EXHIBIT 2.2
CREDIT AGREEMENT
among
MAGELLAN HEALTH SERVICES, INC.,
VARIOUS LENDERS
and
DEUTSCHE BANK AG, NEW YORK BRANCH,
as ADMINISTRATIVE AGENT
--------------------------------
Dated as of January 5, 2004
--------------------------------
DEUTSCHE BANK SECURITIES INC.,
as LEAD ARRANGER and
BOOK RUNNING MANAGER,
and
CREDIT SUISSE FIRST BOSTON,
acting through its CAYMAN ISLANDS BRANCH,
as SYNDICATION AGENT
DEUTSCHE BANK [/]
TABLE OF CONTENTS
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Page
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SECTION 1. Amount and Terms of Credit............................................................................1
1.01 The Commitments.......................................................................................1
1.02 Minimum Amount of Each Borrowing......................................................................3
1.03 Notice of Borrowing...................................................................................3
1.04 Disbursement of Funds.................................................................................4
1.05 Notes.................................................................................................5
1.06 Conversions...........................................................................................7
1.07 Pro Rata Borrowings...................................................................................7
1.08 Interest..............................................................................................7
1.09 Interest Periods for Eurodollar Loans.................................................................8
1.10 Increased Costs, Illegality, etc......................................................................9
1.11 Compensation.........................................................................................11
1.12 Change of Lending Office.............................................................................12
1.13 Replacement of Lenders...............................................................................12
SECTION 2. Letters of Credit....................................................................................14
2.01 Letters of Credit....................................................................................14
2.02 Maximum Letter of Credit Outstandings; Final Maturities; etc.........................................15
2.03 Letter of Credit Requests; Minimum Stated Amount.....................................................15
2.04 Letter of Credit Participations......................................................................17
2.05 Agreement to Repay Letter of Credit Drawings.........................................................19
2.06 Increased Costs......................................................................................21
2.07 Credit-Linked Deposit Account........................................................................21
SECTION 3. Commitment Commission; Fees; Reductions of Commitment................................................23
3.01 Fees.................................................................................................23
3.02 Voluntary Termination of Unutilized Commitments......................................................24
3.03 Mandatory Reduction of Commitments...................................................................25
SECTION 4. Prepayments; Payments; Taxes.........................................................................26
4.01 Voluntary Prepayments................................................................................26
4.02 Mandatory Repayments.................................................................................27
4.03 Method and Place of Payment..........................................................................31
4.04 Net Payments.........................................................................................31
SECTION 5. Conditions Precedent to Credit Events on the Initial Borrowing Date..................................34
5.01 Execution of Agreement; Notes........................................................................34
5.02 Officer's Certificate................................................................................35
5.03 Opinions of Counsel..................................................................................35
5.04 Corporate Documents; Proceedings; etc................................................................35
5.05 The Transaction, etc.................................................................................35
5.06 Adverse Change, Approvals............................................................................37
5.07 Litigation...........................................................................................38
(i)
5.08 Pledge Agreement.....................................................................................38
5.09 Subsidiaries Guaranties..............................................................................38
5.10 Security Agreement...................................................................................38
5.11 Financial Statements; Projections....................................................................39
5.12 Solvency Certificate; Insurance Certificates.........................................................39
5.13 Shareholders' Agreements; Management Agreements; Employment Agreements;
Non-Compete Agreements; Tax Sharing Agreements; and Existing Indebtedness Agreements.................39
5.14 Fees, etc............................................................................................40
SECTION 6. Conditions Precedent to All Credit Events............................................................40
6.01 No Default; Representations and Warranties...........................................................40
6.02 Notice of Borrowing; Letter of Credit Request........................................................40
SECTION 7. Representations, Warranties and Agreements...........................................................41
7.01 Organizational Status................................................................................41
7.02 Power and Authority..................................................................................41
7.03 No Violation.........................................................................................41
7.04 Approvals............................................................................................42
7.05 Financial Statements; Financial Condition; Undisclosed Liabilities;
Projections; No Material Adverse Effect..............................................................42
7.06 Litigation...........................................................................................43
7.07 True and Complete Disclosure.........................................................................43
7.08 Use of Proceeds; Margin Regulations..................................................................43
7.09 Tax Returns and Payments.............................................................................44
7.10 Compliance with ERISA................................................................................44
7.11 The Security Documents...............................................................................45
7.12 Properties...........................................................................................46
7.13 Capitalization.......................................................................................46
7.14 Subsidiaries; etc....................................................................................47
7.15 Compliance with Statutes, etc........................................................................47
7.16 Investment Company Act...............................................................................47
7.17 Public Utility Holdings Company Act..................................................................47
7.18 Environmental Matters................................................................................48
7.19 Labor Relations......................................................................................48
7.20 Intellectual Property, etc...........................................................................49
7.21 Indebtedness.........................................................................................49
7.22 Insurance............................................................................................49
7.23 Subordination, etc...................................................................................49
7.24 Certain Agreements...................................................................................49
SECTION 8. Affirmative Covenants................................................................................49
8.01 Information Covenants................................................................................50
8.02 Books, Records and Inspections; Annual Meetings......................................................53
8.03 Maintenance of Property; Insurance...................................................................53
8.04 Existence; Franchises................................................................................54
8.05 Compliance with Statutes, etc........................................................................54
8.06 Compliance with Environmental Laws...................................................................54
(ii)
8.07 ERISA................................................................................................55
8.08 End of Fiscal Years; Fiscal Quarters.................................................................56
8.09 Performance of Obligations...........................................................................57
8.10 Payment of Taxes.....................................................................................57
8.11 Use of Proceeds......................................................................................57
8.12 Additional Security; Further Assurances; etc.........................................................57
8.13 Foreign Subsidiaries Security........................................................................59
8.14 Ownership of Subsidiaries; etc.......................................................................60
8.15 Maintenance of Corporate Separateness................................................................60
8.16 Permitted Acquisitions...............................................................................60
8.17 Concentration and Disbursement Accounts..............................................................62
SECTION 9. Negative Covenants...................................................................................62
9.01 Liens................................................................................................62
9.02 Consolidation, Merger, Purchase or Sale of Assets, etc...............................................65
9.03 Dividends............................................................................................67
9.04 Indebtedness.........................................................................................67
9.05 Advances, Investments and Loans......................................................................69
9.06 Transactions with Affiliates.........................................................................71
9.07 Capital Expenditures.................................................................................72
9.08 Consolidated Interest Coverage Ratio.................................................................73
9.09 Minimum Consolidated EBITDA..........................................................................74
9.10 Total Leverage Ratio.................................................................................75
9.11 Modified Leverage Ratio..............................................................................76
9.12 Limitations on Payments of Certain Indebtedness; Modifications of
Certain Indebtedness Documents, Certificate of Incorporation, By-Laws
and Certain Other Agreements, etc....................................................................76
9.13 Limitation on Certain Restrictions on Subsidiaries...................................................77
9.14 Business, etc........................................................................................78
9.15 Limitation on Creation of Subsidiaries...............................................................78
9.16 Limitation on Issuance of Capital Stock..............................................................78
9.17 Changes to Legal Names, Organizational Identification Numbers,
Jurisdiction or Type or Organization.................................................................79
SECTION 10. Events of Default....................................................................................80
10.01 Payments.............................................................................................80
10.02 Representations, etc.................................................................................80
10.03 Covenants............................................................................................80
10.04 Default Under Other Agreements.......................................................................80
10.05 Bankruptcy, etc......................................................................................80
10.06 ERISA................................................................................................81
10.07 Security Documents...................................................................................81
10.08 Subsidiaries Guaranty................................................................................82
10.09 Judgments............................................................................................82
10.10 Change of Control....................................................................................82
(iii)
SECTION 11. Defined Terms........................................................................................83
SECTION 12. The Administrative Agent............................................................................111
12.01 Appointment.........................................................................................111
12.02 Nature of Duties....................................................................................112
12.03 Lack of Reliance on the Administrative Agent........................................................112
12.04 Certain Rights of the Administrative Agent..........................................................112
12.05 Reliance............................................................................................113
12.06 Indemnification.....................................................................................113
12.07 The Administrative Agent in its Individual Capacity.................................................113
12.08 Holders.............................................................................................113
12.09 Resignation by the Administrative Agent.............................................................114
SECTION 13. Miscellaneous.......................................................................................115
13.01 Payment of Expenses, etc............................................................................115
13.02 Right of Setoff.....................................................................................116
13.03 Notices.............................................................................................116
13.04 Benefit of Agreement; Assignments; Participations...................................................116
13.05 No Waiver; Remedies Cumulative......................................................................119
13.06 Payments Pro Rata...................................................................................119
13.07 Calculations; Computations..........................................................................120
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL..............................120
13.09 Counterparts........................................................................................121
13.10 Effectiveness.......................................................................................121
13.11 Headings Descriptive................................................................................121
13.12 Amendment or Waiver; etc............................................................................121
13.13 Survival............................................................................................123
13.14 Domicile of Loans...................................................................................123
13.15 Register............................................................................................123
13.16 Confidentiality.....................................................................................124
(iv)
SCHEDULE I Commitments
SCHEDULE II Lender Addresses
SCHEDULE III ERISA Plans
SCHEDULE IV Real Property
SCHEDULE V Subsidiaries
SCHEDULE VI Existing Indebtedness
SCHEDULE VII Insurance
SCHEDULE VIII Existing Liens
SCHEDULE IX Existing Investments
EXHIBIT A-1 Notice of Borrowing
EXHIBIT A-2 Notice of Conversion/Continuation
EXHIBIT B-1 Term Note
EXHIBIT B-2 Revolving Note
EXHIBIT B-3 Swingline Note
EXHIBIT C Letter of Credit Request
EXHIBIT D Section 4.04(b)(ii) Certificate
EXHIBIT E-1 Opinion of Weil, Gotshal & Xxxxxx LLP
EXHIBIT E-2 Opinion of Xxxxx X. Xxxxxx, Esq.
EXHIBIT F Officers' Certificate
EXHIBIT G Pledge Agreement
EXHIBIT H Subsidiaries Guaranty
EXHIBIT I Security Agreement
EXHIBIT J Solvency Certificate
EXHIBIT K Compliance Certificate
EXHIBIT L Assignment and Assumption Agreement
EXHIBIT M Intercompany Note
EXHIBIT N Mortgage
(v)
CREDIT AGREEMENT, dated as of January 5, 2004, among MAGELLAN HEALTH SERVICES,
INC., a Delaware corporation (the "Borrower"), the Lenders party hereto from
time to time, and DEUTSCHE BANK AG, NEW YORK BRANCH, as administrative agent (in
such capacity, the "Administrative Agent"). All capitalized terms used herein
and defined in Section 11 are used herein as therein defined.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, subject to and upon the terms and conditions set forth
herein, the Lenders are willing to make available to the Borrower the respective
credit facilities provided for herein;
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
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1.01 The Commitments. (a) Subject to and upon the terms and
conditions set forth herein, each Lender with a Term Loan Commitment severally
agrees to make a term loan or term loans (each a "Term Loan" and, collectively,
the "Term Loans") to the Borrower, which Term Loans (i) shall be incurred
pursuant to a single drawing on the Initial Borrowing Date, (ii) shall be
denominated in Dollars, (iii) except as hereinafter provided, shall, at the
option of the Borrower, be incurred and maintained as, and/or converted into,
Base Rate Loans or Eurodollar Loans, provided that (A) except as otherwise
specifically provided in Section 1.10(b), all Term Loans comprising the same
Borrowing shall at all times be of the same Type, and (B) unless either the
Administrative Agent otherwise agrees in its sole discretion or has determined
that the Syndication Date has occurred (at which time this clause (B) shall no
longer be applicable), prior to the 90th day following the Initial Borrowing
Date, Term Loans may only be incurred and maintained as, and/or converted into,
Eurodollar Loans so long as all such outstanding Eurodollar Loans, together with
all outstanding Revolving Loans that are maintained as Eurodollar Loans, are
subject to an Interest Period of one month which begins and ends on the same
day, with the first such Interest Period to begin no sooner than three Business
Days after the Initial Borrowing Date, and (iv) shall be made by each such
Lender in that aggregate principal amount which does not exceed the Term Loan
Commitment of such Lender on the Initial Borrowing Date. Once repaid, Term Loans
incurred hereunder may not be reborrowed.
(b) Subject to and upon the terms and conditions set forth herein,
each Lender with a Revolving Loan Commitment severally agrees to make, at any
time and from time to time on or after the Initial Borrowing Date and prior to
the Final Maturity Date, a revolving loan or revolving loans (each a "Revolving
Loan" and, collectively, the "Revolving Loans") to the Borrower, which Revolving
Loans (i) shall be denominated in Dollars, (ii) shall, at the option of the
Borrower, be incurred and maintained as, and/or converted into, Base Rate Loans
or Eurodollar Loans, provided that (A) except as otherwise specifically provided
in Section 1.10(b), all Revolving Loans comprising the same Borrowing shall at
all times be of the same Type, and (B) unless either the Administrative Agent
otherwise agrees in its sole discretion or has determined that the Syndication
Date has occurred (at which time this clause (B) shall no longer be applicable),
prior to the 90th day following the Initial Borrowing Date, Revolving Loans may
only be incurred and maintained as, and/or converted into, Eurodollar Loans so
long as all such outstanding Eurodollar Loans, together with all outstanding
Term Loans that are maintained as Eurodollar Loans, are subject to an Interest
Period of one month which begins and ends on the same day, with the first such
Interest Period to begin no sooner than three Business Days after the Initial
Borrowing Date, (iii) may be repaid and reborrowed in accordance with the
provisions hereof, and (iv) shall not exceed for any such Lender at any time
outstanding that aggregate principal amount which, when added to the product of
(x) such Lender's RL Percentage and (y) the sum of (I) the aggregate amount of
all WC Letter of Credit Outstandings (exclusive of WC Unpaid Drawings which are
repaid with the proceeds of, and simultaneously with the incurrence of, the
respective incurrence of Revolving Loans) at such time and (II) the aggregate
principal amount of all Swingline Loans (exclusive of Swingline Loans which are
repaid with the proceeds of, and simultaneously with the incurrence of, the
respective incurrence of Revolving Loans) then outstanding, equals the Revolving
Loan Commitment of such Lender at such time.
(c) Subject to and upon the terms and conditions set forth herein,
the Swingline Lender agrees to make, at any time and from time to time on or
after the Initial Borrowing Date and prior to the Swingline Expiry Date, a
revolving loan or revolving loans (each a "Swingline Loan" and, collectively,
the "Swingline Loans") to the Borrower, which Swingline Loans (i) shall be
incurred and maintained as Base Rate Loans, (ii) shall be denominated in
Dollars, (iii) may be repaid and reborrowed in accordance with the provisions
hereof, (iv) shall not exceed in aggregate principal amount at any time
outstanding, when combined with the aggregate principal amount of all Revolving
Loans (exclusive of Revolving Loans which are repaid with the proceeds of, and
simultaneously with the incurrence of, the respective incurrence of Swingline
Loans) then outstanding and the aggregate amount of all WC Letter of Credit
Outstandings (exclusive of WC Unpaid Drawings which are repaid with the proceeds
of, and simultaneously with the incurrence of, the respective incurrence of
Swingline Loans) at such time, an amount equal to the Total Revolving Loan
Commitment at such time, and (v) shall not exceed in aggregate principal amount
at any time outstanding the Maximum Swingline Amount. Notwithstanding anything
to the contrary contained in this Section 1.01(c), (i) the Swingline Lender
shall not be obligated to make any Swingline Loans at a time when a Lender
Default exists with respect to an RL Lender unless the Swingline Lender has
entered into arrangements satisfactory to it and the Borrower to eliminate the
Swingline Lender's risk with respect to the Defaulting RL Lender's or Defaulting
RL Lenders' participation in such Swingline Loans, including by cash
collateralizing such Defaulting RL Lender's or Defaulting RL Lenders' RL
Percentage of the outstanding Swingline Loans, and (ii) the Swingline Lender
shall not make any Swingline Loan after it has received written notice from the
Borrower, any other Credit Party or the Required Lenders stating that a Default
or an Event of Default exists and is continuing until such time as the Swingline
Lender shall have received written notice (A) of rescission of all such notices
from the party or parties originally delivering such notice or notices or (B) of
the waiver of such Default or Event of Default by the Required Lenders.
(d) On any Business Day, the Swingline Lender may, in its sole
discretion, give notice to the RL Lenders that the Swingline Lender's
outstanding Swingline Loans shall be funded with one or more Borrowings of
Revolving Loans (provided that such notice shall be deemed to have been
automatically given upon the occurrence of a Default or an Event of Default
under Section 10.05 or upon the exercise of any of the remedies provided in the
last paragraph of Section 10), in which case one or more Borrowings of Revolving
Loans constituting Base Rate Loans (each such Borrowing, a "Mandatory
Borrowing") shall be made on the immediately succeeding Business Day by all RL
2
Lenders pro rata based on each such RL Lender's RL Percentage (determined before
giving effect to any termination of the Revolving Loan Commitments pursuant to
the last paragraph of Section 10) and the proceeds thereof shall be applied
directly by the Swingline Lender to repay the Swingline Lender for such
outstanding Swingline Loans. Each RL Lender hereby irrevocably agrees to make
Revolving Loans upon one Business Day's notice pursuant to each Mandatory
Borrowing in the amount and in the manner specified in the preceding sentence
and on the date specified in writing by the Swingline Lender notwithstanding (i)
the amount of the Mandatory Borrowing may not comply with the Minimum Borrowing
Amount otherwise required hereunder, (ii) whether any conditions specified in
Section 6 are then satisfied, (iii) whether a Default or an Event of Default
then exists, (iv) the date of such Mandatory Borrowing, and (v) the amount of
the Total Revolving Loan Commitment at such time. In the event that any
Mandatory Borrowing cannot for any reason be made on the date otherwise required
above (including, without limitation, as a result of the commencement of a
proceeding under the Bankruptcy Code with respect to the Borrower), then each RL
Lender hereby agrees that it shall forthwith purchase (as of the date the
Mandatory Borrowing would otherwise have occurred, but adjusted for any payments
received from the Borrower on or after such date and prior to such purchase)
from the Swingline Lender such participations in the outstanding Swingline Loans
as shall be necessary to cause the RL Lenders to share in such Swingline Loans
ratably based upon their respective RL Percentages (determined before giving
effect to any termination of the Revolving Loan Commitments pursuant to the last
paragraph of Section 10), provided that (x) all interest payable on the
Swingline Loans shall be for the account of the Swingline Lender until the date
as of which the respective participation is required to be purchased and, to the
extent attributable to the purchased participation, shall be payable to the
participant from and after such date and (y) at the time any purchase of
participations pursuant to this sentence is actually made, the purchasing RL
Lender shall be required to pay the Swingline Lender interest on the principal
amount of participation purchased for each day from and including the day upon
which the Mandatory Borrowing would otherwise have occurred to but excluding the
date of payment for such participation, at the overnight Federal Funds Rate for
the first three days and at the interest rate otherwise applicable to Revolving
Loans maintained as Base Rate Loans hereunder for each day thereafter.
1.02 Minimum Amount of Each Borrowing. The aggregate principal amount
of each Borrowing of Loans under a respective Tranche of Loans shall not be less
than the Minimum Borrowing Amount applicable to such Tranche of Loans. More than
one Borrowing may occur on the same date, but at no time shall there be
outstanding more than ten Borrowings of Eurodollar Loans in the aggregate for
all Tranches of Loans.
1.03 Notice of Borrowing. (a) Whenever the Borrower desires to incur
(x) Eurodollar Loans hereunder, the Borrower shall give the Administrative Agent
at the Notice Office at least three Business Days' prior notice of each
Eurodollar Loan to be incurred hereunder and (y) Base Rate Loans hereunder
(excluding Swingline Loans and Revolving Loans made pursuant to a Mandatory
Borrowing), the Borrower shall give the Administrative Agent at the Notice
Office at least one Business Day's prior notice of each Base Rate Loan to be
incurred hereunder, provided that (in each case) any such notice shall be deemed
to have been given on a certain day only if given before 11:00 A.M. (New York
time) on such day. Each such notice (each a "Notice of Borrowing"), except as
otherwise expressly provided in Section 1.10, shall be irrevocable and shall be
in writing, or by telephone promptly confirmed in writing, in the form of
3
Exhibit A-1, appropriately completed to specify: (i) the aggregate principal
amount of the Loans to be incurred pursuant to such Borrowing, (ii) the date of
such Borrowing (which shall be a Business Day), (iii) whether the Loans being
incurred pursuant to such Borrowing shall constitute Term Loans or Revolving
Loans and (iv) whether the Loans being incurred pursuant to such Borrowing are
to be initially maintained as Base Rate Loans or, to the extent permitted
hereunder, Eurodollar Loans and, if Eurodollar Loans, the initial Interest
Period to be applicable thereto. The Administrative Agent shall promptly give
each Lender which is required to make Loans of the Tranche specified in the
respective Notice of Borrowing, notice of such proposed Borrowing, of such
Lender's proportionate share thereof and of the other matters required by the
immediately preceding sentence to be specified in the Notice of Borrowing.
(b) (i) Whenever the Borrower desires to incur Swingline Loans
hereunder, the Borrower shall give the Swingline Lender no later than 1:00 P.M.
(New York time) on the date that a Swingline Loan is to be incurred, written
notice or telephonic notice promptly confirmed in writing of each Swingline Loan
to be incurred hereunder. Each such notice shall be irrevocable and specify in
each case (A) the date of Borrowing (which shall be a Business Day), and (B) the
aggregate principal amount of the Swingline Loans to be incurred pursuant to
such Borrowing.
(ii) Mandatory Borrowings shall be made upon the notice specified in
Section 1.01(d), with the Borrower irrevocably agreeing, by its incurrence of
any Swingline Loan, to the making of the Mandatory Borrowings as set forth in
Section 1.01(d).
(c) Without in any way limiting the obligation of the Borrower to
confirm in writing any telephonic notice of any Borrowing or prepayment of
Loans, the Administrative Agent or the Swingline Lender, as the case may be, may
act without liability upon the basis of telephonic notice of such Borrowing or
prepayment, as the case may be, believed by the Administrative Agent or the
Swingline Lender, as the case may be, in good faith to be from the president,
the chief executive officer or a Financial Officer of the Borrower, or from any
other authorized officer of the Borrower designated in writing by the Borrower
to the Administrative Agent as being authorized to give such notices, prior to
receipt of written confirmation. In each such case, the Borrower hereby waives
the right to dispute the Administrative Agent's or Swingline Lender's record of
the terms of such telephonic notice of such Borrowing or prepayment of Loans, as
the case may be, absent manifest error.
1.04 Disbursement of Funds. No later than 1:00 P.M. (New York time)
on the date specified in each Notice of Borrowing (or (x) in the case of
Swingline Loans, no later than 4:00 P.M. (New York time) on the date specified
pursuant to Section 1.03(b)(i) or (y) in the case of Mandatory Borrowings, no
later than 1:00 P.M. (New York time) on the date specified in Section 1.01(d)),
each Lender with a Commitment of the respective Tranche of Loans will make
available its pro rata portion (determined in accordance with Section 1.07) of
each such Borrowing requested to be made on such date (or in the case of
Swingline Loans, the Swingline Lender will make available the full amount
thereof). All such amounts will be made available in Dollars and in immediately
available funds at the Payment Office, and the Administrative Agent will, except
in the case of Revolving Loans made pursuant to a Mandatory Borrowing, make
available to the Borrower at the Payment Office the aggregate of the amounts so
made available by the Lenders. Unless the Administrative Agent shall have been
4
notified by any Lender prior to the date of Borrowing that such Lender does not
intend to make available to the Administrative Agent such Lender's portion of
any Borrowing to be made on such date, the Administrative Agent may assume that
such Lender has made such amount available to the Administrative Agent on such
date of Borrowing and the Administrative Agent may (but shall not be obligated
to), in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such corresponding amount is not in fact made available
to the Administrative Agent by such Lender, the Administrative Agent shall be
entitled to recover such corresponding amount on demand from such Lender. 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 promptly (but in any event within one
Business Day thereafter) pay such corresponding amount to the Administrative
Agent. The Administrative Agent also shall be entitled to recover on demand from
such Lender or the Borrower, as the case may be, interest on such corresponding
amount in respect of each day from the date such corresponding amount was made
available by the Administrative Agent to the Borrower until the date such
corresponding amount is recovered by the Administrative Agent, at a rate per
annum equal to (i) if recovered from such Lender, the overnight Federal Funds
Rate for the first three days and at the interest rate otherwise applicable to
such Loans for each day thereafter, and (ii) if recovered from the Borrower, the
rate of interest applicable to the respective Borrowing, as determined pursuant
to Section 1.08. Nothing in this Section 1.04 shall be deemed to relieve any
Lender from its obligation to make Loans hereunder or to prejudice any rights
which the Borrower may have against any Lender as a result of any failure by
such Lender to make Loans hereunder.
1.05 Notes. (a) The Borrower's obligation to pay the principal of,
and interest on, the Loans made by each Lender shall be evidenced in the
Register maintained by the Administrative Agent pursuant to Section 13.15 and
shall, if requested by such Lender, also be evidenced (i) in the case of Term
Loans, by a promissory note duly executed and delivered by the Borrower
substantially in the form of Exhibit B-1, with blanks appropriately completed in
conformity herewith (each a "Term Note" and, collectively, the "Term Notes"),
(ii) in the case of Revolving Loans, by a promissory note duly executed and
delivered by the Borrower substantially in the form of Exhibit B-2, with blanks
appropriately completed in conformity herewith (each a "Revolving Note" and,
collectively, the "Revolving Notes"), and (iii) in the case of Swingline Loans,
by a promissory note duly executed and delivered by the Borrower substantially
in the form of Exhibit B-3, with blanks appropriately completed in conformity
herewith (the "Swingline Note").
(b) The Term Note issued to each Lender that has a Term Loan
Commitment or outstanding Term Loans shall (i) be executed by the Borrower, (ii)
be payable to such Lender or its registered assigns and be dated the Initial
Borrowing Date (or, if issued after the Initial Borrowing Date, be dated the
date of issuance thereof), (iii) be in a stated principal amount equal to the
Term Loans made by such Lender on the Initial Borrowing Date (or, if issued
after the Initial Borrowing Date, be in a stated principal amount equal to the
outstanding Term Loans of such Lender at such time) and be payable in the
outstanding principal amount of Term Loans evidenced thereby from time to time,
(iv) mature on the Final Maturity Date, (v) bear interest as provided in the
appropriate clause of Section 1.08 in respect of the Base Rate Loans and
Eurodollar Loans, as the case may be, evidenced thereby, (vi) be subject to
voluntary prepayment as provided in Section 4.01, and mandatory repayment as
provided in Section 4.02, and (vii) be entitled to the benefits of this
Agreement and the other Credit Documents.
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(c) The Revolving Note issued to each Lender that has a Revolving
Loan Commitment or outstanding Revolving Loans shall (i) be executed by the
Borrower, (ii) be payable to such Lender or its registered assigns and be dated
the Initial Borrowing Date (or, if issued after the Initial Borrowing Date, be
dated the date of the issuance thereof), (iii) be in a stated principal amount
equal to the Revolving Loan Commitment of such Lender (or, if issued after the
termination thereof, be in a stated principal amount equal to the outstanding
Revolving Loans of such Lender at such time) and be payable in the outstanding
principal amount of the Revolving Loans evidenced thereby from time to time,
(iv) mature on the Final Maturity Date, (v) bear interest as provided in the
appropriate clause of Section 1.08 in respect of the Base Rate Loans and
Eurodollar Loans, as the case may be, evidenced thereby, (vi) be subject to
voluntary prepayment as provided in Section 4.01, and mandatory repayment as
provided in Section 4.02, and (vii) be entitled to the benefits of this
Agreement and the other Credit Documents.
(d) The Swingline Note issued to the Swingline Lender shall (i) be
executed by the Borrower, (ii) be payable to the Swingline Lender or its
registered assigns and be dated the Initial Borrowing Date, (iii) be in a stated
principal amount equal to the Maximum Swingline Amount and be payable in the
outstanding principal amount of the Swingline Loans evidenced thereby from time
to time, (iv) mature on the Swingline Expiry Date, (v) bear interest as provided
in the appropriate clause of Section 1.08 in respect of the Base Rate Loans
evidenced thereby, (vi) be subject to voluntary prepayment as provided in
Section 4.01, and mandatory repayment as provided in Section 4.02, and (vii) be
entitled to the benefits of this Agreement and the other Credit Documents.
(e) Each Lender will note on its internal records the amount of each
Loan made by it and each payment in respect thereof and prior to any transfer of
any of its Notes will endorse on the reverse side thereof the outstanding
principal amount of Loans evidenced thereby. Failure to make any such notation
or any error in such notation shall not affect the Borrower's obligations in
respect of such Loans.
(f) Notwithstanding anything to the contrary contained above in this
Section 1.05 or elsewhere in this Agreement, Notes shall only be delivered to
Lenders which at any time specifically request the delivery of such Notes. No
failure of any Lender to request or obtain a Note evidencing its Loans to the
Borrower shall affect or in any manner impair the obligations of the Borrower to
pay the Loans (and all related Obligations) incurred by the Borrower which would
otherwise be evidenced thereby in accordance with the requirements of this
Agreement, and shall not in any way affect the security or guaranties therefor
provided pursuant to the various Credit Documents. Any Lender which does not
have a Note evidencing its outstanding Loans shall in no event be required to
make the notations otherwise described in preceding clause (e). At any time when
any Lender requests the delivery of a Note to evidence any of its Loans, the
Borrower shall promptly execute and deliver to the respective Lender, at the
Borrower's expense, the requested Note in the appropriate amount or amounts to
evidence such Loans.
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1.06 Conversions. The Borrower shall have the option to convert, on
any Business Day, all or a portion equal to at least the Minimum Borrowing
Amount of the outstanding principal amount of Loans (other than Swingline Loans
which may not be converted pursuant to this Section 1.06) made pursuant to one
or more Borrowings (so long as of the same Tranche) of one or more Types of
Loans into a Borrowing (of the same Tranche) of another Type of Loan, provided
that (i) except as otherwise provided in Section 1.10(b), Eurodollar Loans may
be converted into Base Rate Loans only on the last day of an Interest Period
applicable to the Loans being converted and no such partial conversion of
Eurodollar Loans shall reduce the outstanding principal amount of such
Eurodollar Loans made pursuant to a single Borrowing to less than the Minimum
Borrowing Amount applicable thereto, (ii) unless the Required Lenders otherwise
agree, Base Rate Loans may only be converted into Eurodollar Loans if no Default
or Event of Default is in existence on the date of the conversion, (iii) unless
the Administrative Agent otherwise agrees in its sole discretion or has
determined that the Syndication Date has occurred (at which time this clause
(iii) shall no longer be applicable), prior to the 90th day following the
Initial Borrowing Date, conversions of Base Rate Loans into Eurodollar Loans
shall be subject to the provisions of clause (B) of the proviso in each of
Sections 1.01(a)(iii) and 1.01(b)(ii), and (iv) no conversion pursuant to this
Section 1.06 shall result in a greater number of Borrowings of Eurodollar Loans
than is permitted under Section 1.02. Each such conversion shall be effected by
the Borrower by giving the Administrative Agent at the Notice Office prior to
11:00 A.M. (New York time) at least three Business Days' prior notice (each a
"Notice of Conversion/Continuation") in the form of Exhibit A-2, appropriately
completed to specify the Loans to be so converted, the Borrowing or Borrowings
pursuant to which such Loans were incurred and, if to be converted into
Eurodollar Loans, the Interest Period to be initially applicable thereto. The
Administrative Agent shall give each Lender prompt notice of any such proposed
conversion affecting any of its Loans. Upon any such conversion the proceeds
thereof will be deemed to be applied directly on the day of such conversion to
prepay the outstanding principal amount of the Loans being converted.
1.07 Pro Rata Borrowings. All Borrowings of Term Loans and Revolving
Loans under this Agreement shall be incurred from the Lenders pro rata on the
basis of their Term Loan Commitments or Revolving Loan Commitments, as the case
may be, provided that all Mandatory Borrowings shall be incurred from the RL
Lenders pro rata on the basis of their RL Percentages. It is understood that no
Lender shall be responsible for any default by any other Lender of its
obligation to make Loans hereunder and that each Lender shall be obligated to
make the Loans provided to be made by it hereunder, regardless of the failure of
any other Lender to make its Loans hereunder.
1.08 Interest. (a) The Borrower agrees to pay interest in respect of
the unpaid principal amount of each Base Rate Loan from the date of Borrowing
thereof until the earlier of (i) the maturity thereof (whether by acceleration
or otherwise) and (ii) the conversion of such Base Rate Loan to a Eurodollar
Loan pursuant to Section 1.06 or 1.09, as applicable, at a rate per annum which
shall be equal to the sum of the Applicable Margin plus the Base Rate as in
effect from time to time.
(b) The Borrower agrees to pay interest in respect of the unpaid
principal amount of each Eurodollar Loan from the date of Borrowing thereof
until the earlier of (i) the maturity thereof (whether by acceleration or
otherwise) and (ii) the conversion of such Eurodollar Loan to a Base Rate Loan
pursuant to Section 1.06, 1.09 or 1.10, as applicable, at a rate per annum which
shall, during each Interest Period applicable thereto, be equal to the sum of
the Applicable Margin as in effect from time to time during such Interest Period
plus the Eurodollar Rate for such Interest Period.
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(c) Overdue principal and, to the extent permitted by law, overdue
interest in respect of each Loan shall, in each case, bear interest at a rate
per annum equal to the greater of (x) the rate which is 2% in excess of the rate
then borne by such Loans and (y) the rate which is 2% in excess of the rate
otherwise applicable to Base Rate Loans of the respective Tranche of Loans from
time to time, and all other overdue amounts payable hereunder and under any
other Credit Document shall bear interest at a rate per annum equal to the rate
which is 2% in excess of the rate applicable to Revolving Loans that are
maintained as Base Rate Loans from time to time. Interest that accrues under
this Section 1.08(c) shall be payable on demand.
(d) Accrued (and theretofore unpaid) interest shall be payable (i) in
respect of each Base Rate Loan, (x) quarterly in arrears on each Quarterly
Payment Date, (y) on the date of any repayment or prepayment in full of all
outstanding Base Rate Loans of the respective Tranche of Loans being so repaid
or prepaid, and (z) at maturity (whether by acceleration or otherwise) and,
after such maturity, on demand, and (ii) in respect of each Eurodollar Loan, (x)
on the last day of each Interest Period applicable thereto and, in the case of
an Interest Period in excess of three months, on each date occurring at three
month intervals after the first day of such Interest Period, and (y) on the date
of any repayment or prepayment (on the amount repaid or prepaid), at maturity
(whether by acceleration or otherwise) and, after such maturity, on demand.
(e) Upon each Interest Determination Date, the Administrative Agent
shall determine the Eurodollar Rate for each Interest Period applicable to the
respective Eurodollar Loans and shall promptly notify the Borrower and the
Lenders thereof. Each such determination shall, absent manifest error, be final
and conclusive and binding on all parties hereto.
1.09 Interest Periods for Eurodollar Loans. At the time the Borrower
gives any Notice of Borrowing or Notice of Conversion/Continuation in respect of
the making of, or conversion into, any Eurodollar Loan (in the case of the
initial Interest Period applicable thereto) or prior to 11:00 A.M. (New York
time) on the third Business Day prior to the expiration of an Interest Period
applicable to such Eurodollar Loan (in the case of any subsequent Interest
Period), the Borrower shall have the right to elect the Interest Period
applicable to such Eurodollar Loan, which Interest Period shall, at the option
of the Borrower (but otherwise subject to the provisions of clause (B) of the
proviso in each of Sections 1.01(a)(iii) and 1.01(b)(ii)), be a one, two, three
or six month period, provided that (in each case):
(i) all Eurodollar Loans comprising a Borrowing shall at all times
have the same Interest Period;
(ii) the initial Interest Period for any Eurodollar Loan shall
commence on the date of Borrowing of such Eurodollar Loan (including the
date of any conversion thereto from a Base Rate Loan) and each Interest
Period occurring thereafter in respect of such Eurodollar Loan shall
commence on the day on which the next preceding Interest Period applicable
thereto expires;
8
(iii) if any Interest Period for a Eurodollar Loan begins on a day for
which there is no numerically corresponding day in the calendar month at
the end of such Interest Period, such Interest Period shall end on the last
Business Day of such calendar month;
(iv) if any Interest Period for a Eurodollar Loan would otherwise
expire on a day which is not a Business Day, such Interest Period shall
expire on the next succeeding Business Day; provided, however, that if any
Interest Period for a Eurodollar Loan would otherwise expire on a day which
is not a Business Day but is a day of the month after which no further
Business Day occurs in such month, such Interest Period shall expire on the
next preceding Business Day;
(v) unless the Required Lenders otherwise agree, no Interest Period
for any Borrowing of any Tranche of Loans may be selected at any time when
a Default or an Event of Default is then in existence; and
(vi) no Interest Period in respect of any Borrowing of any Tranche of
Loans shall be selected which extends beyond the Final Maturity Date.
If by 11:00 A.M. (New York time) on the third Business Day prior to
the expiration of any Interest Period applicable to a Borrowing of Eurodollar
Loans, the Borrower has failed to elect, or is not permitted to elect, a new
Interest Period to be applicable to such Eurodollar Loans as provided above, the
Borrower shall be deemed to have elected to convert such Eurodollar Loans into
Base Rate Loans effective as of the expiration date of such current Interest
Period.
1.10 Increased Costs, Illegality, etc. (a) In the event that any
Lender shall have determined (which determination shall, absent manifest error,
be final and conclusive and binding upon all parties hereto but, with respect to
clause (i) below, may be made only by the Administrative Agent):
(i) on any Interest Determination Date that, by reason of any changes
arising after the date of this Agreement affecting the interbank Eurodollar
market, adequate and fair means do not exist for ascertaining the
applicable interest rate on the basis provided for in the definition of
Eurodollar Rate; or
(ii) at any time, that such Lender shall incur increased costs or
reductions in the amounts received or receivable hereunder with respect to
any Eurodollar Loan because of (x) any change since the Effective Date in
any applicable law or governmental rule, regulation, order, guideline or
request (whether or not having the force of law) or in the interpretation
or administration thereof and including the introduction of any new law or
governmental rule, regulation, order, guideline or request, such as, but
not limited to: (A) a change in the basis of taxation of payment to any
Lender of the principal of or interest on the Loans or the Notes or any
other amounts payable hereunder (except for (x) taxes with respect to which
additional amounts are paid pursuant to Section 4.04 or (y) changes in the
rate of tax on, or determined by reference to, the net income or net
profits (or any franchise or similar tax imposed in lieu of a net income or
net profits tax) of such Lender pursuant to the laws of the jurisdiction in
9
which it is organized or in which its principal office or applicable
lending office is located or any subdivision thereof or therein) or (B) a
change in official reserve requirements, but, in all events, excluding
reserves required under Regulation D to the extent included in the
computation of the Eurodollar Rate and/or (y) other circumstances arising
since the Effective Date affecting such Lender, the interbank Eurodollar
market or the position of such Lender in such market; or
(iii) at any time, that the making or continuance of any Eurodollar
Loan has been made (x) unlawful by any law or governmental rule, regulation
or order, (y) impossible by compliance by any Lender in good faith with any
governmental request (whether or not having force of law) or (z)
impracticable as a result of a contingency occurring after the Effective
Date which materially and adversely affects the interbank Eurodollar
market;
then, and in any such event, such Lender (or the Administrative Agent, in the
case of clause (i) above) shall promptly give notice (by telephone promptly
confirmed in writing) to the Borrower and, except in the case of clause (i)
above, to the Administrative Agent of such determination (which notice the
Administrative Agent shall promptly transmit to each of the other Lenders).
Thereafter (x) in the case of clause (i) above, Eurodollar Loans shall no longer
be available until such time as the Administrative Agent notifies the Borrower
and the Lenders that the circumstances giving rise to such notice by the
Administrative Agent no longer exist, and any Notice of Borrowing or Notice of
Conversion/Continuation given by the Borrower with respect to Eurodollar Loans
which have not yet been incurred (including by way of conversion) shall be
deemed rescinded by the Borrower, (y) in the case of clause (ii) above, the
Borrower agrees to pay to such Lender, upon such Lender's written request
therefor, such additional amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
reasonable discretion shall determine) as shall be required to compensate such
Lender for such increased costs or reductions in amounts received or receivable
hereunder (a written notice as to the additional amounts owed to such Lender,
showing in reasonable detail the basis for the calculation thereof, submitted to
the Borrower by such Lender shall, absent manifest error, be final and
conclusive and binding on all the parties hereto) and (z) in the case of clause
(iii) above, the Borrower shall take one of the actions specified in Section
1.10(b) as promptly as possible and, in any event, within the time period
required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii), the Borrower may, and in the
case of a Eurodollar Loan affected by the circumstances described in Section
1.10(a)(iii), the Borrower shall, either (x) if the affected Eurodollar Loan is
then being made initially or pursuant to a conversion, cancel such Borrowing by
giving the Administrative Agent telephonic notice (confirmed in writing) on the
same date that the Borrower was notified by the affected Lender or the
Administrative Agent pursuant to Section 1.10(a)(ii) or (iii) or (y) if the
affected Eurodollar Loan is then outstanding, upon at least three Business Days'
written notice to the Administrative Agent, require the affected Lender to
convert such Eurodollar Loan into a Base Rate Loan, provided that, if more than
one Lender is affected at any time, then all affected Lenders must be treated
the same pursuant to this Section 1.10(b).
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(c) If any Lender determines that after the Effective Date the
introduction of or any change in any applicable law or governmental rule,
regulation, order, guideline, directive or request (whether or not having the
force of law) concerning capital adequacy, or any change in interpretation or
administration thereof by the NAIC or any governmental authority, central bank
or comparable agency, will have the effect of increasing the amount of capital
required or expected to be maintained by such Lender or any corporation
controlling such Lender based on the existence of such Lender's Commitments
hereunder or its obligations hereunder, then the Borrower agrees to pay to such
Lender, upon its written demand therefor, such additional amounts as shall be
required to compensate such Lender or such other corporation for the increased
cost to such Lender or such other corporation or the reduction in the rate of
return to such Lender or such other corporation as a result of such increase of
capital. In determining such additional amounts, each Lender will act reasonably
and in good faith and will use averaging and attribution methods which are
reasonable, provided that such Lender's determination of compensation owing
under this Section 1.10(c) shall, absent manifest error, be final and conclusive
and binding on all the parties hereto. Each Lender, upon determining that any
additional amounts will be payable pursuant to this Section 1.10(c), will give
prompt written notice thereof to the Borrower, which notice shall show in
reasonable detail the basis for calculation of such additional amounts.
