affix its corporate seal to this Agreement or any other Loan
Document pursuant to any requirement of law or regulation, agrees that this
Agreement is delivered by Borrower under seal and waives any shortening of the
statute of limitations that may result from not affixing the corporate seal to
this Agreement or such other Loan Documents.
SECTION 10.14. PATRIOT ACT. The Administrative Agent and each
Lender hereby notifies the Loan Parties that pursuant to the requirements of the
Patriot Act, it is required to obtain, verify and record information that
identifies each Loan Party, which information includes the name and address of
such Loan Party and other information that will allow such Lender or the
Administrative Agent, as applicable, to identify such Loan Party in accordance
with the Patriot Act. Each Loan Party shall, and shall cause each of its
Subsidiaries to, provide to the extent commercially reasonable, such information
and take such other actions as are reasonably requested by the Administrative
Agent or any Lender in order to assist the Administrative Agent and the Lenders
in maintaining compliance with the Patriot Act.
(remainder of page left intentionally blank)
90
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed under seal in the case of the Borrower by their
respective authorized officers as of the day and year first above written.
HEICO CORPORATION
By
---------------------------------
Name: Xxxxxx X. Xxxxx
Title: Executive Vice President,
Chief Financial Officer and
Treasurer
[SEAL]
SUNTRUST BANK, as Administrative Agent,
as Issuing Bank, as Swingline Lender and
as a Lender
By
---------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
WACHOVIA BANK, NATIONAL ASSOCIATION
By
---------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
HSBC BANK USA
By
---------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
REGIONS BANK
By
---------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
COMMERCEBANK, N.A.
By
---------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
THE NORTHERN TRUST COMPANY
By
---------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
CITIBANK, F.S.B.
By
---------------------------------
Name:
Title:
[SIGNATURE PAGE TO REVOLVING CREDIT AGREEMENT]
SCHEDULE I
APPLICABLE MARGIN AND
APPLICABLE COMMITMENT FEE PERCENTAGE
Applicable Margin Applicable Margin Applicable
Pricing Leverage for Eurodollar for Base Rate Commitment Fee
Level Ratio Loans Loans Percentage
------- ------------------- ----------------- ----------------- -----------------
I Less than or
equal to 1.00:1.00 0.75% per annum 0.00% per annum 0.20% per annum
II Greater than
1.00:1.00 but
less than 1.50:1.00 1.00% per annum 0.00% per annum 0.3% per annum
III Greater than or
equal to
1.50:1.00 but
less than 2.00:1.00 1.25% per annum 0.00% per annum 0.35% per annum
IV Greater than or
equal to 2.00:1.00
but less than
2.50:1.00 1.50% per annum 0.00% per annum 0.40% per annum
V Greater than or
equal to 2.50:1.00 2.00% per annum 0.50% per annum 0.50% per annum