1.11 Compensation. (a) The Borrower agrees to compensate each Lender,
upon its written request (which request shall set forth in reasonable detail the
basis for requesting such compensation), for all losses, liabilities and
reasonable expenses (including, without limitation, any loss, expense or
liability incurred by reason of the liquidation or reemployment of deposits or
other funds required by such Lender to fund its Eurodollar Loans but excluding
loss of anticipated profits) which such Lender may sustain: (i) if for any
reason (other than a default by such Lender or the Administrative Agent) a
Borrowing of, or conversion from or into, Eurodollar Loans does not occur on a
date specified therefor in a Notice of Borrowing or Notice of
Conversion/Continuation (whether or not withdrawn by the Borrower or deemed
withdrawn pursuant to Section 1.10(a)); (ii) if any prepayment or repayment
(including any prepayment or repayment made pursuant to Section 4.01, Section
4.02 or as a result of an acceleration of the Loans pursuant to Section 10) or
conversion of any of its Eurodollar Loans occurs on a date which is not the last
day of an Interest Period with respect thereto; (iii) if any prepayment of any
of its Eurodollar Loans is not made on any date specified in a notice of
prepayment given by the Borrower; or (iv) as a consequence of (x) any other
default by the Borrower to repay Eurodollar Loans when required by the terms of
this Agreement or any Note held by such Lender or (y) any election made pursuant
to Section 1.10(b).
(b) The Borrower agrees to compensate the Administrative Agent and
each CL Lender, upon its written request (which request shall set forth in
reasonable detail the basis for requesting such compensation), for all losses,
liabilities and reasonable expenses incurred by the Administrative Agent or such
CL Lender in connection with (i) any withdrawals from the Credit-Linked Deposit
Account pursuant to the terms of this Agreement prior to the end of the
applicable Interest Period or Scheduled Investment Termination Date for the
Credit-Linked Deposits and (ii) the termination of the Total Credit-Linked
Commitment (and the related termination of the investment of the funds held in
the Credit-Linked Deposit Account) prior to the end of any applicable Interest
Period or Scheduled Investment Termination Date for the Credit-Linked Deposits.
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(c) Any Lender's or the Administrative Agent's determination of
compensation owing to it under this Section 1.11 shall, absent manifest error,
be final and conclusive and binding on all the parties hereto.
1.12 Change of Lending Office. Each Lender agrees that on the
occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or
(iii), Section 1.10(c), Section 2.06 or Section 4.04 with respect to such
Lender, it will, if requested by the Borrower, use reasonable efforts (subject
to overall policy considerations of such Lender) to designate another lending
office for any Loans or Letters of Credit affected by such event, provided that
such designation is made on such terms that such Lender and its lending office
suffer no economic, legal or regulatory disadvantage, with the object of
avoiding the consequence of the event giving rise to the operation of such
Section. Nothing in this Section 1.12 shall affect or postpone any of the
obligations of the Borrower or the right of any Lender provided in Sections
1.10, 2.06 and 4.04.
1.13 Replacement of Lenders. (x) If any Lender becomes a Defaulting
Lender or otherwise defaults in its obligations to make Loans, (y) upon the
occurrence of an event giving rise to the operation of Section 1.10(a)(ii) or
(iii), Section 1.10(c), Section 2.06 or Section 4.04 with respect to any Lender
which results in such Lender charging to the Borrower increased costs in excess
of those being generally charged by the other Lenders or (z) in the case of a
refusal by a Lender to consent to certain proposed changes, waivers, discharges
or terminations with respect to this Agreement which have been approved by the
Required Lenders as (and to the extent) provided in Section 13.12(b), the
Borrower shall have the right, if no Default or Event of Default then exists
(or, in the case of preceding clause (z), will exist immediately after giving
effect to such replacement), either (A) to replace such Lender with one or more
other Eligible Transferees, none of whom shall constitute a Defaulting Lender at
the time of such replacement (collectively, the "Replacement Lender") and each
of whom shall be reasonably acceptable to the Administrative Agent or (B) to
replace only (a) the Revolving Loan Commitment (and outstandings pursuant
thereto) of the Replaced Lender and/or the Credit-Linked Commitment of the
Replaced Lender with an identical Revolving Loan Commitment and/or Credit-Linked
Commitment provided by the Replacement Lender or (b) in the case of a
replacement as provided in Section 13.12(b) where the consent of the respective
Lender is required with respect to less than all Tranches of its Loans or
Commitments, the Commitments and/or outstanding Loans of such Lender in respect
of each Tranche where the consent of such Lender would otherwise be individually
required, with identical Commitments and/or Loans of the respective Tranche
provided by the Replacement Lender (each such Lender which is replaced by a
Replacement Lender or whose Commitment (or any portion thereof) or Loans (or any
portion thereof) is replaced (either pursuant to preceding clause (A) or (B)) is
referred to herein as a "Replaced Lender"); provided that:
(i) at the time of any replacement pursuant to this Section
1.13, the Replaced Lender and the Replacement Lender shall enter into
one or more Assignment and Assumption Agreements pursuant to Section
13.04(b) (and with all fees payable pursuant to said Section 13.04(b)
to be paid by the Replacement Lender and/or the Replaced Lender (as
may be agreed to at such time by and among the Borrower, the
Replacement Lender and the Replaced Lender)) pursuant to which the
Replacement Lender shall acquire (A) all of the Commitments and
outstanding Loans of, and in each case participations in Letters of
Credit by, the Replaced Lender or (B) in the case of the replacement
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of only (a) the Revolving Loan Commitment, the Revolving Loan
Commitment and outstanding Revolving Loans and participations in WC
Letter of Credit Outstandings of the Replaced Lender, (b) the
Credit-Linked Commitment, participations in CL Letter of Credit
Outstandings of the Replaced Lender, and (c) Term Loans, the
outstanding Term Loans of the Replaced Lender and, in connection with
(x) an acquisition pursuant to preceding sub-clause (A), the
Replacement Lender shall pay to (I) the Replaced Lender in respect
thereof an amount equal to the sum of (1) an amount equal to the
aggregate principal of, and all accrued and unpaid interest on, all
outstanding Loans of the Replaced Lender, (2) an amount equal to all
Unpaid Drawings that have been funded by (and not reimbursed to) such
Replaced Lender, together with all then accrued and unpaid interest
with respect thereto at such time, and (3) an amount equal to all
accrued, but theretofore unpaid, Fees owing to the Replaced Lender
pursuant to Section 3.01, (II) each Issuing Lender in respect thereof
an amount equal to such Replaced Lender's RL Percentage and/or CL
Percentage, as the case may be, of any Unpaid Drawing (which at such
time remains an Unpaid Drawing) to the extent such amount was not
theretofore funded by such Replaced Lender to such Issuing Lender and
(III) the Swingline Lender in respect thereof an amount equal to such
Replaced Lender's RL Percentage of any Mandatory Borrowing to the
extent such amount was not theretofore funded by such Replaced Lender
to the Swingline Lender or (y) an acquisition pursuant to preceding
sub-clause (B) where less than all Tranches are being acquired, the
Replacement Lender shall pay to (I) the Replaced Lender in respect
thereof an amount equal to the sum of (1) an amount equal to the
aggregate principal of, and all accrued and unpaid interest on, all
outstanding Loans of the Replaced Lender of the affected Tranche or
Tranches, (2) in the case of the replacement of the Revolving Loan
Commitment and/or Credit-Linked Commitment of the Replaced Lender, an
amount equal to all WC Unpaid Drawings and/or CL Unpaid Drawings, as
the case may be, that have been funded by (and not reimbursed to)
such Replaced Lender, together with all then accrued and unpaid
interest with respect thereto at such time, and (3) an amount equal
to all accrued, but theretofore unpaid, Fees owing to the Replaced
Lender pursuant to Section 3.01 with respect to the affected Tranche
or Tranches, (II) in the case of the replacement of the Revolving
Loan Commitment and/or Credit-Linked Commitment, each Issuing Lender
in respect thereof an amount equal to such Replaced Lender's RL
Percentage and/or CL Percentage, as the case may be, of any Unpaid
Drawing (which at such time remains an Unpaid Drawing) to the extent
such amount was not theretofore funded by such Replaced Lender to
such Issuing Lender and (III) in the case of the replacement of the
Revolving Loan Commitment, the Swingline Lender in respect thereof an
amount equal to such Replaced Lender's RL Percentage of any Mandatory
Borrowing to the extent such amount was not theretofore funded by
such Replaced Lender to the Swingline Lender; and
(ii) all obligations of the Borrower due and owing to the Replaced
Lender at such time (other than those specifically described in clause (i)
above in respect of which the assignment purchase price has been, or is
concurrently being, paid) shall be paid in full to such Replaced Lender
concurrently with such replacement.
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Upon the execution of the respective Assignment and Assumption
Agreement, the payment of amounts referred to in clauses (i) and (ii) above, if
so requested by the Replacement Lender, delivery to the Replacement Lender of
the appropriate Note or Notes executed by the Borrower and the satisfaction of
the other applicable conditions in Section 13.04(b), the Replacement Lender
shall become a Lender hereunder and the Replaced Lender shall cease to
constitute a Lender hereunder, except with respect to indemnification provisions
under this Agreement (including, without limitation, Sections 1.10, 1.11, 2.06,
4.04, 12.06 and 13.01), which shall survive as to such Replaced Lender. Without
the consent of the Administrative Agent, the Credit-Linked Deposit funded by any
CL Lender shall not be released in connection with any assignment of its
Credit-Linked Commitment, but shall instead be purchased by the relevant
assignee and continue to be held for application (if not already applied)
pursuant to Section 2.04(c) in respect of such assignee's obligations under the
Credit-Linked Commitment assigned to it.
SECTION 2. Letters of Credit.
-----------------
2.01 Letters of Credit. (a) Subject to and upon the terms and
conditions set forth herein, the Borrower may request that an Issuing Lender
issue, at any time and from time to time on and after the Initial Borrowing Date
and prior to the 30th day prior to the Final Maturity Date, for the account of
the Borrower and for the benefit of (x) any holder (or any trustee, agent or
other similar representative for any such holders) of L/C Supportable
Obligations of the Borrower or any of its Subsidiaries, an irrevocable standby
letter of credit, in a form customarily used by such Issuing Lender or in such
other form as is reasonably acceptable to such Issuing Lender, and (y) sellers
of goods to the Borrower or any of its Subsidiaries, an irrevocable trade letter
of credit, in a form customarily used by such Issuing Lender or in such other
form as has been approved by such Issuing Lender (each such letter of credit, a
"Letter of Credit" and, collectively, the "Letters of Credit"). All Letters of
Credit shall be denominated in Dollars and shall be issued on a sight basis
only.
(b) Subject to and upon the terms and conditions set forth herein,
each Issuing Lender agrees that it will, at any time and from time to time on
and after the Initial Borrowing Date and prior to the 30th day prior to the
Final Maturity Date, following its receipt of the respective Letter of Credit
Request, issue for account of the Borrower, one or more Letters of Credit as are
permitted to remain outstanding hereunder without giving rise to a Default or an
Event of Default, provided that no Issuing Lender shall be under any obligation
to issue any Letter of Credit of the types described above if at the time of
such issuance:
(i) any order, judgment or decree of any governmental authority or
arbitrator shall purport by its terms to enjoin or restrain such Issuing
Lender from issuing such Letter of Credit or any requirement of law
applicable to such Issuing Lender or any request or directive (whether or
not having the force of law) from any governmental authority with
jurisdiction over such Issuing Lender shall prohibit, or request that such
Issuing Lender refrain from, the issuance of letters of credit generally or
such Letter of Credit in particular or shall impose upon such Issuing
Lender with respect to such Letter of Credit any restriction or reserve or
capital requirement (for which such Issuing Lender is not otherwise
compensated hereunder) not in effect with respect to such Issuing Lender on
the date hereof, or any unreimbursed loss, cost or expense which was not
applicable or in effect with respect to such Issuing Lender as of the date
hereof and which such Issuing Lender reasonably and in good xxxxx xxxxx
material to it; or
14
(ii) such Issuing Lender shall have received from the Borrower, any
other Credit Party or the Required Lenders prior to the issuance of such
Letter of Credit notice of the type described in the second sentence of
Section 2.03(b).
2.02 Maximum Letter of Credit Outstandings; Final Maturities; etc.
Notwithstanding anything to the contrary contained in this Agreement, (i) no WC
Letter of Credit shall be issued the Stated Amount of which, when added to the
WC Letter of Credit Outstandings (exclusive of WC Unpaid Drawings which are
repaid on the date of, and prior to the issuance of, the respective WC Letter of
Credit) at such time would exceed either (x) $45,000,000 or (y) when added to
the sum of (I) the aggregate principal amount of all Revolving Loans then
outstanding and (II) the aggregate principal amount of all Swingline Loans then
outstanding, an amount equal to the Total Revolving Loan Commitment at such
time, (ii) no CL Letter of Credit shall be issued the Stated Amount of which,
when added to the CL Letter of Credit Outstandings (exclusive of CL Unpaid
Drawings which are repaid on the date of, and prior to the issuance of, the
respective CL Letter of Credit) would exceed either (x) the Total Credit-Linked
Commitment at such time or (y) the aggregate amount of the Credit-Linked
Deposits in the Credit-Linked Deposit Account at such time, (iii) no WC Letter
of Credit shall be issued unless the CL Letter of Credit Outstandings equals the
Total Credit-Linked Commitment as then in effect, and (iv) each Letter of Credit
shall by its terms terminate (x) in the case of standby Letters of Credit, on or
before the earlier of (A) the date which occurs 12 months after the date of the
issuance thereof (although any such standby Letter of Credit shall be extendible
for successive periods of up to 12 months, but, in each case, not beyond the one
year anniversary of the Final Maturity Date, on terms acceptable to the
respective Issuing Lender) and (B) the one year anniversary of the Final
Maturity Date, and (y) in the case of trade Letters of Credit, on or before the
earlier of (A) the date which occurs 180 days after the date of issuance thereof
and (B) 30 days prior to the Final Maturity Date.
2.03 Letter of Credit Requests; Minimum Stated Amount. (a) Whenever
the Borrower desires that a Letter of Credit be issued for its account, the
Borrower shall give the Administrative Agent and the respective Issuing Lender
at least five Business Days' (or such shorter period as is acceptable to such
Issuing Lender) written notice thereof (including by way of facsimile). Each
notice shall be in the form of Exhibit C, appropriately completed (each a
"Letter of Credit Request") to specify: (i) the name of the respective Issuing
Lender thereof; (ii) whether such Letter of Credit is to be a CL Letter of
Credit or, to the extent permitted hereunder, a WC Letter of Credit; (iii)
whether such Letter of Credit is to be a stand-by or trade Letter of Credit;
(iv) the date of issuance of such Letter of Credit (which shall be a Business
Day); (v) the initial Stated Amount of such Letter of Credit; (vi) the
beneficiary of such Letter of Credit and the obligations to be supported by such
Letter of Credit; and (vii) the stated expiration date of such Letter of Credit.
(b) The making of each Letter of Credit Request shall be deemed to be
a representation and warranty by the Borrower to the Lenders that such Letter of
Credit may be issued in accordance with, and will not violate the requirements
of, Section 2.02. Unless the respective Issuing Lender has received notice from
the Borrower, any other Credit Party or the Required Lenders before it issues a
Letter of Credit that one or more of the conditions specified in Section 5 or 6
are not then satisfied, or that the issuance of such Letter of Credit would
violate Section 2.02, then such Issuing Lender shall, subject to the terms and
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conditions of this Agreement, issue the requested Letter of Credit for the
account of the Borrower in accordance with such Issuing Lender's usual and
customary practices. Upon the issuance of or modification or amendment to any
standby Letter of Credit, each Issuing Lender shall promptly notify the Borrower
and the Administrative Agent in writing of such issuance, modification or
amendment and such notice shall be accompanied by a copy of such Letter of
Credit or the respective modification or amendment thereto, as the case may be.
Promptly after receipt of such notice the Administrative Agent shall notify the
Participants, in writing, of such issuance, modification or amendment.
(c) In the event that a WC Letter of Credit is outstanding at a time
when the Borrower has the availability to issue a new CL Letter of Credit in
accordance with the terms of this Agreement, the Borrower shall have the right,
upon written notice to the Administrative Agent and the respective Issuing
Lender, to re-designate one or more WC Letters of Credit as a CL Letter of
Credit in each case so long as (i) each such CL Letters of Credit may otherwise
be issued in accordance with, and will not violate the requirements of, Section
2.02, (ii) the Borrower certifies in writing to the Administrative Agent and the
respective Issuing Lender that (x) no Default or Event of Default then exists or
would result therefrom and (y) all of the representations and warranties
contained herein and in the other Credit Documents are true and correct in all
material respects with the same effect as though such representations and
warranties had been made on the date of such re-designation (it being understood
and agreed that any representation or warranty which by its terms is made as of
a specified date shall be required to be true and correct in all material
respects only as of such specified date) and (iii) neither the Administrative
Agent nor the respective Issuing Lender has received a written notice from the
Borrower, any other Credit Party or any Lender stating that a Default or an
Event of Default exists and is continuing unless the Administrative Agent and
such Issuing Lender shall have received written notice (A) of rescission of all
such notices from the party or parties originally delivering such notice or
notices or (B) the waiver of such Default or Event of Default by the Required
Lenders. Upon satisfaction of the conditions described above in this Section
2.02(c), (x) the respective Issuing Lender shall re-designate the affected WC
Letter of Credit or WC Letters of Credit as a CL Letter of Credit or CL Letters
of Credit, as the case may be, and (y) a new CL Letters of Credit or CL Letters
of Credit shall be deemed issued at such time under this Agreement.
(d) On the first Business Day of each week, each Issuing Lender shall
furnish the Administrative Agent with a written (including via facsimile) report
of the daily aggregate outstandings of CL Letters of Credit and WC Letters of
Credit issued by such Issuing Lender for the immediately preceding week.
Notwithstanding anything to the contrary contained in this Agreement, in the
event that a Lender Default exists with respect to an RL Lender, no Issuing
Lender shall be required to issue any WC Letter of Credit unless such Issuing
Lender has entered into arrangements satisfactory to it and the Borrower to
eliminate such Issuing Lender's risk with respect to the participation in WC
Letters of Credit by the Defaulting RL Lender or RL Lenders, including by cash
collateralizing such Defaulting RL Lender's or RL Lenders' RL Percentage of the
respective WC Letter of Credit Outstandings.
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(e) The initial Stated Amount of each Letter of Credit shall not be
less than $50,000 or such lesser amount as is acceptable to the respective
Issuing Lender.
2.04 Letter of Credit Participations. (a) Immediately upon the
issuance by an Issuing Lender of any Letter of Credit, such Issuing Lender shall
be deemed to have sold and transferred to each RL Lender or CL Lender, as the
case may be, and each such RL Lender or CL Lender (in its capacity under this
Section 2.04, a "Participant") shall be deemed irrevocably and unconditionally
to have purchased and received from such Issuing Lender, without recourse or
warranty, an undivided interest and participation, to the extent of such
Participant's RL Percentage or CL Percentage, as the case may be, in such Letter
of Credit, each drawing or payment made thereunder and the obligations of the
Borrower under this Agreement with respect thereto, and any security therefor or
guaranty pertaining thereto. Upon any change in the RL Percentages of the RL
Lenders or in the CL Percentages of the CL Lenders, in each case pursuant to
Section 1.13 or 13.04(b), it is hereby agreed that, with respect to all
outstanding Letters of Credit and Unpaid Drawings relating thereto, there shall
be an automatic adjustment to the participations pursuant to this Section 2.04
to reflect the new RL Percentages or CL Percentages of the assignor and assignee
RL Lender or CL Lender, as the case may be.
(b) In determining whether to pay under any Letter of Credit, no
Issuing Lender shall have any obligation relative to the other Lenders other
than to confirm that any documents required to be delivered under such Letter of
Credit appear to have been delivered and that they appear to substantially
comply on their face with the requirements of such Letter of Credit. Any action
taken or omitted to be taken by an Issuing Lender under or in connection with
any Letter of Credit issued by it shall not create for such Issuing Lender any
resulting liability to the Borrower, any other Credit Party, any Lender or any
other Person unless such action is taken or omitted to be taken with gross
negligence or willful misconduct on the part of such Issuing Lender (as
determined by a court of competent jurisdiction in a final and non-appealable
decision).
(c) (i) In the event that an Issuing Lender makes any payment under
any WC Letter of Credit issued by it and the Borrower shall not have reimbursed
such amount in full to such Issuing Lender pursuant to Section 2.05(a), such
Issuing Lender shall promptly notify the Administrative Agent, which shall
promptly notify each relevant Participant of such failure, and each such
Participant shall promptly and unconditionally pay to such Issuing Lender the
amount of such Participant's RL Percentage of such unreimbursed payment in
Dollars and in same day funds. If the Administrative Agent so notifies, prior to
12:00 Noon (New York time) on any Business Day, any Participant required to fund
a payment under a WC Letter of Credit, such Participant shall make available to
the respective Issuing Lender in Dollars such Participant's RL Percentage of the
amount of such payment on such Business Day in same day funds. If and to the
extent such Participant shall not have so made its RL Percentage of the amount
of such payment available to the respective Issuing Lender, such Participant
agrees to pay to such Issuing Lender, forthwith on demand such amount, together
with interest thereon, for each day from such date until the date such amount is
paid to such Issuing Lender at the overnight Federal Funds Rate for the first
three days and at the interest rate applicable to Revolving Loans that are
maintained as Base Rate Loans for each day thereafter. The failure of any such
Participant to make available to an Issuing Lender its RL Percentage of any
payment under any WC Letter of Credit issued by such Issuing Lender shall not
relieve any such other Participant of its obligation hereunder to make available
to such Issuing Lender its RL Percentage of any payment under any WC Letter of
Credit on the date required, as specified above, but no such Participant shall
be responsible for the failure of any such other Participant to make available
to such Issuing Lender such other Participant's RL Percentage of any such
payment.
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(ii) In the event that an Issuing Lender makes any payment under any
CL Letter of Credit issued by it and the Borrower shall not have reimbursed
such amount in full to such Issuing Lender pursuant to Section 2.05(a) on
or before the seventh day immediately succeeding the date such payment is
made, each CL Lender hereby irrevocably authorizes the Administrative Agent
to reimburse such Issuing Lender for such amount solely from such CL
Lender's CL Percentage of the Credit-Linked Deposits on deposit with the
Administrative Agent in the Credit-Linked Deposit Account.
(d) Whenever an Issuing Lender receives a payment of a reimbursement
obligation as to which it has received any payments from the respective
Participants pursuant to clause (c) above, such Issuing Lender shall pay to each
such Participant which has paid its RL Percentage or CL Percentage thereof, as
the case may be, in Dollars and in same day funds, an amount equal to such
Participant's share (based upon the proportionate aggregate amount originally
funded by such Participant to the aggregate amount funded by all such
Participants) of the principal amount of such reimbursement obligation and
interest thereon accruing after the funding of the respective participations (it
being understood and agreed that any such payment to be made pursuant to this
Section 2.04(d) to a Participant which is a CL Lender shall be made by such
Issuing Lender to the Administrative Agent for the account of such CL Lender
and, except for a payment made as required under Section 4.02(g), for deposit in
the Credit-Linked Deposit Account).
(e) Upon the request of any Participant, each Issuing Lender shall
furnish to such Participant copies of any standby Letter of Credit issued by it
and such other documentation as may reasonably be requested by such Participant.
(f) The obligations of the Participants to make payments to each
Issuing Lender with respect to Letters of Credit shall be irrevocable and not
subject to any qualification or exception whatsoever and shall be made in
accordance with the terms and conditions of this Agreement under all
circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement or any of
the other Credit Documents;
(ii) the existence of any claim, setoff, defense or other right which
the Borrower or any of its Subsidiaries may have at any time against a
beneficiary named in a Letter of Credit, any transferee of any Letter of
Credit (or any Person for whom any such transferee may be acting), the
Administrative Agent, any Participant, or any other Person, whether in
connection with this Agreement, any Letter of Credit, the transactions
contemplated herein or any unrelated transactions (including any underlying
transaction between the Borrower or any Subsidiary of the Borrower and the
beneficiary named in any such Letter of Credit);
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(iii) any draft, certificate or any other document presented under any
Letter of Credit proving to be forged, fraudulent, invalid or insufficient
in any respect or any statement therein being untrue or inaccurate in any
respect;
(iv) the surrender or impairment of any security for the performance
or observance of any of the terms of any of the Credit Documents; or
(v) the occurrence of any Default or Event of Default.
2.05 Agreement to Repay Letter of Credit Drawings. (a) (i) Subject to
Section 2.05(b), the Borrower agrees to reimburse each Issuing Lender, by making
payment to the Administrative Agent in immediately available funds at the
Payment Office for any payment or disbursement made by such Issuing Lender under
any Letter of Credit issued by it (each such amount, so paid until reimbursed by
the Borrower, an "Unpaid Drawing"), not later than one Business Day following
receipt by the Borrower of notice of such payment or disbursement (provided that
no such notice shall be required to be given if a Default or an Event of Default
under Section 10.05 shall have occurred and be continuing, in which case the
Unpaid Drawing shall be due and payable immediately without presentment, demand,
protest or notice of any kind (all of which are hereby waived by the Borrower)),
with interest on the amount so paid or disbursed by such Issuing Lender, to the
extent not reimbursed prior to 12:00 Noon (New York time) on the date of such
payment or disbursement, from and including the date paid or disbursed to but
excluding the date such Issuing Lender was reimbursed by the Borrower therefor
at a rate per annum equal to (i) in the case of WC Unpaid Drawings, the Base
Rate in effect from time to time plus the Applicable Margin as in effect from
time to time for Revolving Loans that are maintained as Base Rate Loans, or (ii)
in the case of CL Unpaid Drawings, the Base Rate in effect from time to time
plus the remainder of (A) the Applicable CL Margin as in effect from time to
time minus (B) 1.00%; provided, however, (x) to the extent such amounts are not
reimbursed prior to 12:00 Noon (New York time) on the third Business Day
following the receipt by the Borrower of notice of such payment or disbursement
or following the occurrence of a Default or an Event of Default under Section
10.05, interest shall thereafter accrue on the amounts so paid or disbursed by
such Issuing Lender (and until reimbursed by the Borrower) at a rate per annum
equal to the rate otherwise applicable to the respective Unpaid Drawing as
provided in sub-clause (i) or (ii) above, as the case may be, plus (in either
case) 2%, with such interest to be payable on demand, and (y) from and after the
time that the Borrower shall have notified the Administrative Agent and the
respective Issuing Lender that the Borrower has elected to keep outstanding a CL
Unpaid Drawing as provided in Section 2.05(b)(i), such CL Unpaid Drawing shall
accrue interest as provided in Section 2.05(b)(ii). Each Issuing Lender shall
give the Borrower and the Administrative Agent prompt written notice of each
Drawing under any Letter of Credit issued by it, provided that the failure to
give any such notice shall in no way affect, impair or diminish the Borrower's
obligations hereunder.
(ii) If any Drawing under a CL Letter of Credit that has been funded
by the CL Lenders from the Credit-Linked Deposits as provided in Section
2.04(c)(ii) shall be reimbursed by the Borrower on a day other than on the last
day of an Interest Period applicable to the Credit-Linked Deposits, the
Administrative Agent shall invest the amount so reimbursed in overnight or
short-term cash equivalent investments until the end of the Interest Period at
the time in effect and the Borrower shall pay to the Administrative Agent, upon
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the Administrative Agent's request therefor, the amount, if any, by which (I)
the interest accrued on a like amount of the Credit-Linked Deposits at the LIBOR
Rate for the Interest Period in effect therefor shall exceed (II) the interest
earned through the investment of the amount so reimbursed for the period from
the date of such reimbursement through the end of the applicable Interest
Period, as determined by the Administrative Agent (such determination shall,
absent manifest error, be final and conclusive and binding on all parties
hereto) and set forth in the request for payment delivered to the Borrower. In
the event that the Borrower shall fail to pay any amount due under this Section
2.05(a)(ii), the interest payable by the Administrative Agent to the CL Lenders
on their Credit-Linked Deposits under Section 2.07 shall be correspondingly
reduced and the CL Lenders shall without further act succeed, ratably in
accordance with their CL Percentages, to the rights of the Administrative Agent
with respect to such amount due from the Borrower.
(b) (i) In the event that the Credit-Linked Deposit Account is
charged by the Administrative Agent pursuant to Section 2.04(c)(ii) to reimburse
the applicable Issuing Lender for any payment made by it under a CL Letter of
Credit that has not been reimbursed by the Borrower in cash pursuant to Section
2.05(a), the Borrower shall have the right to elect to keep the CL Unpaid
Drawing outstanding until the Final Maturity Date (subject to any earlier
repayment of such CL Unpaid Drawing as may be required pursuant to Section
4.02(g)). In the event that the Borrower has made such an election, the Borrower
also shall have the right to pay to the Administrative Agent in reimbursement of
such outstanding CL Unpaid Drawing an amount equal to the amount so charged for
deposit in the Credit-Linked Deposit Account, and such payment by the Borrower
shall correspondingly reduce or satisfy, as applicable, the Borrower's
reimbursement obligations pursuant to such Section 2.05(a) in respect of such CL
Unpaid Drawing. To the extent that the Borrower elects not to repay any CL
Unpaid Drawing pursuant to Section 2.05(a) at the time the respective Drawing
under the CL Letter of Credit occurs, the Borrower shall notify the
Administrative Agent and the respective Issuing Lender thereof in writing at
such time.
(ii) The Borrower agrees to pay to the Administrative Agent for the
ratable account of each CL Lender, interest with respect to any CL Letter of
Credit which is reimbursed from funds in the Credit-Linked Deposit Account and
which have not been reimbursed by the Borrower, equal to the amount that such CL
Lender would have received under Section 2.07(b) calculated for the relevant
period for which payment is required to be made less amounts already received
pursuant to Section 2.07(b) by such CL Lender for such relevant period. Interest
accrued under this Section 2.05(b)(ii) shall be due and payable quarterly in
arrears on each Quarterly Payment Date and on the date on which all CL Unpaid
Drawings have been paid in full by the Borrower.
(c) The obligations of the Borrower under this Section 2.05 to
reimburse each Issuing Lender with respect to drafts, demands and other
presentations for payment under Letters of Credit issued by it (each a
"Drawing") (including, in each case, interest thereon) shall be absolute and
unconditional under any and all circumstances and irrespective of any setoff,
counterclaim or defense to payment which the Borrower or any of its Subsidiaries
may have or have had against any Lender (including in its capacity as an Issuing
Lender or as a Participant), including, without limitation, any defense based
upon the failure of any drawing under a Letter of Credit to conform to the terms
of the Letter of Credit or any nonapplication or misapplication by the
beneficiary of the proceeds of such Drawing; provided, however, that the
20
Borrower shall not be obligated to reimburse any Issuing Lender for any wrongful
payment made by such Issuing Lender under a Letter of Credit issued by it as a
result of acts or omissions constituting willful misconduct or gross negligence
on the part of such Issuing Lender (as determined by a court of competent
jurisdiction in a final and non-appealable decision).
2.06 Increased Costs. If at any time after the Effective Date, the
introduction of or any change in any applicable law, rule, regulation, order,
guideline or request or in the interpretation or administration thereof by the
NAIC or any governmental authority charged with the interpretation or
administration thereof, or compliance by any Issuing Lender or any Participant
with any request or directive by the NAIC or by any such governmental authority
(whether or not having the force of law), shall either (i) impose, modify or
make applicable any reserve, deposit, capital adequacy or similar requirement
against letters of credit issued by any Issuing Lender or participated in by any
Participant, or (ii) impose on any Issuing Lender or any Participant any other
conditions relating, directly or indirectly, to this Agreement, the
Credit-Linked Deposits or any Letter of Credit; and the result of any of the
foregoing is to increase the cost to any Issuing Lender or any Participant of
issuing, maintaining or participating in the Credit-Linked Deposits or any
Letter of Credit, or reduce the amount of any sum received or receivable by any
Issuing Lender or any Participant hereunder or reduce the rate of return on its
capital with respect to the Credit-Linked Deposits or Letters of Credit (except
for (x) taxes with respect to which additional amounts are paid pursuant to
Section 4.04 or (y) changes in the rate of tax on, or determined by reference
to, the net income or net profits (or any franchise or similar tax imposed in
lieu of a net income or net profits tax) of such Issuing Lender or such
Participant pursuant to the laws of the jurisdiction in which it is organized or
in which its principal office or applicable lending office is located or any
subdivision thereof or therein), then, upon the delivery of the certificate
referred to below to the Borrower by any Issuing Lender or any Participant (a
copy of which certificate shall be sent by such Issuing Lender or such
Participant to the Administrative Agent), the Borrower agrees to pay to such
Issuing Lender or such Participant such additional amount or amounts as will
compensate such Issuing Lender or such Participant for such increased cost or
reduction in the amount receivable or reduction on the rate of return on its
capital. Any Issuing Lender or any Participant, upon determining that any
additional amounts will be payable pursuant to this Section 2.06, will give
prompt written notice thereof to the Borrower, which notice shall include a
certificate submitted to the Borrower by such Issuing Lender or such Participant
(a copy of which certificate shall be sent by the Issuing Lender or such
Participant to the Administrative Agent), setting forth in reasonable detail the
basis for the calculation of such additional amount or amounts necessary to
compensate such Issuing Lender or such Participant. The certificate required to
be delivered pursuant to this Section 2.06 shall, absent manifest error, be
final and conclusive and binding on the Borrower.
2.07 Credit-Linked Deposit Account; etc. (a) On the Initial Borrowing
Date and subject to the satisfaction of the conditions precedent set forth in
Section 5, each CL Lender on such date shall pay to the Administrative Agent
such CL Lender's Credit-Linked Deposit. The Credit-Linked Deposits shall be held
by the Administrative Agent in (or credited to) the Credit-Linked Deposit
Account, and no Person other than the Administrative Agent shall have a right of
withdrawal from the Credit-Linked Deposit Account or any other right or power
with respect to the Credit-Linked Deposits. Notwithstanding anything herein to
the contrary, the funding obligation of each CL Lender in respect of its
Participation in CL Letters of Credit shall be satisfied in full upon the
funding of its Credit-Linked Deposit.
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(b) Each of the Administrative Agent, each Issuing Lender and each CL
Lender hereby acknowledges and agrees that (i) each CL Lender is funding its
Credit-Linked Deposit to the Administrative Agent for application in the manner
contemplated by Section 2.04, (ii) the Administrative Agent may invest the
Credit-Linked Deposits in such investments as may be determined from time to
time by the Administrative Agent and (iii) the Administrative Agent has agreed
to pay to each CL Lender a return on its Credit-Linked Deposit (except (x)
during periods when such Credit-Linked Deposits are used to reimburse an Issuing
Lender with respect to Drawings on CL Letters of Credit for the period
commencing on the date of the related Drawing or (y) as otherwise provided in
Sections 2.05(a)(ii) and 2.07(d)) equal at any time to the LIBOR Rate for the
Interest Period in effect for the Credit-Linked Deposits at such time less the
Credit-Linked Deposit Cost Amount at such time. Such interest will be paid to
the CL Lenders by the Administrative Agent at the LIBOR Rate for the Interest
Period in effect for the Credit-Linked Deposits at such time (or at an amount
determined in accordance with Section 2.05(a)(ii) or 2.07(d), as applicable)
less (in each case) the Credit-Linked Deposit Cost Amount quarterly in arrears
on each Quarterly Payment Date.
(c) The Borrower shall have no right, title or interest in or to the
Credit-Linked Deposit Account or the Credit-Linked Deposits and no obligations
with respect thereto (except to refund portions thereof used to reimburse an
Issuing Lender with respect to Drawings on CL Letters of Credit as provided in
Section 2.04), it being acknowledged and agreed by the parties hereto that the
funding of the Credit-Linked Deposits by the CL Lenders and the application of
the Credit-Linked Deposits in the manner contemplated by Section 2.04(c)(ii)
constitute agreements among the Administrative Agent, each Issuing Lender and
each CL Lender with respect to the Participation in the CL Letters of Credit
and, except to the extent set forth in Section 2.05(b), do not constitute any
loan or extension of credit to the Borrower.
(d) If the Administrative Agent is not offering Dollar deposits (in
the applicable amounts) in the London interbank market, or the Administrative
Agent determines that adequate and fair means do not otherwise exist for
ascertaining the LIBOR Rate for the Credit-Linked Deposits (or any part
thereof), then the Credit-Linked Deposits (or such parts, as applicable) shall
be invested so as to earn a return equal to the greater of the Federal Funds
Rate and a rate determined by the Administrative Agent in accordance with
banking industry rules on interbank compensation.
(e) The Borrower shall have the right to elect the Interest Period to
be applicable to the Credit-Linked Deposits from time to time, which Interest
Period shall, at the option of the Borrower, be a one, three or six month
period, provided that (in each case):
(i) the Credit-Linked Deposits shall at all times have the same
Interest Period;
(ii) the initial Interest Period for the Credit-Linked Deposits shall
commence on the Initial Borrowing Date and each Interest Period occurring
thereafter in respect of the Credit-Linked Deposits shall commence on the
day on which the next preceding Interest Period applicable thereto expires,
provided that (x) if any Interest Period for the Credit-Linked Deposits
begins on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period, such Interest Period
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shall end on the last Business Day of such calendar month, and (y) if any
Interest Period for the Credit-Linked Deposits would otherwise expire on a
day which is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day, although if any Interest Period for the
Credit-Linked Deposits would otherwise expire on a day which is not a
Business Day but is a day of the month after which no further Business Day
occurs in such month, such Interest Period shall expire on the next
preceding Business Day; and
(iii) until the Borrower notifies the Administrative Agent of a change
in the Interest Period as provided below, each Interest Period for the
Credit-Linked Deposits shall be a period of one month.
The Borrower shall have the right to elect a new Interest Period to
be applicable to the Credit-Linked Deposits so long as the Borrower notifies the
Administrative Agent of such election in writing by 11:00 A.M. (New York time)
on the third Business Day prior to the expiration of the Interest Period then in
effect for the Credit-Linked Deposits; provided, however, if the Borrower has
failed to so notify the Administrative Agent of such Interest Period, the
Borrower shall be deemed to have elected an Interest Period of one month
effective as of the expiration of such current Interest Period.
SECTION 3. Commitment Commission; Fees; Reductions of Commitment.
-----------------------------------------------------
3.01 Fees. (a) The Borrower agrees to pay to the Administrative Agent
for distribution to each Non-Defaulting RL Lender a commitment commission (the
"Commitment Commission") for the period from and including the Effective Date to
and including the Final Maturity Date (or such earlier date on which the Total
Revolving Loan Commitment has been terminated) computed at a rate per annum
equal to the Applicable Commitment Commission Percentage on the daily average
Unutilized Revolving Loan Commitment of such Non-Defaulting RL Lender as in
effect from time to time. Accrued Commitment Commission shall be due and payable
quarterly in arrears on each Quarterly Payment Date and on the date upon which
the Total Revolving Loan Commitment is terminated.
(b) The Borrower agrees to pay to the Administrative Agent for
distribution to each RL Lender (based on each such RL Lender's respective RL
Percentage) a fee in respect of each WC Letter of Credit (the "WC Letter of
Credit Fee") for the period from and including the date of issuance of such WC
Letter of Credit to and including the date of termination or expiration of such
WC Letter of Credit, computed at a rate per annum equal to the Applicable Margin
with respect to Revolving Loans that are maintained as Eurodollar Loans on the
daily Stated Amount of each such WC Letter of Credit. Accrued WC Letter of
Credit Fees shall be due and payable quarterly in arrears on each Quarterly
Payment Date and on the first day on or after the termination of the Total
Revolving Loan Commitment upon which no WC Letters of Credit remain outstanding.
(c) The Borrower agrees to pay to the Administrative Agent for
distribution to each CL Lender (based on each such CL Lender's CL Percentage) a
fee (the "CL Facility Fee") equal to the sum of (I) a rate per annum equal to
the Applicable CL Margin as in effect from time to time on the Total
Credit-Linked Commitment as in effect from time to time (or, if terminated, on
the aggregate amount of the Credit-Linked Deposits from time to time (whether or
not such Credit-Linked Deposits have been applied as provided in Section 2.04
(c) (ii))) and (II) a rate per annum equal to the Credit-Linked Deposit Cost
Amount as in effect from time to time on the amount of the Total Credit-Linked
Commitment as in effect from time to time (or, if terminated, on the aggregate
amount of the Credit-Linked Deposits from time to time (whether or not such
Credit-Linked Deposits have been applied as provided in Section 2.04 (c) (ii))),
23
in each case for the period from and including the Effective Date to and
including the date on which the Total Credit-Linked Commitment has been
terminated, all CL Unpaid Drawings (including all accrued and unpaid interest
thereon) have been paid in full and all CL Letters of Credit have been
terminated. Accrued CL Facility Fees shall be due and payable quarterly in
arrears on each Quarterly Payment Date and on the date on which the Total
Credit-Linked Commitment has been terminated, all CL Unpaid Drawings (including
all accrued and unpaid interest thereon) have been paid in full and all CL
Letters of Credit have been terminated.
(d) The Borrower agrees to pay to each Issuing Lender, for its own
account, a facing fee in respect of each Letter of Credit issued by it (the
"Facing Fee") for the period from and including the date of issuance of such
Letter of Credit to and including the date of termination or expiration of such
Letter of Credit, computed at a rate per annum equal to 1/8 of 1% on the daily
Stated Amount of such Letter of Credit, provided that in any event the minimum
amount of Facing Fees payable in any twelve-month period for each Letter of
Credit shall be not less than $500; it being agreed that, on the day of issuance
of any Letter of Credit and on each anniversary thereof prior to the termination
or expiration of such Letter of Credit, if $500 will exceed the amount of Facing
Fees that will accrue with respect to such Letter of Credit for the immediately
succeeding twelve-month period, the full $500 shall be payable on the date of
issuance of such Letter of Credit and on each such anniversary thereof. Except
as otherwise provided in the proviso to the immediately preceding sentence,
accrued Facing Fees shall be due and payable quarterly in arrears on each
Quarterly Payment Date and upon the first day on or after the termination of the
Total Commitment, upon which no Letters of Credit remain outstanding.
(e) The Borrower agrees to pay to each Issuing Lender, for its own
account, upon each payment under, issuance of, or amendment to, any Letter of
Credit issued by it, such amount as shall at the time of such event be the
administrative charge and the reasonable expenses which such Issuing Lender is
generally imposing in connection with such occurrence with respect to letters of
credit.
(f) The Borrower agrees to pay to the Administrative Agent such fees
as may be agreed to in writing from time to time by the Borrower or any of its
Subsidiaries and the Administrative Agent.
3.02 Voluntary Termination of Unutilized Commitments. (a) Upon at
least three Business Days' prior written notice to the Administrative Agent at
the Notice Office (which notice the Administrative Agent shall promptly transmit
to each of the Lenders), the Borrower shall have the right, at any time or from
time to time, without premium or penalty, to terminate the Total Unutilized
Revolving Loan Commitment in whole, or reduce it in part in an integral multiple
of $1,000,000, provided that each such reduction shall apply proportionately to
permanently reduce the Revolving Loan Commitment of each RL Lender.
24
(b) Upon at least seven days' prior written notice to the
Administrative Agent at the Notice Office (which notice the Administrative Agent
shall promptly transmit to each of the Lenders), the Borrower shall have the
right, at any time or from time to time, without premium or penalty, to
terminate the Total Unutilized Credit-Linked Commitment in whole, or reduce it
in part in an integral multiple of $1,000,000, provided that each such reduction
shall apply proportionately to permanently reduce the Credit-Linked Commitment
of each CL Lender. At the time of any termination or reduction of the Total
Credit-Linked Commitment pursuant to this Section 3.02(b), the Administrative
Agent shall return to the CL Lenders (ratably in accordance with their
respective CL Percentages) their Credit-Linked Deposits in an amount by which
the aggregate amount of the Credit-Linked Deposits at such time exceeds the
Total Credit-Linked Commitment as in effect immediately after giving effect to
such termination.
(c) In the event of a refusal by a Lender to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Lenders as (and to the
extent) provided in Section 13.12(b), the Borrower may, subject to its
compliance with the requirements of Section 13.12(b), upon five Business Days'
prior written notice to the Administrative Agent at the Notice Office (which
notice the Administrative Agent shall promptly transmit to each of the Lenders)
terminate all of the Commitments of such Lender (other than any such Commitment
which is being maintained by such Lender (and not being terminated by the
Borrower) as provided in Section 13.12(b)), so long as all Loans (other than any
such Loans that are being maintained by such Lender (and not being repaid by the
Borrower) as provided in Section 13.12(b)) and CL Unpaid Drawings (to the extent
that such Lender's Credit-Linked Commitment is being terminated), together with
accrued and unpaid interest, Fees and all other amounts, owing to such Lender
are repaid concurrently with the effectiveness of such termination pursuant to
Section 4.01(b) (at which time Schedule I shall be deemed modified to reflect
such changed amounts) and such Lender's RL Percentage or CL Percentage, as the
case may be, of all outstanding WC Letters of Credit and/or CL Letters of Credit
are cash collateralized by the Borrower in a manner reasonably satisfactory to
the Administrative Agent and the respective Issuing Lenders, and at such time,
such Lender shall no longer constitute a "Lender" for purposes of this
Agreement, except with respect to indemnifications under this Agreement
(including, without limitation, Sections 1.10, 1.11, 2.06, 4.04, 12.06 and
13.01), which shall survive as to such repaid Lender. At the time of any
termination of a CL Lender's Credit-Linked Commitment pursuant to this Section
3.02(c), the Administrative Agent shall return to such CL Lender its
Credit-Linked Deposit.
3.03 Mandatory Reduction of Commitments. (a) The Total Commitment
(and the Commitment of each Lender) shall terminate in its entirety on January
31, 2004, unless the Initial Borrowing Date has occurred on or prior to such
date.
(b) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Term Loan Commitment (and the Term Loan
Commitment of each Lender) shall terminate in its entirety on the Initial
Borrowing Date (after giving effect to the incurrence of Term Loans on such
date).
(c) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Revolving Loan Commitment (and the Revolving
Loan Commitment of each RL Lender) shall terminate in its entirety upon the
earlier of (i) the Final Maturity Date and (ii) unless the Required Lenders
otherwise agree in writing, the date on which a Change of Control occurs.
25
(d) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Credit-Linked Commitment (and the Credit-Linked
Commitment of each CL Lender) shall terminate in its entirety upon the earlier
to occur of (i) the Final Maturity Date and (ii) unless the Required Lenders
otherwise agree in writing, the date on which a Change of Control occurs. At the
time of any termination of the Total Credit-Linked Commitment pursuant to this
Section 3.03(d) or pursuant to Section 10, the Administrative Agent shall return
to the CL Lenders (ratably in accordance with their respective CL Percentages)
their Credit-Linked Deposits (to the extent not theretofore applied pursuant to
Section 2.04(c)(ii)) in an amount by which the aggregate amount of the
Credit-Linked Deposits at such time exceeds the aggregate CL Letter of Credit
Outstandings at such time.
SECTION 4. Prepayments; Payments; Taxes.
----------------------------
4.01 Voluntary Prepayments. (a) The Borrower shall have the right to
prepay the Loans, without premium or penalty, in whole or in part at any time
and from time to time on the following terms and conditions: (i) the Borrower
shall give the Administrative Agent prior to 12:00 Noon (New York time) at the
Notice Office (x) at least one Business Day's prior written notice (or
telephonic notice promptly confirmed in writing) of its intent to prepay Base
Rate Loans (or same day notice in the case of a prepayment of Swingline Loans)
and (y) at least three Business Days' prior written notice (or telephonic notice
promptly confirmed in writing) of its intent to prepay Eurodollar Loans, which
notice (in each case) shall specify whether Term Loans, Revolving Loans or
Swingline Loans shall be prepaid, the amount of such prepayment and the Types of
Loans to be prepaid and, in the case of Eurodollar Loans, the specific Borrowing
or Borrowings pursuant to which such Eurodollar Loans were made, and which
notice the Administrative Agent shall, except in the case of a prepayment of
Swingline Loans, promptly transmit to each of the Lenders; (ii) (x) each partial
prepayment of Term Loans pursuant to this Section 4.01(a) shall be in an
aggregate principal amount of at least $500,000 (or such lesser amount as is
acceptable to the Administrative Agent), (y) each partial prepayment of
Revolving Loans pursuant to this Section 4.01(a) shall be in an aggregate
principal amount of at least $500,000 (or such lesser amount as is acceptable to
the Administrative Agent) and (z) each partial prepayment of Swingline Loans
pursuant to this Section 4.01(a) shall be in an aggregate principal amount of at
least $250,000 (or such lesser amount as is acceptable to the Administrative
Agent), provided that if any partial prepayment of Eurodollar Loans made
pursuant to any Borrowing shall reduce the outstanding principal amount of
Eurodollar Loans made pursuant to such Borrowing to an amount less than the
Minimum Borrowing Amount applicable thereto, then such Borrowing may not be
continued as a Borrowing of Eurodollar Loans (and same shall automatically be
converted into a Borrowing of Base Rate Loans) and any election of an Interest
Period with respect thereto given by the Borrower shall have no force or effect;
(iii) each prepayment pursuant to this Section 4.01(a) in respect of any Loans
made pursuant to a Borrowing shall be applied pro rata among such Loans,
provided that at the Borrower's election in connection with any prepayment of
Revolving Loans pursuant to this Section 4.01(a), such prepayment shall not, so
long as no Default or Event of Default then exists, be applied to any Revolving
Loan of a Defaulting RL Lender; and (iv) each voluntary prepayment of Term Loans
pursuant to this Section 4.01(a) shall be applied to reduce the then remaining
Scheduled Repayments on a pro rata basis (based upon the then remaining unpaid
principal amounts of such Scheduled Repayments after giving effect to all prior
reductions thereto).
26
(b) In the event of a refusal by a Lender to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Lenders as (and to the
extent) provided in Section 13.12(b), the Borrower may, upon five Business Days'
prior written notice to the Administrative Agent at the Notice Office (which
notice the Administrative Agent shall promptly transmit to each of the Lenders)
repay all Loans, together with accrued and unpaid interest, Fees, and other
amounts owing to such Lender (or owing to such Lender with respect to each
Tranche which gave rise to the need to obtain such Lender's individual consent)
in accordance with, and subject to the requirements of, said Section 13.12(b) so
long as (i) in the case of the repayment of Revolving Loans of any Lender
pursuant to this Section 4.01(b), (x) the Revolving Loan Commitment of such
Lender is terminated concurrently with such repayment pursuant to Section
3.02(c) (at which time Schedule I shall be deemed modified to reflect the
changed Revolving Loan Commitments) and (y) such Lender's RL Percentage of all
outstanding WC Letters of Credit is cash collateralized by the Borrower in a
manner reasonably satisfactory to the Administrative Agent and the Issuing
Lenders, (ii) in the case of the repayment of CL Unpaid Drawings for the account
of any Lender pursuant to this Section 4.01(b), (x) the Credit-Linked Commitment
of such Lender is terminated concurrently with such repayment pursuant to
Section 3.02(c) (at which time Schedule I shall be deemed modified to reflect
the changed Credit-Linked Commitments) and (y) such Lender's CL Percentage of
all outstanding CL Letters of Credit is cash collateralized by the Borrower in a
manner satisfactory to the Administrative Agent and the Issuing Lenders and
(iii) the consents, if any, required under Section 13.12(b) in connection with
the repayment pursuant to this Section 4.01(b) have been obtained. Each
prepayment of any Term Loans pursuant to this Section 4.01(b) shall be applied
to reduce the then remaining Scheduled Repayments of the Term Loans on a pro
rata basis (based upon the then remaining unpaid principal amounts of such
Scheduled Repayments after giving effect to all prior reductions thereto).
4.02 Mandatory Repayments. (a) (i) On any day on which the sum of (I)
the aggregate outstanding principal amount of all Revolving Loans (after giving
effect to all other repayments thereof on such date), (II) the aggregate
outstanding principal amount of all Swingline Loans (after giving effect to all
other repayments thereof on such date) and (III) the aggregate amount of all WC
Letter of Credit Outstandings exceeds the Total Revolving Loan Commitment at
such time, the Borrower shall prepay on such day the principal of Swingline
Loans and, after all Swingline Loans have been repaid in full or if no Swingline
Loans are outstanding, Revolving Loans in an amount equal to such excess. If,
after giving effect to the prepayment of all outstanding Swingline Loans and
Revolving Loans, the aggregate amount of the WC Letter of Credit Outstandings
exceeds the Total Revolving Loan Commitment at such time, the Borrower shall pay
to the Administrative Agent at the Payment Office on such day an amount of cash
and/or Cash Equivalents equal to the amount of such excess (up to a maximum
amount equal to the WC Letter of Credit Outstandings at such time), such cash
and/or Cash Equivalents to be held as security for all obligations of the
Borrower to the Issuing Lenders and the Lenders hereunder in a cash collateral
account to be established by, and under the sole dominion and control of, the
Administrative Agent.
27
(ii) On any day on which the aggregate amount of all CL Letter of
Credit Outstandings exceeds the Total Credit-Linked Commitment at such time, the
Borrower shall pay to the Administrative Agent at the Payment Office on such day
an amount of cash and/or Cash Equivalents equal to the amount of such excess (up
to a maximum amount equal to the CL Letter of Credit Outstandings at such time),
such cash and/or Cash Equivalents to be held as security for all obligations of
the Borrower to the Issuing Lenders and the Lenders hereunder in a cash
collateral account to be established by, and under the sole dominion and control
of, the Administrative Agent.
(b) In addition to any other mandatory repayments pursuant to this
Section 4.02, on each date set forth below, the Borrower shall be required to
repay that principal amount of Term Loans, to the extent then outstanding, as is
set forth opposite each such date below (each such repayment, as the same may be
reduced as provided in Sections 4.01(a), 4.01(b) and 4.02(g), a "Scheduled
Repayment"):
Scheduled Repayment Date Amount
------------------------ ------
March 15, 2004 $3,750,000
June 15, 2004 $3,750,000
September 15, 2004 $3,750,000
December 15, 2004 $3,750,000
March 15, 2005 $5,625,000
June 15, 2005 $5,625,000
September 15, 2005 $5,625,000
December 15, 2005 $5,625,000
March 15, 2006 $6,250,000
June 15, 2006 $6,250,000
September 15, 2006 $6,250,000
December 15, 2006 $6,250,000
March 15, 2007 $6,250,000
June 15, 2007 $6,250,000
September 15, 2007 $6,250,000
December 15, 2007 $6,250,000
March 15, 2008 $4,166,666
June 15, 2008 $4,166,667
Final Maturity Date $4,166,667
28
(c) In addition to any other mandatory repayments pursuant to this
Section 4.02, on each date on or after the Initial Borrowing Date upon which the
Borrower or any of its Subsidiaries receives any cash proceeds from any capital
contribution or any sale or issuance of its common or preferred equity
(including from the sale or issuance of options, warrants or rights to purchase
any such equity), an amount equal to 50% of the Net Equity Proceeds of such
capital contribution or sale or issuance of equity shall be applied on such date
in accordance with the requirements of Sections 4.02(g) and (h); provided,
however, an amount equal to 100% of the cash proceeds of each Capital Cure
Contribution shall be applied on each date of receipt thereof in accordance with
Sections 4.02(g) and (h). Notwithstanding the foregoing, the following shall not
be subject to the mandatory prepayment provisions of this Section 4.02(c):
proceeds received from (i) the sale or issuance by the Borrower of shares of its
common equity (including as a result of the exercise of any options, warrants or
rights with respect thereto), or options, warrants or rights to purchase such
common equity, in either case to any officers, directors or employees of the
Borrower or any of its Subsidiaries in an aggregate amount not to exceed
$5,000,000 in any fiscal year of the Borrower; (ii) any capital contributions
made to any Subsidiary of the Borrower to the extent made by the Borrower or any
of its Subsidiaries; (iii) the issuance of shares of common equity of the
Borrower in connection with the exercise of the New Aetna Warrant; and (iv) the
Equity Offering in an aggregate amount of $200,000,000, although any amounts in
excess of $150,000,000 shall only be excluded pursuant to this sub-clause (iv)
to the extent that the proceeds therefrom are used by the Borrower in accordance
with the Plan of Reorganization to pay the holders of allowed Class 8 and 9
Claims for the number of shares they would have received pursuant to (and as
defined in) the Plan of Reorganization.
(d) In addition to any other mandatory repayments pursuant to this
Section 4.02, on each date on or after the Initial Borrowing Date upon which the
Borrower or any of its Subsidiaries receives any cash proceeds from any issuance
or incurrence by the Borrower or any of its Subsidiaries of Indebtedness for
borrowed money (other than Indebtedness for borrowed money permitted to be
incurred pursuant to Section 9.04 as in effect on the Effective Date), an amount
equal to 100% of the Net Debt Proceeds of the respective issuance or incurrence
of Indebtedness shall be applied on such date in accordance with the
requirements of Sections 4.02(g) and (h).
(e) In addition to any other mandatory repayments pursuant to this
Section 4.02, on each date on or after the Initial Borrowing Date upon which the
Borrower or any of its Subsidiaries receives any cash proceeds from any Asset
Sale, an amount equal to 100% of the Net Sale Proceeds therefrom shall be
applied on such date in accordance with the requirements of Sections 4.02(g) and
(h); provided, however, that with respect to no more than $10,000,000 in the
aggregate of cash proceeds from Asset Sales in any fiscal year of the Borrower,
an amount equal to the Net Sale Proceeds therefrom shall not be required to be
so applied on such date so long as no Default or Event of Default then exists or
would result from such Asset Sale and such Net Sale Proceeds shall be used to
purchase assets (other than working capital unless purchased as part of a
Permitted Acquisition) used or to be used in the businesses permitted pursuant
to Section 9.14 within 180 days following the date of such Asset Sale, and
provided further, that if all or any portion of such Net Sale Proceeds not
required to be so applied as provided above in this Section 4.02(e) are not so
reinvested within such 180-day period (or such earlier date, if any, as the
Borrower or the relevant Subsidiary determines not to reinvest the Net Sale
Proceeds from such Asset Sale as set forth above), an amount equal to such
remaining portion shall be applied on the last day of such period (or such
earlier date, as the case may be) as provided above in this Section 4.02(e)
without regard to the preceding proviso.
29
(f) In addition to any other mandatory repayments pursuant to this
Section 4.02, within 10 days following each date on or after the Initial
Borrowing Date upon which the Borrower or any of its Subsidiaries receives any
cash proceeds from any Recovery Event (other than Recovery Events where the Net
Insurance Proceeds therefrom do not exceed $50,000), an amount equal to 100% of
the Net Insurance Proceeds from such Recovery Event shall be applied within such
ten day period in accordance with the requirements of Sections 4.02(g) and (h);
provided, however, that (i) so long as no Default or Event of Default then
exists and such Net Insurance Proceeds do not exceed $10,000,000, an amount
equal to such Net Insurance Proceeds shall not be required to be so applied
within such ten day period to the extent that the Borrower has delivered a
certificate to the Administrative Agent within such ten day period stating that
such Net Insurance Proceeds shall be used to replace or restore properties or
assets in respect of which such Net Insurance Proceeds were paid within 180 days
following the date of the receipt of such Net Insurance Proceeds (which
certificate shall set forth the estimates of the Net Insurance Proceeds to be so
expended), and (ii) if the amount of such Net Insurance Proceeds exceeds
$10,000,000, then an amount equal to the entire amount of such Net Insurance
Proceeds (and not just the portion thereof in excess of $10,000,000) shall be
applied as provided above in this Section 4.02(f) without regard to preceding
clause (i) of this proviso, and provided further, that if all or any portion of
such Net Insurance Proceeds not required to be so applied pursuant to the
preceding proviso are not so used within 180 days after the date of the receipt
of such Net Insurance Proceeds (or such earlier date, if any, as the Borrower or
the relevant Subsidiary determines not to reinvest the Net Insurance Proceeds
relating to such Recovery Event as set forth above), an amount equal to such
remaining portion shall be applied on the last day of such period (or such
earlier date, as the case may be) as provided above in this Section 4.02(f)
without regard to the preceding proviso.
(g) Each amount required to be applied pursuant to Sections 4.02(c),
(d), (e) and (f) in accordance with this Section 4.02(g) shall be applied (i)
first, as a mandatory repayment of principal of outstanding Term Loans, and (ii)
second, to the extent in excess of the amounts required to be applied pursuant
to preceding clause (i), as a mandatory repayment of any outstanding CL Unpaid
Drawings which the Borrower had theretofore elected to keep outstanding as
provided in Section 2.05(b) (which repayment shall be re-deposited by the
Administrative Agent into the Credit-Linked Deposit Account). The amount of each
principal repayment of outstanding Term Loans made as required by this Sections
4.02(g) shall be applied to reduce the then remaining Scheduled Repayments on a
pro rata basis (based upon the then remaining unpaid principal amounts of such
Scheduled Repayments after giving effect to all prior reductions thereto).
(h) With respect to each repayment of Loans required by this Section
4.02, the Borrower may designate the Types of Loans of the respective Tranche
which are to be repaid and, in the case of Eurodollar Loans, the specific
Borrowing or Borrowings of the respective Tranche pursuant to which such
Eurodollar Loans were made, provided that: (i) repayments of Eurodollar Loans
pursuant to this Section 4.02 may only be made on the last day of an Interest
Period applicable thereto unless all Eurodollar Loans of the respective Tranche
with Interest Periods ending on such date of required repayment and all Base
Rate Loans of the respective Tranche have been paid in full; (ii) if any
repayment of Eurodollar Loans made pursuant to a single Borrowing shall reduce
the outstanding Eurodollar Loans made pursuant to such Borrowing to an amount
less than the Minimum Borrowing Amount applicable thereto, such Borrowing shall
be automatically converted into a Borrowing of Base Rate Loans; and (iii) each
repayment of any Loans made pursuant to a Borrowing shall be applied pro rata
among such Loans. In the absence of a designation by the Borrower as described
in the preceding sentence, the Administrative Agent shall, subject to the above,
make such designation in its sole discretion.
30
(i) In addition to any other mandatory repayments pursuant to this
Section 4.02, (i) all then outstanding Term Loans shall be repaid in full on the
Final Maturity Date, (ii) all then outstanding Revolving Loans shall be repaid
in full on the Final Maturity Date, (iii) all then outstanding Swingline Loans
shall be repaid in full on the Swingline Expiry Date, (iv) all then outstanding
CL Unpaid Drawings which the Borrower had theretofore elected to keep
outstanding as provided in Section 2.05(b) shall be repaid in full on the Final
Maturity Date, and (v) unless the Required Lenders otherwise agree in writing,
all then outstanding Loans and other Obligations shall be repaid in full on the
date on which a Change of Control occurs.
(j) If any Letter of Credit is outstanding on the 30th day prior to
the Final Maturity Date which has an expiry date later than the Final Maturity
Date (or which, pursuant to its terms, may be extended to a date later than the
Final Maturity Date), the Borrower shall, on such 30th day, either (x) pay to
the Administrative Agent at the Payment Office an amount of cash equal to 105%
of the aggregate Stated Amount of all such Letters of Credit to be held as
security for all obligations of the Borrower to the Issuing Lenders in respect
of such Letters of Credit in a cash collateral account to be established by, and
under the sole dominion and control of, the Administrative Agent or (y) deliver
to the Administrative Agent a standby letter of credit (other than a Letter of
Credit) in favor of the Administrative Agent and in a stated amount equal to
105% of the aggregate Stated Amount of all such Letters of Credit, which standby
letter of credit shall be in form and substance, and issued by a financially
sound financial institution, reasonably acceptable to the Administrative Agent.
4.03 Method and Place of Payment. Except as otherwise specifically
provided herein, all payments under this Agreement and under any Note shall be
made to the Administrative Agent for the account of the Lender or Lenders
entitled thereto not later than 12:00 Noon (New York time) on the date when due
and shall be made in Dollars in immediately available funds at the Payment
Office. Whenever any payment to be made hereunder or under any Note shall be
stated to be due on a day which is not a Business Day, the due date thereof
shall be extended to the next succeeding Business Day and, with respect to
payments of principal, interest shall be payable at the applicable rate during
such extension.
4.04 Net Payments. (a) All payments made by any Credit Party under
any Credit Document will be made without setoff, counterclaim or other defense.
Except as provided in Section 4.04(b), all such payments will be made free and
clear of, and without deduction or withholding for, any present or future taxes,
levies, imposts, duties, fees, assessments or other charges of whatever nature
now or hereafter imposed by any jurisdiction or by any political subdivision or
taxing authority thereof or therein with respect to such payments (but
excluding, except as provided in the second succeeding sentence, any tax imposed
on or measured by the net income or net profits (or any franchise or similar tax
imposed in lieu of a net income or net profits tax) of a Lender, an Issuing
Lender or the Administrative Agent (each a "Section 4.04 Indemnitee"), as the
case may be, pursuant to the laws of the jurisdiction in which such Section 4.04
Indemnitee is organized or the jurisdiction in which the principal office or
31
applicable lending office of such Section 4.04 Indemnitee is located or any
subdivision thereof or therein) and all interest, penalties or similar
liabilities with respect to such non-excluded taxes, levies, imposts, duties,
fees, assessments or other charges (all such non-excluded taxes, levies,
imposts, duties, fees, assessments or other charges being referred to
collectively as "Taxes"). If any Taxes are so levied or imposed, the Borrower
and any other Credit Party agrees to pay the full amount of such Taxes, and such
additional amounts as may be necessary so that every payment of all amounts due
under this Agreement or under any other Credit Document to any Section 4.04
Indemnitee, after withholding or deduction for or on account of any Taxes, will
not be less than the amount provided for herein or in such other Credit
Document. If any amounts are payable in respect of Taxes pursuant to the
preceding sentence, the Borrower and each other Credit Party jointly and
severally agree to reimburse each Section 4.04 Indemnitee, upon the written
request of such Section 4.04 Indemnitee, for taxes imposed on or measured by the
net income or net profits (or any franchise or similar tax imposed in lieu of a
net income or net profits tax) of such Section 4.04 Indemnitee pursuant to the
laws of the jurisdiction in which such Section 4.04 Indemnitee is organized or
in which the principal office or applicable lending office of such Section 4.04
Indemnitee is located or under the laws of any political subdivision or taxing
authority of any such jurisdiction in which such Section 4.04 Indemnitee is
organized or in which the principal office or applicable lending office of such
Section 4.04 Indemnitee is located and for any withholding of taxes as such
Section 4.04 Indemnitee shall determine are payable by, or withheld from, such
Section 4.04 Indemnitee in respect of such amounts so paid to or on behalf of
such Section 4.04 Indemnitee pursuant to the preceding sentence and in respect
of any amounts paid to or on behalf of such Section 4.04 Indemnitee pursuant to
this sentence. The Borrower will furnish to the Administrative Agent within 60
days after the date the payment of any Taxes is due pursuant to applicable law
certified copies of tax receipts evidencing such payment by the Borrower or the
respective Credit Party. The Borrower and each other Credit Party jointly and
severally agree to indemnify and hold harmless each Section 4.04 Indemnitee and
reimburse each such Person upon its written request, for the amount of any Taxes
so levied or imposed and paid by each such Person.
(b) Each Non-U.S. Lender agrees to deliver to the Borrower and the
Administrative Agent on or prior to the Effective Date or, in the case of a
Non-U.S. Lender that is an assignee or transferee of an interest under this
Agreement pursuant to Section 1.13 or 13.04(b) (unless the respective Non-U.S.
Lender was already a Non-U.S. Lender hereunder immediately prior to such
assignment or transfer), on the date of such assignment or transfer to such
Non-U.S. Lender or, in the case of a successor Issuing Lender, the date such
Issuing Lender becomes an Issuing Lender or, in the case of a successor
Administrative Agent, the date of the appointment of such Administrative Agent,
(i) two accurate and complete original signed copies of U.S. Internal Revenue
Service Form W-8ECI or Form W-8BEN (with respect to a complete exemption from
withholding under an income tax treaty) (or successor forms) certifying to such
Non-U.S. Lender's entitlement as of such date to a complete exemption from
United States withholding tax with respect to payments to be made under this
Agreement and under any other Credit Document, or (ii) if the Non-U.S. Lender is
not a "bank" within the meaning of Section 881(c)(3)(A) of the Code and cannot
deliver either U.S. Internal Revenue Service Form W-8ECI or Form W-8BEN (with
respect to a complete exemption from withholding under an income tax treaty) (or
any successor forms) pursuant to clause (i) above, (x) a certificate
substantially in the form of Exhibit D (any such certificate, a "Section
4.04(b)(ii) Certificate") and (y) two accurate and complete original signed
copies of U.S. Internal Revenue Service Form W-8BEN (with respect to the
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portfolio interest exemption) (or successor form) certifying to such Non-U.S.
Lender's entitlement as of such date to a complete exemption from United States
withholding tax with respect to payments of interest to be made under this
Agreement and under any other Credit Document. In addition, each Non-U.S. Lender
agrees that from time to time after the Effective Date, when a lapse in time or
change in circumstances renders the previous certification obsolete or
inaccurate in any material respect, such Non-U.S. Lender will deliver to the
Borrower and the Administrative Agent two new accurate and complete original
signed copies of U.S. Internal Revenue Service Form W-8ECI, Form W-8BEN (with
respect to the benefits of any income tax treaty), or Form W-8BEN (with respect
to the portfolio interest exemption) and a Section 4.04(b)(ii) Certificate, as
the case may be, and such other forms as may be required in order to confirm or
establish the entitlement of such Non-U.S. Lender to a continued exemption from
or reduction in United States withholding tax with respect to payments under
this Agreement and any other Credit Document, or such Non-U.S. Lender shall
immediately notify the Borrower and the Administrative Agent of its inability to
deliver any such form or Certificate, in which case such Non-U.S. Lender shall
not be required to deliver any such form or Certificate pursuant to this Section
4.04(b). Each U.S. Lender (other than a Lender, an Issuing Lender or the
Administrative Agent, as the case may be, that may be treated as an exempt
recipient based on the indicators described in U.S. Treasury Regulation section
1.6049-4(c)(1)(ii)) agrees to deliver to the Borrower and the Administrative
Agent on or prior to the Effective Date or, in the case of a U.S. Lender that is
an assignee or transferee of an interest under this Agreement pursuant to
Section 1.13 or 13.04(b) (unless the respective U.S. Lender was already a U.S.
Lender hereunder immediately prior to such assignment or transfer), on the date
of such assignment or transfer to such U.S. Lender or, in the case of a U.S.
Lender that is a successor Issuing Lender, the date such Issuing Lender becomes
an Issuing Lender or, in the case of a U.S. Lender that is a successor
Administrative Agent, the date of the appointment of such Administrative Agent,
two accurate and complete original signed copies of U.S. Internal Revenue
Service Form W-9 (or successor forms) certifying to such U.S. Lender's
entitlement as of such date to a complete exemption from United States backup
withholding tax with respect to payments to be made under this Agreement and
under any other Credit Document. Notwithstanding anything to the contrary
contained in Section 4.04(a), but subject to Section 13.04(b) and the
immediately succeeding sentence, (x) the Borrower shall be entitled, to the
extent it is required to do so by law, to deduct or withhold income (including
income taxes imposed by withholding) or similar taxes imposed by the United
States (or any political subdivision or taxing authority thereof or therein)
from interest, Fees or other amounts payable hereunder for the account of any
Lender, any Issuing Lender or the Administrative Agent, as the case may be, to
the extent that such Lender, such Issuing Lender or such Administrative Agent,
as the case may be, has not provided to the Borrower U.S. Internal Revenue
Service Forms that establish a complete exemption from such deduction or
withholding and (y) the Borrower shall not be obligated pursuant to Section
4.04(a) to gross-up payments to be made to, or to indemnify, a Lender, an
Issuing Lender or the Administrative Agent, as the case may be, in respect of
income (including income taxes imposed by withholding) or similar taxes imposed
by the United States if (I) such Lender, such Issuing Lender or such
Administrative Agent, as the case may be, has not provided to the Borrower the
U.S. Internal Revenue Service Forms required to be provided to the Borrower
pursuant to this Section 4.04(b) or (II) in the case of a payment, other than
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interest, to a Lender, an Issuing Lender or the Administrative Agent, as the
case may be, described in clause (ii) in the first sentence above in this
Section 4.04(b), to the extent that such forms do not establish a complete
exemption from withholding of such taxes. Notwithstanding anything to the
contrary contained in the preceding sentence or elsewhere in this Section 4.04
and except as set forth in Section 13.04(b), the Borrower agrees to pay any
additional amounts and to indemnify each Lender in the manner set forth in
Section 4.04(a) (without regard to the identity of the jurisdiction requiring
the deduction or withholding) in respect of any amounts deducted or withheld by
it as described in the immediately preceding sentence as a result of any changes
that are effective after the Effective Date in any applicable law, treaty,
governmental rule, regulation, guideline or order, or in the interpretation
thereof, relating to the deducting or withholding of income (including income
taxes imposed by withholding) or similar taxes.
(c) If the Borrower pays any additional amount under this Section
4.04 to a Section 4.04 Indemnitee, and such Section 4.04 Indemnitee determines
in its sole good faith discretion that it has actually received or realized in
connection therewith any refund or any reduction of, or credit against, its Tax
liabilities in or with respect to the taxable year in which the additional
amount is paid (a "Tax Benefit"), such Section 4.04 Indemnitee shall pay to such
Borrower an amount that the Section 4.04 Indemnitee shall, in its sole good
faith discretion, determine is equal to the net benefit, after tax, which was
obtained by such Section 4.04 Indemnitee in such year as a consequence of such
Tax Benefit; provided, however, that (i) any Section 4.04 Indemnitee may
determine, in its sole good faith discretion consistent with the policies of
such Section 4.04 Indemnitee, whether to seek a Tax Benefit; (ii) any Taxes that
are imposed on a Section 4.04 Indemnitee as a result of a disallowance or
reduction, (including through the expiration of any tax credit carryover or
carryback of such Section 4.04 Indemnitee that otherwise would not have expired)
of any Tax Benefit with respect to which such Section 4.04 Indemnitee has made a
payment to the Borrower pursuant to this Section 4.04(c) shall be treated as a
Tax for which the Borrower is obligated to indemnify such Section 4.04
Indemnitee pursuant to this Section 4.04 without any exclusions or defenses,
(iii) subject to Section 13.16(c), nothing in this Section 4.04(c) shall require
any Section 4.04 Indemnitee to disclose any confidential information to the
Borrower (including, without limitation, its tax returns), and (iv) no Section
4.04 Indemnitee shall be required to pay any amounts pursuant to this Section
4.04(c) at any time that a Default or an Event of Default exists.
SECTION 5. Conditions Precedent to Credit Events on the Initial
Borrowing Date. The obligation of each Lender to make Loans, the obligation of
each CL Lender to fund its Credit-Linked Deposit and the obligation of each
Issuing Lender to issue Letters of Credit, in each case on the Initial Borrowing
Date, is subject at the time of the making of such Loans, the funding of such
Credit-Linked Deposits or the issuance of such Letters of Credit to the
satisfaction of the following conditions:
5.01 Execution of Agreement; Notes. On or prior to the Initial
Borrowing Date, (i) this Agreement shall have been executed and delivered as
provided in Section 13.10 and (ii) there shall have been delivered to the
Administrative Agent for the account of each of the Lenders that has requested
same the appropriate Term Note and/or Revolving Note executed by the Borrower
and, if requested by the Swingline Lender, the Swingline Note executed by the
Borrower, in each case in the amount, maturity and as otherwise provided herein.
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5.02 Officer's Certificate. On the Initial Borrowing Date, the
Administrative Agent shall have received a certificate, dated the Initial
Borrowing Date and signed on behalf of the Borrower by the chairman of the
board, the chief executive officer, the chief financial officer, the president
or any vice president of the Borrower, certifying on behalf of the Borrower that
all of the conditions in Sections 5.05, 5.06, 5.07 and 6.01 have been satisfied
on such date.
5.03 Opinions of Counsel. On the Initial Borrowing Date, the
Administrative Agent shall have received (i) from Weil, Gotshal & Xxxxxx LLP,
special counsel to the Credit Parties, an opinion addressed to the
Administrative Agent, the Collateral Agent and each of the Lenders and dated the
Initial Borrowing Date covering the matters set forth in Exhibit E-1 and such
other matters incident to the transactions contemplated herein as the
Administrative Agent may reasonably request, and (ii) from Xxxxx X. Xxxxxx,
General Counsel of the Borrower, an opinion addressed to the Administrative
Agent, the Collateral Agent and each of the Lenders and dated the Initial
Borrowing Date covering the matters set forth in Exhibit E-2 and such other
matters incident to the transactions contemplated herein as the Administrative
Agent may reasonably request.
5.04 Corporate Documents; Proceedings; etc. (a) On the Initial
Borrowing Date, the Administrative Agent shall have received a certificate from
each Credit Party, dated the Initial Borrowing Date, signed by the chairman of
the board, the chief executive officer, the president, the chief financial
officer or any vice president of such Credit Party, and attested to by the
secretary or any assistant secretary of such Credit Party, substantially in the
form of Exhibit F with appropriate insertions, together with copies of the
certificate or articles of incorporation and by-laws (or equivalent
organizational documents), as applicable, of such Credit Party and the
resolutions of such Credit Party referred to in such certificate, and each of
the foregoing shall be in form and substance reasonably acceptable to the
Administrative Agent.
(b) On the Initial Borrowing Date, all corporate, partnership,
limited liability company and legal proceedings and all instruments and
agreements in connection with the transactions contemplated by this Agreement
and the other Credit Documents shall be reasonably satisfactory in form and
substance to the Administrative Agent, and the Administrative Agent shall have
received all information and copies of all documents and papers, including
records of corporate proceedings, governmental approvals, good standing
certificates and bring-down telegrams or facsimiles, if any, which the
Administrative Agent may have reasonably requested in connection therewith, such
documents and papers where appropriate to be certified by proper corporate,
partnership, limited liability company or governmental authorities.
5.05 The Transaction, etc. (a) On or prior to the Initial Borrowing
Date, (i) there shall have been delivered to the Administrative Agent true and
correct copies of the Confirmation Order (which shall be a Final Order), the
Plan of Reorganization, the Disclosure Statement and the other Plan Documents,
which Confirmation Order, Plan of Reorganization, Disclosure Statement and other
Plan Documents shall be in form and substance reasonably satisfactory to the
Administrative Agent and the Required Lenders and shall be in full force and
effect on the Initial Borrowing Date (and with the Confirmation Order, the Plan
of Reorganization and the Disclosure Statement also to be certified by the
Bankruptcy Court), (ii) there shall have been delivered to the Administrative
Agent a true and correct copy of the Notice of Plan Effective Date, which Notice
of Plan Effective Date shall be in form and substance reasonably satisfactory to
35
the Administrative Agent and the Required Lenders, shall have been entered by
the Bankruptcy Court, shall be in full force and effect and shall not be subject
to any stay, (iii) all conditions precedent to the effective date of the Plan of
Reorganization shall have been satisfied (and not waived without the consent of
the Administrative Agent and the Required Lenders) to the reasonable
satisfaction of the Administrative Agent and the Required Lenders, (iv) the
effective date of the Plan of Reorganization shall have occurred and the Plan of
Reorganization shall have been substantially consummated, and (v) no request to
revoke the Confirmation Order shall be pending before the Bankruptcy Court.
(b) On the Initial Borrowing Date and prior to or concurrently with
the incurrence of the Loans hereunder, each element of the Transaction shall
have been consummated in accordance with the Plan of Reorganization, the other
applicable Plan Documents and all applicable laws. Pursuant to the Plan of
Reorganization:
(i) all loans, interest and other amounts owing pursuant to the
Existing Credit Agreement shall have been repaid or otherwise satisfied in
full and all letters of credit issued thereunder shall have been terminated
(or supported by a Letter of Credit issued hereunder), in each case in
accordance with the requirements of the Plan of Reorganization, and the
Existing Credit Agreement and all guarantees and security documents with
respect thereto shall have been terminated and be of no further force and
effect;
(ii) the Administrative Agent shall have received (x) releases of
security interests in and Liens on the assets owned by the Borrower and its
Subsidiaries from the lenders and collateral agent or trustee in respect of
the Existing Credit Agreement (including, without limitation, (I) proper
termination statements (Form UCC-3 or the appropriate equivalent) for
filing under the UCC of each jurisdiction where a financing statement (Form
UCC-1 or the appropriate equivalent) was filed with respect to the Borrower
or any of its Subsidiaries in connection with the security interests
created with respect to the Existing Credit Agreement and the documentation
related thereto, (II) termination or reassignment of any security interest
in, or Lien on, any patents, trademarks, copyrights, or similar interests
of the Borrower or any of its Subsidiaries on which filings have been made,
and (III) terminations of all mortgages, leasehold mortgages, deeds of
trust and leasehold deeds of trust created with respect to property of the
Borrower or any of its Subsidiaries, in each case to secure the obligations
in respect of the Existing Credit Agreement), all of which shall be in form
and substance reasonably satisfactory to the Administrative Agent, and (y)
all collateral owned by the Borrower or any of its Subsidiaries in the
possession of any of the lenders in respect of the Existing Credit
Agreement or any collateral agent or trustee under any related security
document;
(iii) the holders of shares of the Borrower's existing preferred and
common stock shall have received new shares of Ordinary Common Stock of the
Borrower and/or warrants to purchase new shares of Ordinary Common Stock of
the Borrower on the terms specified in the Plan of Reorganization;
36
(iv) the holders of the existing general unsecured claims of the
Borrower and its Subsidiaries that are "Debtors-in-Possession" (other than
those general unsecured claims that are settled for cash as provided in the
Plan of Reorganization) shall have received (x) new shares of Ordinary
Common Stock of the Borrower, (y) New Senior Notes in an aggregate
principal amount not to exceed the remainder of (A) $300,000,000 (plus the
amount of accrued and unpaid interest on the Old Notes from and after
October 31, 2003 at a per annum interest rate of 9-3/4%) minus (B) the Cash
Distribution Amount and (z) cash in an aggregate amount of not to exceed
$50,000,000, in each case on the terms specified in the Plan of
Reorganization;
(v) Aetna shall have received (w) $11,271,028 in cash, (x) the New
Aetna Note in the principal amount of $48,915,205, (y) the Aetna Letter of
Credit in the face amount of $5,000,000 and (z) the New Aetna Warrant to
purchase up to 100,000 new shares of Ordinary Common Stock of the Borrower,
in each case on the terms specified in the Plan of Reorganization and the
Aetna Amended MSA; and
(vi) the Administrative Agent shall have received evidence in form,
scope and substance reasonably satisfactory to it, that the matters set
forth in this Section 5.05(b) have been satisfied on such date.
(c) On the Initial Borrowing Date, (i) the Borrower shall have
received at least $100,000,000 of gross cash proceeds from the Equity Offering,
(ii) the Borrower shall have an aggregate amount of existing unrestricted cash
on hand which, when added to the aggregate principal amount of Term Loans
incurred on the Initial Borrowing Date and the net cash proceeds received from
the Equity Offering, shall be sufficient to make all cash payments required to
be made pursuant to the Plan of Reorganization, (iii) the Borrower shall have at
least $65,000,000 of Unrestricted cash and/or Cash Equivalents on hand after
making all cash payments required to be made pursuant to the Plan of
Reorganization and no Revolving Loans or Swingline Loans shall be outstanding
and (iv) the Administrative Agent shall have received evidence, in form, scope
and substance reasonably satisfactory to it, that the matters set forth above in
this Section 5.05(c) have been satisfied on such date. In addition, on or prior
to the Initial Borrowing Date, there shall have been delivered to the
Administrative Agent true and correct copies of the documents governing the
terms and conditions of the shares of capital stock of the Borrower issued
pursuant to the Equity Offering, which documents shall be in form and substance
reasonably satisfactory to the Administrative Agent and the Required Lenders.
5.06 Adverse Change, Approvals. (a) Nothing shall have occurred since
September 30, 2003 (and neither the Administrative Agent nor the Required
Lenders shall have become aware of any facts or conditions not previously known
to any such Persons) which the Administrative Agent or the Required Lenders
shall determine has had, or could reasonably be expected to have, a Material
Adverse Effect.
(b) On or prior to the Initial Borrowing Date, all necessary
governmental (domestic (including those of the Bankruptcy Court) and foreign)
and material third party approvals and/or consents in connection with the
Transaction (and the payment of all fees, costs and expenses in connection
therewith), the other transactions contemplated hereby and the granting of Liens
under the Credit Documents shall have been obtained and remain in effect, and
all applicable waiting periods with respect thereto shall have expired without
any action being taken by any competent authority which, in the reasonable
judgment of the Administrative Agent, restrains, prevents, or imposes materially
37
adverse conditions upon, the consummation of the Transaction or the other
transactions contemplated by the Credit Documents or otherwise referred to
herein or therein. On the Initial Borrowing Date, there shall not exist any
judgment, order, injunction or other restraint prohibiting or imposing
materially adverse conditions upon the Transaction or the other transactions
contemplated by the Credit Documents or otherwise referred to herein or therein.
5.07 Litigation. On the Initial Borrowing Date, no litigation by any
entity (private or governmental) shall be pending or threatened with respect to
the this Agreement or any other Document or any documentation executed in
connection herewith or therewith, or with respect to the Transaction, or which
the Administrative Agent or the Required Lenders shall determine has had, or
could reasonably be expected to have, a Material Adverse Effect.
5.08 Pledge Agreement. On the Initial Borrowing Date, each Credit
Party shall have duly authorized, executed and delivered the Pledge Agreement in
the form of Exhibit G (as amended, modified or supplemented from time to time,
the "Pledge Agreement") and shall have delivered to the Collateral Agent, as
Pledgee thereunder, all of the Pledge Agreement Collateral, if any, referred to
therein and then owned by such Credit Party, (x) endorsed in blank in the case
of promissory notes constituting Pledge Agreement Collateral and (y) together
with executed and undated endorsements for transfer in the case of equity
interests constituting certificated Pledge Agreement Collateral, along with
evidence that all other actions necessary or, in the reasonable opinion of the
Collateral Agent, desirable, to perfect the security interests purported to be
created by the Pledge Agreement have been taken and the Pledge Agreement shall
be in full force and effect.
5.09 Subsidiaries Guaranties. On the Initial Borrowing Date, each
Subsidiary Guarantor shall have duly authorized, executed and delivered the
Subsidiaries Guaranty in the form of Exhibit H (as amended, modified or
supplemented from time to time, the "Subsidiaries Guaranty"), and the
Subsidiaries Guaranty shall be in full force and effect.
5.10 Security Agreement. On the Initial Borrowing Date, each Credit
Party shall have duly authorized, executed and delivered the Security Agreement
in the form of Exhibit I (as amended, modified or supplemented from time to
time, the "Security Agreement") covering all of such Credit Party's Security
Agreement Collateral, together with:
(i) proper financing statements (Form UCC-1 or the equivalent) for
filing under the UCC or other appropriate filing offices of each
jurisdiction as may be necessary or, in the reasonable opinion of the
Collateral Agent, desirable, to perfect the security interests purported to
be created by the Security Agreement;
(ii) fully executed bank control agreements with respect to the
initial Primary Concentration Accounts; and
(iii) all other documents or filings necessary or, in the reasonable
opinion of the Collateral Agent, desirable to perfect and protect the
security interests purported to be created by the Security Agreement,
and the Security Agreement shall be in full force and effect.
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5.11 Financial Statements; Projections. On or prior to the Initial
Borrowing Date, the Administrative Agent shall have received true and correct
copies of the historical and pro forma consolidated financial statements and the
Projections referred to in Section 7.05.
5.12 Solvency Certificate; Insurance Certificates. On the Initial
Borrowing Date, the Administrative Agent shall have received:
(i) a solvency certificate from the chief financial officer of the
Borrower in the form of Exhibit J; and
(ii) certificates of insurance complying with the requirements of
Section 8.03 for the business and properties of the Borrower and its
Subsidiaries, in form and substance reasonably satisfactory to the
Administrative Agent.
5.13 Shareholders' Agreements; Management Agreements; Employment
Agreements; Non-Compete Agreements; Tax Sharing Agreements; and Existing
Indebtedness Agreements. On or prior to the Initial Borrowing Date, there shall
have been delivered to the Administrative Agent true and correct copies of the
following documents:
(i) all agreements entered into by the Borrower or any of its
Subsidiaries governing the terms and relative rights of its equity
interests and any agreements entered into by its shareholders relating to
any such entity with respect to its equity interests that will remain in
place after giving effect to the Transaction (collectively, the
"Shareholders' Agreements");
(ii) all material agreements with members of, or with respect to, the
management of the Borrower or any of its Subsidiaries that will remain in
place after giving effect to the Transaction (collectively, the "Management
Agreements");
(iii) all material employment agreements entered by the Borrower that
will remain in place after giving effect to the Transaction (collectively,
the "Employment Agreements");
(iv) all non-compete agreements entered into by the Borrower or any of
its Subsidiaries which restrict the activities of the Borrower or any of
its Subsidiaries that will remain in place after giving effect to the
Transaction (collectively, "the Non-Compete Agreements");
(v) all tax sharing, tax allocation and other similar agreements
entered into by the Borrower or any of its Subsidiaries that will remain in
place after giving effect to the Transaction (collectively, the "Tax
Sharing Agreements"); and
(vi) all agreements evidencing or relating to Indebtedness of the
Borrower or any of its Subsidiaries (other than with respect to Capitalized
Lease Obligations) which is to remain outstanding after giving effect to
the Transaction (the "Existing Indebtedness Agreements");
39
all of which Shareholders' Agreements, Management Agreements, Employment
Agreements, Non-Compete Agreements, Tax Sharing Agreements and Existing
Indebtedness Agreements shall be in form and substance reasonably satisfactory
to the Administrative Agent and shall be in full force and effect on the Initial
Borrowing Date.
5.14 Fees, etc. On the Initial Borrowing Date, all costs, fees,
expenses (including, without limitation, reasonable legal fees and expenses) and
other compensation contemplated hereby, payable to the Administrative Agent and
the Lenders or otherwise payable in respect of the Transaction shall have been
paid by the Borrower to the extent due and invoiced.
SECTION 6. Conditions Precedent to All Credit Events. The obligation
of each Lender to make Loans (including Loans made on the Initial Borrowing
Date) and the obligation of each Issuing Lender to issue Letters of Credit
(including Letters of Credit issued on the Initial Borrowing Date), are subject,
at the time of each such Credit Event (except as hereinafter indicated), to the
satisfaction of the following conditions:
6.01 No Default; Representations and Warranties. At the time of each
such Credit Event and also after giving effect thereto (i) there shall exist no
Default or Event of Default and (ii) all representations and warranties
contained herein and in the other Credit Documents shall be true and correct in
all material respects with the same effect as though such representations and
warranties had been made on the date of such Credit Event (it being understood
and agreed that any representation or warranty which by its terms is made as of
a specified date shall be required to be true and correct in all material
respects only as of such specified date).
6.02 Notice of Borrowing; Letter of Credit Request. (a) Prior to the
making of each Loan (other than a Swingline Loan or a Revolving Loan made
pursuant to a Mandatory Borrowing), the Administrative Agent shall have received
a Notice of Borrowing meeting the requirements of Section 1.03(a). Prior to the
making of each Swingline Loan, the Swingline Lender shall have received the
notice referred to in Section 1.03(b)(i).
(b) Prior to the issuance of each Letter of Credit, the
Administrative Agent and the respective Issuing Lender shall have received a
Letter of Credit Request meeting the requirements of Section 2.03(a).
The acceptance of the benefits of each Credit Event shall constitute
a representation and warranty by the Borrower to the Administrative Agent and
each of the Lenders that all the conditions specified in Section 5 (with respect
to Credit Events on the Initial Borrowing Date) and in this Section 6 (with
respect to Credit Events on or after the Initial Borrowing Date) and applicable
to such Credit Event are satisfied as of that time. All of the Notes,
certificates, legal opinions and other documents and papers referred to in
Section 5 and in this Section 6, unless otherwise specified, shall be delivered
to the Administrative Agent at the Notice Office 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 to the
Administrative Agent and the Required Lenders.
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SECTION 7. Representations, Warranties and Agreements. In order to
induce the Lenders to enter into this Agreement and to make the Loans and fund
the Credit-Linked Deposits, and issue (or participate in) the Letters of Credit,
in each case as provided herein, the Borrower makes the following
representations, warranties and agreements, in each case after giving effect to
the Transaction, all of which shall survive the execution and delivery of this
Agreement and the Notes and the making of the Loans, the funding of the
Credit-Linked Deposits and the issuance of the Letters of Credit, with the
occurrence of each Credit Event on or after the Initial Borrowing Date being
deemed to constitute a representation and warranty that the matters specified in
this Section 7 are true and correct in all material respects on and as of the
Initial Borrowing Date and on the date of each such other Credit Event (it being
understood and agreed that any representation or warranty which by its terms is
made as of a specified date shall be required to be true and correct in all
material respects only as of such specified date).
7.01 Organizational Status. Each of the Borrower and each of its
Subsidiaries (i) is a duly organized and validly existing corporation,
partnership or limited liability company, as the case may be, in good standing
under the laws of the jurisdiction of its organization, (ii) has the corporate,
partnership or limited liability company power and authority, as the case may
be, to own its property and assets and to transact the business in which it is
engaged and presently proposes to engage and (iii) is duly qualified and is
authorized to do business and is in good standing in each jurisdiction where the
ownership, leasing or operation of its property or the conduct of its business
requires such qualifications except for failures to be so qualified which,
either individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.
7.02 Power and Authority. Each Credit Party has the corporate,
partnership or limited liability company power and authority, as the case may
be, to execute, deliver and perform the terms and provisions of each of the
Documents to which it is party and has taken all necessary corporate,
partnership or limited liability company action, as the case may be, to
authorize the execution, delivery and performance by it of each of such
Documents. Each Credit Party has duly executed and delivered each of the
Documents to which it is party, and each of such Documents constitutes its
legal, valid and binding obligation enforceable in accordance with its terms,
except to the extent that the enforceability thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws generally affecting creditors' rights and by equitable principles
(regardless of whether enforcement is sought in equity or at law).
7.03 No Violation. Neither the execution, delivery or performance by
any Credit Party of the Documents to which it is a party, nor compliance by it
with the terms and provisions thereof, (i) will contravene any provision of any
law, statute, rule or regulation (including, without limitation, any Health Care
Law) or any order, writ, injunction or decree of any court or governmental
instrumentality, (ii) will conflict with or result in any breach of any of the
terms, covenants, conditions or provisions of, or constitute a default under, or
result in the creation or imposition of (or the obligation to create or impose)
any Lien (except pursuant to the Security Documents) upon any of the property or
assets of any Credit Party or any of its Subsidiaries pursuant to the terms of
any indenture, mortgage, deed of trust, credit agreement or loan agreement, or
any other material agreement, contract or instrument, in each case to which any
Credit Party or any of its Subsidiaries is a party or by which it or any its
property or assets is bound or to which it may be subject, or (iii) will violate
any provision of the certificate or articles of incorporation, certificate of
formation, limited liability company agreement or by-laws (or equivalent
organizational documents), as applicable, of any Credit Party or any of its
Subsidiaries.
41
7.04 Approvals. No order, consent, approval, license, authorization
or validation of, or filing, recording or registration with (except for those
that have otherwise been obtained or made on or prior to the Initial Borrowing
Date and which remain in full force and effect on the Initial Borrowing Date) or
exemption by, any governmental or public body or authority, or any subdivision
thereof, is required to be obtained or made by, or on behalf of, any Credit
Party to authorize, or is required to be obtained or made by, or on behalf of,
any Credit Party in connection with, (i) the execution, delivery and performance
of any Document or (ii) the legality, validity, binding effect or enforceability
of any Document.
7.05 Financial Statements; Financial Condition; Undisclosed
Liabilities; Projections; No Material Adverse Effect. (a) The consolidated
balance sheets of the Borrower as at September 30, 2002, December 31, 2002 and
September 30, 2003, and the related consolidated statements of income, cash
flows and retained earnings of the Borrower for the fiscal year ended September
30, 2002, the three-month period ended December 31, 2002 and the nine-month
period ended September 30, 2003, copies of which have been furnished to the
Lenders prior to the Initial Borrowing Date, present fairly in all material
respects the consolidated financial position of the Borrower at the dates of
such balance sheets and the consolidated results of the operations of the
Borrower for the periods covered thereby. All of the foregoing historical
financial statements have been prepared in accordance with generally accepted
accounting principles consistently applied (except, in the case of the
aforementioned nine-month interim financial statements, for normal year-end
audit adjustments and the absence of footnotes).
(b) On and as of the Initial Borrowing Date and after giving effect
to the Transaction and to all Indebtedness (including the Loans, the New Senior
Notes and the New Aetna Note) being issued, incurred or assumed and Liens
created by the Credit Parties in connection therewith, (i) the sum of the
assets, at a fair valuation, of the Borrower on a stand-alone basis and of the
Borrower and its Subsidiaries taken as a whole will exceed their respective
debts, (ii) each of the Borrower on a stand-alone basis and the Borrower and its
Subsidiaries taken as a whole have not incurred and do not intend to incur, and
do not believe that they will incur, debts beyond their respective ability to
pay such debts as such debts mature, and (iii) the Borrower on a stand-alone
basis and the Borrower and its Subsidiaries taken as a whole will have
sufficient capital with which to conduct their respective businesses. For
purposes of this Section 7.05(b), "debt" means any liability on a claim, and
"claim" means (a) right to payment, whether or not such a right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured, or unsecured or (b) right to an
equitable remedy for breach of performance if such breach gives rise to a
payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured
or unsecured. The amount of contingent liabilities at any time shall be computed
as the amount that, in the light of all the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.
42
(c) Except as fully disclosed in the financial statements delivered
pursuant to Section 7.05(a), there were as of the Initial Borrowing Date no
liabilities or obligations with respect to the Borrower or any of its
Subsidiaries of any nature whatsoever (whether absolute, accrued, contingent or
otherwise and whether or not due) which, either individually or in the
aggregate, could reasonably be expected to be material to the Borrower and its
Subsidiaries taken as a whole. As of the Initial Borrowing Date, the Borrower
does not know of any basis for the assertion against it or any of its
Subsidiaries of any liability or obligation of any nature whatsoever that is not
fully disclosed in the financial statements delivered pursuant to Section
7.05(a) which, either individually or in the aggregate, could reasonably be
expected to be material to the Borrower or any of its Subsidiaries.
(d) The Projections delivered to the Administrative Agent and the
Lenders prior to the Initial Borrowing Date have been prepared in good faith and
are based on reasonable assumptions, and there are no statements or conclusions
in the Projections which are based upon or include information known to the
Borrower to be misleading in any material respect or which fail to take into
account material information known to the Borrower regarding the matters
reported therein. On the Initial Borrowing Date, the Borrower believes that the
Projections are reasonable and attainable, it being recognized by the Lenders,
however, that projections as to future events are not to be viewed as facts and
that the actual results during the period or periods covered by the Projections
may differ from the projected results and such differences may be material.
(e) Since September 30, 2003, there has been no change in the
condition (financial or otherwise), business, operations, property, assets or
liabilities of the Borrower or any of its Subsidiaries that has had, or could
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.
7.06 Litigation. There are no actions, suits or proceedings pending
or, to the knowledge of the Borrower, threatened (i) with respect to any Credit
Document or (ii) that could reasonably be expected, either individually or in
the aggregate, to have a Material Adverse Effect.
7.07 True and Complete Disclosure. All factual information (taken as
a whole) furnished by or on behalf of the Borrower in writing to the
Adminstrative Agent or any Lender (including, without limitation, all
information contained in the Documents) for purposes of or in connection with
the Transaction, this Agreement, the other Documents or any transaction
contemplated herein or therein is, and all other such factual information (taken
as a whole) hereafter furnished by or on behalf of the Borrower in writing to
the Administrative Agent or any Lender will be, true and accurate in all
material respects on the date as of which such information is dated or certified
and not incomplete by omitting to state any fact necessary to make such
information (taken as a whole) not misleading in any material respect at such
time in light of the circumstances under which such information was provided.
7.08 Use of Proceeds; Margin Regulations. (a) All proceeds of the
Term Loans will be used by the Borrower to finance, in part, the cash payments
required in connection with the consummation of the Plan of Reorganization and
to pay the fees and expenses incurred in connection with the Transaction.
43
(b) All proceeds of the Revolving Loans and the Swingline Loans will
be used for the working capital and general corporate purposes of the Borrower
and its Subsidiaries (including to repay the Aetna Note at the scheduled or
required date or dates of payment thereof in accordance with the terms thereof);
it being understood that no Revolving Loans or Swingline Loans may be used to
make the cash payments required in connection with the consummation of the Plan
of Reorganization or to pay any fees and expenses incurred in connection with
the Transaction.
(c) All Letters of Credit will be used for the purposes described in
Section 2.01(a).
(d) No part of any Credit Event (or the proceeds thereof) will be
used to purchase or carry any Margin Stock or to extend credit for the purpose
of purchasing or carrying any Margin Stock. Neither the making of any Loan nor
the use of the proceeds thereof nor the occurrence of any other Credit Event
will violate or be inconsistent with the provisions of Regulation T, U or X of
the Board of Governors of the Federal Reserve System.
7.09 Tax Returns and Payments. Each of the Borrower and each of its
Subsidiaries has timely filed or caused to be timely filed with the appropriate
taxing authority all federal and other material returns, statements, forms and
reports for taxes (the "Returns") required to be filed by, or with respect to
the income, properties or operations of, the Borrower and/or any of its
Subsidiaries. The Returns accurately reflect in all material respects all
liability for taxes of the Borrower and its Subsidiaries for the periods covered
thereby. Each of the Borrower and each of its Subsidiaries has paid all taxes
and assessments payable by it which have become due, other than (i) those that
are immaterial, (ii) those being contested in good faith and adequately
disclosed and fully provided for on the financial statements of the Borrower and
its Subsidiaries in accordance with generally accepted accounting principles,
(iii) those discharged pursuant to the Plan of Reorganization and (iv) those
payable over time pursuant to the Plan of Reorganization (which taxes and
assessments, in the case of this clause (iv) and to the extent due in accordance
with the Plan of Reorganization, have been paid in all material respects in
accordance with the terms of the Plan of Reorganization). There is no action,
suit, proceeding, investigation, audit or claim now pending or, to the best
knowledge of the Borrower, threatened by any authority regarding any material
taxes relating to the Borrower or any of its Subsidiaries. As of the Initial
Borrowing Date, neither the Borrower nor any of its Subsidiaries has entered
into an agreement or waiver or been requested to enter into an agreement or
waiver extending any statute of limitations relating to the payment or
collection of taxes of the Borrower or any of its Subsidiaries, or is aware of
any circumstances that would cause the taxable years or other taxable periods of
the Borrower or any of its Subsidiaries not to be subject to the normally
applicable statute of limitations. Neither the Borrower nor any of its
Subsidiaries has incurred, nor will any of them incur, any material tax
liability in connection with the Transaction or any other transactions
contemplated hereby (it being understood that the representation contained in
this sentence does not cover any future tax liabilities of the Borrower or any
of its Subsidiaries arising as a result of the operation of their businesses in
the ordinary course of business).
44
7.10 Compliance with ERISA. (a) Schedule III sets forth, as of the
Initial Borrowing Date, the name of each ERISA Plan. Each ERISA Plan (and each
related trust, insurance contract or fund) is in substantial compliance with its
terms and with all applicable laws, including, without limitation, ERISA and the
Code; each ERISA Plan (and each related trust, if any) which is intended to be
qualified under Section 401(a) of the Code has received a determination letter
from the Internal Revenue Service to the effect that it meets the requirements
of Sections 401(a) and 501(a) of the Code; neither the Borrower nor any of its
Subsidiaries or ERISA Affiliates has ever maintained or contributed to, or had
any obligation to maintain or contribute to (or borne any liability with respect
to) any "employee pension benefit plan," within the meaning of Section 3(2) of
ERISA, that is a "multiemployer plan," within the meaning of Section 3(37) of
ERISA, or that is subject to the minimum funding standards of Section 412 of the
Code or Section 302 of ERISA or subject to Title IV of ERISA; all contributions
required to be made with respect to an ERISA Plan have been timely made; neither
the Borrower nor any of its Subsidiaries nor any ERISA Affiliate has incurred
any material liability (including any indirect, contingent or secondary
liability) to or on account of an ERISA Plan pursuant to Section 409, 502(i),
502(l), 515, 4204 or 4212 of ERISA or Section 4975 of the Code or expects to
incur any such material liability under any of the foregoing sections with
respect to any ERISA Plan; no condition exists which presents a material risk to
the Borrower or any of its Subsidiaries or any ERISA Affiliate of incurring a
material liability to or on account of an ERISA Plan pursuant to the foregoing
provisions of ERISA and the Code; no action, suit, proceeding, hearing, audit or
investigation with respect to the administration, operation or the investment of
assets of any ERISA Plan (other than routine claims for benefits) is pending,
expected or threatened which, if adversely determined, could reasonably be
expected to result in a material liability to the Borrower or any of its
Subsidiaries; each group health plan (as defined in Section 607(1) of ERISA or
Section 4980B(g)(2) of the Code) which covers or has covered employees or former
employees of the Borrower or any of its Subsidiaries or ERISA Affiliates has at
all times been operated in compliance with the provisions of Part 6 of subtitle
B of Title I of ERISA and Section 4980B of the Code, except for any failure to
so comply which could not, individually or in the aggregate, reasonably be
expected to result in a material liability of the Borrower or any of its
Subsidiaries; no lien imposed under the Code or ERISA on the assets of the
Borrower or any of its Subsidiaries or any ERISA Affiliate exists or is likely
to arise on account of any ERISA Plan; and the Borrower and its Subsidiaries may
cease contributions to or terminate any employee benefit plan maintained by any
of them without incurring any material liability.
(b) Each Foreign Pension Plan has been maintained in substantial
compliance with its terms and with the requirements of any and all applicable
laws, statutes, rules, regulations and orders and has been maintained, where
required, in good standing with applicable regulatory authorities. All material
contributions required to be made with respect to a Foreign Pension Plan have
been timely made. Neither the Borrower nor any of its Subsidiaries has incurred
any material obligation in connection with the termination of, or withdrawal
from, any Foreign Pension Plan. The present value of the accrued benefit
liabilities (whether or not vested) under each Foreign Pension Plan, determined
as of the end of the Borrower's most recently ended fiscal year on the basis of
actuarial assumptions, each of which is reasonable, did not exceed the current
value of the assets of such Foreign Pension Plan allocable to such benefit
liabilities by a material amount.
7.11 The Security Documents. (a) The security interests created under
the Pledge Agreement in favor of the Collateral Agent, as Pledgee, for the
benefit of the Secured Creditors, constitute perfected security interests in the
Pledge Agreement Collateral described in the Pledge Agreement, superior to and
prior to the rights of all third Persons, and subject to no security interests
of any other Person. No filings or recordings are required in order to perfect
(or maintain the perfection or priority of) the security interests created in
the Pledge Agreement Collateral under the Pledge Agreement.
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(b) The provisions of the Security Agreement are effective to create
in favor of the Collateral Agent for the benefit of the Secured Creditors a
legal, valid and enforceable security interest in all right, title and interest
of the Credit Parties in the Security Agreement Collateral described therein,
and, upon the proper filing of UCC financing statements (which filings have been
made within 10 days after the Initial Borrowing Date or, if later, within 10
days after a Credit Party becomes a party to the Security Agreement), the
Collateral Agent, for the benefit of the Secured Creditors, will have a fully
perfected security interest in all right, title and interest in all of the
Security Agreement Collateral described therein, superior to and prior to the
rights of all third Persons, and subject to no other Liens other than Permitted
Liens. Upon the recordation of (x) the Grant of Security Interest in U.S.
Patents, if applicable, and (y) the Grant of Security Interest in U.S.
Trademarks, if applicable, in the respective form attached to the Security
Agreement, in each case in the United States Patent and Trademark Office,
together with filings on Form UCC-1 made pursuant to the Security Agreement, the
security interest created by the Security Agreement in the United States
trademarks and patents covered by the Security Agreement will be perfected. Upon
the recordation of the Grant of Security Interest in U.S. Copyrights, if
applicable, in the form attached to the Security Agreement with the United
States Copyright Office, together with filings on Form UCC-1 made pursuant to
the Security Agreement, the security interest created by the Security Agreement
in the United States copyrights covered by the Security Agreement will be
perfected.
(c) If any Mortgage is executed and delivered in accordance with
Section 8.12, upon the proper filing of each such Mortgage in the appropriate
filing office, each such Mortgage will create, as security for the obligations
purported to be secured thereby, a valid and enforceable perfected security
interest in and mortgage lien on the respective Mortgaged Property in favor of
the Collateral Agent (or such other trustee as may be required or desired under
local law) for the benefit of the Secured Creditors, superior and prior to the
rights of all third Persons (except that the security interest and mortgage lien
created on such Mortgaged Property may be subject to the Permitted Encumbrances
related thereto) and subject to no other Liens (other than Permitted Liens
related thereto).
7.12 Properties. All Real Property owned or leased by the Borrower or
any of its Subsidiaries as of the Initial Borrowing Date, and the nature of the
interest therein, is correctly set forth in Schedule IV. Each of the Borrower
and each of its Subsidiaries has good and marketable title to, or a validly
subsisting leasehold interest in, all material properties owned or leased by it,
including all material property reflected in the most recent historical balance
sheets referred to in Section 7.05(a) (except as sold or otherwise disposed of
since the date of such balance sheet in the ordinary course of business or as
permitted by the terms of this Agreement), free and clear of all Liens, other
than Permitted Liens.
7.13 Capitalization. On the Initial Borrowing Date, the authorized
capital stock of the Borrower consists of (i) 100,000,000 shares of ordinary
common stock, $.01 par value per share ("Ordinary Common Stock"), (ii)
40,000,000 shares of multiple and variable vote restricted convertible common
stock, $.01 par value per share ("MVS Common Stock"), and (iii) 10,000,000
46
shares of preferred stock, $.01 par value per share, of which no shares of such
preferred stock are issued and outstanding. All outstanding shares of the
capital stock of the Borrower have been duly and validly issued and are fully
paid and non-assessable. The Borrower does not have outstanding any securities
convertible into or exchangeable for its capital stock or outstanding any rights
to subscribe for or to purchase, or any options for the purchase of, or any
agreement providing for the issuance (contingent or otherwise) of, or any calls,
commitments or claims of any character relating to, its capital stock, except
for (w) shares of the Borrower's MVS Common Stock which are convertible into
shares of the Borrower's Ordinary Common Stock, (x) options, rights or warrants
that have been issued or may be issued from time to time to purchase shares of
the Borrower's Ordinary Common Stock, (y) shares of the Borrower's Ordinary
Common Stock distributed to holders of allowed claims pursuant to the Plan of
Reorganization and (z) shares of the Borrower's Ordinary Common Stock held by
Permitted Holders which are convertible into shares of the Borrower's MVS Common
Stock.
7.14 Subsidiaries; etc. (a) The Borrower has no Subsidiaries other
than (i) those Subsidiaries listed on Schedule V (which Schedule identifies (x)
the direct owner of each such Subsidiary on the Initial Borrowing Date and their
percentage ownership therein and (y) each Wholly-Owned Specified Subsidiary) and
(ii) new Subsidiaries created or acquired after the Initial Borrowing Date in
accordance with the terms of this Agreement.
(b) Schedule V also sets forth, as of the Initial Borrowing Date, (i)
the exact legal name of each Credit Party, the type of organization of such
Credit Party, whether or not such Credit Party is a registered organization
(within the meaning of the New York UCC), the jurisdiction of organization of
such Credit Party, the location (within the meaning of the New York UCC) of such
Credit Party, and the organizational identification number (if any) of such
Credit Party, and (ii) the basis for which (x) any Wholly-Owned Specified
Subsidiary of the Borrower on the Initial Borrowing Date cannot enter into any
Credit Document and (y) the shares of capital stock of any Domestic Subsidiary
of the Borrower cannot be pledged pursuant to the Pledge Agreement.
7.15 Compliance with Statutes, etc. Each of the Borrower and each of
its Subsidiaries is in compliance with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the ownership
of its property (including, without limitation, applicable Health Care Laws and
statutes, regulations, orders and restrictions relating to environmental
standards and controls), except such noncompliances as could not, either
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
7.16 Investment Company Act. Neither the Borrower nor any of its
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.
7.17 Public Utility Holdings Company Act. Neither the Borrower nor
any of its Subsidiaries is a "holding company," or a "subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company" within the meaning of the Public Utility
Holdings Company Act of 1935, as amended.
47
7.18 Environmental Matters. (a) Each of the Borrower and each of its
Subsidiaries is in compliance with all applicable Environmental Laws and the
requirements of any permits issued under such Environmental Laws. There are no
pending or, to the knowledge of the Borrower, threatened Environmental Claims
against the Borrower or any of its Subsidiaries or any Real Property owned,
leased or operated by the Borrower or any of its Subsidiaries (including any
such claim arising out of the ownership, lease or operation by the Borrower or
any of its Subsidiaries of any Real Property formerly owned, leased or operated
by the Borrower or any of its Subsidiaries but no longer owned, leased or
operated by the Borrower or any of its Subsidiaries). There are no facts,
circumstances, conditions or occurrences with respect to the business or
operations of the Borrower or any of its Subsidiaries, or any Real Property
owned, leased or operated by the Borrower or any of its Subsidiaries (including
any Real Property formerly owned, leased or operated by the Borrower or any of
its Subsidiaries but no longer owned, leased or operated by the Borrower or any
of its Subsidiaries) or, to the knowledge of the Borrower, any property
adjoining or adjacent to any such Real Property that could be reasonably
expected (i) to form the basis of an Environmental Claim against the Borrower or
any of its Subsidiaries or any Real Property owned, leased or operated by the
Borrower or any of its Subsidiaries or (ii) to cause any Real Property owned,
leased or operated by the Borrower or any of its Subsidiaries to be subject to
any restrictions on the ownership, lease, occupancy or transferability of such
Real Property by the Borrower or any of its Subsidiaries under any applicable
Environmental Law.
(b) Hazardous Materials have not at any time been generated, used,
treated or stored on, or transported to or from, or Released on or from, any
Real Property owned, leased or operated by the Borrower or any of its
Subsidiaries or, to the knowledge of the Borrower, any property adjoining or
adjacent to any Real Property, where such generation, use, treatment, storage,
transportation or Release has violated or could be reasonably expected to
violate any applicable Environmental Law or give rise to an Environmental Claim.
(c) Notwithstanding anything to the contrary in this Section 7.18,
the representations and warranties made in this Section 7.18 shall be untrue
only if the effect of any or all conditions, violations, claims, restrictions,
failures and noncompliances of the types described above could, either
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
7.19 Labor Relations. Neither the Borrower nor any of its
Subsidiaries is engaged in any unfair labor practice that could, either
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. There is (i) no unfair labor practice complaint pending against
the Borrower or any of its Subsidiaries or, to the knowledge of the Borrower,
threatened against any of them, before the National Labor Relations Board, and
no grievance or arbitration proceeding arising out of or under any collective
bargaining agreement is so pending against the Borrower or any of its
Subsidiaries or, to the knowledge of the Borrower, threatened against any of
them, (ii) no strike, labor dispute, slowdown or stoppage pending against the
Borrower or any of its Subsidiaries or, to the knowledge of the Borrower and the
Borrower, threatened against the Borrower or any of its Subsidiaries and (iii)
no union representation question exists with respect to the employees of the
Borrower or any of its Subsidiaries, except (with respect to any matter
specified in clause (i), (ii) or (iii) above, either individually or in the
aggregate) such as could not reasonably be expected to have a Material Adverse
Effect.
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7.20 Intellectual Property, etc. Each of the Borrower and each of its
Subsidiaries owns or has the right to use all the patents, trademarks, permits,
domain names, service marks, trade names, copyrights, licenses, franchises,
inventions, trade secrets, proprietary information and know-how of any type,
whether or not written (including, but not limited to, rights in computer
programs and databases) and formulas, or rights with respect to the foregoing,
and has obtained assignments of all leases, licenses and other rights of
whatever nature, necessary for the present conduct of its business, without any
known conflict with the rights of others which, or the failure to obtain which,
as the case may be, could, either individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
7.21 Indebtedness. Schedule VI sets forth a true and complete list of
all Indebtedness (including Contingent Obligations) of the Borrower and its
Subsidiaries as of the Initial Borrowing Date (but excluding the Obligations,
the New Senior Notes, the New Aetna Note and the Aetna Subsidiaries Subordinated
Guaranty, the "Existing Indebtedness") and which is to remain outstanding after
giving effect to the Transaction, in each case showing the aggregate principal
amount thereof and the name of the respective borrower and any Credit Party or
any of its Subsidiaries which directly or indirectly guarantees such
Indebtedness.
7.22 Insurance. Schedule VII sets forth a true and complete listing
of all insurance maintained by the Borrower and its Subsidiaries as of the
Initial Borrowing Date, with the amounts insured (and any deductibles) set forth
therein.
7.23 Subordination, etc. The subordination provisions contained in
the Aetna Subsidiaries Subordinated Guaranty are enforceable against each
Subsidiary Guarantor and Aetna (and its successors or assigns), and all
Guaranteed Obligations under (and as defined in) the Subsidiaries Guaranty are
within the definition of "Guarantor Senior Debt" included in such subordination
provisions.
7.24 Certain Agreements. (a) Neither the Borrower nor any of it
Subsidiaries is a party to any agreement or instrument or subject to any
corporate, partnership or limited liability company restriction, as the case may
be, that, either individually or in the aggregate, has resulted or could
reasonably be expected to result in a Material Adverse Effect.
(b) Neither the Borrower nor any of its Subsidiaries is in default in
any manner under any provision of any indenture or other agreement or instrument
evidencing Indebtedness, or any other material agreement or instrument to which
it is a party or by which it or any of its properties or assets are or may be
bound, if such default, either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
SECTION 8. Affirmative Covenants. The Borrower hereby covenants and
agrees that on and after the Effective Date and until the Total Commitment and
all Letters of Credit have terminated (or have been cash collateralized or
supported by a backstop letter of credit as provided in Section 4.02(j)) and the
Loans, Notes and Unpaid Drawings (in each case together with interest thereon),
Fees and all other Obligations (other than indemnities described in Section
13.13 (and similar indemnities described in the other Credit Documents, in each
case) which are not then due and payable) incurred hereunder and thereunder, are
paid in full:
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8.01 Information Covenants. The Borrower will furnish to each Lender:
---------------------
(a) Monthly Reports. Within 30 days after the end of each fiscal
month of the Borrower (other than the last fiscal month of each quarterly
accounting period of the Borrower) (commencing with the Borrower's fiscal month
ending on November 30, 2003), the consolidated balance sheet of the Borrower and
its Subsidiaries as at the end of such fiscal month and the related consolidated
statements of income and cash flows for such fiscal month and for the elapsed
portion of the fiscal year ended with the last day of such fiscal month, in each
case setting forth comparative figures for the corresponding fiscal month in the
prior fiscal year, all of which shall be certified by a Financial Officer of the
Borrower that they fairly present in all material respects in accordance with
generally accepted accounting principles the financial condition of the Borrower
and its Subsidiaries as of the dates indicated and the results of their
operations for the periods indicated, subject to normal year-end audit
adjustments and the absence of footnotes.
(b) Quarterly Financial Statements. Within 45 days after the close of
each of the first three quarterly accounting periods in each fiscal year of the
Borrower, (i) the consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such quarterly accounting period and the related
consolidated statements of income and retained earnings and statement of cash
flows for such quarterly accounting period and for the elapsed portion of the
fiscal year ended with the last day of such quarterly accounting period, in each
case setting forth comparative figures for the corresponding quarterly
accounting period in the prior fiscal year and comparable budgeted figures for
such quarterly accounting period as set forth in the respective budget delivered
pursuant to Section 8.01(e), all of which shall be certified by a Financial
Officer of the Borrower that they fairly present in all material respects in
accordance with generally accepted accounting principles the financial condition
of the Borrower and its Subsidiaries as of the dates indicated and the results
of their operations for the periods indicated, subject to normal year-end audit
adjustments and the absence of footnotes, and (ii) management's discussion and
analysis of the important operational and financial developments during such
quarterly accounting period.
(c) Annual Financial Statements. Within 90 days after the close of
each fiscal year of the Borrower, (i) the consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such fiscal year and the related
consolidated statements of income and retained earnings and statement of cash
flows for such fiscal year setting forth comparative figures for the preceding
fiscal year and certified by Ernst & Young LLP or other independent certified
public accountants of recognized national standing reasonably acceptable to the
Administrative Agent, together with a report of such accounting firm stating
that in the course of its regular audit of the financial statements of the
Borrower and its Subsidiaries, which audit was conducted in accordance with
generally accepted auditing standards, such accounting firm obtained no
knowledge of any Default or an Event of Default relating to financial or
accounting matters which has occurred and is continuing or, if such a Default or
an Event of Default was noted and is continuing, a statement as to the nature
thereof, and (ii) management's discussion and analysis of the important
operational and financial developments during such fiscal year.
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(d) Management Letters. Promptly after the Borrower's or any of its
Subsidiaries' receipt thereof, a copy of any "management letter" received from
its certified public accountants and management's response thereto.
(e) Budgets. No later than 60 days following the first day of each
fiscal year of the Borrower, a budget in form reasonably satisfactory to the
Administrative Agent (including budgeted statements of income, sources and uses
of cash and balance sheets for the Borrower and its Subsidiaries on a
consolidated basis) (i) for each of the four quarterly accounting periods of
such fiscal year prepared in detail and (ii) for the two immediately succeeding
fiscal years prepared in summary form, in each case setting forth, with
appropriate discussion, the principal assumptions upon which such budget is
based and a statement by a Financial Officer of the Borrower to the effect that
the budget is a reasonable estimate for the periods covered thereby.
(f) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Sections 8.01(b) and (c), a compliance
certificate from a Financial Officer of the Borrower in the form of Exhibit K
certifying on behalf of the Borrower that, to such officer's knowledge after due
inquiry, no Default or Event of Default has occurred and is continuing or, if
any Default or Event of Default has occurred and is continuing, specifying the
nature and extent thereof, which certificate shall (i) set forth in reasonable
detail the calculations required to establish whether the Borrower and its
Subsidiaries were in compliance with the provisions of Sections 4.02(e),
4.02(f), 8.16, 9.01(vi), 9.01(vii), 9.01(x), 9.01(xii), 9.01(xix), 9.02(v),
9.03(ii), 9.04(v), 9.04(xi), 9.04(xiv), 9.05(v), 9.05(viii), 9.05(xiv) and 9.07
through 9.11, inclusive, at the end of such fiscal quarter or year, as the case
may be, (ii) list all Wholly-Owned Specified Subsidiaries as of the end of such
fiscal quarter or year, as the case may be, together with a report of (a) the
total assets of each such Wholly-Owned Specified Subsidiary, (b) the total cash
contributed to each such Wholly-Owned Specified Subsidiary by the Borrower or
another Wholly-Owned Subsidiary thereof during the Test Period covered by such
financial statements, (c) the total cash distributed by each such Wholly-Owned
Specified Subsidiary to the Borrower or another Wholly-Owned Subsidiary thereof
during the Test Period covered by such financial statements, and (d) the basis
for which each such Wholly-Owned Specified Subsidiary cannot enter into any
Credit Document, and (iii) certify that there have been no changes to Annexes C
through F, and Annexes I through K, in each case of the Security Agreement and
Annexes A through F of the Pledge Agreement, in each case since the Initial
Borrowing Date or, if later, since the date of the most certificate delivered
pursuant to this Section 8.01(f), or if there have been any such changes, a list
in reasonable detail of such changes (but, in each case with respect to this
clause (iii), only to the extent that such changes are required to be reported
to the Collateral Agent pursuant to the terms of such Security Documents) and
whether the Borrower and the other Credit Parties have otherwise taken all
actions required to be taken by them pursuant to such Security Documents in
connections with any such changes.
(g) Notice of Default, Litigation and Material Adverse Effect.
Promptly, and in any event within three Business Days after any officer of the
Borrower or any of its Subsidiaries obtains knowledge thereof, notice of (i) the
occurrence of any event which constitutes a Default or an Event of Default, (ii)
any litigation or governmental investigation or proceeding pending against the
Borrower or any of its Subsidiaries (x) which, either individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect or (y)
with respect to any Credit Document, or (iii) any other event, change or
circumstance that has had, or could reasonably be expected to have, a Material
Adverse Effect.
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(h) Other Reports and Filings. Promptly after the filing or delivery
thereof, copies of all financial information, proxy materials and reports, if
any, which the Borrower or any of its Subsidiaries shall publicly file with the
Securities and Exchange Commission or any successor thereto (the "SEC") or
deliver to holders (or any trustee, agent or other representative therefor) of
its material Indebtedness pursuant to the terms of the documentation governing
such Indebtedness.
(i) Environmental Matters. Promptly after any officer of the Borrower
or any of its Subsidiaries obtains knowledge thereof, notice of one or more of
the following environmental matters to the extent that such environmental
matters, either individually or when aggregated with all other such
environmental matters, could reasonably be expected to have a Material Adverse
Effect:
(i) any pending or threatened Environmental Claim against the Borrower
or any of its Subsidiaries or any Real Property owned, leased or operated
by the Borrower or any of its Subsidiaries;
(ii) any condition or occurrence on or arising from any Real Property
owned, leased or operated by the Borrower or any of its Subsidiaries that
(a) results in noncompliance by the Borrower or any of its Subsidiaries
with any applicable Environmental Law or (b) could reasonably be expected
to form the basis of an Environmental Claim against the Borrower or any of
its Subsidiaries or any such Real Property;
(iii) any condition or occurrence on any Real Property owned, leased
or operated by the Borrower or any of its Subsidiaries that could
reasonably be expected to cause such Real Property to be subject to any
restrictions on the ownership, lease, occupancy, use or transferability by
the Borrower or any of its Subsidiaries of such Real Property under any
Environmental Law; and
(iv) the taking of any removal or remedial action in response to the
actual or alleged presence of any Hazardous Material on any Real Property
owned, leased or operated by the Borrower or any of its Subsidiaries as
required by any Environmental Law or any governmental or other
administrative agency; provided that in any event the Borrower shall
deliver to each Lender all notices received by the Borrower or any of its
Subsidiaries from any government or governmental agency under, or pursuant
to, CERCLA which identify the Borrower or any of its Subsidiaries as
potentially responsible parties for remediation costs or which otherwise
notify the Borrower or any of its Subsidiaries of potential liability under
CERCLA.
All such notices shall describe in reasonable detail the nature of
the claim, investigation, condition, occurrence or removal or remedial action
and the Borrower's or such Subsidiary's response thereto.
52
(j) Bank Debt Ratings. Promptly upon, and in any event within three
Business Days after, any officer of the Borrower obtains knowledge of any change
in the Bank Debt Rating by Xxxxx'x or S&P, notice of such change and the
effective date thereof.
(k) Other Information. From time to time, such other information or
documents (financial or otherwise) with respect to the Borrower or any of its
Subsidiaries as the Administrative Agent or any Lender (through the
Administrative Agent) may reasonably request.
8.02 Books, Records and Inspections; Annual Meetings. (a) The
Borrower will, and will cause each of its Subsidiaries to, keep proper books of
record and accounts in which full, true and correct entries which permit the
preparation of financial statements in accordance with generally accepted
accounting principles and which conform to all requirements of law shall be made
of all dealings and transactions in relation to its business and activities. The
Borrower will, and will cause each of its Subsidiaries to, permit officers and
designated representatives of the Administrative Agent or the Required Lenders
to visit and inspect, under guidance of officers of the Borrower or such
Subsidiary, any of the properties of the Borrower or such Subsidiary, and to
examine the books of account of the Borrower or such Subsidiary and discuss the
affairs, finances and accounts of the Borrower or such Subsidiary with, and be
advised as to the same by, its and their officers and independent accountants,
all upon reasonable prior notice and at such reasonable times and intervals and
to such reasonable extent as the Administrative Agent or the Required Lenders
may reasonably request; provided, however, so long as no Event of Default
exists, the Required Lenders (but not the Administrative Agent) shall be limited
to one such visit in any fiscal year of the Borrower.
(b) At a date to be mutually agreed upon between the Administrative
Agent and the Borrower occurring on or prior to the 120th day after the close of
each fiscal year of the Borrower, the Borrower will, at the request of the
Administrative Agent, hold a meeting (which meeting, to the extent agreed to by
the Administrative Agent, may be by teleconference) with all of the Lenders at
which meeting will be reviewed the financial results of the Borrower and its
Subsidiaries for the previous fiscal year and the budgets presented for the
current fiscal year of the Borrower.
8.03 Maintenance of Property; Insurance. (a) The Borrower will, and
will cause each of its Subsidiaries to, (i) keep all property necessary to the
business of the Borrower and its Subsidiaries in good working order and
condition, ordinary wear and tear excepted, (ii) maintain with financially sound
and reputable insurance companies insurance on all such property and against all
such risks as is consistent and in accordance with industry practice for
companies similarly situated owning similar properties and engaged in similar
businesses as the Borrower and its Subsidiaries, and (iii) furnish to the
Administrative Agent, upon its request therefor, full information as to the
insurance carried. Such insurance shall include physical damage insurance on all
real and personal property (whether now owned or hereafter acquired) on an all
risk basis and business interruption insurance. The provisions of this Section
8.03 shall be deemed supplemental to, but not duplicative of, the provisions of
any Security Documents that require the maintenance of insurance. In addition to
the foregoing, the Borrower acknowledges and agrees that (x) the Administrative
Agent has the right, on an annual basis, to review the insurance then being
maintained by the Borrower and its Subsidiaries and to require the Borrower and
its Subsidiaries to increase their levels of coverage from that which then
53
exists to the extent that the Administrative Agent has a reasonable basis to
require same and (y) they will, within 30 days following such a request by the
Administrative Agent, obtain such increased insurance coverage to the extent
available at commercially reasonable rates.
(b) The Borrower will, and will cause each of the other Credit
Parties to, keep its property insured in favor of the Collateral Agent, and all
policies or certificates (or certified copies thereof) with respect to such
insurance (and any other insurance maintained by (or on behalf of) the Borrower
and/or such other Credit Party) (i) shall name the Collateral Agent as loss
payee and/or additional insured, (ii) shall state that such insurance policies
shall not be canceled without at least 30 days' prior written notice thereof by
the respective insurer to the Collateral Agent (or at least 10 days' prior
written notice in the case of non-payment of premium), (iii) shall provide that
the respective insurers irrevocably waive any and all rights of subrogation with
respect to the Collateral Agent and the other Secured Creditors, and (iv) shall
be deposited with the Collateral Agent.
(c) If the Borrower or any of its Subsidiaries shall fail to maintain
insurance in accordance with this Section 8.03, or if the Borrower or any of its
Subsidiaries shall fail to so endorse and deposit all policies or certificates
with respect thereto, the Administrative Agent shall have the right (but shall
be under no obligation) to procure such insurance and the Borrower agrees to
reimburse the Administrative Agent for all costs and expenses of procuring and
maintaining such insurance.
8.04 Existence; Franchises. The Borrower will, and will cause each of
its Subsidiaries to, do or cause to be done, all things necessary to preserve
and keep in full force and effect its existence and its material rights,
franchises, licenses, permits, copyrights, trademarks and patents; provided,
however, that nothing in this Section 8.04 shall prevent (i) sales of assets and
other transactions by the Borrower or any of its Subsidiaries in accordance with
Section 9.02 or (ii) the withdrawal by the Borrower or any of its Subsidiaries
of its qualification as a foreign corporation, partnership or limited liability
company, as the case may be, in any jurisdiction if such withdrawal could not,
either individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
8.05 Compliance with Statutes, etc.. The Borrower will, and will
cause each of its Subsidiaries to, comply with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property (including applicable statutes,
regulations, orders and restrictions relating to Health Care Laws and
environmental standards and controls), except such noncompliances as could not,
either individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
8.06 Compliance with Environmental Laws. (a) The Borrower will
comply, and will cause each of its Subsidiaries to comply, with all
Environmental Laws and permits applicable to, or required by, the ownership,
lease or use of its Real Property now or hereafter owned, leased or operated by
the Borrower or any of its Subsidiaries, except such noncompliances as could
not, either individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect, and will promptly pay or cause to be paid all costs and
expenses incurred in connection with such compliance, and will keep or cause to
54
be kept all such Real Property free and clear of any Liens imposed pursuant to
such Environmental Laws. Neither the Borrower nor any of its Subsidiaries will
generate, use, treat, store, Release or dispose of, or permit the generation,
use, treatment, storage, Release or disposal of Hazardous Materials on any Real
Property now or hereafter owned, leased or operated by the Borrower or any of
its Subsidiaries, or transport or permit the transportation of Hazardous
Materials to or from any such Real Property, except for Hazardous Materials
generated, used, treated, stored, Released or disposed of at any such Real
Properties in compliance in all material respects with all applicable
Environmental Laws and as required in connection with the normal operation, use
and maintenance of the business or operations of the Borrower or any of its
Subsidiaries.
(b) (i) After the receipt by the Administrative Agent or any Lender
of any notice of the type described in Section 8.01(i), (ii) at any time that
the Borrower or any of its Subsidiaries are not in compliance with Section
8.06(a) or (iii) in the event that the Administrative Agent or the Lenders have
exercised any of the remedies pursuant to the last paragraph of Section 10, the
Borrower will (in each case) provide, at the sole expense of the Borrower and at
the request of the Administrative Agent, an environmental site assessment report
concerning any Real Property owned, leased or operated by the Borrower or any of
its Subsidiaries, prepared by an environmental consulting firm reasonably
approved by the Administrative Agent, indicating the presence or absence of
Hazardous Materials and the potential cost of any removal or remedial action in
connection with such Hazardous Materials on such Real Property. If the Borrower
fails to provide the same within 30 days after such request was made, the
Administrative Agent may order the same, the cost of which shall be borne by the
Borrower, and the Borrower shall grant and hereby grants to the Administrative
Agent and the Lenders and their respective agents access to such Real Property
and specifically grants the Administrative Agent and the Lenders an irrevocable
non-exclusive license, subject to the rights of tenants, to undertake such an
assessment at any reasonable time upon reasonable notice to the Borrower, all at
the sole expense of the Borrower.
8.07 ERISA. As soon as possible and, in any event, within ten (10)
days after the Borrower or any of its Subsidiaries or any ERISA Affiliate knows
or has reason to know of the occurrence of any of the following, the Borrower
will deliver to each of the Lenders a certificate of a Financial Officer of the
Borrower setting forth the full details as to such occurrence and the action, if
any, that the Borrower, such Subsidiary or such ERISA Affiliate is required or
proposes to take, together with any notices required or proposed to be given or
filed by the Borrower, such Subsidiary, the ERISA Plan administrator or such
ERISA Affiliate to or with the PBGC or any other governmental agency, or an
ERISA Plan participant and any notices received by the Borrower, such Subsidiary
or such ERISA Affiliate from the PBGC or any other government agency, or an
ERISA Plan participant with respect thereto: that a Reportable Event has
occurred (except to the extent that the Borrower has previously delivered to the
Lenders a certificate and notices (if any) concerning such event pursuant to the
next clause hereof); that a contributing sponsor (as defined in Section
4001(a)(13) of ERISA) of an ERISA Plan subject to Title IV of ERISA is subject
to the advance reporting requirement of PBGC Regulation Section 4043.61 (without
regard to subparagraph (b)(1) thereof), and an event described in subsection
..62, .63, .64, .65, .66, .67 or .68 of PBGC Regulation Section 4043 is
reasonably expected to occur with respect to such ERISA Plan within the
following 30 days; that an accumulated funding deficiency, within the meaning of
Section 412 of the Code or Section 302 of ERISA, has been incurred or an
55
application may be or has been made for a waiver or modification of the minimum
funding standard (including any required installment payments) or an extension
of any amortization period under Section 412 of the Code or Section 303 or 304
of ERISA with respect to an ERISA Plan; that any contribution required to be
made with respect to an ERISA Plan or Foreign Pension Plan has not been timely
made; that an ERISA Plan has been or may be terminated, reorganized, partitioned
or declared insolvent under Title IV of ERISA; that an ERISA Plan has an
Unfunded Current Liability; that proceedings may be or have been instituted to
terminate or appoint a trustee to administer an ERISA Plan which is subject to
Title IV of ERISA; that a proceeding has been instituted pursuant to Section 515
of ERISA to collect a delinquent contribution to an ERISA Plan; that the
Borrower or any of its Subsidiaries or any ERISA Affiliate will or may incur any
material liability (including any indirect, contingent, or secondary liability)
to or on account of the termination of or withdrawal from an ERISA Plan under
Section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with respect to
an ERISA Plan under Section 401(a)(29), 4971, 4975 or 4980 of the Code or
Section 409, 502(i) or 502(l) of ERISA or with respect to a group health plan
(as defined in Section 607(1) of ERISA or Section 4980B(g)(2) of the Code) under
Section 4980B of the Code; or that the Borrower or any of its Subsidiaries may
incur any material liability pursuant to any employee welfare benefit plan (as
defined in Section 3(1) of ERISA) that provides benefits to retired employees or
other former employees (other than as required by Section 601 of ERISA) or any
ERISA Plan or any Foreign Pension Plan. The Borrower will deliver to each of the
Lenders copies of any records, documents or other information that must be
furnished to the PBGC with respect to any ERISA Plan pursuant to Section 4010 of
ERISA. At the request of any Lender, the Borrower will also deliver to such
Lender a complete copy of the annual report (on Internal Revenue Service Form
5500-series) of each ERISA Plan (including, to the extent required, the related
financial and actuarial statements and opinions and other supporting statements,
certifications, schedules and information) required to be filed with the
Internal Revenue Service. In addition to any certificates or notices delivered
to the Lenders pursuant to the first sentence hereof, copies of annual reports
and any records, documents or other information required to be furnished to the
PBGC or any other governmental agency, and any material notices received by the
Borrower, any of its Subsidiaries or any ERISA Affiliate with respect to any
ERISA Plan or Foreign Pension Plan or received from any governmental agency or
plan administrator or sponsor or trustee with respect to any multiemployer plan
(as defined in Section 4001(a)(3) of ERISA), shall be delivered to the Lenders
no later than ten (10) days after the date such records, documents and/or
information has been furnished to the PBGC or any other governmental agency or
such notice has been received by the Borrower, the respective Subsidiary or the
ERISA Affiliate, as applicable. The Borrower will ensure, and cause each of its
applicable Subsidiaries to ensure, that all Foreign Pension Plans administered
by it or into which it makes payments obtains or retains (as applicable)
registered status under and as required by applicable law and is administered in
a timely manner in all respects in compliance with all applicable laws except
where the failure to do any of the foregoing could not, either individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.
8.08 End of Fiscal Years; Fiscal Quarters. The Borrower will cause
(i) each of its, and each of its Subsidiaries, fiscal years to end on December
31 of each year and (ii) each of its, each of its Subsidiaries, fiscal quarters
to end on March 31, June 30, September 30 and December 31 of each year;
provided, however, (x) one or more of the Subsidiaries of the Borrower existing
on the Initial Borrowing Date may have a fiscal year that ends on September 30
and (y) one or more of such Subsidiaries may elect to change their fiscal year
end to December 31.
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8.09 Performance of Obligations. The Borrower will, and will cause
each of its Subsidiaries to, perform all of its obligations under the terms of
each mortgage, indenture, security agreement, loan agreement or credit agreement
and each other agreement, lease, contract or instrument by which it is bound,
except such non-performances as could not, either individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
8.10 Payment of Taxes. The Borrower will pay and discharge, and will
cause each of its Subsidiaries to pay and discharge, all taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits or
upon any properties belonging to it, in each case on a timely basis, and all
lawful claims which, if unpaid, might become a Lien or charge upon any
properties of the Borrower or any of its Subsidiaries not otherwise permitted
under Section 9.01(i); provided that neither the Borrower nor any of its
Subsidiaries shall be required to pay any such tax, assessment, charge, levy or
claim which is immaterial or is being contested in good faith and by proper
proceedings if it has maintained adequate reserves with respect thereto in
accordance with generally accepted accounting principles.
8.11 Use of Proceeds. The Borrower will use the proceeds of the Loans
and the Letters of Credit only as provided in Section 7.08.
8.12 Additional Security; Further Assurances; etc. (a) Except as
otherwise provided in Section 9.15 and for Wholly-Owned Specified Subsidiaries
existing on the Initial Borrowing Date (for so long as (and to the extent that)
such Persons constitute Wholly-Owned Specified Subsidiaries), the Borrower will,
and will cause each of its Wholly-Owned Domestic Subsidiaries to, grant to the
Collateral Agent for the benefit of the Secured Creditors security interests and
Mortgages in such assets and properties of the Borrower and such Wholly-Owned
Domestic Subsidiaries as are not covered by the original Security Documents and
as may be reasonably requested from time to time by the Administrative Agent or
the Required Lenders (collectively, the "Additional Security Documents");
provided, however, neither the Borrower nor any Wholly-Owned Domestic Subsidiary
of the Borrower will be required to grant a Mortgage on Real Property pursuant
to this Section 8.12(a) unless the fair market value (as determined in good
faith by the Borrower) of such Mortgaged Property equals or exceeds $1,000,000.
All such security interests and Mortgages shall be granted pursuant to
documentation reasonably satisfactory in form and substance to the
Administrative Agent and shall constitute, after appropriate filings have been
made (to the extent required to be so made), valid and enforceable perfected
security interests and Mortgages superior to and prior to the rights of all
third Persons and subject to no other Liens except for Permitted Liens. The
Additional Security Documents or instruments related thereto shall have been
duly recorded or filed in such manner and in such places as are required by law
to establish, perfect, preserve and protect the Liens in favor of the Collateral
Agent required to be granted pursuant to the Additional Security Documents and
all taxes, fees and other charges payable in connection therewith shall have
been paid in full.
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(b) The Borrower will, and will cause each of the other Credit
Parties to, at the expense of the Borrower, make, execute, endorse, acknowledge,
file and/or deliver to the Collateral Agent from time to time such vouchers,
invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, powers of attorney, certificates, real
property surveys, reports, landlord waivers, bailee agreements, control
agreements and other assurances or instruments and take such further steps
relating to the Collateral covered by any of the Security Documents as the
Collateral Agent may reasonably require. Furthermore, the Borrower will, and
will cause the other Credit Parties to, deliver to the Collateral Agent such
opinions of counsel, title insurance and other related documents as may be
reasonably requested by the Administrative Agent to assure itself that this
Section 8.12 has been complied with.
(c) If the Administrative Agent or the Required Lenders reasonably
determine that they are required by law or regulation to have appraisals
prepared in respect of any Real Property of the Borrower and its Subsidiaries
constituting Collateral, the Borrower will, at its own expense, provide to the
Administrative Agent appraisals which satisfy the applicable requirements of the
Real Estate Appraisal Reform Amendments of the Financial Institution Reform,
Recovery and Enforcement Act of 1989, as amended, and which shall otherwise be
in form and substance reasonably satisfactory to the Administrative Agent.
(d) (i) The Borrower will cause each Wholly-Owned Specified
Subsidiary of the Borrower (whether existing on the Initial Borrowing Date or
thereafter created, established or acquired) that has not entered into any
Credit Document because to have done so either (x) would have violated a law,
regulation, rule, order, approval, license or other restriction applicable to
such Wholly-Owned Specified Subsidiary and issued or imposed by any governmental
authority or (y) would have reasonably been expected to cause such Wholly-Owned
Subsidiary to fail to satisfy a net worth, net equity or capital requirement or
similar calculation or requirement imposed on such Wholly-Owned Subsidiary by
any governmental authority having jurisdiction of such Wholly-Owned Subsidiary
due to the regulated nature of such Wholly-Owned Subsidiary's operations, in
either case to, upon such restrictions ceasing to (or to the extent that such
restrictions do not) apply to such Wholly-Owned Specified Subsidiary, execute
and deliver to the Collateral Agent counterparts of the Security Agreement, the
Pledge Agreement and the Subsidiaries Guaranty (to the extent that any such
Credit Documents were not theretofore entered into by such Wholly-Owned
Specified Subsidiary), together with all other relevant documentation (including
opinions of counsel, resolutions, officers' certificates and UCC financing
statements) of the type described in Section 5 as such Wholly-Owned Specified
Subsidiary would have had to deliver if it executed such Credit Documents on the
Initial Borrowing Date (after which time such Wholly-Owned Specified Subsidiary
shall cease to constitute same); provided, however, no Wholly-Owned Foreign
Subsidiary of the Borrower shall be required to take any actions pursuant to
this Section 8.12(d)(i) except to the extent required by Section 8.13.
(ii) To the extent that the capital stock or other equity interests
of any Subsidiary of the Borrower have not theretofore been pledged to the
Collateral Agent under the Pledge Agreement because to have done so would have
violated a law, regulation, rule, order, approval, license or other restriction
applicable to such Subsidiary and issued or imposed by any governmental
authority due to the regulated nature of such Subsidiary's operations, the
Borrower will, or will cause the other applicable Credit Party to, upon such
restrictions ceasing to apply to such Subsidiary, pledge and deliver to the
Collateral Agent pursuant to, and to the extent required by, the Pledge
Agreement the capital stock or other equity interests of any such Subsidiary.
58
(e) The Borrower agrees that each action required by clauses (a)
through (d) of this Section 8.12 shall be completed as soon as possible, but in
no event later than 30 days (or 10 days in the case of preceding clause (d))
after such action is required to be taken or is requested to be taken by the
Administrative Agent or the Required Lenders, as the case may be; provided that,
in no event will the Borrower or any of its Subsidiaries be required to take any
action, other than using its commercially reasonable efforts, to obtain consents
from third parties with respect to its compliance with this Section 8.12.
8.13 Foreign Subsidiaries Security. Following a change in the
relevant sections of the Code or the regulations, rules, rulings, notices or
other official pronouncements issued or promulgated thereunder, with respect to
any Foreign Subsidiary of the Borrower which has not already had all of its
stock pledged pursuant to the Pledge Agreement, the Administrative Agent may
request in writing that the Borrower deliver to the Administrative Agent within
30 days after such request evidence reasonably satisfactory to the
Administrative Agent that (i) a pledge of 66-2/3% or more of the total combined
voting power of all classes of capital stock of such Foreign Subsidiary entitled
to vote, (ii) the entering into by such Foreign Subsidiary of a security
agreement in substantially the form of the Security Agreement and (iii) the
entering into by such Foreign Subsidiary of a guaranty in substantially the form
of the Subsidiaries Guaranty, in any such case would no longer reasonably be
expected to cause (x) any undistributed earnings of such Foreign Subsidiary as
determined for Federal income tax purposes to be treated as a deemed dividend to
such Foreign Subsidiary's United States parent for Federal income tax purposes
or (y) other materially adverse Federal income tax consequences to the Credit
Parties, and, to the extent such evidence is so delivered (or no evidence to the
contrary is delivered within such 30-day period) the Borrower will, at the
written request of the Administrative Agent or the Required Lenders, take one or
more of the actions described in the immediately succeeding sentence. Provided
that the actions set forth in clauses (i) through (iii) above would not cause
the conditions set forth in either clause (x) or (y) above to be met, then
within 45 days after the Administrative Agent's request, (I) the Borrower will,
or will cause its applicable Subsidiary to, pledge that portion of each such
Foreign Subsidiary's outstanding capital stock not theretofore pledged pursuant
to the Pledge Agreement to the Collateral Agent for the benefit of the Secured
Creditors pursuant to the Pledge Agreement (or another pledge agreement in
substantially similar form, if needed), (II) the Borrower will cause each such
Foreign Subsidiary (to the extent that it is a Wholly-Owned Subsidiary) to
execute and deliver the Security Agreement and the Pledge Agreement (or another
security agreement or pledge agreement in substantially similar form, if
needed), granting the Secured Creditors a security interest in all of each such
Foreign Subsidiary's assets and securing the Obligations of the Borrower under
the Credit Documents and under any Interest Rate Protection Agreement or Other
Hedging Agreement and, in the event the Subsidiaries Guaranty shall have been
executed by such Foreign Subsidiary, the obligations of such Foreign Subsidiary
thereunder, and (III) the Borrower will cause each such Foreign Subsidiary (to
the extent it is a Wholly-Owned Subsidiary) to execute and deliver the
Subsidiaries Guaranty (or another guaranty in substantially similar form, if
needed), guaranteeing the Obligations of the Borrower under the Credit Documents
and under any Interest Rate Protection Agreement or Other Hedging Agreement; in
each case to the extent that the entering into the Security Agreement, Pledge
Agreement or Subsidiaries Guaranty is permitted by the laws of the respective
foreign jurisdiction and with all documents delivered pursuant to this Section
8.13 to be in form and substance reasonably satisfactory to the Administrative
Agent.
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8.14 Ownership of Subsidiaries; etc. Except (i) for non-Wholly-Owned
Subsidiaries existing as of the Initial Borrowing Date or (ii) as otherwise
permitted by Section 9.05(xiv) and the definition of Permitted Acquisition, the
Borrower will, and will cause each of its Subsidiaries to, either solely or
together with one or more other Wholly-Owned Subsidiaries, own 100% of the
capital stock and other equity interests of each of their Subsidiaries (other
than, in the case of a Foreign Subsidiary, directors' qualifying shares and
nominal shares held by local nationals, in each case to the extent required by
applicable law).
8.15 Maintenance of Corporate Separateness. The Borrower will, and
will cause each of its Subsidiaries to, satisfy in all material respects
customary corporate formalities, including the holding of regular board of
directors' and shareholders' meetings or action by directors or shareholders
without a meeting and the maintenance of corporate offices and records. Neither
the Borrower nor any of its Subsidiaries will take any action, or conduct its
affairs in a manner, which is likely to result in the corporate existence of the
Borrower or any of its Subsidiaries being ignored, or in the assets and
liabilities of the Borrower or any of its Subsidiaries being substantively
consolidated with one another or with those of any other such Person in a
bankruptcy, reorganization or other insolvency proceeding.
8.16 Permitted Acquisitions. (a) Subject to the provisions of this
Section 8.16 and the requirements contained in the definition of Permitted
Acquisition, from and after January 1, 2004 the Borrower and each of its
Wholly-Owned Subsidiaries that are Subsidiary Guarantors may from time to time
effect Permitted Acquisitions, so long as (in each case except to the extent the
Required Lenders otherwise specifically agree in writing in the case of a
specific Permitted Acquisition): (i) no Default or Event of Default shall have
occurred and be continuing at the time of the consummation of the proposed
Permitted Acquisition or immediately after giving effect thereto; (ii) the
Borrower shall have given to the Administrative Agent and the Lenders at least
10 Business Days' prior written notice of any Permitted Acquisition (or such
shorter period of time as may be reasonably acceptable to the Administrative
Agent), which notice shall describe in reasonable detail the principal terms and
conditions of such Permitted Acquisition; (iii) the Administrative Agent and the
Lenders shall have received, to the extent available, audited year end financial
statements for at least the previous fiscal year and interim unaudited quarterly
financial statements for the then current fiscal year of the Acquired Entity or
Business being acquired pursuant to such proposed Permitted Acquisition,
although to the extent that such audited year end financial statements are not
available, the Administrative Agent shall be reasonably satisfied with the form
and scope of all financial statements for such Acquired Entity of Business for
the then most recently ended fiscal year of such Acquired Entity or Business and
for the then current fiscal year of such Acquired Entity or Business; (iv)
calculations are made by the Borrower with respect to the financial covenants
contained in Sections 9.08 through 9.11, inclusive, for the respective
Calculation Period on a Pro Forma Basis as if the respective Permitted
Acquisition (as well as all other Permitted Acquisitions theretofore consummated
after the first day of such Calculation Period) had occurred on the first day of
such Calculation Period, and such calculations shall show that such financial
covenants would have been complied with if the Permitted Acquisition had
occurred on the first day of such Calculation Period; (v) based on good faith
60
projections prepared by the Borrower for the period from the date of the
consummation of the respective Permitted Acquisition to the date which is one
year thereafter, the level of financial performance measured by the financial
covenants set forth in Sections 9.08 through 9.11, inclusive, shall be better
than or equal to such level as would be required to provide that no Default or
Event of Default would exist under the financial covenants contained in such
Sections 9.08 through 9.11, inclusive, as compliance with such financial
covenants would be required through the date which is one year from the date of
the consummation of the respective Permitted Acquisition; (vi) all of the
representations and warranties contained herein and in the other Credit
Documents shall be true and correct in all material respects with the same
effect as though such representations and warranties had been made on and as of
the date of such Permitted Acquisition (both before and after giving effect
thereto), unless stated to relate to a specific earlier date, in which case such
representations and warranties shall be true and correct in all material
respects as of such earlier date; (vii) the Maximum Permitted Consideration for
the respective Permitted Acquisition, when added to the aggregate Maximum
Permitted Consideration paid for all other Permitted Acquisitions consummated
during such fiscal year, does not exceed $50,000,000; (viii) after giving effect
to such proposed Permitted Acquisition and the payment of all amounts (including
fees and expenses) owing in connection therewith, the sum of the Total
Unutilized Revolving Loan Commitment then in effect plus the aggregate amount of
all Unrestricted cash and Cash Equivalents of the Borrower and the Subsidiary
Guarantors at such time shall equal or exceed the sum of (I) $25,000,000 plus
(II) an amount equal to the aggregate amount reasonably likely to be payable in
respect of all post-closing purchase price adjustments, earn-out payments,
non-compete payments and/or deferred purchase payments (or similar payments), in
each case required or which will be required in connection with such Permitted
Acquisition (and all other Permitted Acquisitions for which such purchase price
adjustments and other payments may be required to be made) as determined by the
Borrower in good faith; and (ix) the Borrower shall have delivered to the
Administrative Agent (with copies for each Lender) a certificate executed by one
of its Financial Officers certifying compliance with the requirements of
preceding clauses (i) through (viii), inclusive (to the extent applicable), and
containing the calculations (in reasonable detail) (A) required by preceding
clauses (iv), (v), (vii) and (viii) (to the extent applicable) and (B) necessary
to establish the Acquired EBITDA of the Acquired Entity or Business acquired
pursuant to each Permitted Acquisition for the most recently ended 12-month
period for which financial statements are available for such Acquired Entity or
Business; provided, however, the provisions of clauses (ii), (iii) and (v) above
shall not be applicable to Permitted Acquisitions in which the Maximum Permitted
Consideration is less than $5,000,000.
(b) At the time of each Permitted Acquisition involving the creation
or acquisition of a Subsidiary, or the acquisition of capital stock or other
equity interest of any Person, the capital stock or other equity interests
thereof created or acquired in connection with such Permitted Acquisition shall
be pledged for the benefit of the Secured Creditors pursuant to (and to the
extent required by) the Pledge Agreement.
(c) The Borrower will cause each Wholly-Owned Domestic Subsidiary
and, to the extent required by Section 8.13, each Wholly-Owned Foreign
Subsidiary, in each case which is formed to effect, or is acquired pursuant to,
a Permitted Acquisition to comply with, and to execute and deliver all of the
documentation as and to the extent required by, Sections 8.12 and 9.15, to the
reasonable satisfaction of the Administrative Agent.
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(d) The consummation of each Permitted Acquisition shall be deemed to
be a representation and warranty by the Borrower that the certifications
pursuant to this Section 8.16 are true and correct and that all conditions
thereto have been satisfied (or waived, to the extent applicable, in a prior
writing by the Required Lenders) and that same is permitted in accordance with
the terms of this Agreement, which representation and warranty shall be deemed
to be a representation and warranty for all purposes hereunder, including,
without limitation, Sections 7 and 10.
8.17 Cash Management System; etc. The Borrower and its Wholly-Owned
Subsidiaries shall maintain a cash management system in a manner and following
procedures consistent with their past business practices, which cash management
system, in any event, shall provide that all available cash of the Borrower and
the Subsidiary Guarantors (other than (i) nominal amounts of cash, (ii)
Restricted cash and (iii) cash required to be maintained at Subsidiary
Guarantors in order to (but only to the extent required to) maintain capital or
net worth requirements imposed on such Subsidiary Guarantors by governmental
authorities due to the regulated nature of such Subsidiary Guarantors'
operations) be swept on a daily basis to one of the Primary Concentration
Accounts in which the Collateral Agent has "control" over within the meaning of
Section 9-104 of the New York UCC.
SECTION 9. Negative Covenants. The Borrower hereby covenants and
agrees that on and after the Effective Date and until the Total Commitment and
all Letters of Credit have terminated (or have been cash collateralized or
supported by a backstop letter of credit as provided in Section 4.02(j)) and the
Loans, Notes and Unpaid Drawings (in each case, together with interest thereon),
Fees and all other Obligations (other than any indemnities described in Section
13.13 which are not then due and payable) incurred hereunder and thereunder, are
paid in full:
9.01 Liens. The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets (real or personal, tangible or intangible) of
the Borrower or any of its Subsidiaries, whether now owned or hereafter
acquired, or sell any such property or assets subject to an understanding or
agreement, contingent or otherwise, to repurchase such property or assets
(including sales of accounts receivable with recourse to the Borrower or any of
its Subsidiaries), or assign any right to receive income or permit the filing of
any financing statement under the UCC or any other similar notice of Lien under
any similar recording or notice statute; provided that the provisions of this
Section 9.01 shall not prevent the creation, incurrence, assumption or existence
of the following (Liens described below are herein referred to as "Permitted
Liens"):
(i) inchoate Liens for taxes, assessments or governmental charges or
levies not yet due or Liens for taxes, assessments or governmental charges
or levies being contested in good faith and by appropriate proceedings for
which adequate reserves have been established in accordance with generally
accepted accounting principles;
(ii) Liens in respect of property or assets of the Borrower or any of
its Subsidiaries imposed by law, which were incurred in the ordinary course
of business and do not secure Indebtedness for borrowed money, such as
carriers', warehousemen's, materialmen's, repairmen's, supplier's and
mechanics' liens and other similar Liens arising in the ordinary course of
62
business, and (x) which do not in the aggregate materially detract from the
value of the Borrower's and its Subsidiaries' property or assets taken as a
whole or materially impair the use thereof in the operation of the business
of the Borrower and its Subsidiaries taken as a whole or (y) which are
being contested in good faith by appropriate proceedings, which proceedings
have the effect of preventing the forfeiture or sale of the property or
assets subject to any such Lien;
(iii) Liens in existence on the Initial Borrowing Date which are
listed, and the property subject thereto described, in Schedule VIII, but
only to the respective date, if any, set forth in such Schedule VIII for
the removal, replacement and termination of any such Liens, plus renewals,
replacements and extensions of such Liens to the extent set forth on such
Schedule VIII provided that (x) the aggregate principal amount of the
Indebtedness, if any, secured by such Liens does not increase from that
amount outstanding at the time of any such renewal, replacement or
extension and (y) any such renewal, replacement or extension does not
encumber any additional assets or properties of the Borrower or any of its
Subsidiaries;
(iv) Liens created pursuant to the Security Documents (which Liens
include all Liens contemplated by Section 7.C of the Aetna Amended MSA (as
in effect on the Effective Date);
(v) licenses, sublicenses, leases or subleases granted to other
Persons not materially interfering with the conduct of the business of the
Borrower or any of its Subsidiaries;
(vi) Liens upon assets of the Borrower or any of its Subsidiaries
subject to Capitalized Lease Obligations to the extent such Capitalized
Lease Obligations are permitted by Section 9.04(v), provided that (x) such
Liens only serve to secure the payment of Indebtedness arising under such
Capitalized Lease Obligation and (y) the Lien encumbering the asset giving
rise to the Capitalized Lease Obligation does not encumber any other asset
of the Borrower or any Subsidiary;
(vii) purchase money security interests in Real Property acquired
after the Initial Borrowing Date or with respect to improvements thereto,
and Liens placed upon equipment acquired after the Initial Borrowing Date
and used in the ordinary course of business of the Borrower or any of its
Subsidiaries and (in each case) placed at the time of the acquisition (or
construction) thereof by the Borrower or such Subsidiary or within 270 days
thereafter to secure Indebtedness incurred to pay all or a portion of the
purchase (or construction) price thereof or to secure Indebtedness incurred
solely for the purpose of financing the acquisition (or construction) of
any such Real Property (or improvements thereto) or equipment or
extensions, renewals or replacements of any of the foregoing for the same
or a lesser amount, provided that (x) the Indebtedness secured by such
Liens is permitted by Section 9.04(v) and (y) in all events, the Lien
encumbering the Real Property (or improvements thereto) or equipment so
acquired (or constructed) does not encumber any other asset of the Borrower
or any of its Subsidiaries;
63
(viii) easements, rights-of-way, restrictions, encroachments and other
similar charges or encumbrances, and minor title deficiencies, in each case
not securing Indebtedness and not materially interfering with the conduct
of the business of the Borrower or any of its Subsidiaries;
(ix) Liens arising from precautionary UCC financing statement filings
regarding operating leases entered into in the ordinary course of business;
(x) Liens arising out of the existence of judgments or awards in
respect of which the Borrower or any of its Subsidiaries shall in good
faith be prosecuting an appeal or proceedings for review and in respect of
which there shall have been secured a subsisting stay of execution pending
such appeal or proceedings, provided that the aggregate amount of all cash
(including the stated amount of all letters of credit) and the fair market
value of all other property subject to such Liens does not exceed
$15,000,000 at any time outstanding;
(xi) statutory and common law landlords' liens under leases to which
the Borrower or any of its Subsidiaries is a party;
(xii) Liens (other than Liens imposed under ERISA) incurred in the
ordinary course of business in connection with workers compensation claims,
unemployment insurance, social security benefits and other similar forms of
governmental insurance benefits and (y) deposits securing the performance
of bids, tenders, leases (other than Capitalized Lease Obligations) and
contracts (other than Indebtedness) in the ordinary course of business,
statutory obligations, surety bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of business
and consistent with past practice (exclusive of obligations in respect of
the payment for borrowed money), provided that the aggregate amount of all
cash and the fair market value of all other property subject to all Liens
permitted by this sub-clause (y) shall not at any time exceed $2,000,000;
(xiii) Permitted Encumbrances;
(xiv) Liens on property or assets acquired pursuant to a Permitted
Acquisition, or on property or assets of a Subsidiary of the Borrower in
existence at the time such Subsidiary is acquired pursuant to a Permitted
Acquisition, provided that (x) any Indebtedness that is secured by such
Liens is permitted to exist under Section 9.04(xi), and (y) such Liens are
not incurred in connection with, or in contemplation or anticipation of,
such Permitted Acquisition and do not attach to any other asset of the
Borrower or any of its Subsidiaries;
(xv) customary Liens in favor of banking institutions encumbering
deposits (including the right of set-off) held by such banking institutions
incurred in the ordinary course of business;
(xvi) Liens solely in the nature of restrictions imposed on certain
Subsidiaries of the Borrower by governmental authorities to maintain
certain levels of capital or net worth requirements due to the regulated
nature of such Subsidiaries' operations;
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(xvii) deposit, escrow or similar accounts held by customers of the
Borrower or any of its Subsidiaries as security for the obligations of the
Borrower or any of its Subsidiaries under customer contracts entered into
in the ordinary course of business on a basis consistent with past
practices;
(xviii) fiduciary or similar accounts held by the Borrower or any of
its Subsidiaries for their respective customers and for which the Borrower
or its respective Subsidiaries process claims on an ASO basis, in each case
so long as such accounts are funded with cash provided to the Borrower or
its respective Subsidiaries by their respective customers; and
(xix) Liens not otherwise permitted by clauses (i) through (xviii) of
this Section 9.01 to the extent attaching to properties and assets not
constituting Collateral and with an aggregate fair value not in excess of,
and securing liabilities not in excess of, $10,000,000 in the aggregate at
any time outstanding.
In connection with the granting of Liens of the type described in
clauses (vi), (vii) and (xiv) of this Section 9.01 by the Borrower of any of its
Subsidiaries, the Administrative Agent and the Collateral Agent shall be
authorized to take any actions deemed appropriate by it in connection therewith
(including, without limitation, by executing appropriate lien releases or lien
subordination agreements in favor of the holder or holders of such Liens, in
either case solely with respect to the property subject to such Liens).
9.02 Consolidation, Merger, Purchase or Sale of Assets, etc. The
Borrower will not, and will not permit any of its Subsidiaries to, wind up,
liquidate or dissolve its affairs or enter into any partnership, joint venture,
or transaction of merger or consolidation, or convey, sell, lease or otherwise
dispose of all or any part of its property or assets, or enter into any
sale-leaseback transactions, or purchase or otherwise acquire (in one or a
series of related transactions) any part of the property or assets (other than
purchases or other acquisitions of inventory, materials, equipment and
intangible assets in the ordinary course of business) of any Person (or agree to
do any of the foregoing at any future time), except that:
(i) Capital Expenditures by the Borrower and its Subsidiaries shall be
permitted to the extent not in violation of Section 9.07;
(ii) each of the Borrower and its Subsidiaries may make sales of
inventory in the ordinary course of business;
(iii) Investments may be made to the extent permitted by Section 9.05;
(iv) each of the Borrower and its Subsidiaries may sell or otherwise
dispose of obsolete, uneconomic or worn-out equipment in the ordinary
course of business;
(v) the Borrower and its Subsidiaries may sell assets (other than the
capital stock or other equity interests of any Subsidiary unless all of the
capital stock and other equity interests of such Subsidiary then owned by
the Borrower and its Subsidiaries are sold in a sale permitted by this
clause (v)), so long as (v) no Default or Event of Default then exists or
would result therefrom, (w) each such sale is in an arm's-length
65
transaction and the Borrower or the respective Subsidiary receives at least
fair market value (as determined in good faith by the Borrower or such
Subsidiary, as the case may be), (x) the consideration received by the
Borrower or such Subsidiary consists of at least 75% cash and is paid at
the time of the closing of such sale, (y) the Net Sale Proceeds therefrom
are applied and/or reinvested as (and to the extent) required by Section
4.02(e) and (z) the aggregate amount of the proceeds received from all
assets sold pursuant to this clause (v) shall not exceed $12,500,000 in any
fiscal year of the Borrower;
(vi) each of the Borrower and its Subsidiaries may lease (as lessee)
or license (as licensee) real or personal property (so long as any such
lease or license does not create a Capitalized Lease Obligation except to
the extent permitted by Section 9.04(v));
(vii) each of the Borrower and its Subsidiaries may sell or discount,
in each case without recourse and in the ordinary course of business,
accounts receivable arising in the ordinary course of business, but only in
connection with the compromise or collection thereof and not as part of any
financing transaction or bulk sale;
(viii) each of the Borrower and its Subsidiaries may grant licenses,
sublicenses, leases or subleases to other Persons not materially
interfering with the conduct of the business of the Borrower or any of its
Subsidiaries, in each case so long as no such grant otherwise restricts any
Credit Party's right to xxxxx x xxxx on such assets or property in favor of
the Collateral Agent;
(ix) any Subsidiary of the Borrower may merge with and into, or be
dissolved or liquidated into, or transfer any of its assets to, the
Borrower or any Wholly-Owned Domestic Subsidiary of the Borrower which is a
Subsidiary Guarantor so long as (i) in the case of any such merger,
dissolution or liquidation involving the Borrower, the Borrower is the
surviving corporation of any such merger, dissolution or liquidation, (ii)
in all other cases, a Wholly-Owned Domestic Subsidiary which is a
Subsidiary Guarantor is the surviving corporation of any such merger,
dissolution or liquidation, (iii) the security interests granted to the
Collateral Agent for the benefit of the Secured Creditors pursuant to the
Security Documents in the assets of such Subsidiary shall remain in full
force and effect and perfected (to at least the same extent as in effect
immediately prior to such merger, dissolution or liquidation), and (iv) in
the case of any such transaction pursuant to which any consideration is
paid to a Person that is not a Wholly-Owned Subsidiary of the Borrower,
such consideration shall be permitted to be paid at such time only to the
extent that it could otherwise have been paid pursuant to (and the Borrower
shall be required to satisfy the provisions of ) Section 8.16 or 9.05(xiv),
as applicable; provided, however, so long as any New Senior Notes or the
New Aetna Note remain outstanding, no Subsidiary of the Borrower may merge
with or into, or be dissolved or liquidated into, or transfer any of its
assets to, the Borrower;
(x) any Foreign Subsidiary of the Borrower may merge with and into, or
be dissolved or liquidated into, or transfer any of its assets to, any
Wholly-Owned Foreign Subsidiary of the Borrower so long as (i) in the case
of any such merger, dissolution or liquidation, a Wholly-Owned Foreign
Subsidiary of the Borrower is the surviving corporation of any such merger,
dissolution or liquidation, and (ii) in the case of any such transaction
66
pursuant to which any consideration is paid to a Person that is not a
Wholly-Owned Subsidiary of the Borrower, such consideration shall be
permitted to be paid at such time only to the extent that it could
otherwise have been paid pursuant to (and the Borrower shall be required to
satisfy the provisions of) Section 8.16 or 9.05(xiv), as applicable;
(xi) Permitted Acquisitions may be made to the extent permitted by
Section 8.16; and
(xii) the Borrower or any of its Subsidiaries may sell the assets
which are the subject of the Aetna Purchase Option upon the terms and
conditions contained in the Aetna Asset Purchase Agreement.
To the extent the Required Lenders waive the provisions of this
Section 9.02 with respect to the sale of any Collateral, or any Collateral is
sold as permitted by this Section 9.02 (other than to the Borrower or a
Subsidiary thereof), such Collateral shall be sold free and clear of the Liens
created by the Security Documents, and the Administrative Agent and the
Collateral Agent shall be authorized to take any actions deemed appropriate in
order to effect the foregoing.
9.03 Dividends. The Borrower will not, and will not permit any of its
Subsidiaries to, authorize, declare or pay any Dividends with respect to the
Borrower or any of its Subsidiaries, except that:
(i) any Subsidiary of the Borrower may (x) pay cash Dividends to the
Borrower or to any Wholly-Owned Subsidiary of the Borrower and (y) if such
Subsidiary is not a Wholly-Owned Subsidiary of the Borrower, pay cash Dividends
to its shareholders generally so long as the Borrower or its respective
Subsidiary which owns the equity interest or interests in the Subsidiary paying
such Dividends receives at least its proportionate share thereof (based upon its
relative holdings of equity interests in the Subsidiary paying such Dividends
and taking into account that the relative preferences, if any, of the various
classes of equity interests in such Subsidiary);
(ii) so long as there shall exist no Default or Event of Default
(both before and after giving effect to the payment thereof), the Borrower may
repurchase outstanding shares of its Ordinary Common Stock (or options to
purchase such Ordinary Common Stock) following the death, disability, retirement
or termination of employment of employees, officers or directors of the Borrower
or any of its Subsidiaries, provided that the aggregate amount of all Dividends
paid by the Borrower pursuant to this clause (ii) shall not exceed $1,000,000 in
any fiscal year of the Borrower; and
(iii) the Borrower may pay regularly scheduled Dividends on its
Qualified Preferred Stock pursuant to the terms thereof through the issuance of
additional shares of such Qualified Preferred Stock and/or shares of Ordinary
Common Stock but not in cash or other property.
9.04 Indebtedness. The Borrower will not, and will not permit any of
its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness, except:
67
(i) Indebtedness incurred pursuant to this Agreement and the other
Credit Documents;
(ii) Existing Indebtedness outstanding on the Initial Borrowing Date
and listed on Schedule VI (as reduced by any permanent repayments of
principal thereof), without giving effect to any subsequent extension,
renewal or refinancing thereof except to the extent set forth on Schedule
VI, provided that the aggregate principal amount of the Indebtedness to be
extended, renewed or refinanced does not increase from that amount
outstanding at the time of any such extension, renewal or refinancing;
(iii) Indebtedness of the Borrower under Interest Rate Protection
Agreements entered into with respect to other Indebtedness permitted under
this Section 9.04 so long as the entering into of such Interest Rate
Protection Agreements are bona fide hedging activities and are not for
speculative purposes;
(iv) Indebtedness of the Borrower or any of its Subsidiaries under
Other Hedging Agreements providing protection to the Borrower and its
Subsidiaries against fluctuations in currency values in connection with the
Borrower's or any of its Subsidiaries foreign operations so long as the
entering into of such Other Hedging Agreements are bona fide hedging
activities and are not for speculative purposes;
(v) Indebtedness of the Borrower and its Subsidiaries evidenced by
Capitalized Lease Obligations (to the extent permitted by Section 9.07) and
purchase money Indebtedness described in Section 9.01(vii), provided that
in no event shall the sum of the aggregate principal amount of all
Capitalized Lease Obligations and purchase money Indebtedness permitted by
this clause (v) exceed $15,000,000 at any time outstanding;
(vi) intercompany Indebtedness among the Borrower and its Subsidiaries
to the extent permitted by Sections 9.05(viii) and (xiv);
(vii) to the extent that same constitutes Indebtedness, obligations in
respect of earn-out arrangements permitted pursuant to a Permitted
Acquisition;
(viii) Indebtedness of the Borrower under the New Senior Notes and the
other New Senior Notes Documents in an aggregate principal amount not to
exceed the remainder of (x) $300,000,000 (plus accrued and unpaid interest
on the Old Notes from and after October 31, 2003 at a rate per annum of
9-3/4%) minus (y) the Cash Distribution Amount (less the amount of any
repayments of principal of the New Senior Notes made after the Initial
Borrowing Date);
(ix) Indebtedness of the Borrower and the Subsidiary Guarantors under
the New Aetna Note and the Aetna Subsidiaries Subordinated Guaranty in an
aggregate principal amount of $48,915,205 (less the amount of any
repayments of principal thereof made after the Initial Borrowing Date);
(x) Indebtedness consisting of guaranties by the Borrower and the
Subsidiary Guarantors of each other's Indebtedness permitted under this
Agreement (other than obligations in respect of the New Senior Notes);
68
(xi) Indebtedness of a Subsidiary of the Borrower acquired pursuant to
a Permitted Acquisition (or Indebtedness assumed at the time of a Permitted
Acquisition of an asset securing such Indebtedness), provided that (x) such
Indebtedness was not incurred in connection with, or in anticipation or
contemplation of, such Permitted Acquisition, (y) such Indebtedness does
not constitute debt for borrowed money, it being understood and agreed that
Capitalized Lease Obligations and purchase money Indebtedness shall not
constitute debt for borrowed money for purposes of this clause (y) and (z)
the aggregate principal amount of all Indebtedness permitted by this clause
(xi) shall not exceed $10,000,000 at any one time outstanding;
(xii) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
(except in the case of daylight overdrafts) drawn against insufficient
funds in the ordinary course of business so long as such Indebtedness is
extinguished within four Business Days of the incurrence thereof;
(xiii) Indebtedness of the Borrower or any of its Subsidiaries which
may be deemed to exist in connection with agreements providing for
indemnification, purchase price adjustments and similar obligations in
connection with the acquisition or disposition of assets in accordance with
the requirements of this Agreement so long as any such obligations are
those of the Person making the respective acquisition or sale, and are not
guaranteed by any other Person except as permitted by Section 9.04(x); and
(xiv) so long as no Default or Event of Default then exists or would
result therefrom, additional Indebtedness of the Borrower and its
Subsidiaries not to exceed $10,000,000 in aggregate principal amount at any
time outstanding.
9.05 Advances, Investments and Loans. The Borrower will not, and will
not permit any of its Subsidiaries to, directly or indirectly, lend money or
credit or make advances to any Person, or purchase or acquire any stock,
obligations or securities of, or any other interest in, or make any capital
contribution to, any other Person, or purchase or own a futures contract or
otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, or hold any
cash or Cash Equivalents (each of the foregoing an "Investment" and,
collectively, "Investments"), except that the following shall be permitted:
(i) the Borrower and its Subsidiaries may acquire and hold accounts
receivables owing to any of them, if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with
customary trade terms of the Borrower or such Subsidiary;
(ii) the Borrower and its Subsidiaries may acquire and hold cash and
Cash Equivalents, provided that during any time that Revolving Loans or
Swingline Loans are outstanding, the aggregate amount of Unrestricted cash
and Cash Equivalents permitted to be held by the Borrower and its
Subsidiaries shall not exceed $40,000,000 for any period of five
consecutive Business Days;
69
(iii) the Borrower and its Subsidiaries may hold the Investments held
by them on the Initial Borrowing Date and described on Schedule IX,
provided that any additional Investments made with respect thereto shall be
permitted only if permitted under the other provisions of this Section
9.05;
(iv) the Borrower and its Subsidiaries may acquire and own investments
(including debt obligations) received in connection with the bankruptcy or
reorganization of suppliers and customers and in good faith settlement of
delinquent obligations of, and other disputes with, customers and suppliers
arising in the ordinary course of business;
(v) the Borrower and its Subsidiaries may make loans and advances to
their officers and employees for moving, relocation and travel expenses and
other similar expenditures, in each case in the ordinary course of business
consistent with past practices of the Borrower and its Subsidiaries in an
aggregate amount not to exceed $5,000,000 at any time outstanding
(determined without regard to any write-downs or write-offs of such loans
and advances);
(vi) the Borrower may enter into Interest Rate Protection Agreements
to the extent permitted by Section 9.04(iii);
(vii) the Borrower and its Subsidiaries may enter into Other Hedging
Agreements to the extent permitted by Section 9.04(iv);
(viii) the Borrower and its Wholly-Owned Subsidiaries may make
intercompany loans and advances between and among one another
(collectively, "Intercompany Loans"), provided that (i) the aggregate
principal amount of all Intercompany Loans made by the Credit Parties
pursuant to this Section 9.05(viii) to Wholly-Owned Subsidiaries of the
Borrower that are not Subsidiary Guarantors shall not exceed $25,000,000 at
any time outstanding (determined without regard to any write-downs or
write-offs thereof), (ii) no Intercompany Loans may be made by a Credit
Party to a Wholly-Owned Subsidiary of the Borrower that is not a Credit
Party at a time that any Default or Event of Default exists and is
continuing, (iii) any such Intercompany Loan made by a Credit Party shall
be evidenced by an Intercompany Note which shall be pledged to the
Collateral Agent pursuant to, and to the extent required by, the Pledge
Agreement, and (iv) each Intercompany Loan made to any Credit Party shall
include (or, if not evidenced by an Intercompany Note, the books and
records of the respective parties shall note that such Intercompany Loan
shall be subject to) the subordination provisions attached as Annex A to
the form of Intercompany Note;
(ix) the Borrower and the Subsidiary Guarantors may make capital
contributions to their respective Subsidiaries that are Subsidiary
Guarantors;
(x) so long as no Specified Default or Event of Default then exists or
would result therefrom, the Borrower and its Wholly-Owned Subsidiaries may
make cash capital contributions and Intercompany Loans to their respective
Wholly-Owned Subsidiaries as, and only to the extent, necessary to enable
such Wholly-Owned Subsidiaries to satisfy a net worth, net equity or
70
capital requirement or similar calculation or requirement imposed on such
Wholly-Owned Subsidiaries by any governmental authority having jurisdiction
of such Wholly-Owned Subsidiaries due to the regulated nature of such
Wholly-Owned Subsidiaries' operations;
(xi) Permitted Acquisitions shall be permitted in accordance with
Section 8.16;
(xii) the Borrower may acquire and hold obligations of one or more
officers, directors or other employees of the Borrower or any of its
Subsidiaries in connection with such officers', directors' or employees'
acquisition of shares of capital stock of the Borrower so long as no cash
is paid by the Borrower or any of its Subsidiaries to such officers,
directors or employees in connection with the acquisition of any such
obligations;
(xiii) the Borrower and its Subsidiaries may acquire and hold
promissory notes and other non-cash consideration issued by the purchaser
of assets in connection with a sale of such assets to the extent permitted
by Section 9.02(v); and
(xiv) so long as no Default or Event of Default then exists or would
result therefrom, the Borrower and its Subsidiaries may make Investments
not otherwise permitted by clauses (i) through (xiii) of this Section 9.05
in an aggregate amount not to exceed $15,000,000 at any time outstanding
(determined without regard to any write-downs or write-offs of such
Investments).
9.06 Transactions with Affiliates. The Borrower will not, and will
not permit any of its Subsidiaries to, enter into any transaction or series of
related transactions with any Affiliate of the Borrower or any of its
Subsidiaries, other than in the ordinary course of business and on terms and
conditions substantially as favorable to the Borrower or such Subsidiary as
would reasonably be obtained by the Borrower or such Subsidiary at that time in
a comparable arm's-length transaction with a Person other than an Affiliate,
except that:
(i) Dividends may be paid to the extent provided in Section 9.03;
(ii) loans may be made and other transactions may be entered into by
the Borrower and its Subsidiaries to the extent permitted by Sections 9.02, 9.04
and 9.05;
(iii) customary fees, indemnities and reimbursements may be paid to
officers and directors of the Borrower and its Subsidiaries;
(iv) the Borrower and its Subsidiaries may enter into, and may make
payments under, employment agreements, employee benefits plans, stock option
plans, indemnification provisions, severance arrangements, and other similar
compensatory arrangements with officers, employees and directors of the Borrower
and its Subsidiaries in the ordinary course of business;
(v) periodic allocations of overhead expenses among the Borrower and
its Subsidiaries may be made; and
71
(vi) the Borrower may pay to any Subsidiary Guarantor and any
Subsidiary of the Borrower may pay to the Borrower or any Subsidiary Guarantor
management, consulting or similar fees on a basis consistent with past
practices.
Notwithstanding anything to the contrary contained in this Agreement, the
Borrower will not, and will not permit any of its Subsidiaries to, pay any
management, consulting or similar fees to any of their respective Affiliates
other than as permitted by clause (vi) above.
9.07 Capital Expenditures. (a) The Borrower will not, and will not
permit any of its Subsidiaries to, make any Capital Expenditures, except that
during any fiscal year of the Borrower set forth below (taken as one accounting
period), the Borrower and its Subsidiaries may make Capital Expenditures so long
as the aggregate amount of all such Capital Expenditures does not exceed in any
fiscal year of the Borrower set forth below the amount set forth opposite such
fiscal year below:
Fiscal Year Ending On Amount
--------------------- ------
December 31, 2004 $70,000,000
December 31, 2005 $50,000,000
December 31, 2006 $40,000,000
December 31, 2007 $40,000,000
December 31, 2008 $30,000,000
(b) In addition to the foregoing, in the event that the amount of
Capital Expenditures permitted to be made by the Borrower and its Subsidiaries
pursuant to clause (a) above in any fiscal year of the Borrower (before giving
effect to any increase in such permitted Capital Expenditure amount pursuant to
this clause (b)) is greater than the amount of Capital Expenditures actually
made by the Borrower and its Subsidiaries during such fiscal year, the lesser of
(x) such excess and (y) 50% of the applicable permitted scheduled Capital
Expenditure amount as set forth in such clause (a) above for such fiscal year
may be carried forward and utilized to make Capital Expenditures in the
immediately succeeding fiscal year, provided that no amounts once carried
forward pursuant to this Section 9.07(b) may be carried forward to any fiscal
year of the Borrower thereafter and such amounts may only be utilized after the
Borrower and its Subsidiaries have utilized in full the permitted Capital
Expenditure amount for such fiscal year as set forth in clause (a) above
(without giving effect to any increase in such amount pursuant to this clause
(b)).
(c) In addition to the foregoing, the Borrower and its Subsidiaries
may make Capital Expenditures with the amount of Net Sale Proceeds received by
the Borrower or any of its Subsidiaries from any Asset Sale so long as such Net
Sale Proceeds are reinvested within 180 days following the date of such Asset
Sale, but only to the extent that an amount equal to such Net Sale Proceeds are
not otherwise required to be applied pursuant to Section 4.02(e).
(d) In addition to the foregoing, the Borrower or any of its
Subsidiaries may make Capital Expenditures with the amount of Net Insurance
Proceeds received by the Borrower or any of its Subsidiaries from any Recovery
Event so long as such Net Insurance Proceeds are used to replace or restore any
properties or assets in respect of which such Net Insurance Proceeds were paid
within 180 days following the date of receipt of such Net Insurance Proceeds
from such Recovery Event, but only to the extent that an amount equal to such
Net Insurance Proceeds are not otherwise required to be applied pursuant to
Section 4.02(f).
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(e) In addition to the foregoing, the Borrower and its Wholly-Owned
Subsidiaries that are Subsidiary Guarantors may consummate Permitted
Acquisitions in accordance with the requirements of Section 8.16.
9.08 Consolidated Interest Coverage Ratio. The Borrower will not
permit the Consolidated Interest Coverage Ratio for any Test Period ending on
the last day of any fiscal quarter of the Borrower set forth below to be less
than the ratio set forth opposite such fiscal quarter below:
Fiscal Quarter Ended Ratio
-------------------- -----
March 31, 2004 1.85:1.00
June 30, 2004 2.25:1.00
September 30, 2004 2.65:1.00
December 31, 2004 2.95:1.00
March 31, 2005 3.05:1.00
June 30, 2005 3.20:1.00
September 30, 2005 3.40:1.00
December 31, 2005 3.40:1.00
March 31, 2006 3.40:1.00
June 30, 2006 3.40:1.00
September 30, 2006 3.40:100
December 31, 2006 3.40:1.00
March 31, 2007 3.40:1.00
June 30, 2007 3.40:1.00
September 30, 2007 3.45:1.00
December 31, 2007
and the last day of each fiscal quarter of the Borrower thereafter 3.50:1.00
73
9.09 Minimum Consolidated EBITDA. The Borrower will not permit
Consolidated EBITDA for any Test Period ending on the last day of any fiscal
quarter of the Borrower set forth below be less than the amount set forth
opposite such fiscal quarter below:
Fiscal Quarter Ended Amount
-------------------- ------
March 31, 2004 $112,000,000
June 30, 2004 $98,500,000
September 30, 2004 $101,000,000
December 31, 2004 $106,500,000
March 31, 2005 $111,000,000
June 30, 2005 $117,000,000
September 30, 2005 $125,000,000
December 31, 2005 $133,000,000
March 31, 2006 $128,500,000
June 30, 2006 $122,000,000
September 30, 2006 $113,000,000
December 31, 2006 $104,000,000
March 31, 2007 $104,000,000
June 30, 2007 $105,000,000
September 30, 2007 $105,500,000
December 31, 2007 $106,000,000
March 31, 2008 $107,000,000
June 30, 2008 $108,000,000
Notwithstanding the foregoing, in the event that Consolidated EBITDA
for any Test Period ending on the last day of any fiscal quarter of the Borrower
set forth above in this Section 9.09 is less than the amount set forth opposite
such fiscal quarter (any such fiscal quarter is referred to herein as a "Default
Quarter"), the Borrower shall have the right to cure any Default or Event of
Default that has so arisen solely under this Section 9.09 by causing one or more
74
members of the Capital Cure Contribution Group to make a cash equity
contribution to the Borrower within 15 days after the earliest of (A) the date
that the Borrower obtains knowledge of such Default or Event of Default, (B) the
delivery of the financial statements (and related officer's certificate)
pursuant to Section 8.01 in respect of the respective Default Quarter and (C)
the required date of delivery of such financial statements (and related
officer's certificate) in respect of such Default Quarter in an aggregate amount
equal to the applicable Capital Contribution Cure Amount (each such cash equity
contribution is referred to herein as a "Capital Cure Contribution") , in each
case so long as (i) the Borrower shall have notified the Administrative Agent
and each Lender within five Business Days after the earliest of the dates
referred to above in this paragraph that the Borrower has elected to cure such
Default or Event of Default and the amount of the applicable Capital
Contribution Cure Amount, (ii) within 15 days after the earliest of the dates
referred to above in this paragraph, one or more members of the Capital Cure
Contribution Group shall have made a Capital Cure Contribution in an aggregate
amount equal to the applicable Capital Contribution Cure Amount and the
Administrative Agent shall have received notice of same from the Borrower and
(iii) 100% of the proceeds of such Capital Cure Contribution are applied on the
date of receipt thereof in accordance with Section 4.02(c). From and after the
consummation of any Capital Cure Contribution, compliance with the covenants
contained in this Section 9.09 shall be recalculated on a pro forma basis in
accordance with the immediately succeeding sentence. Each Capital Cure
Contribution made in accordance with the requirements of the immediately
preceding sentence shall be included in Consolidated EBITDA (up to the
applicable Capital Contribution Cure Amount) for the applicable Default Quarter
for purposes of thereafter determining whether the Borrower is in compliance
with the covenants set forth in this Section 9.09 only (and not for any other
covenants) for the Test Period ending at the end of such Default Quarter and for
subsequent Test Periods which include such Default Quarter. It is understood and
agreed by the parties hereto that (A) nothing in this paragraph shall prevent
the occurrence of any Default or, if such Default continues unremedied for three
or more Business Days, any Event of Default (or the exercise of any remedies as
a result thereof while such Event of Default continues) if the Borrower shall
fail to be in compliance with this Section 9.09 as of the end of any Test Period
and (B) the Borrower only shall have the right to cure such Default or Event of
Default strictly in accordance with the terms of this paragraph.
9.10 Total Leverage Ratio. The Borrower will not permit the Total
Leverage Ratio at any time during a period set forth below to be greater than
the ratio set forth opposite such period below:
Period Ratio
------ -----
Initial Borrowing Date through and including March 30, 2005 4.00:1.00
March 31, 2005 through and including September 29, 2005 3.50:1.00
September 30, 2005 and thereafter 3.00:1.00
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9.11 Modified Leverage Ratio. The Borrower will not permit the
Modified Leverage Ratio at any time during a period set forth below to be
greater than the ratio set forth opposite such period below:
Period Ratio
------ -----
Initial Borrowing Date through and including December 30, 2004 1.50:1.00
December 31, 2004 through and including September 29, 2005 1.25:1.00
September 30, 2005 and thereafter 1.00:1.00
9.12 Limitations on Payments of Certain Indebtedness; Modifications of Certain
Indebtedness Documents, Certificate of Incorporation, By-Laws and Certain Other
Agreements, etc. The Borrower will not, and will not permit any of its
Subsidiaries to:
(i) make (or give any notice in respect of) any voluntary or optional
payment or prepayment on or redemption or acquisition for value of, or any
prepayment or redemption as a result of any asset sale, change of control
or similar event of (including, in each case without limitation, by way of
depositing with the trustee with respect thereto, or with any other Person,
money or securities before due for the purpose of paying when due), any New
Senior Note or the New Aetna Note, provided, however, (x) that the New
Aetna Note may be prepaid upon the exercise of the Aetna Purchase Option in
accordance with the terms of the Aetna Documents and (y) the Borrower may
purchase, repurchase or redeem outstanding New Senior Notes so long as (I)
no Default or Event of Default then exists or would result therefrom, (II)
the aggregate amount of cash expended to effect all such purchases,
repurchases and redemptions shall not exceed $50,000,000, and (III)
immediately after giving effect to any such purchase, repurchase or
redemption, the sum of the Total Unutilized Revolving Loan Commitment then
in effect plus the aggregate amount of all Unrestricted cash and Cash
Equivalents of the Borrower and the Subsidiary Guarantors at such time
shall equal at least $25,000,000;
(ii) amend or modify, or permit the amendment or modification of any
provision of, (x) any New Senior Notes Document, the New Aetna Note or the
Aetna Subsidiaries Subordinated Guaranty other than any such amendments or
modifications (A) to the New Senior Notes Documents or the New Aetna Note
which could not reasonably be expected to be adverse to the interests of
the Lenders and which have been approved in writing by the Administrative
Agent (such approval not to be unreasonably withheld) and (B) to the Aetna
Subsidiaries Subordinated Guaranty to evidence conforming changes that have
been, or are then being, made to the Subsidiaries Guaranty taking into
account, however, the subordination provisions of the Aetna Subsidiaries
Subordinated Guaranty (to the extent applicable) and so long as the form of
such amendment is reasonably satisfactory to the Administrative Agent, or
(y) the Aetna Asset Purchase Agreement, the Aetna Purchase Option, the Plan
of Reorganization or the Disclosure Statement other than any such
amendments or modifications to the Aetna Asset Purchase Agreement and the
Aetna Purchase Option which do not reduce the price to be paid or expand
the assets to be purchased pursuant to the Aetna Purchase Option or which
could not reasonably be expected to be adverse to the interests of the
Lenders;
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(iii) amend, modify or change its certificate or articles of
incorporation (including, without limitation, by the filing or modification
of any certificate or articles of designation), certificate of formation,
limited liability company agreement or by-laws (or the equivalent
organizational documents), as applicable, or any agreement entered into by
it with respect to its capital stock or other equity interests (including
any Shareholders' Agreement), or enter into any new agreement with respect
to its capital stock or other equity interests, unless such amendment,
modification, change or other action contemplated by this clause (iii)
could not reasonably be expected to be adverse to the interests of the
Lenders in any material respect; and
(iv) amend or modify, or permit the amendment or modification of, any
Tax Sharing Agreement or enter into any new tax sharing agreement, tax
allocation agreement or similar agreements in each case without the prior
written consent of the Administrative Agent except for any such agreements
exclusively between or among the Borrower and the Subsidiary Guarantors.
9.13 Limitation on Certain Restrictions on Subsidiaries. The Borrower
will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any such Subsidiary to (a) pay
dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by the Borrower or any of its
Subsidiaries, or pay any Indebtedness owed to the Borrower or any of its
Subsidiaries, (b) make loans or advances to the Borrower or any of its
Subsidiaries or (c) transfer any of its properties or assets to the Borrower or
any of its Subsidiaries, except for such encumbrances or restrictions existing
under or by reason of (i) applicable law or any applicable regulation, rule,
order, approval, license or other restrictions issued by any governmental
authority, (ii) this Agreement and the other Credit Documents, (iii) the New
Senior Note Documents, (iv) the Aetna Documents (as in effect on the Initial
Borrowing Date and as the same may thereafter be amended or modified in
accordance with the terms of the Aetna Documents and this Agreement so long as
the terms of any restrictions described in clauses (a) through (c) above are no
more restrictive on the Borrower or any of its Subsidiaries in any material
respect than those terms as in effect on the Initial Borrowing Date), (v)
customary provisions restricting subletting or assignment of any lease governing
any leasehold interest of the Borrower or any of its Subsidiaries, (vi)
customary provisions restricting assignment of any licensing agreement (in which
the Borrower or any of its Subsidiaries is the licensee) or other contract
entered into by the Borrower or any of its Subsidiaries in the ordinary course
of business, (vii) restrictions on the transfer of any asset pending the close
of the sale of such asset, (viii) restrictions on the transfer of any asset
subject to a Lien permitted by Section 9.01(iii), (vi), (vii), (xiv), (xvii),
(xviii) or (xix) and (ix) customary restrictions in the respective Subsidiary's
industry imposed by customers under contractual arrangements entered into in the
ordinary course of business with respect to cash or other deposits or minimum
net worth or similar requirements.
77
9.14 Business, etc. (a) The Borrower will not, and will not permit
any of its Subsidiaries to, engage in any business other than the businesses
engaged in by the Borrower and its Subsidiaries as of the Initial Borrowing Date
and reasonable extensions thereof and businesses ancillary or complimentary
thereto.
(b) Notwithstanding anything to the contrary contained in this
Agreement, so long as any New Senior Notes or the New Aetna Note remain
outstanding the Borrower will not own any material assets other than (i) the
capital stock of its Subsidiaries, (ii) cash and Cash Equivalents, (iii)
intellectual property, (iv) the lease of the Real Property on which the
Borrower's headquarters is located and (v) other assets held by the Borrower in
the ordinary course of its business as conducted on the Initial Borrowing Date
and on a basis consistent with past practice.
9.15 Limitation on Creation of Subsidiaries. The Borrower will not,
and will not permit any of its Subsidiaries to, establish, create or acquire
after the Initial Borrowing Date any Subsidiary, provided that the Borrower and
its Wholly Owned Subsidiaries may (x) establish, create and, to the extent
permitted by this Agreement, acquire Wholly-Owned Subsidiaries and (y)
establish, create and acquire non-Wholly-Owned Subsidiaries to the extent
permitted by Section 9.05(xiv) or by the definition of Permitted Acquisition, in
each case so long as (i) all of the capital stock and other equity interests of
such new Subsidiary are (to the extent owned by a Credit Party) pledged to the
Collateral Agent pursuant to, and to the extent required by, the Pledge
Agreement, (ii) each such new Wholly-Owned Domestic Subsidiary (and, to the
extent required by Section 8.13, each new Wholly-Owned Foreign Subsidiary)
executes and delivers to the Collateral Agent a counterpart of the Subsidiaries
Guaranty, the Pledge Agreement and the Security Agreement, (iii) each such new
Wholly-Owned Domestic Subsidiary (and, to the extent required by Section 8.13,
each new Wholly-Owned Foreign Subsidiary) enters into such Mortgages and other
Additional Security Documents as the Administrative Agent or the Required
Lenders may require pursuant to Section 8.12 and (iv) each such new Wholly-Owned
Domestic Subsidiary (and to the extent required by Section 8.13, each new
Wholly-Owned Foreign Subsidiary) executes and delivers all other relevant
documentation (including opinions of counsel, resolutions, officers'
certificates and UCC financing statements) of the type described in Section 5 as
such new Subsidiary would have had to deliver if it were a Credit Party on the
Initial Borrowing Date; provided, however, that neither the Borrower nor any
Subsidiary thereof shall be required to take any action of the type described in
preceding clauses (i) through (iv) to the extent (but only to the extent) that
the taking of any such action either (A) would violate any law, regulation,
rule, order, approval, license or other restriction applicable to the Borrower
or such Subsidiary and imposed by any governmental authority due to the
regulated nature of the Borrower's or such Subsidiary's operations or (B) would
reasonably be expected to cause such Wholly-Owned Subsidiary to fail to satisfy
a net worth, net equity or capital requirement or similar calculation or
requirement imposed on such Wholly-Owned Subsidiary by any governmental
authority having jurisdiction of such Wholly-Owned Subsidiary due to the
regulated nature of such Wholly-Owned Subsidiary's operations.
9.16 Limitation on Issuance of Capital Stock. (a) The Borrower will
not, and will not permit any of its Subsidiaries to, issue (i) any preferred
stock or other preferred equity interests other than (x) Qualified Preferred
Stock of the Borrower or (y) any preferred stock issued by a Subsidiary of the
78
Borrower to the extent that such preferred stock is held by the Borrower or a
Wholly-Owned Subsidiary thereof or (ii) any redeemable common stock or other
redeemable common equity interests other than common stock or other redeemable
common equity interests that is redeemable at the sole option of the Borrower or
such Subsidiary, as the case may be.
(b) The Borrower will not permit any of its Subsidiaries to issue any
capital stock or other equity interests (including by way of sales of treasury
stock) or any options or warrants to purchase, or securities convertible into,
capital stock or other equity interests, except (i) for transfers and
replacements of then outstanding shares of capital stock or other equity
interests, (ii) for stock splits, stock dividends and issuances which do not
decrease the percentage ownership of the Borrower or any of its Subsidiaries in
any class of the capital stock or other equity interests of such Subsidiary,
(iii) in the case of Foreign Subsidiaries, to qualify directors and other
nominal amounts required to be held by local nationals in each case to the
extent required by applicable law, or (iv) for issuances by newly created or
acquired Subsidiaries in accordance with the terms of this Agreement.
(c) The Borrower will not permit any Person, other than one or more
members of the Onex Group, to own or hold any MVS Common Stock.
9.17 Changes to Legal Names, Organizational Identification Numbers,
Jurisdiction or Type or Organization. The Borrower will not, and will not permit
any of the other Credit Parties to, change its legal name until (i) it shall
have given to the Collateral Agent not less than 15 days prior written notice of
its intention so to do, clearly describing such new name and providing other
information in connection therewith as the Collateral Agent may reasonably
request, and (ii) with respect to such new name, it shall have taken all action
reasonably requested by the Collateral Agent to maintain the security interests
of the Collateral Agent in the Collateral intended to be granted pursuant to the
applicable Security Documents at all times fully perfected and in full force and
effect. In addition, to the extent that any Credit Party does not have an
organizational identification number on the Initial Borrowing Date and later
obtains one, or if there is any change in the organizational identification
number of any Credit Party, the Borrower or such other Credit Party shall
promptly notify the Collateral Agent of such new or changed organizational
identification number and shall take all actions reasonably satisfactory to the
Collateral Agent to the extent necessary to maintain the security interests of
the Collateral Agent in the Collateral intended to be granted pursuant to the
applicable Security Documents fully perfected and in full force and effect.
Furthermore, the Borrower will not, and will not permit any of the other Credit
Parties to, change its jurisdiction of organization or its type of organization
until (i) it shall have given to the Collateral Agent not less than 15 days
prior written notice of its intention so to do, clearly describing such new
jurisdiction of organization and/or type of organization and providing such
other information in connection therewith as the Collateral Agent may reasonably
request (although no change pursuant to this Section 9.17 shall be permitted to
the extent that it involves a "Registered Organization" (as defined in the
Security Agreement) ceasing to constitute same) and (ii) with respect to such
new jurisdiction and/or type of organization, it shall have taken all actions
reasonably requested by the Collateral Agent to maintain the security interests
of the Collateral Agent in the Collateral intended to be granted pursuant to the
Security Documents at all times fully perfected and in full force and effect.
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SECTION 10. Events of Default. Upon the occurrence of any of the
following specified events (each an "Event of Default"):
10.01 Payments. The Borrower shall (i) default in the payment when
due of any principal of any Loan or any Note or any Unpaid Drawing or (ii)
default, and such default shall continue unremedied for three or more Business
Days, in the payment when due of any interest on any Loan, Note or Unpaid
Drawing or any Fees or any other amounts owing hereunder or under any other
Credit Document; or
10.02 Representations, etc. Any representation, warranty or statement
made or deemed made by any Credit Party herein or in any other Credit Document
or in any certificate delivered to the Administrative Agent or any Lender
pursuant hereto or thereto shall prove to be untrue in any material respect on
the date as of which made or deemed made; or
10.03 Covenants. The Borrower or any of its Subsidiaries shall (i)
default in the due performance or observance by it of any term, covenant or
agreement contained in Section 8.01(g)(i), 8.08, 8.11, 8.16 or Section 9 (other
than Section 9.09), (ii) default in the due performance or observance by it of
Section 9.09 and such default shall continue unremedied for a period of three or
more Business Days after the end of the applicable Test Period or (iii) default
in the due performance or observance by it of any other term, covenant or
agreement contained in this Agreement or in any other Credit Document (other
than those set forth in Sections 10.01 and 10.02) and such default shall
continue unremedied for a period of 30 days after written notice thereof to the
defaulting party by the Administrative Agent or the Required Lenders; or
10.04 Default Under Other Agreements. (i) The Borrower or any of its
Subsidiaries shall (x) default in any payment of any Indebtedness (other than
the Obligations) beyond the period of grace, if any, provided in an instrument
or agreement under which such Indebtedness was created or (y) default in the
observance or performance of any agreement or condition relating to any
Indebtedness (other than the Obligations) or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such Indebtedness
(or a trustee or agent on behalf of such holder or holders) to cause (determined
without regard to whether any notice is required), any such Indebtedness to
become due prior to its stated maturity, or (ii) any Indebtedness (other than
the Obligations) of the Borrower or any of its Subsidiaries shall be declared to
be (or shall become) due and payable, or required to be prepaid other than by a
regularly scheduled required prepayment, prior to the stated maturity thereof,
provided that it shall not be a Default or an Event of Default under this
Section 10.04 unless the aggregate principal amount of all Indebtedness as
described in preceding clauses (i) and (ii) is at least $15,000,000; or
10.05 Bankruptcy, etc. The Borrower or any of its Subsidiaries shall
commence a voluntary case concerning itself under Title 11 of the United States
Code entitled "Bankruptcy," as now or hereafter in effect, or any successor
thereto (the "Bankruptcy Code"); or an involuntary case is commenced against the
Borrower or any of its Subsidiaries, and the petition is not controverted within
10 days, or is not dismissed within 60 days, after commencement of the case; or
a custodian (as defined in the Bankruptcy Code) is appointed for, or takes
charge of, all or substantially all of the property of the Borrower or any of
80
its Subsidiaries which custodian is not dismissed within 60 days after the date
of such appointment or the date such custodian takes charge, or the Borrower or
any of its Subsidiaries commences any other proceeding under any reorganization,
arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or
liquidation or similar law of any jurisdiction whether now or hereafter in
effect relating to the Borrower or any of its Subsidiaries, or there is
commenced against the Borrower or any of its Subsidiaries any such proceeding
which remains undismissed for a period of 60 days, or the Borrower or any of its
Subsidiaries is adjudicated insolvent or bankrupt; or any order of relief or
other order approving any such case or proceeding is entered; or the Borrower or
any of its Subsidiaries suffers any appointment of any custodian or the like for
it or any substantial part of its property to continue undischarged or unstayed
for a period of 60 days; or the Borrower or any of its Subsidiaries makes a
general assignment for the benefit of creditors; or any corporate, limited
liability company or similar action is taken by the Borrower or any of its
Subsidiaries for the purpose of effecting any of the foregoing; or
10.06 ERISA. (a) Any ERISA Plan shall fail to satisfy the minimum funding
standard required for any plan year or part thereof under Section 412 of the
Code or Section 302 of ERISA or a waiver of such standard or extension of any
amortization period is sought or granted under Section 412 of the Code or
Section 303 or 304 of ERISA, a Reportable Event shall have occurred, a
contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of an ERISA
Plan subject to Title IV of ERISA shall be subject to the advance reporting
requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph
(b)(1) thereof) and an event described in subsection .62, .63, .64, .65, .66,
..67 or .68 of PBGC Regulation Section 4043 shall be reasonably expected to occur
with respect to such ERISA Plan within the following 30 days, any ERISA Plan
which is subject to Title IV of ERISA shall have had or is likely to have a
trustee appointed to administer such ERISA Plan, any ERISA Plan which is subject
to Title IV of ERISA is, shall have been or is likely to be terminated or to be
the subject of termination proceedings under ERISA, any ERISA Plan shall have an
Unfunded Current Liability, a contribution required to be made with respect to
an ERISA Plan or a Foreign Pension Plan has not been timely made, the Borrower
or any of its Subsidiaries or any ERISA Affiliate has incurred or is likely to
incur any liability to or on account of an ERISA Plan under Section 409, 502(i),
502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section
401(a)(29), 4971 or 4975 of the Code or on account of a group health plan (as
defined in Section 607(1) of ERISA or Section 4980B(g)(2) of the Code) under
Section 4980B of the Code, or the Borrower or any of its Subsidiaries has
incurred or is likely to incur liabilities pursuant to one or more employee
welfare benefit plans (as defined in Section 3(1) of ERISA) that provide
benefits to retired employees or other former employees (other than as required
by Section 601 of ERISA) or ERISA Plans or Foreign Pension Plans, a "default"
within the meaning of Section 4219(c)(5) of ERISA shall occur with respect to
any ERISA Plan, any applicable law, rule or regulation is adopted, changed or
interpreted, or the interpretation or administration thereof is changed, in each
case after the date hereof, by any governmental authority or agency or by any
court (a "Change of Law"), or, as a result of a Change in Law, an event occurs
following a Change in Law, with respect to or otherwise affecting any ERISA
Plan; (b) there shall result from any such event or events the imposition of a
lien, the granting of a security interest, or a liability or a material risk of
incurring a liability; and (c) such lien, security interest or liability, either
individually and/or in the aggregate, has had, or could reasonably be expected
to have, in the opinion of the Required Lenders, a Material Adverse Effect; or
81
10.07 Security Documents. After the execution and delivery thereof,
any of the Security Documents shall cease to be in full force and effect, or
shall cease to give the Collateral Agent for the benefit of the Secured
Creditors the Liens, rights, powers and privileges purported to be created
thereby (including, without limitation, a perfected security interest in, and
Lien on, all of the Collateral, in favor of the Collateral Agent, superior to
and prior to the rights of all third Persons (except as permitted by Section
9.01), and subject to no other Liens (except as permitted by Section 9.01), or
any Credit Party shall default in the due performance or observance of any term,
covenant or agreement on its part to be performed or observed pursuant to any
such Security Document and such default shall continue beyond the period of
grace, if any, specifically applicable thereto pursuant to the terms of such
Security Document; or
10.08 Subsidiaries Guaranty. The Subsidiaries Guaranty or any
provision thereof shall cease to be in full force or effect as to any Subsidiary
Guarantor, or any Subsidiary Guarantor or any Person acting for or on behalf of
such Subsidiary Guarantor shall deny or disaffirm such Subsidiary Guarantor's
obligations under the Subsidiaries Guaranty or any Subsidiary Guarantor shall
default in the due performance or observance of any term, covenant or agreement
on its part to be performed or observed pursuant to the Subsidiaries Guaranty;
or
10.09 Judgments. One or more judgments or decrees shall be entered
against the Borrower or any of its Subsidiaries involving in the aggregate for
the Borrower and its Subsidiaries a liability (not paid or fully covered by a
reputable and solvent insurance company) and such judgments and decrees either
shall be final and non-appealable or shall not be vacated, discharged or stayed
or bonded pending appeal for any period of 30 consecutive days, and the
aggregate amount of all such judgments equals or exceeds $15,000,000; or
10.10 Change of Control. A Change of Control shall occur;
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent, upon the written request of
the Required Lenders, shall by written notice to the Borrower, take any or all
of the following actions, without prejudice to the rights of the Administrative
Agent, any Lender or the holder of any Note to enforce its claims against any
Credit Party (provided that, if an Event of Default specified in Section 10.05
shall occur with respect to the Borrower, the result which would occur upon the
giving of written notice by the Administrative Agent as specified in clauses (i)
and (ii) below shall occur automatically without the giving of any such notice):
(i) declare the Total Commitment terminated, whereupon all Commitments of each
Lender shall forthwith terminate immediately and any Commitment Commission shall
forthwith become due and payable without any other notice of any kind; (ii)
declare the principal of and any accrued interest in respect of all Loans and
the Notes and all other Obligations owing hereunder and thereunder to be,
whereupon the same shall become, forthwith due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
each Credit Party; (iii) terminate any Letter of Credit which may be terminated
in accordance with its terms; (iv) direct the Borrower to pay (and the Borrower
agrees that upon receipt of such notice, or upon the occurrence of an Event of
Default specified in Section 10.05 with respect to the Borrower, it will pay) to
the Administrative Agent at the Payment Office such additional amount of cash or
Cash Equivalents, to be held as security by the Administrative Agent, as is
equal to the aggregate Stated Amount of all Letters of Credit issued for the
account of the Borrower and then outstanding; (v) enforce, as Collateral Agent,
all of the Liens and security interests created pursuant to the Security
Documents; and (vi) apply any cash collateral held by the Administrative Agent
pursuant to Section 4.02 to the repayment of the Obligations.
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SECTION 11. Defined Terms. As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):
"Acquired EBITDA" shall mean, for any Acquired Entity or Business for
any period, the Consolidated EBITDA as determined for such Acquired Entity or
Business for such period on the basis substantially the same (with necessary
reference changes) as provided in the definition of Consolidated EBITDA
contained herein.
"Acquired Entity or Business" shall mean either (x) the assets
constituting a business, division or product line of any Person not already a
Subsidiary of the Borrower or (y) 100% of the capital stock of any such Person,
which Person shall, as a result of such stock acquisition, become a Wholly-Owned
Subsidiary of the Borrower (or shall be merged with and into the Borrower or a
Wholly-Owned Subsidiary of the Borrower, with the Borrower or such Wholly-Owned
Subsidiary being the surviving Person).
"Additional Security Documents" shall have the meaning provided in
Section 8.12.
"Administrative Agent" shall mean DBAG, in its capacity as
Administrative Agent for the Lenders hereunder, and shall include any successor
to the Administrative Agent appointed pursuant to Section 12.09.
"Aetna" shall mean Aetna Inc., a Pennsylvania corporation.
"Aetna Amended MSA" shall mean the Second Amendment to the Master
Service Agreement, dated as of March 11, 2003, entered into by and among the
Borrower (on behalf of itself and all of its affiliates), and Aetna (on behalf
of itself and all of its applicable affiliates, as the same may be further
amended, modified or supplemented from time to time.
"Aetna Asset Purchase Agreement" shall mean the form of asset
purchase agreement attached as Exhibit D to the Aetna Amended MSA, as the same
may be amended, modified or supplemented from time to time in accordance with
the terms thereof and hereof.
"Aetna Documents" shall mean, collectively, the Aetna Amended MSA,
the Aetna Asset Purchase Agreement, the New Aetna Note, the Aetna Subsidiaries
Subordinated Guaranty and the New Aetna Warrant.
"Aetna Letter of Credit" shall mean the "Letter of Credit" as defined
in the Aetna Amended MSA.
"Aetna Purchased Assets" shall mean the "Purchased Assets" under, and
as defined in, the Aetna Asset Purchase Agreement.
83
"Aetna Purchase Option" shall mean Aetna's option to purchase the
Aetna-Purchased Assets from the Borrower and/or its applicable Subsidiaries
pursuant to the Aetna Amended MSA and the Aetna Asset Purchase Agreement.
"Aetna Subsidiaries Subordinated Guaranty" shall mean the
subordinated guaranty, dated as of January 5, 2004, issued by the Subsidiary
Guarantors to Aetna guaranteeing the Borrower's obligations under the New Aetna
Note and the Aetna Asset Purchase Agreement.
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling (including, but not limited to, all directors
and officers of such Person), controlled by, or under direct or indirect common
control with, such Person. A Person shall be deemed to control another Person if
such Person possesses, directly or indirectly, the power (i) to vote 10% or more
of the securities having ordinary voting power (including, with respect to the
Borrower, the MVS Common Stock) for the election of directors (or equivalent
governing body) of such Person or (ii) to direct or cause the direction of the
management and policies of such other Person, whether through the ownership of
voting securities, by contract or otherwise; provided, however, that neither the
Administrative Agent nor any Affiliate thereof shall be considered an Affiliate
of the Borrower or any Subsidiary thereof.
"Agreement" shall mean this Credit Agreement, as modified,
supplemented, amended, restated (including any amendment and restatement
hereof), extended or renewed from time to time.
"Applicable Commitment Commission Percentage" shall mean for any day,
(i) in the event that the Total Unutilized Revolving Loan Commitment in effect
on such day is greater than or equal to 50% of the Total Revolving Loan
Commitment as in effect on such day, .750% per annum, and (ii) in the event that
the Total Unutilized Revolving Loan Commitment in effect on such day is less
than 50% of the Total Revolving Loan Commitment as in effect on such day, .500%
per annum. For purposes of this definition, the Total Unutilized Revolving Loan
Commitment and the Total Revolving Loan Commitment as in effect on any day shall
be determined after the close of business (New York time) on such day, following
adjustments to such amounts for activity on such day.
"Applicable Margin" and "Applicable CL Margin" shall mean, on any
day, (i) with respect to Loans, the respective percentage per annum set forth
below under the appropriate column for the respective Type of Loan, and (ii)
with respect to the Tranche evidenced by the Total Credit-Linked Commitment, the
respective percentage per annum set forth below under the column "Applicable CL
Margin" and (in the case of preceding clauses (i) and (ii)) opposite the
respective Level (i.e., Xxxxx 0, Xxxxx 0 or Level 3, as the case may be) that is
in effect on such day based on the Bank Debt Ratings:
=================================================== ========================== =========================== =========================
Loans maintained as Loans maintained as Base Applicable CL Margin
Level Eurodollar Loans Rate Loans
=================================================== ========================== =========================== =========================
Level 1
-------
a rating from S&P of BB- or higher and a rating
from Xxxxx'x of Ba3 or higher 3.00% 2.00% 3.00%
--------------------------------------------------- -------------------------- --------------------------- -------------------------
84
=================================================== ========================== =========================== =========================
Loans maintained as Loans maintained as Base Applicable CL Margin
Level Eurodollar Loans Rate Loans
=================================================== ========================== =========================== =========================
Level 2
-------
does not qualify for Level 1, with a rating (i) from S&P of BB- or higher and
from Xxxxx'x of B1 or higher or (ii) from Xxxxx'x of Ba3 or higher and from S&P
of B+ or higher
3.25% 2.25% 3.25%
----------------------------------------------------- -------------------------- --------------------------- -----------------------
Level 3
-------
does not qualify for Level 1 or Xxxxx 0 3.50% 2.50% 3.50%
----------------------------------------------------- -------------------------- --------------------------- -----------------------
; provided that Level 3 pricing shall apply (i) at all times when a Default or
an Event of Default exists, (ii) at all times when either or both of Xxxxx'x
and/or S&P no longer maintain a Bank Debt Rating and (iii) at all times through
and including March 31, 2004.
"Asset Sale" shall mean any sale, transfer or other disposition by
the Borrower or any of its Subsidiaries to any Person (including by way of
redemption by such Person) other than to the Borrower or a Wholly-Owned
Subsidiary of the Borrower of any asset (including, without limitation, any
capital stock or other securities of, or equity interests in, another Person)
other than sales of assets pursuant to Sections 9.02(ii), (iv), (vii) and
(viii).
"Assignment and Assumption Agreement" shall mean an Assignment and
Assumption Agreement substantially in the form of Exhibit L (appropriately
completed).
"Attributable Debt" shall mean, as of any date of determination
thereof, without duplication, (i) in connection with a Sale and Leaseback
Transaction, the net present value (discounted according to generally accepted
accounting principles at the cost of debt implied in the lease) of the
obligations of the lessee for rental payments during the then remaining term of
any applicable lease, and (ii) the principal balance outstanding under any
synthetic lease, tax retention operating lease, off-balance sheet loan or
similar off-balance sheet financing (including an off-balance sheet receivables
financing) product to which such Person is a party.
"Bank Debt Rating" shall mean, on any date, each of the ratings most
recently publicly announced by Xxxxx'x and S&P for the Loans.
"Bankruptcy Code" shall have the meaning provided in Section 10.05.
"Bankruptcy Court" shall mean the United States Bankruptcy Court for
the Southern District of New York having jurisdiction over the jointly
administered cases under the Bankruptcy Code commenced by the Borrower and
certain of its Subsidiaries on March 11, 2003 in the United States District
Court for the Southern District of New York and styled In re Magellan Health
Services, Inc., et al., 03-40515 (PCB) and, to the extent of any reference made
under Section 157 of Title 28 of the United States Code, the unit of such
District Court having jurisdiction over such cases under Section 151 of Title 28
of the United States Code.
85
"Base Rate" shall mean, at any time, the higher of (i) the Prime
Lending Rate at such time and (ii) 1/2 of 1% in excess of the overnight Federal
Funds Rate at such time.
"Base Rate Loan" shall mean each Swingline Loan and each other Loan
designated or deemed designated as such by the Borrower at the time of the
incurrence thereof or conversion thereto.
"Borrower" shall have the meaning provided in the first paragraph of
this Agreement.
"Borrowing" shall mean the borrowing of one Type of Loan of a single
Tranche from all the Lenders having Commitments of the respective Tranche (or
from the Swingline Lender in the case of Swingline Loans) on a given date (or
resulting from a conversion or conversions on such date) having in the case of
Eurodollar Loans the same Interest Period, provided that Base Rate Loans
incurred pursuant to Section 1.10(b) shall be considered part of the related
Borrowing of Eurodollar Loans.
"Business Day" shall mean (i) for all purposes other than as covered
by clause (ii) below, any day except Saturday, Sunday and any day which shall be
in New York, New York, a legal holiday or a day on which banking institutions
are authorized or required by law or other government action to close and (ii)
with respect to all notices and determinations in connection with, and payments
of principal and interest on, Eurodollar Loans, any day which is a Business Day
described in clause (i) above and which is also a day for trading by and between
banks in U.S. dollar deposits in the interbank Eurodollar market.
"Calculation Period" shall mean, in the case of any Permitted
Acquisition, the Test Period most recently ended prior to the date of any such
Permitted Acquisition for which financial statements are available.
"Capital Contribution Cure Amount" shall mean, for any Default
Quarter, that amount by which Consolidated EBITDA for the Test Period ended on
the last day of such Default Quarter was less than the amount set forth opposite
such Default Quarter in the table appearing in Section 9.09.
"Capital Cure Contribution" shall have the meaning provided in
Section 9.09.
"Capital Cure Contribution Group" shall mean one or more members of
the Onex Group and one or more members of the R2 Group (but, in the case of one
or more members of the R2 Group, only to the extent that its capital
contribution is made as part of any co-investment right with, or co-investment
offer made to one or more members of the R2 Group by, the Onex Group).
"Capital Expenditures" shall mean, with respect to any Person, all
expenditures by such Person which should be capitalized in accordance with
generally accepted accounting principles and, without duplication, the amount of
Capitalized Lease Obligations incurred by such Person.
86
"Capitalized Lease Obligations" shall mean, with respect to any
Person, all rental obligations of such Person which, under generally accepted
accounting principles, are or will be required to be capitalized on the books of
such Person, in each case taken at the amount thereof accounted for as
indebtedness in accordance with such principles.
"Cash Distribution Amount" shall have the meaning provided in the
Plan of Reorganization.
"Cash Equivalents" shall mean, as to any Person, (i) securities
issued or directly and fully guaranteed or insured by the United States or any
agency, instrumentality or sponsored corporation thereof and backed by the full
faith and credit of the United States, and in each case having maturities of not
more than one year from the date of acquisition, (ii) Dollar denominated time
deposits, certificates of deposit, overnight bank deposits and bankers'
acceptances with any Lender or any commercial bank of recognized standing,
having capital and surplus in excess of $250,000,000 and the commercial paper of
the holding company of which, at the time of acquisition thereof, is rated at
least A-2 or the equivalent thereof by S&P or at least P-2 or the equivalent
thereof by Xxxxx'x (or if at such time neither is issuing ratings, then a
comparable rating of another nationally recognized rating agency), or, if no
such commercial paper rating is available, a long-term debt rating, at the time
of acquisition thereof, of at least A or the equivalent thereof by S&P or at
least A-2 or the equivalent thereof by Xxxxx'x (or if at such time neither is
issuing ratings, then a comparable rating of another nationally recognized
rating agency), (iii) repurchase obligations with a term of not more than 92
days for underlying securities of the types described in clause (i) above and
entered into with any commercial bank meeting the qualifications specified in
clause (ii) above, (iv) other investment instruments offered or sponsored by
financial institutions having capital and surplus in excess of $250,000,000 and
the commercial paper of the holding company of which, at the time of acquisition
thereof, is rated at least A-1 or the equivalent thereof by S&P or at least P-1
or the equivalent thereof by Xxxxx'x (or if at such time neither is issuing
ratings, then a comparable rating of another nationally recognized rating
agency), or, if no such commercial paper rating is available, a long-term debt
rating, at the time of acquisition thereof, of at least A+ or the equivalent
thereof by S&P or at least A-1 or the equivalent thereof by Xxxxx'x (or if at
such time neither is issuing ratings, then a comparable rating of another
nationally recognized rating agency), (v) readily marketable direct obligations
issued by any state of the United States or any political subdivision thereof
having, at the time of acquisition thereof, one of the two highest rating
categories obtainable from either Xxxxx'x or S&P (or if at such time neither is
issuing ratings, then a comparable rating of another nationally recognized
rating agency), (vi) commercial paper rated, at the time of acquisition thereof,
at least A-1 or the equivalent thereof by S&P or at least P-1 or the equivalent
thereof by Xxxxx'x (or if at such time neither is issuing ratings, then a
comparable rating of another nationally recognized rating agency), in each case
maturing within one year after the date of acquisition, (vii) investments in
money market funds which invest substantially all their assets in securities of
the types described in clauses (i) through (vi) above, and (viii) in the case of
any Foreign Subsidiary of the Borrower, (x) certificates of deposit (or
comparable instruments) of any bank with which such Foreign Subsidiary regularly
transacts business and with maturities of not more than six months from the date
of acquisition by such Foreign Subsidiary, (y) overnight deposits and demand
deposit accounts maintained with any bank that such Foreign Subsidiary regularly
transacts business and (z) securities of the type and maturity described in
clause (i) above but issued by the principal governmental authority in which
such Foreign Subsidiary is organized so long as such security has the highest
rating available from either S&P or Xxxxx'x.
87
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as the same has been amended and may
hereafter be amended from time to time, 42 U.S.C. ss. 9601 et seq.
"Change of Control" shall mean (i) a "change of control" under (and
as defined in) any New Senior Note Document shall have occurred, (ii) any
"Person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act), other than the Onex Group, (A) is or shall become the "beneficial
owner" (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act),
directly or indirectly, of 35% or more of the outstanding total Voting Power of
the Borrower's capital stock (determined on a fully diluted basis) at a time
when the Onex Group owns less than 50% of the total Voting Power of the
Borrower's capital stock (determined on a fully diluted basis) or (B) shall have
obtained the power (whether or not exercised) to elect a majority of the
Borrower's directors, or (iii) at any time the Board of Directors of the
Borrower shall cease to consist of a majority of Continuing Directors.
"CL Facility Fee" shall have the meaning provided in Section 3.01(c).
"CL Lender" shall mean each Lender having a Credit-Linked Commitment
(or, to the extent terminated, an outstanding Credit-Linked Deposit).
"CL Letter of Credit" shall mean each Letter of Credit designated as
such pursuant to Section 2.03(a) or (c), as the case may be.
"CL Letter of Credit Outstandings" shall mean, at any time, the
aggregate amount of all Letter of Credit Outstandings at such time in respect of
CL Letters of Credit.
"CL Percentage" of any CL Lender at any time shall mean a fraction
(expressed as a percentage) the numerator of which is the Credit-Linked
Commitment of such CL Lender at such time and the denominator of which is the
Total Credit-Linked Commitment at such time, provided that if the CL Percentage
of any CL Lender is to be determined after the Total Credit-Linked Commitment
has been terminated, then the CL Percentage of such CL Lender shall be
determined immediately prior (and without giving effect) to such termination.
"CL Unpaid Drawing" shall mean any Unpaid Drawing under a CL Letter
of Credit.
"Change of Law" shall have the meaning provided in Section 10.06.
"Code" shall mean the U.S. Internal Revenue Code of 1986, as amended
from time to time, and the regulations promulgated thereunder. Section
references to the Code are to the Code as in effect at the date of this
Agreement and any subsequent provisions of the Code amendatory thereof,
supplemental thereto or substituted therefor.
"Collateral" shall mean all property (whether real or personal) with
respect to which any security interests have been granted (or purported to be
granted) by any Credit Party pursuant to any Security Document, including,
without limitation, all Pledge Agreement Collateral, all Security Agreement
Collateral, all Mortgaged Properties and all cash and Cash Equivalents delivered
as collateral pursuant to Section 4.02 or 10.
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"Collateral Agent" shall mean the Administrative Agent acting as
collateral agent for the Secured Creditors pursuant to the Security Documents.
"Commitment" shall mean any of the commitments of any Lender, i.e.,
whether the Term Loan Commitment, the Revolving Loan Commitment or the
Credit-Linked Commitment.
"Commitment Commission" shall have the meaning provided in Section
3.01(a).
"Confirmation Order" shall mean the order of the Bankruptcy Court
confirming the Plan of Reorganization, which order shall be a Final Order.
"Consolidated EBITDA" shall mean, for any period, Consolidated Net
Income for such period adjusted by (x) adding thereto, (A) without duplication
and to the extent deducted in arriving at Consolidated Net Income for such
period: (a) Consolidated Interest Expense; (b) provision for taxes based on
income; (c) the amount of all amortization of intangibles and depreciation; (d)
non-cash charges for the impairment of goodwill or other intangibles or the
write-off of goodwill, intangibles or other assets; (e) the amortization or
write-off of deferred financing, legal and accounting costs with respect to the
Transaction or any Permitted Acquisition; and (f) the amount of all other
non-cash charges or non-cash losses and (B) solely for purposes of determining
compliance with Section 9.09 (and not for any other purpose), the aggregate
Capital Contribution Cure Amount made pursuant to a Capital Cure Contribution
during any Default Quarter occurring during such period, and (y) deducting
therefrom, the amount of all cash payments during such period that are
associated with any non-cash charges or non-cash losses that were added back to
Consolidated Net Income in a previous period pursuant to preceding clause
(x)(A)(f); and, in each case, without giving effect to (i) any extraordinary
gains, (ii) any gains or losses from sales of assets other than from sales of
inventory in the ordinary course of business and (iii) any gains, losses,
charges, expenses or income (or contra-expenses) associated with or resulting
from the bankruptcy proceedings referred to in the definition of Bankruptcy
Court including, without limitation, any reorganization expenses, expenses
related to the Borrower's Key Employee Retention Program as described in the
Plan of Reorganization, any adjustments resulting from the application of "fresh
start" accounting under generally accepted accounting principles and any
expenses or charges recognized as a result of the settlement of claims; it being
understood that in determining the Total Leverage Ratio and the Modified
Leverage Ratio, Consolidated EBITDA for any period shall be calculated on a Pro
Forma Basis to give effect to any Acquired Entity or Business acquired during
such period pursuant to a Permitted Acquisition and not subsequently sold or
otherwise disposed of by the Borrower or any of its Subsidiaries during such
period.
"Consolidated Indebtedness" shall mean, at any time, the remainder of
(A) the sum of, without duplication, (i) the aggregate principal amount of all
Indebtedness (or, if greater, the aggregate face amount of any Indebtedness
issued at a discount) of the Borrower and its Subsidiaries at such time
(including, without limitation, all Loans, letters of credit (including Letters
of Credit), Capitalized Lease Obligations and guaranties of other Indebtedness)
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and (ii) the aggregate outstanding amount of all Attributable Debt of the
Borrower and its Subsidiaries at such time; provided that for purposes of this
definition, the amount of Indebtedness in respect of Interest Rate Protection
Agreements and Other Hedging Agreements shall be at any time the unrealized net
loss position, if any, of the Borrower and/or its Subsidiaries thereunder on a
marked-to-market basis determined no more than one month prior to such time,
minus (B) the aggregate amount of all Unrestricted cash and Cash Equivalents of
the Borrower and its Subsidiaries at such time in excess of $20,000,000.
"Consolidated Interest Coverage Ratio" shall mean, for any period,
the ratio of Consolidated EBITDA to Consolidated Interest Expense for such
period.
"Consolidated Interest Expense" shall mean, for any period, the sum
of the total consolidated interest expense of the Borrower and its Subsidiaries
for such period (calculated without regard to any limitations on the payment
thereof) plus, without duplication, (i) that portion of Capitalized Lease
Obligations of the Borrower and its Subsidiaries representing the interest
factor for such period, (ii) all Fees accrued during such period pursuant to
Sections 3.01(a), (b), (c) and (d), (iii) all interest expense during such
period as set forth in Sections 2.05(a) and (b) and (iv) the interest component
(or imputed interest) of any lease payment or other off-balance sheet financing
under Attributable Debt transactions paid by the Borrower and its Subsidiaries
for such period; provided that the amortization or write-off of deferred
financing, legal and accounting costs with respect to the Transaction or any
Permitted Acquisition in each case shall be excluded from Consolidated Interest
Expense to the extent same would otherwise have been included therein.
"Consolidated Net Income" shall mean, for any period, the net income
(or loss) of the Borrower and its Subsidiaries for such period, determined on a
consolidated basis (after any deduction for minority interests), provided that
(i) in determining Consolidated Net Income, the net income of any other Person
which is not a Subsidiary of the Borrower or is accounted for by the Borrower by
the equity method of accounting shall be included only to the extent of the
payment of cash dividends or cash distributions by such other Person to the
Borrower or a Subsidiary thereof during such period, and (ii) the net income of
any Subsidiary of the Borrower shall be excluded to the extent that the
declaration or payment of cash dividends or similar cash distributions by that
Subsidiary of that net income is not at the date of determination permitted by
operation of its charter or any agreement, instrument or law applicable to such
Subsidiary provided that any net income excluded under clause (i) or (ii) above
in any period (to the extent that such net income otherwise would have been
included in the Consolidated Net Income of the Borrower in such period) shall be
included in any subsequent period to the extent of any cash dividend or cash
distribution of such net income in such subsequent period made by such Person to
the Borrower or a Subsidiary thereof (provided the net income of such Subsidiary
is not restricted as set forth in clause (ii) above).
"Contingent Obligation" shall mean, as to any Person, any obligation
of such Person as a result of such Person being a general partner of any other
Person, unless the underlying obligation is expressly made non-recourse as to
such general partner, and any obligation of such Person guaranteeing or intended
to guarantee any Indebtedness, leases, dividends or other obligations ("primary
obligations") of any other Person (the "primary obligor") in any manner, whether
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directly or indirectly, including, without limitation, any obligation of such
Person, whether or not contingent, (i) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (ii) to
advance or supply funds (x) for the purchase or payment of any such primary
obligation or (y) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (iv) otherwise
to assure or hold harmless the holder of such primary obligation against loss in
respect thereof; provided, however, that the term Contingent Obligation shall
not include endorsements of instruments for deposit or collection in the
ordinary course of business. The amount of any Contingent Obligation shall be
deemed to be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Contingent Obligation is made or, if not
stated or determinable, the maximum reasonably anticipated liability in respect
thereof (assuming such Person is required to perform thereunder) as determined
by such Person in good faith.
"Continuing Directors" shall mean the directors of the Borrower on
the Initial Borrowing Date and each other director, if such director's
nomination for election to the Board of Directors of the Borrower is recommended
by a majority of then Continuing Directors; it being understood, however, that
any director of the Borrower elected by the Onex Group, either voting as a
separate class as the holders of the MVS Common Stock or voting together with
the holders of the Ordinary Common Stock, at a time when the Onex Group owns 50%
or more of the total Voting Power of the Borrower's capital stock (determined on
a fully diluted basis), shall constitute a Continuing Director.
"Credit Documents" shall mean this Agreement and, after the execution
and delivery thereof pursuant to the terms of this Agreement, each Note, the
Subsidiaries Guaranty and each Security Document.
"Credit Event" shall mean the making of any Loan or the issuance of
any Letter of Credit.
"Credit-Linked Commitment" shall mean, for each Lender, the amount
set forth opposite such Lender's name in Schedule I directly below the column
entitled "Credit-Linked Commitment," as the same may be (x) reduced from time to
time or terminated pursuant to Sections 3.02, 3.03 and/or 10, as applicable, or
(y) adjusted from time to time as a result of assignments to or from such Lender
pursuant to Section 1.13 or 13.04(b).
"Credit-Linked Deposit" shall mean, as to each CL Lender, the cash
deposit made by such CL Lender pursuant to Section 2.07(a) or Section 1.13 or
13.04(b), as the case may be, as such deposit may be (x) reduced from time to
time pursuant to the terms of this Agreement and (y) reduced or increased from
time to time pursuant to assignments to or by such CL Lender pursuant to Section
1.13 or 13.04(b). The initial amount of each CL Lender's Credit-Linked Deposit
shall be equal to the amount of its Credit-Linked Commitment on the Initial
Borrowing Date or on the date that such Person becomes a CL Lender pursuant to
Section 1.13 or 13.04(b).
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"Credit-Linked Deposit Account" shall mean the account of, and
established by, the Administrative Agent under its sole and exclusive control
and maintained at the office of the Administrative Agent located at 00 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 and designated as the "Magellan Credit-Linked
Deposit Account" that shall be used solely for the purposes set forth in
Sections 2.04(c)(ii) and 2.05(b).
"Credit-Linked Deposit Cost Amount" shall mean, at any time, an
amount (expressed in basis points) determined by the Administrative Agent in
consultation with the Borrower based on the term on which the Credit-Linked
Deposits are invested from time to time and representing the Administrative
Agent's administrative cost for investing the Credit-Linked Deposits.
"Credit Party" shall mean the Borrower and each Subsidiary Guarantor.
"DBAG" shall mean Deutsche Bank AG, New York Branch, in its
individual capacity, and any successor corporation thereto by merger,
consolidation or otherwise.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" shall mean any Lender with respect to which a
Lender Default is in effect.
"Defaulting RL Lender" shall mean any RL Lender with respect to which
a Lender Default is in effect.
"Default Quarter" shall have the meaning provided in Section 9.09.
"Disclosure Statement" shall mean the Disclosure Statement, dated
August 18, 2003, pursuant to Section 1125 of the Bankruptcy Code relating to the
Plan of Reorganization, as approved by the Bankruptcy Court, and as the same may
be amended, modified or supplemented from time in accordance with the terms
hereof and thereof.
"Dividend" shall mean, with respect to any Person, that such Person
has declared or paid a dividend, distribution or returned any equity capital to
its stockholders, partners or members or authorized or made any other
distribution, payment or delivery of property (other than common equity of such
Person) or cash to its stockholders, partners or members as such, or redeemed,
retired, purchased or otherwise acquired, directly or indirectly, for a
consideration any shares of any class of its capital stock or any partnership or
membership interests outstanding on or after the Initial Borrowing Date (or any
options or warrants issued by such Person with respect to its capital stock or
other equity interests), or set aside any funds for any of the foregoing
purposes, or shall have permitted any of its Subsidiaries to purchase or
otherwise acquire for a consideration any shares of any class of the capital
stock or any partnership or membership interests of such Person outstanding on
or after the Initial Borrowing Date (or any options or warrants issued by such
Person with respect to its capital stock or other equity interests). Without
limiting the foregoing, "Dividends" with respect to any Person shall also
include all payments made or required to be made by such Person with respect to
any stock appreciation rights, plans, equity incentive or achievement plans or
any similar plans or setting aside of any funds for the foregoing purposes.
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"Documents" shall mean the Credit Documents and the Plan Documents.
"Dollars" and the sign "$" shall each mean freely transferable lawful
money of the United States.
"Domestic Subsidiary" shall mean each Subsidiary of the Borrower
incorporated or organized in the United States or any State thereof.
"Drawing" shall have the meaning provided in Section 2.05(c).
"Effective Date" shall have the meaning provided in Section 13.10.
"Eligible Transferee" shall mean and include a commercial bank, an
insurance company, a finance company, a financial institution, any fund that
invests in loans or any other "accredited investor" (as defined in Regulation D
of the Securities Act), but in any event excluding the Borrower and its
Subsidiaries.
"Employment Agreements" shall have the meaning provided in Section
5.13.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, directives,
claims, liens, notices of noncompliance or violation, investigations or
proceedings relating in any way to any Environmental Law or any permit issued,
or any approval given, under any such Environmental Law (hereafter, "Claims"),
including, without limitation, (a) any and all Claims by governmental or
regulatory authorities for enforcement, cleanup, removal, response, remedial or
other actions or damages pursuant to any applicable Environmental Law, and (b)
any and all Claims by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief in connection
with alleged injury or threat of injury to health, safety or the environment due
to the presence of Hazardous Materials.
"Environmental Law" shall mean any Federal, state, foreign or local
statute, law, rule, regulation, ordinance, code, guideline, policy and rule of
common law now or hereafter in effect and in each case as amended, and any
judicial or administrative interpretation thereof, including any judicial or
administrative order, consent decree or judgment, relating to the environment,
employee health and safety or Hazardous Materials, including, without
limitation, CERCLA; the Resource Conservation and Recovery Act, 42 U.S.Css. 6901
et seq.; the Federal Water Pollution Control Act, 33 X.X.X.xx. 1251 et seq.; the
Toxic Substances Control Act, 15 X.X.X.xx. 2601 et seq.; the Clean Air Act, 42
X.X.X.xx. 7401 et seq.; the Safe Drinking Water Act, 42 X.X.X.xx. 3803 et seq.;
the Oil Pollution Act of 1990, 33 X.X.X.xx. 2701 et seq.; the Emergency Planning
and the Community Right-to-Know Act of 1986, 42 X.X.X.xx. 11001 et seq.; the
Hazardous Material Transportation Act, 49 U.S.C.ss.1801 et seq.; the
Occupational Safety and Health Act, 29 X.X.X.xx. 651 et seq.; and any state and
local or foreign counterparts or equivalents, in each case as amended from time
to time.
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"Equity Offering" shall mean, collectively, (i) the offering by the
Borrower of 2,631,579 shares of its Ordinary Common Stock in accordance with the
Plan of Reorganization and (ii) the issuance by the Borrower of shares of its
MVS Common Stock to an Affiliate of Onex in accordance with the Plan of
Reorganization.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder. Section references to ERISA are to ERISA, as in effect at the
date of this Agreement and any subsequent provisions of ERISA, amendatory
thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section 3(9)
of ERISA) which together with the Borrower or a Subsidiary of the Borrower would
be deemed to be a "single employer" (i) within the meaning of Section 414(b),
(c), (m) or (o) of the Code or (ii) as a result of the Borrower or a Subsidiary
of the Borrower being or having been a general partner of such person.
"ERISA Plan" shall mean any pension plan as defined in Section 3(2)
of ERISA, which is maintained or contributed to by (or to which there is an
obligation to contribute of) the Borrower or a Subsidiary of the Borrower or an
ERISA Affiliate on or after the Initial Borrowing Date, and each such plan for
the five year period immediately following the latest date (whether before or
after the Initial Borrowing Date) on which the Borrower, a Subsidiary of the
Borrower or an ERISA Affiliate maintained, contributed to or had an obligation
to contribute to such plan.
"Eurodollar Loan" shall mean each Loan (other than a Swingline Loan)
designated as such by the Borrower at the time of the incurrence thereof or
conversion thereto.
"Eurodollar Rate" shall mean (a) the offered quotation to first-class
banks in the New York interbank Eurodollar market by the Administrative Agent
for Dollar deposits of amounts in immediately available funds comparable to the
outstanding principal amount of the applicable Eurodollar Loan for which the
Eurodollar Rate is being determined with maturities comparable to the Interest
Period applicable to such Eurodollar Loan commencing two Business Days
thereafter as of 10:00 A.M. (New York time) on the applicable Interest
Determination Date, divided (and rounded upward to the nearest 1/16 of 1%) by
(b) a percentage equal to 100% minus the then stated maximum rate of all reserve
requirements (including, without limitation, any marginal, emergency,
supplemental, special or other reserves required by applicable law) applicable
to any member bank of the Federal Reserve System in respect of Eurocurrency
funding or liabilities as defined in Regulation D (or any successor category of
liabilities under Regulation D).
"Event of Default" shall have the meaning provided in Section 10.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"Existing Credit Agreement" shall mean the "Senior Secured Credit
Agreement" as defined in the Plan of Reorganization.
"Existing Indebtedness" shall have the meaning provided in Section
7.21.
"Existing Indebtedness Agreements" shall have the meaning provided in
Section 5.13.
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"Facing Fee" shall have the meaning provided in Section 3.01(d).
"Federal Funds Rate" shall mean, for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average 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.
"Fees" shall mean all amounts payable pursuant to or referred to in
Section 3.01.
"Final Maturity Date" shall mean August 15, 2008.
"Final Order" shall mean an order of the Bankruptcy Court entered by
the Bankruptcy Court, which has not been reversed, vacated or stayed and as to
which the time to appeal, petition for certiorari, or to move for a new trial
has expired and as to which no appeal, writ of certioreri or request for a new
trial shall then be pending.
"Financial Officer" of any Person shall mean the chief financial
officer or treasurer of such Person.
"Foreign Pension Plan" shall mean each employee benefit plan,
employment, bonus, incentive, stock purchase and stock option plan, program,
agreement or arrangement; and each severance, termination pay, salary
continuation, retention, accrued leave, vacation, sick pay, sick leave, medical,
life insurance, disability, accident, profit-sharing, fringe benefit, pension,
deferred compensation or other retirement or superannuation plan, fund, program,
agreement, commitment or arrangement sponsored, established, maintained or
contributed to, or required to be contributed to, or with respect to which any
liability is borne, outside the fifty states of the United States of America, by
the Borrower or any of its Subsidiaries, including, without limitation, any such
plan, fund, program, agreement or arrangement sponsored by a government or
governmental entity.
"Foreign Subsidiary" shall mean each Subsidiary of the Borrower that
is incorporated or organized under the laws of any jurisdiction other than the
United States or any State thereof.
"Hazardous Materials" shall mean (a) any petroleum or petroleum
products, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation, dielectric fluid containing levels
of polychlorinated biphenyls, and radon gas; (b) any chemicals, materials or
substances defined as or included in the definition of "hazardous substances,"
"hazardous waste," "hazardous materials," "extremely hazardous substances,"
"restricted hazardous waste," "toxic substances," "toxic pollutants,"
"contaminants," or "pollutants," or words of similar import, under any
applicable Environmental Law; and (c) any other chemical, material or substance,
the exposure to, or Release of which is prohibited, limited or regulated by any
governmental authority.
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"Health Care Laws" shall mean any and all applicable current and
future laws, rules, regulations, codes, ordinances, orders, decrees, judgments,
injunctions or binding agreements issued, promulgated or entered into by the
Food and Drug Administration, the Health Care Financing Administration, the
Department of Health and Human Services ("HHS"), the Office of Inspector General
of HHS, the Drug Enforcement Administration or any other governmental authority,
including any state and/or local professional licensing laws, certificate of
need laws and state reimbursement laws, relating in any way to the conduct of
the business of the Borrower or any Subsidiary thereof and the provision of
health care services generally.
"Indebtedness" shall mean, as to any Person, without duplication, (i)
all indebtedness of such Person for borrowed money or for the deferred purchase
price of property or services, (ii) the maximum amount available to be drawn or
paid under all letters of credit, bankers' acceptances, bank guaranties and
similar obligations issued for the account of such Person and all unpaid
drawings in respect of such letters of credit, bankers' acceptances and similar
obligations, (iii) all Indebtedness of the types described in clause (i), (ii),
(iv), (v), (vi), (vii) or (viii) of this definition secured by any Lien on any
property owned by such Person, whether or not such Indebtedness has been assumed
by such Person (provided that, if the Person has not assumed or otherwise become
liable in respect of such Indebtedness, such Indebtedness shall be deemed to be
in an amount equal to the fair market value of the property to which such Lien
relates as determined in good faith by such Person), (iv) the aggregate amount
of all Capitalized Lease Obligations of such Person, (v) all obligations of such
Person to pay a specified purchase price for goods or services, whether or not
delivered or accepted, i.e., take-or-pay and similar obligations, (vi) all
Contingent Obligations of such Person, (vii) all obligations under any Interest
Rate Protection Agreement, any Other Hedging Agreement or under any similar type
of agreement, and (viii) all Attributable Debt of such Person. Notwithstanding
the foregoing, Indebtedness shall not include trade payables and accrued
expenses incurred by any Person in accordance with customary practices and in
the ordinary course of business of such Person (including pursuant to customer
service contracts, including the Aetna Amended MSA).
"Initial Borrowing Date" shall mean the date occurring on or after
the Effective Date on which the initial incurrence of Loans occurs.
"Intercompany Loan" shall have the meaning provided in Section
9.05(viii).
"Intercompany Note" shall mean a promissory note, in the form of
Exhibit M, evidencing Intercompany Loans.
"Interest Determination Date" shall mean, with respect to any
Eurodollar Loan, the second Business Day prior to the commencement of any
Interest Period relating to such Eurodollar Loan.
"Interest Period" shall mean (i) as to any Borrowing of Eurodollar
Loans, the interest period applicable to such Borrowing of Eurodollar Loans
selected pursuant to, and otherwise subject to the provisions of, Section 1.09,
and (ii) as to any investment of the Credit-Linked Deposits, the interest period
applicable to the Credit-Linked Deposits selected pursuant to, and otherwise
subject to the provisions of, Section 2.07(e).
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"Interest Rate Protection Agreement" shall mean any interest rate
swap agreement, interest rate cap agreement, interest collar agreement, interest
rate hedging agreement or other similar agreement or arrangement.
"Investments" shall have the meaning provided in Section 9.05.
"Issuing Lender" shall mean each of (i) DBAG (except as otherwise
provided in Section 12.09) and (ii) and any other Lender reasonably acceptable
to the Administrative Agent and the Borrower which agrees to issue Letters of
Credit hereunder. Any Issuing Lender may, in its discretion, arrange for one or
more Letters of Credit to be issued by one or more Affiliates of such Issuing
Lender, in which case any such Affiliates also shall be an Issuing Lender
hereunder.
"L/C Supportable Obligations" shall mean (i) obligations of the
Borrower or any of its Subsidiaries with respect to workers' compensation,
surety bonds and other similar statutory or regulatory obligations, (ii)
obligations of the Borrower or any of its Subsidiaries with respect to customer
contracts entered into in the ordinary course of business and (iii) such other
obligations of the Borrower or any of its Subsidiaries as are reasonably
acceptable to the respective Issuing Lender and otherwise permitted to exist
pursuant to the terms of this Agreement (other than obligations in respect of
the New Senior Notes, the New Aetna Note, the Aetna Subsidiaries Subordinated
Guaranty, the Aetna Purchase Option and Indebtedness which is subordinated to
any of the Obligations or capital stock).
"Leaseholds" of any Person shall mean all the right, title and
interest of such Person as lessee or licensee in, to and under leases or
licenses of land, improvements and/or fixtures.
"Lender" shall mean each financial institution listed on Schedule I,
as well as any Person that becomes a "Lender" hereunder pursuant to Section 1.13
or 13.04(b).
"Lender Default" shall mean (i) the refusal (which has not been
retracted) or the failure of a Lender to make available its portion of any
Borrowing (including any Mandatory Borrowing) or to fund its portion of any
unreimbursed payment under Section 2.04(c) or (ii) a Lender having notified in
writing the Borrower and/or the Administrative Agent that such Lender does not
intend to comply with its obligations under Section 1.01(a), 1.01(b), 1.01(d) or
2.
"Letter of Credit" shall have the meaning provided in Section
2.01(a). Letters of Credit shall be either CL Letters of Credit or WC Letters of
Credit.
"Letter of Credit Outstandings" shall mean, at any time, the sum of
(i) the Stated Amount of all outstanding Letters of Credit and (ii) the
aggregate amount of all Unpaid Drawings in respect of all Letters of Credit.
"Letter of Credit Request" shall have the meaning provided in Section
2.03(a).
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"LIBOR Rate" shall mean, for any Interest Period with respect to the
investment of the Credit-Linked Deposits, the rate for deposits in Dollars for
such Interest Period which appears on the Telerate Page 3750 as of 11:00 A.M.
(London time) on the day that is two Business Days preceding the beginning of
such Interest Period. If such rate does not appear on Telerate Page 3750, the
rate for that Interest Period will be the rate determined in good faith by the
Administrative Agent on the basis of the rates at which deposits in Dollars are
offered by four major banks in the London interbank market at approximately
11:00 A.M. (London time) on the day that is two Business Days preceding the
beginning of the new Interest Period to prime banks in the London interbank
market for such Interest Period commencing on the beginning of the new Interest
Period and in the then outstanding amount of the Credit-Linked Deposits. The
Administrative Agent will request the principal London office of each of such
four major banks in the London interbank market to provide a quotation of its
rate. If at least two such quotations are provided, the rate for that new
Interest Period will be the arithmetic mean of the quotations. If fewer than two
quotations are provided as requested, the rate for that Interest Period will be
the arithmetic mean of the rates quoted by major banks in New York City,
selected by the Administrative Agent, at approximately 11:00 A.M. (New York
time) on the beginning of the new Interest Period for loans in Dollars to
leading European banks for such Interest Period commencing on the beginning of
the new Interest Period and in the amount of the Credit-Linked Deposits.
"Lien" shall mean any mortgage, pledge, hypothecation, collateral
assignment, deposit arrangement, encumbrance, lien (statutory or other),
preference, priority or other security agreement of any kind or nature
whatsoever (including, without limitation, any conditional sale or other title
retention agreement, any financing or similar statement or notice filed under
the UCC or any other similar recording or notice statute, and any lease having
substantially the same effect as any of the foregoing).
"Loan" shall mean each Term Loan, each Revolving Loan and each
Swingline Loan.
"Management Agreements" shall have the meaning provided in Section
5.13.
"Mandatory Borrowing" shall have the meaning provided in Section
1.01(d).
"Margin Stock" shall have the meaning provided in Regulation U.
"Material Adverse Effect" shall mean (i) a material adverse effect on
the Transaction, (ii) a material adverse effect on the business, operations,
property, assets, liabilities or condition (financial or otherwise) of the
Borrower and its Subsidiaries taken as a whole or (iii) a material adverse
effect (x) on the rights or remedies of the Lenders or the Administrative Agent
hereunder or under any other Credit Document or (y) on the ability of any Credit
Party to perform its obligations to the Lenders or Administrative Agent
hereunder or under any other Credit Document; it being understood that the
exercise of the Aetna Purchase Option in accordance with the terms thereof and
hereof in and of itself shall not constitute a Material Adverse Effect.
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"Maximum Permitted Consideration" shall mean, with respect to any
Permitted Acquisition, the sum (without duplication) of (i) the fair market
value of the Ordinary Common Stock of the Borrower (based on (x) the closing
and/or trading price of the Ordinary Common Stock of the Borrower on the date of
such Permitted Acquisition on the stock exchange on which the Ordinary Common
Stock of the Borrower is listed or the automated quotation system on which the
Ordinary Common Stock is quoted, or (y) if the Ordinary Common Stock of the
Borrower is not listed on an exchange or quoted on a quotation system, the bid
and asked prices of the Ordinary Common Stock in the over-the-counter market at
the close of trading or (z) if the Ordinary Common Stock of the Borrower is not
so listed, based on a good faith determination of the Board of Directors of the
Borrower) issued as consideration in connection with such Permitted Acquisition,
(ii) the fair market value of all Qualified Preferred Stock of the Borrower
(based on a good faith determination of the Board of Directors of the Borrower)
issued as consideration in connection with such Permitted Acquisition, (iii) the
aggregate amount of all cash paid by the Borrower or any of its Subsidiaries in
connection with such Permitted Acquisition (including payments of fees, costs,
expenses and taxes in connection therewith), (iv) the aggregate principal amount
of, and other obligations due under, all Indebtedness assumed, incurred and/or
issued by the Borrower or any of its Subsidiaries in connection with such
Permitted Acquisition, (v) the aggregate amount that could reasonably be
expected to be paid (based on good faith projections prepared by the Borrower)
pursuant to any earn-out, non-compete, consulting or deferred compensation or
purchase price adjustment) for such Permitted Acquisition and (vi) the fair
market value (based on a good faith determination of the Borrower) of all other
consideration payable in connection with such Permitted Acquisition.
"Maximum Swingline Amount" shall mean $5,000,000.
"Minimum Borrowing Amount" shall mean (i) for Term Loans, $5,000,000,
(ii) for Revolving Loans, $500,000, and (iii) for Swingline Loans, $250,000.
"Modified Leverage Ratio" shall mean, at any time, the ratio of (x)
Consolidated Indebtedness at such time (less the aggregate principal amount of
the New Aetna Note and all New Senior Notes outstanding at such time) to (y)
Consolidated EBITDA for the Test Period then most recently ended.
"Moody's" shall mean Xxxxx'x Investors Service, Inc., or any
successor corporation thereto.
"Mortgage" shall mean a mortgage substantially in the form of Exhibit
N, with such modifications thereto as any local counsel of the Collateral Agent
may deem necessary or appropriate.
"Mortgaged Property" shall mean any Real Property owned or leased by
the Borrower or any other Credit Party which is encumbered (or required to be
encumbered) by a Mortgage.
"MVS Common Stock" shall have the meaning provided in Section 7.13.
"NAIC" shall mean the National Association of Insurance
Commissioners.
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"Net Debt Proceeds" shall mean, with respect to any incurrence or
issuance of Indebtedness for borrowed money, the cash proceeds (net of
underwriting discounts and commissions and other reasonable fees, expenses and
costs associated therewith including, without limitation, those of attorneys,
accountants and other professionals) received by the respective Person from the
respective incurrence of such Indebtedness for borrowed money.
"Net Equity Proceeds" shall mean, with respect to each issuance or
sale of any equity by any Person or any capital contribution to such Person, the
cash proceeds (net of underwriting discounts and commissions and other
reasonable costs associated therewith including, without limitation, those of
attorneys, accountants and other professionals) received by such Person from the
respective sale or issuance of its equity or from the respective capital
contribution.
"Net Insurance Proceeds" shall mean, with respect to any Recovery
Event, the cash proceeds (net of reasonable costs and taxes incurred in
connection with such Recovery Event) received by the respective Person in
connection with such Recovery Event.
"Net Sale Proceeds" shall mean, for any Asset Sale, the gross cash
proceeds (including any cash received by way of deferred payment pursuant to a
promissory note, receivable or otherwise, but only as and when received)
received from such sale of assets, net of (i) the reasonable costs of such sale
(including fees and commissions, attorney's and other professional fees,
payments of unassumed liabilities relating to the assets sold and required
payments of any Indebtedness (other than Indebtedness secured pursuant to the
Security Documents) which is secured by the respective assets which were sold),
(ii) the incremental taxes paid or payable as a result of such Asset Sale, and
(iii) in the case of the sale of the assets subject to, and upon the exercise
of, the Aetna Purchase Option, an amount equal to the original principal amount
of the New Aetna Note as of the Initial Borrowing Date (i.e., $48,915,205) but
only so long as the remaining obligations under the New Aetna Note are
extinguished or paid in full as part of (and in connection with) the exercise of
the Aetna Purchase Option.
"New Aetna Note" shall mean the $48,915,205 note issued by the
Borrower to Aetna on or prior to the Initial Borrowing Date pursuant to (and in
satisfaction of the Aetna Claim as defined in) the Plan of Reorganization and
the Aetna Amended MSA, which note is due December 31, 2005 (subject to partial
extension).
"New Aetna Warrant" shall mean the warrant issued by the Borrower to
Aetna on or prior to the Initial Borrowing Date pursuant to the Plan of
Reorganization and the Aetna Amended MSA.
"New Senior Notes" shall mean the Borrower's 9-?% Senior Notes due
November 15, 2008 issued pursuant to the New Senior Notes Indenture.
"New Senior Notes Documents" shall mean the New Senior Notes, the New
Senior Notes Indenture and each other document executed and delivered in
connection with the issuance of the New Senior Notes.
"New Senior Notes Indenture" shall mean the Indenture, dated as of
January 5, 2004, between the Borrower and HSBC Bank USA, as trustee, as in
effect on the Initial Borrowing Date and as the same may be amended, modified or
supplemented from time to time in accordance with the terms thereof and hereof.
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"Non-Compete Agreements" shall have the meaning provided in Section
5.13.
"Non-Defaulting Lender" and "Non-Defaulting RL Lender" shall mean and
include each Lender or RL Lender, as the case may be, other than a Defaulting
Lender.
"Non-U.S. Lender" shall mean each Lender, each Issuing Lender or the
Administrative Agent in each case to the extent that any such Person is not a
"United States person" (as such term is defined in Section 7701(a)(30) of the
Code) for U.S. Federal income tax purposes.
"Note" shall mean each Term Note, each Revolving Note and the
Swingline Note.
"Notice of Borrowing" shall have the meaning provided in Section
1.03(a).
"Notice of Conversion/Continuation" shall have the meaning provided
in Section 1.06.
"Notice Office" shall mean (i) for credit notices, the office of the
Administrative Agent located at 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000,
Attention: Xxxxxxx Xxxxxxx, Telephone No.: (000) 000-0000, and Telecopier No.:
(000) 000-0000, and (ii) for operational notices, the office of the
Administrative Agent located at 00 Xxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxx Xxxx, Xxx
Xxxxxx 00000, Attention: Xxxxxxxxx Xxxxxxxx, Telephone No.: (000) 000-0000, and
Telecopier No.: (000) 000-0000, or such other office or person as the
Administrative Agent may hereafter designate in writing as such to the other
parties hereto.
"Notice of Plan Effective Date" shall mean the notice from the
Borrower certifying that the effective date for the Plan of Reorganization has
occurred.
"Obligations" shall mean all amounts owing to the Administrative
Agent, the Collateral Agent, any Issuing Lender, the Swingline Lender or any
Lender pursuant to the terms of this Agreement or any other Credit Document.
"Old Notes" shall mean the "Senior Notes" as defined in the Plan of
Reorganization.
"Onex" shall mean Onex Corporation, a corporation organized and
existing under the laws of the Province of Ontario, Canada, and any successor to
all or substantially all the assets and business thereof.
"Onex American Holdings II" shall mean Onex American Holdings II,
LLC, a limited liability company organized and existing under the laws of
Delaware, and any successor to all or substantially all the assets or business
thereof.
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"Onex Group" shall mean Onex American Holdings II, Onex, Onex
Partners and any Person at the time controlled by Onex or Onex Partners, each of
which shall be considered "a member of the Onex Group" for purposes hereof. For
purposes of this definition, (i) Onex shall be deemed to control any Person
controlled by Xx. Xxxxxx X. Xxxxxxxx so long as Xx. Xxxxxx X. Xxxxxxxx controls
Onex and (ii) "control" shall have the meaning set forth in Rule 12b-2 under the
Exchange Act (as in effect on the Effective Date).
"Onex Partners" shall mean Onex Partners LP, a limited partnership
organized under the laws of the State of Delaware, and any successor to all or
substantially all the assets and business thereof.
"Ordinary Common Stock" shall have the meaning provided in Section
7.13.
"Other Hedging Agreements" shall mean any foreign exchange contracts,
currency swap agreements, commodity agreements or other similar arrangements, or
arrangements designed to protect against fluctuations in currency values or
commodity prices.
"Participant" shall have the meaning provided in Section 2.04(a).
"Payment Office" shall mean the office of the Administrative Agent
located at 00 Xxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxx Xxxx, Xxx Xxxxxx or such other
office as the Administrative Agent may hereafter designate in writing as such to
the other parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor thereto.
"Percentage" shall mean, for any RL Lender or PF Lender, either its
RL Percentage or PF Percentage, as applicable.
"Permitted Acquisition" shall mean the acquisition by the Borrower or
a Wholly-Owned Subsidiary of the Borrower that is a Subsidiary Guarantor of an
Acquired Entity or Business (including by way of merger of such Acquired Entity
or Business with and into the Borrower (so long as the Borrower is the surviving
corporation) or a Wholly-Owned Subsidiary of the Borrower that is a Subsidiary
Guarantor (so long as such Wholly-Owned Subsidiary is the surviving
corporation)), provided that (in each case) (A) the consideration paid or to be
paid by the Borrower or such Wholly-Owned Subsidiary consists solely of cash
(including proceeds of Revolving Loans or Swingline Loans), the issuance or
incurrence of Indebtedness otherwise permitted by Section 9.04, the
assumption/acquisition of any Indebtedness (calculated at face value) which is
permitted to remain outstanding in accordance with the requirements of Section
9.04 and/or the issuance of Ordinary Common Stock of the Borrower or Qualified
Preferred Stock of the Borrower, (B) in the case of the acquisition of 100% of
the capital stock or other equity interests of any Person (including way of
merger), such Person shall own no capital stock or other equity interests of any
other Person (excluding de minimis amounts) unless either (x) such Person and/or
its Wholly-Owned Subsidiaries own 100% of the capital stock or other equity
interests of such other Person or (y) (1) such Person and/or its Wholly-Owned
Subsidiaries own at least 90% of the consolidated assets of such Person and its
Subsidiaries and (2) any non-Wholly-Owned Subsidiary of such Person was
non-Wholly Owned prior to the date of such Permitted Acquisition of such Person,
(C) the Acquired Entity or Business acquired pursuant to the respective
Permitted Acquisition is in a business permitted by Section 9.14, (D) all
applicable requirements of Sections 8.16, 9.02 and 9.15 applicable to Permitted
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Acquisitions are satisfied and (E) so long as any New Senior Notes or the New
Aetna Note remain outstanding, the Borrower only may consummate Permitted
Acquisitions consisting of the acquisition of the capital stock or other equity
interests of an Acquired Entity or Business. Notwithstanding anything to the
contrary contained in the immediately preceding sentence, an acquisition which
does not otherwise meet the requirements set forth above in the definition of
"Permitted Acquisition" shall constitute a Permitted Acquisition if, and to the
extent, the Required Lenders agree in writing, prior to the consummation
thereof, that such acquisition shall constitute a Permitted Acquisition for
purposes of this Agreement.
"Permitted Encumbrance" shall mean, with respect to any Mortgaged
Property, such exceptions to title as are set forth in the mortgage title policy
(or binding commitment) delivered to the Administrative Agent with respect
thereto, all of which exceptions must be acceptable to the Administrative Agent
in its reasonable discretion.
"Permitted Liens" shall have the meaning provided in Section 9.01.
"Person" shall mean any individual, partnership, joint venture, firm,
corporation, association, limited liability company, trust or other enterprise
or any government or political subdivision or any agency, department or
instrumentality thereof.
"Plan Documents" shall have the meaning provided in the Plan of
Reorganization (but excluding the New Senior Secured Credit Agreement (as
defined in the Plan of Reorganization)).
"Plan of Reorganization" shall mean the third amended joint chapter
11 plan of reorganization relating to the Borrower and its Subsidiaries subject
thereto, dated August 18, 2003 as amended on September 25, 2003, October 8, 2003
and October 9, 2003, including the exhibits and schedules thereto, as the same
may be amended, modified or supplemented from time to time in accordance with
the provisions of the Bankruptcy Code and the terms thereof and hereof.
"Pledge Agreement" shall have the meaning provided in Section 5.08.
"Pledge Agreement Collateral" shall mean all "Collateral" as defined
in the Pledge Agreement.
"Pledgee" shall have the meaning provided in the Pledge Agreement.
"Primary Concentration Account" shall mean the principal
concentration and disbursement accounts utilized by the Borrower for its and its
Wholly-Owned Subsidiaries' cash management systems, with the initial Primary
Concentration Accounts being maintained (i) as account number 078-2575 at Mellon
Bank, N.A., at One Mellon Bank Center, Pittsburgh, Pennsylvania, and (ii) as
account number 153910132759 at U.S. Bank National Association, at 000 0xx Xxxxxx
Xxxxx, Xxxxxxxxx, Xxxxxxxxx.
"Prime Lending Rate" shall mean the rate which the Administrative
Agent announces from time to time as its prime lending rate, the Prime Lending
Rate to change when and as such prime lending rate changes. The Prime Lending
Rate is a reference rate and does not necessarily represent the lowest or best
rate actually charged to any customer by the Administrative Agent, which may
make commercial loans or other loans at rates of interest at, above or below the
Prime Lending Rate.
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"Pro Forma Basis" shall mean, in connection with any calculation of
compliance with any financial covenant or financial term, the calculation
thereof after giving effect on a pro forma basis to (w) the incurrence of any
Indebtedness (other than revolving Indebtedness, except to the extent same is
incurred to refinance other outstanding Indebtedness or to finance a Permitted
Acquisition) after the first day of the relevant Calculation Period as if such
Indebtedness had been incurred (and the proceeds thereof applied) on the first
day of the relevant Calculation Period, (x) the permanent repayment of any
Indebtedness (other than revolving Indebtedness except to the extent accompanied
by a corresponding permanent commitment reduction) after the first day of the
relevant Calculation Period as if such Indebtedness had been retired or redeemed
on the first day of the relevant Calculation Period, (y) any Asset Sale
consummated after the first day of the relevant Calculation Period as if such
Asset Sale (and the application of the proceeds therefrom) had occurred (and the
proceeds therefrom had been applied) on the first day of the relevant
Calculation Period, and/or (z) the Permitted Acquisition, if any, then being
consummated as well as any other Permitted Acquisition consummated after the
first day of the relevant Calculation Period and on or prior to the date of the
respective Permitted Acquisition then being effected, as the case may be, with
the following rules to apply in connection therewith:
(i) all Indebtedness (x) (other than revolving Indebtedness, except to
the extent same is incurred to refinance other outstanding Indebtedness or
to finance a Permitted Acquisition) incurred or issued after the first day
of the relevant Calculation Period (whether incurred to finance a Permitted
Acquisition, to refinance Indebtedness or otherwise) shall be deemed to
have been incurred or issued (and the proceeds thereof applied) on the
first day of the respective Calculation Period and remain outstanding
through the date of determination and (y) (other than revolving
Indebtedness except to the extent accompanied by a corresponding permanent
commitment reduction) permanently retired or redeemed after the first day
of the relevant Calculation Period shall be deemed to have been retired or
redeemed on the first day of the respective Calculation Period and remain
retired through the date of determination;
(ii) all Indebtedness assumed to be outstanding pursuant to preceding
clause (i) shall be deemed to have borne interest at (x) the rate
applicable thereto, in the case of fixed rate indebtedness, or (y) at the
rate which would have been applicable thereto on the last day of the
respective Calculation Period, in the case of floating rate Indebtedness
(although interest expense with respect to any Indebtedness for periods
while same was actually outstanding during the respective period shall be
calculated using the actual rates applicable thereto while same was
actually outstanding); and
(iii) in making any determination of Consolidated EBITDA, pro forma
effect shall be given to any Asset Sale or Permitted Acquisition
consummated during the periods described above, with such Consolidated
EBITDA to be determined as if such Asset Sale or Permitted Acquisition was
consummated on the first day of the relevant Calculation Period, and, in
the case of any Permitted Acquisition, taking into account factually
supportable and identifiable cost savings and expenses directly
attributable to any such Permitted Acquisition which would otherwise be
accounted for as an adjustment pursuant to Article 11 of Regulation S-X
under the Securities Act, as if such cost savings or expenses were realized
on the first day of the respective period.
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"Projections" shall mean the projections that were prepared by or on
behalf of the Borrower in connection with the Transaction and delivered to the
Administrative Agent and the Lenders prior to the Initial Borrowing Date.
"Qualified Preferred Stock" shall mean any preferred stock of the
Borrower so long as the terms of any such preferred stock (w) do not contain any
mandatory put, redemption, repayment, sinking fund or other similar provision,
(x) do not require the cash payment of dividends or distributions, (y) do not
contain any covenants (other than periodic reporting covenants) and (z) are
otherwise reasonably satisfactory to the Administrative Agent.
"Quarterly Payment Date" shall mean the 15th day of each June,
September, December and March occurring after the Initial Borrowing Date,
commencing on March 15, 2004.
"Real Property" of any Person shall mean all the right, title and
interest of such Person in and to land, improvements and fixtures, including
Leaseholds.
"Recovery Event" shall mean the receipt by the Borrower or any of its
Subsidiaries of any cash insurance proceeds or condemnation awards payable (i)
by reason of theft, loss, physical destruction, damage, taking or any other
similar event with respect to any property or assets of the Borrower or any of
its Subsidiaries and (ii) under any policy of insurance required to be
maintained under Section 8.03.
"Register" shall have the meaning provided in Section 13.15.
"Regulation D" shall mean Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof establishing reserve requirements.
"Regulation T" shall mean Regulation T of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation U" shall mean Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation X" shall mean Regulation X of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Release" shall mean actively or passively disposing, discharging,
injecting, spilling, pumping, leaking, leaching, dumping, emitting, escaping,
emptying, pouring, seeping, migrating or the like, into or upon any land or
water or air, or otherwise entering into the environment.
105
"Replaced Lender" shall have the meaning provided in Section 1.13.
"Replacement Lender" shall have the meaning provided in Section 1.13.
"Reportable Event" shall mean an event described in Section 4043(c)
of ERISA with respect to an ERISA Plan that is subject to Title IV of ERISA
other than those events as to which the 30-day notice period is waived under
subsection .22, .23, .25, .27 or .28 of PBGC Regulation Section 4043.
"Required Lenders" shall mean Non-Defaulting Lenders the sum of whose
outstanding Term Loans, Revolving Loan Commitments (or after the termination
thereof, outstanding Revolving Loans and RL Percentages of (x) outstanding
Swingline Loans and (y) WC Letter of Credit Outstandings) and Credit-Linked
Commitments (or after the termination, CL Percentages of CL Letter of Credit
Outstandings) represent at least a majority of the sum of (i) all outstanding
Term Loans of Non-Defaulting Lenders, (ii) the Total Revolving Loan Commitment
less the Revolving Loan Commitments of all Defaulting Lenders (or after the
termination thereof, the sum of then total outstanding Revolving Loans of
Non-Defaulting Lenders and the aggregate RL Percentages of all Non-Defaulting
Lenders of the total outstanding Swingline Loans and WC Letter of Credit
Outstandings at such time) and (iii) the Total Credit-Linked Commitment less the
Credit-Linked Commitments of all Defaulting Lenders (or after the termination
thereof, the aggregate CL Percentages of all Non-Defaulting Lenders of the total
CL Letter of Credit Outstandings at such time).
"Restricted" shall mean, when referring to cash or Cash Equivalents
of the Borrower or any of its Subsidiaries, that such cash or Cash Equivalents
(i) appears (or would be required to appear) as "restricted" on a consolidated
balance sheet of the Borrower or of any such Subsidiary, (ii) are subject to any
Lien in favor of any Person other than the Collateral Agent for the benefit of
the Secured Creditors or (iii) are not otherwise generally available for use by
the Borrower or any of its Subisidiaries.
"Returns" shall have the meaning provided in Section 7.09.
"Revolving Loan" shall have the meaning provided in Section 1.01(b).
"Revolving Loan Commitment" shall mean, for each Lender, the amount
set forth opposite such Lender's name in Schedule I directly below the column
entitled "Revolving Loan Commitment," as the same may be (x) reduced from time
to time or terminated pursuant to Sections 3.02, 3.03 and/or 10, as applicable,
or (y) adjusted from time to time as a result of assignments to or from such
Lender pursuant to Section 1.13 or 13.04(b).
"Revolving Note" shall have the meaning provided in Section 1.05(a).
"RL Lender" shall mean each Lender with a Revolving Loan Commitment
or with outstanding Revolving Loans.
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"RL Percentage" of any RL Lender at any time shall mean a fraction
(expressed as a percentage) the numerator of which is the Revolving Loan
Commitment of such RL Lender at such time and the denominator of which is the
Total Revolving Loan Commitment at such time, provided that if the RL Percentage
of any RL Lender is to be determined after the Total Revolving Loan Commitment
has been terminated, then the RL Percentage of such RL Lender shall be
determined immediately prior (and without giving effect) to such termination.
"R2 Group" shall mean R2 Investments, LDC ("Investments"), a limited
duration company organized and existing under the laws of the Cayman Islands,
Amalgamated Gadget, L.P. ("Amalgamated"), a limited partnership organized and
existing under the laws of Texas and the investment manager of Investments,
Scepter Holdings, Inc., a Texas corporation and the general partner of
Investments or any entity controlling, controlled by or under common control
with Investments or Amalgamated. For purposes of this definition, "control",
"controlling" and "controlled by" shall have the meaning set forth in Rule 12b-2
under the Exchange Act (as in effect on the Effective Date).
"S&P" shall mean Standard & Poor's Rating Services, a division of
XxXxxx-Xxxx, Inc., or any successor thereto.
"Sale and Leaseback Transaction" shall mean any arrangement, directly
or indirectly, whereby a seller or transferor shall sell or otherwise transfer
any real or personal property and then or thereafter lease, or repurchase under
an extended purchase contract, conditional sales or other title retention
agreement, the same or similar property.
"Scheduled Investment Termination Date" shall mean, when referring to
the Credit-Linked Deposits on deposit in the Credit-Linked Deposit Account, the
respective maturity date for the investment that the Credit-Linked Deposits have
been so invested in. The respective maturity date for such investments shall be
the date agreed to by the Borrower and the Administrative Agent from time to
time, provided that if no such agreement shall be reached, the Scheduled
Investment Termination Date shall be the last day of the then current Interest
Period applicable to the Credit-Linked Deposits.
"Scheduled Repayment" shall have the meaning provided in Section
4.02(b).
"SEC" shall have the meaning provided in Section 8.01(h).
"Section 4.04 Indemnitee" shall have the meaning provided in Section
4.04(a).
"Section 4.04(b)(ii) Certificate" shall have the meaning provided in
Section 4.04(b)(ii).
"Secured Creditors" shall have the meaning assigned that term in the
respective Security Documents.
"Securities Act" shall mean the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"Security Agreement" shall have the meaning provided in Section 5.10.
107
"Security Agreement Collateral" shall mean all "Collateral" as
defined in the Security Agreement.
"Security Documents" shall mean and include the Pledge Agreement, the
Security Agreement, each Mortgage and each other Additional Security Document.
"Shareholders' Agreements" shall have the meaning provided in Section
5.13.
"Specified Default" shall mean any Default under Section 10.01 or
10.05.
"Stated Amount" of each Letter of Credit shall mean, at any time, the
maximum amount available to be drawn thereunder (in each case determined without
regard to whether any conditions to drawing could then be met).
"Subsidiaries Guaranty" shall have the meaning provided in Section
5.09.
"Subsidiary" shall mean, as to any Person, (i) any corporation more
than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person and/or one or
more Subsidiaries of such Person and (ii) any partnership, limited liability
company, association, joint venture or other entity in which such Person and/or
one or more Subsidiaries of such Person has more than a 50% equity interest at
the time.
"Subsidiary Guarantor" shall mean each Wholly-Owned Domestic
Subsidiary of the Borrower and, to the extent required by Section 8.13, each
Wholly-Owned Foreign Subsidiary of the Borrower other than, in each case, any
such Wholly-Owned Subsidiary that is (but only for so long as it is) a
Wholly-Owned Specified Subsidiary.
"Swingline Expiry Date" shall mean that date which is five Business
Days prior to the Final Maturity Date.
"Swingline Lender" shall mean DBAG for so long as DBAG is the
Administrative Agent hereunder and thereafter shall mean the successor
Administrative Agent in its individual capacity.
"Swingline Loan" shall have the meaning provided in Section 1.01(c).
"Swingline Note" shall have the meaning provided in Section 1.05(a).
"Syndication Date" shall mean that date upon which the Administrative
Agent determines in its sole discretion (and notifies the Borrower) that the
primary syndication (and resultant addition of Persons as Lenders pursuant to
Section 13.04(b)) has been completed.
"Tax Sharing Agreements" shall have the meaning provided in Section
5.13.
"Taxes" shall have the meaning provided in Section 4.04(a).
108
"Term Loan" shall have the meaning provided in Section 1.01(a).
"Term Loan Commitment" shall mean, for each Lender, the amount set
forth opposite such Lender's name in Schedule I directly below the column
entitled "Term Loan Commitment," as the same may be terminated pursuant to
Sections 3.03 and/or 10.
"Term Note" shall have the meaning provided in Section 1.05(a).
"Test Period" shall mean each period of four consecutive fiscal
quarters of the Borrower then last ended (in each case taken as one accounting
period). Notwithstanding anything to the contrary contained above in this
definition or in Section 13.07 or otherwise required by generally accepted
accounting principles, (A) for purposes of determining compliance with Section
9.08 for any Test Period ending on or before December 31, 2004, each such Test
Period shall mean the period from January 1, 2004 to the last day of the fiscal
quarter of the Borrower then last ended (in each case taken as one accounting
period) (and calculated on a pro forma basis and if the Transaction and the
related financing had occurred on January 1, 2004) and (B) for purposes of
determining compliance with Sections 9.09, 9.10 and 9.11, Consolidated EBITDA
for (i) the fiscal quarter of the Borrower ended March 31, 2003 shall be
$40,700,000, (ii) the fiscal quarter of the Borrower ended June 30, 2003 shall
be $40,000,000, (iii) the fiscal quarter of the Borrower ended September 30,
2003 shall be $41,300,000 and (iv) the fiscal quarter of the Borrower ended
December 31, 2003 shall be $34,600,000 (although once the Borrower's financial
statements which include the Borrower's fiscal quarter ended December 31, 2003
have been delivered to the Lenders, the Consolidated EBITDA for such fiscal
quarter shall be adjusted to reflect the actual reported financial results of
the Borrower for such fiscal quarter).
"Total Commitment" shall mean, at any time, the sum of the
Commitments of each of the Lenders at such time.
"Total Credit-Linked Commitment" shall mean, at any time, the sum of
the Credit-Linked Commitments of each of the Lenders at such time.
"Total Leverage Ratio" shall mean, at any time, the ratio of
Consolidated Indebtedness at such time to Consolidated EBITDA for the Test
Period then most recently ended.
"Total Revolving Loan Commitment" shall mean, at any time, the sum of
the Revolving Loan Commitments of each of the Lenders at such time.
"Total Term Loan Commitment" shall mean, at any time, the sum of the
Term Loan Commitments of each of the Lenders at such time.
"Total Unutilized Credit-Linked Commitment" shall mean, at any time,
an amount equal to the remainder of (x) the Total Credit-Linked Commitment then
in effect less (y) the aggregate amount of the CL Letter of Credit Outstandings
at such time.
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"Total Unutilized Revolving Loan Commitment" shall mean, at any time,
an amount equal to the remainder of (x) the Total Revolving Loan Commitment then
in effect less (y) the sum of the aggregate principal amount of all Revolving
Loans and Swingline Loans then outstanding plus the aggregate amount of all WC
Letter of Credit Outstandings at such time; provided, however, for purposes of
determining the Applicable Commitment Commission Percentage at any time, the
Total Unutilized Revolving Loan Commitment shall be determined without regard to
any outstanding Swingline Loans.
"Tranche" shall mean the respective facility and commitments utilized
in making Loans and issuing Letters of Credit hereunder, with there being four
separate Tranches, i.e., Term Loans, Revolving Loans, Swingline Loan and the CL
Letters of Credit.
"Transaction" shall mean, collectively, (i) the consummation of the
Plan of Reorganization, (ii) the consummation of the Equity Offering, (iii) the
entering into of the Credit Documents and the incurrence of Loans and issuance
of Letters of Credit on the Initial Borrowing Date, (iv) the issuance of the New
Senior Notes on the Initial Borrowing Date and (v) the payment of all fees and
expenses in connection with the foregoing.
"Type" shall mean the type of Loan determined with regard to the
interest option applicable thereto, i.e., whether a Base Rate Loan or a
Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code as from time to time in
effect in the relevant jurisdiction.
"Unfunded Current Liability" of any ERISA Plan shall mean the amount,
if any, by which the value of the accumulated plan benefits under the ERISA Plan
determined on a plan termination basis in accordance with actuarial assumptions
at such time consistent with those prescribed by the PBGC for purposes of
Section 4044 of ERISA, exceeds the fair market value of all plan assets
allocable to such liabilities under Title IV of ERISA (excluding any accrued but
unpaid contribution).
"United States" and "U.S." shall each mean the United States of
America.
"Unpaid Drawing" shall have the meaning provided in Section 2.05(a).
"Unrestricted" shall mean, when referring to cash or Cash Equivalents
of the Borrower or any of its Subsidiaries, that such cash or Cash Equivalents
are not Restricted.
"Unutilized Revolving Loan Commitment" shall mean, with respect to
any Lender at any time, such Lender's Revolving Loan Commitment at such time
less the sum of (i) the aggregate outstanding principal amount of all Revolving
Loans made by such Lender at such time and (ii) such Lender's RL Percentage of
the WC Letter of Credit Outstandings at such time.
"U.S. Lender" shall mean each Lender, each Issuing Lender or the
Administrative Agent that is a "United States person" (as such term is defined
in Section 7701(a)(30) of the Code) for U.S. Federal income tax purposes.
"Voting Power" shall mean, with respect to any class or classes of
capital stock of the Borrower (or any class or classes of capital stock then
convertible into such capital stock at the option of the holders thereof), the
voting power entitled to vote in the election of directors of the Borrower.
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"WC Letter of Credit Fee" shall have the meaning provided in Section
3.01(b).
"WC Letter of Credit" shall mean each Letter of Credit designated as
such pursuant to Section 2.03(a) (although any WC Letter of Credit initially
designated as such shall cease to constitute a WC Letter of Credit upon its
re-designation as a CL Letter of Credit pursuant to Section 2.03(c)).
"WC Letter of Credit Outstandings" shall mean, at any time, the
aggregate amount of all Letter of Credit Outstandings at such time in respect of
WC Letters of Credit.
"WC Unpaid Drawing" shall mean any Unpaid Drawing under a WC Letter
of Credit.
"Wholly-Owned Domestic Subsidiary" shall mean, as to any Person, any
Wholly-Owned Subsidiary of such Person which is also a Domestic Subsidiary of
such Person.
"Wholly-Owned Foreign Subsidiary" shall mean, as to any Person, any
Wholly-Owned Subsidiary of such Person which is also a Foreign Subsidiary of
such Person.
"Wholly-Owned Specified Subsidiary" shall mean any Wholly-Owned
Subsidiary of the Borrower that is prohibited from entering into any Credit
Document because to do so either (x) would violate a law, regulation, rule,
order, approval, license or other restriction applicable to such Wholly-Owned
Subsidiary due to the regulated nature of such Wholly-Owned Subsidiary's
operations and issued or imposed by any governmental authority having
jurisdiction over such Wholly-Owned Subsidiary or (y) would reasonably be
expected to cause such Wholly-Owned Subsidiary to fail to satisfy a net worth,
net equity or capital requirement or similar calculation or requirement imposed
on such Wholly-Owned Subsidiary by any governmental authority having
jurisdiction over such Wholly-Owned Subsidiary due to the regulated nature of
such Wholly-Owned Subsidiary's operations.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i) any
corporation 100% of whose capital stock is at the time owned by such Person
and/or one or more Wholly-Owned Subsidiaries of such Person and (ii) any
partnership, association, joint venture or other entity in which such Person
and/or one or more Wholly-Owned Subsidiaries of such Person has a 100% equity
interest at such time.
SECTION 12. The Administrative Agent.
12.01 Appointment. The Lenders hereby irrevocably designate and
appoint DBAG as Administrative Agent (for purposes of this Section 12 and
Section 13.01, the term "Administrative Agent" also shall include DBAG in its
capacity as Collateral Agent pursuant to the Security Documents) to act as
specified herein and in the other Credit Documents. Each Lender hereby
irrevocably authorizes, and each holder of any Note by the acceptance of such
Note shall be deemed irrevocably to authorize, the Administrative Agent to take
such action on its behalf under the provisions of this Agreement, the other
Credit Documents and any other instruments and agreements referred to herein or
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therein and to exercise such powers and to perform such duties hereunder and
thereunder as are specifically delegated to or required of the Administrative
Agent by the terms hereof and thereof and such other powers as are reasonably
incidental thereto. The Administrative Agent may perform any of its respective
duties hereunder by or through its officers, directors, agents, employees or
affiliates.
12.02 Nature of Duties. The Administrative Agent shall not have any
duties or responsibilities except those expressly set forth in this Agreement
and in the other Credit Documents. Neither the Administrative Agent nor any of
its officers, directors, agents, employees or affiliates shall be liable for any
action taken or omitted by it or them hereunder or under any other Credit
Document or in connection herewith or therewith, unless caused by its or their
gross negligence or willful misconduct (as determined by a court of competent
jurisdiction in a final and non-appealable decision). The duties of the
Administrative Agent shall be mechanical and administrative in nature; the
Administrative Agent shall not have by reason of this Agreement or any other
Credit Document a fiduciary relationship in respect of any Lender or the holder
of any Note; and nothing in this Agreement or in any other Credit Document,
expressed or implied, is intended to or shall be so construed as to impose upon
the Administrative Agent any obligations in respect of this Agreement or any
other Credit Document except as expressly set forth herein or therein.
12.03 Lack of Reliance on the Administrative Agent. Independently and
without reliance upon the Administrative Agent, each Lender and the holder of
each Note, to the extent it deems appropriate, has made and shall continue to
make (i) its own independent investigation of the financial condition and
affairs of the Borrower and its Subsidiaries in connection with the making and
the continuance of the Loans and Letters of Credit and the taking or not taking
of any action in connection herewith and (ii) its own appraisal of the
creditworthiness of the Borrower and its Subsidiaries and, except as expressly
provided in this Agreement, the Administrative Agent shall not have any duty or
responsibility, either initially or on a continuing basis, to provide any Lender
or the holder of any Note with any credit or other information with respect
thereto, whether coming into its possession before the making of the Loans or
the issuance of any Letter of Credit or at any time or times thereafter. The
Administrative Agent shall not be responsible to any Lender or the holder of any
Note for any recitals, statements, information, representations or warranties
herein or in any document, certificate or other writing delivered in connection
herewith or for the execution, effectiveness, genuineness, validity,
enforceability, perfection, collectibility, priority or sufficiency of this
Agreement or any other Credit Document or the financial condition of the
Borrower or any of its Subsidiaries or be required to make any inquiry
concerning either the performance or observance of any of the terms, provisions
or conditions of this Agreement or any other Credit Document, or the financial
condition of the Borrower or any of its Subsidiaries or the existence or
possible existence of any Default or Event of Default.
12.04 Certain Rights of the Administrative Agent. If the
Administrative Agent requests instructions from the Required Lenders with
respect to any act or action (including failure to act) in connection with this
Agreement or any other Credit Document, the Administrative Agent shall be
entitled to refrain from such act or taking such action unless and until the
Administrative Agent shall have received instructions from the Required Lenders;
and the Administrative Agent shall not incur liability to any Lender by reason
of so refraining. Without limiting the foregoing, neither any Lender nor the
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holder of any Note shall have any right of action whatsoever against the
Administrative Agent as a result of the Administrative Agent acting or
refraining from acting hereunder or under any other Credit Document in
accordance with the instructions of the Required Lenders.
12.05 Reliance. The Administrative Agent shall be entitled to rely,
and shall be fully protected in relying, upon any note, writing, resolution,
notice, statement, certificate, telex, teletype or telecopier message,
cablegram, radiogram, order or other document or telephone message signed, sent
or made by any Person that the Administrative Agent believed to be the proper
Person, and, with respect to all legal matters pertaining to this Agreement and
any other Credit Document and its duties hereunder and thereunder, upon advice
of counsel selected by the Administrative Agent.
12.06 Indemnification. To the extent the Administrative Agent (or any
affiliate thereof) is not reimbursed and indemnified by the Borrower, the
Lenders will reimburse and indemnify the Administrative Agent (and any affiliate
thereof) in proportion to their respective "percentage" as used in determining
the Required Lenders (determined as if there were no Defaulting Lenders) for and
against any and all liabilities, obligations, losses, damages, penalties,
claims, actions, judgments, costs, expenses or disbursements of whatsoever kind
or nature which may be imposed on, asserted against or incurred by the
Administrative Agent (or any affiliate thereof) in performing its duties
hereunder or under any other Credit Document (including, without limitation, any
account control agreements entered into pursuant to the Security Agreement) or
in any way relating to or arising out of this Agreement or any other Credit
Document (including, without limitation, any account control agreements entered
into pursuant to the Security Agreement); provided that no Lender shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, claims, actions, judgments, suits, costs, expenses or disbursements
resulting from the Administrative Agent's (or such affiliate's) gross negligence
or willful misconduct (as determined by a court of competent jurisdiction in a
final and non-appealable decision).
12.07 The Administrative Agent in its Individual Capacity. With
respect to its obligation to make Loans, or issue or participate in Letters of
Credit, under this Agreement, the Administrative Agent shall have the rights and
powers specified herein for a "Lender" and may exercise the same rights and
powers as though it were not performing the duties specified herein; and the
term "Lender," "Required Lenders," "holders of Notes" or any similar terms
shall, unless the context clearly indicates otherwise, include the
Administrative Agent in its respective individual capacities. The Administrative
Agent and its affiliates may accept deposits from, lend money to, and generally
engage in any kind of banking, investment banking, trust or other business with,
or provide debt financing, equity capital or other services (including financial
advisory services) to any Credit Party or any Affiliate of any Credit Party (or
any Person engaged in a similar business with any Credit Party or any Affiliate
thereof) as if they were not performing the duties specified herein, and may
accept fees and other consideration from any Credit Party or any Affiliate of
any Credit Party for services in connection with this Agreement and otherwise
without having to account for the same to the Lenders.
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12.08 Holders. The Administrative Agent may deem and treat the payee
of any Note as the owner thereof for all purposes hereof unless and until a
written notice of the assignment, transfer or endorsement thereof, as the case
may be, shall have been filed with the Administrative Agent. Any request,
authority or consent of any Person who, at the time of making such request or
giving such authority or consent, is the holder of any Note shall be conclusive
and binding on any subsequent holder, transferee, assignee or endorsee, as the
case may be, of such Note or of any Note or Notes issued in exchange therefor.
12.09 Resignation by the Administrative Agent. (a) The Administrative
Agent may resign from the performance of all its respective functions and duties
hereunder and/or under the other Credit Documents at any time by giving 15
Business Days' prior written notice to the Lenders and, unless a Default or an
Event of Default under Section 10.05 then exists, the Borrower. Any such
resignation by an Administrative Agent hereunder shall also constitute its
resignation as an Issuing Lender and the Swingline Lender, in which case the
resigning Administrative Agent (x) shall not be required to issue any further
Letters of Credit or make any additional Swingline Loans hereunder and (y) shall
maintain all of its rights as Issuing Lender or Swingline Lender, as the case
may be, with respect to any Letters of Credit issued by it, or Swingline Loans
made by it, prior to the date of such resignation. Such resignation shall take
effect upon the appointment of a successor Administrative Agent pursuant to
clauses (b) and (c) below or as otherwise provided below.
(b) Upon any such notice of resignation by the Administrative Agent,
the Required Lenders shall appoint a successor Administrative Agent hereunder or
thereunder who shall be a commercial bank or trust company reasonably acceptable
to the Borrower, which acceptance shall not be unreasonably withheld or delayed
(provided that the Borrower's approval shall not be required if an Event of
Default then exists).
(c) If a successor Administrative Agent shall not have been so
appointed within such 15 Business Day period, the Administrative Agent, with the
consent of the Borrower (which consent shall not be unreasonably withheld or
delayed, provided that the Borrower's consent shall not be required if an Event
of Default then exists), shall then appoint a successor Administrative Agent who
shall serve as Administrative Agent hereunder or thereunder until such time, if
any, as the Required Lenders appoint a successor Administrative Agent as
provided above.
(d) If no successor Administrative Agent has been appointed pursuant
to clause (b) or (c) above by the 20th Business Day after the date such notice
of resignation was given by the Administrative Agent, the Administrative Agent's
resignation shall become effective and the Required Lenders shall thereafter
perform all the duties of the Administrative Agent hereunder and/or under any
other Credit Document until such time, if any, as the Required Lenders appoint a
successor Administrative Agent as provided above.
(e) Upon a resignation of the Administrative Agent pursuant to this Section
12.09, the Administrative Agent shall remain indemnified to the extent provided
in this Agreement and the other Credit Documents and the provisions of this
Section 12 shall continue in effect for the benefit of the Administrative Agent
for all of its actions and inactions while serving as the Administrative Agent.
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SECTION 13. Miscellaneous.
13.01 Payment of Expenses, etc. The Borrower hereby agrees to: (i)
whether or not the transactions herein contemplated are consummated, pay all
reasonable out-of-pocket costs and expenses of the Administrative Agent and its
affiliates (including, without limitation, the reasonable fees and disbursements
of White & Case LLP and the Administrative Agent's other counsel and
consultants) in connection with the preparation, execution, delivery and
administration of this Agreement (including to administer the Credit-Linked
Deposit Account and the Credit-Linked Deposits) and the other Credit Documents
and the documents and instruments referred to herein and therein and any
amendment, waiver or consent relating hereto or thereto, of the Administrative
Agent in connection with its syndication efforts with respect to this Agreement
and of the Administrative Agent and, after the occurrence of an Event of
Default, each of the Issuing Lenders and Lenders in connection with the
enforcement of this Agreement and the other Credit Documents and the documents
and instruments referred to herein and therein or in connection with any
refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a "work-out" or pursuant to any insolvency or
bankruptcy proceedings (including, in each case without limitation, the
reasonable fees and disbursements of counsel and consultants for the
Administrative Agent and, after the occurrence of an Event of Default, counsel
for each of the Issuing Lenders and Lenders); (ii) pay and hold the
Administrative Agent, each of the Issuing Lenders and each of the Lenders
harmless from and against any and all present and future stamp, excise and other
similar documentary taxes with respect to the foregoing matters and save the
Administrative Agent, each of the Issuing Lenders and each of the Lenders
harmless from and against any and all liabilities with respect to or resulting
from any delay or omission (other than to the extent attributable to the
Administrative Agent, such Issuing Lender or such Lender) to pay such taxes; and
(iii) indemnify the Administrative Agent, each Issuing Lender and each Lender,
and each of their respective officers, directors, employees, representatives,
agents, affiliates, trustees and investment advisors from and hold each of them
harmless against any and all liabilities, obligations (including removal or
remedial actions), losses, damages, penalties, claims, actions, judgments,
suits, costs, expenses and disbursements (including reasonable attorneys' and
consultants' fees and disbursements) incurred by, imposed on or assessed against
any of them as a result of, or arising out of, or in any way related to, or by
reason of, (a) any investigation, litigation or other proceeding (whether or not
the Administrative Agent, any Issuing Lender or any Lender is a party thereto
and whether or not such investigation, litigation or other proceeding is brought
by or on behalf of any Credit Party) related to the entering into and/or
performance of this Agreement or any other Credit Document or the use of any
Letter of Credit or the proceeds of any Loans hereunder or the consummation of
the Transaction or any other transactions contemplated herein or in any other
Credit Document or the exercise of any of their rights or remedies provided
herein or in the other Credit Documents, or (b) the actual or alleged presence
of Hazardous Materials in the air, surface water or groundwater or on the
surface or subsurface of any Real Property at any time owned, leased or operated
by the Borrower or any of its Subsidiaries, the generation, storage,
transportation, handling or disposal of Hazardous Materials by the Borrower or
any of its Subsidiaries at any location, whether or not owned, leased or
operated by the Borrower or any of its Subsidiaries, the non-compliance by the
Borrower or any of its Subsidiaries with any Environmental Law (including
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applicable permits thereunder) applicable to any Real Property, or any
Environmental Claim asserted against the Borrower, any of its Subsidiaries or
any Real Property at any time owned, leased or operated by the Borrower or any
of its Subsidiaries, including, in each case, without limitation, the reasonable
fees and disbursements of counsel and other consultants incurred in connection
with any such investigation, litigation or other proceeding (but excluding any
losses, liabilities, claims, damages or expenses to the extent incurred by
reason of the gross negligence or willful misconduct of the Person to be
indemnified (as determined by a court of competent jurisdiction in a final and
non-appealable decision)). To the extent that the undertaking to indemnify, pay
or hold harmless the Administrative Agent, any Issuing Lender or any Lender set
forth in the preceding sentence may be unenforceable because it is violative of
any law or public policy, the Borrower shall make the maximum contribution to
the payment and satisfaction of each of the indemnified liabilities which is
permissible under applicable law.
13.02 Right of Setoff. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence and during the continuance of an Event of
Default, the Administrative Agent, each Issuing Lender and each Lender is hereby
authorized at any time or from time to time, without presentment, demand,
protest or other notice of any kind to any Credit Party or to any other Person,
any such notice being hereby expressly waived, to set off and to appropriate and
apply any and all deposits (general or special) and any other Indebtedness at
any time held or owing by the Administrative Agent, such Issuing Lender or such
Lender (including, without limitation, by branches and agencies of the
Administrative Agent, such Issuing Lender or such Lender wherever located) to or
for the credit or the account of the Borrower or any of its Subsidiaries against
and on account of the Obligations and liabilities of the Credit Parties to the
Administrative Agent, such Issuing Lender or such Lender under this Agreement or
under any of the other Credit Documents, including, without limitation, all
interests in Obligations purchased by such Lender pursuant to Section 13.06(b),
and all other claims of any nature or description arising out of or connected
with this Agreement or any other Credit Document, irrespective of whether or not
the Administrative Agent, such Issuing Lender or such Lender shall have made any
demand hereunder and although said Obligations, liabilities or claims, or any of
them, shall be contingent or unmatured.
13.03 Notices. Except as otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, telecopier or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered: if to any Credit Party,
at the address specified opposite its signature below or in the other relevant
Credit Documents; if to any Lender, at its address specified on Schedule II; and
if to the Administrative Agent, at the Notice Office; or, as to any Credit Party
or the Administrative Agent, at such other address as shall be designated by
such party in a written notice to the other parties hereto and, as to each
Lender, at such other address as shall be designated by such Lender in a written
notice to the Borrower and the Administrative Agent. All such notices and
communications shall, when mailed, telegraphed, telexed, telecopied, or cabled
or sent by overnight courier, be effective when deposited in the mails,
delivered to the telegraph company, cable company or overnight courier, as the
case may be, or sent by telex or telecopier, except that notices and
communications to the Administrative Agent and the Borrower shall not be
effective until received by the Administrative Agent or the Borrower, as the
case may be.
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13.04 Benefit of Agreement; Assignments; Participations. (a) This
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the respective successors and assigns of the parties hereto; provided,
however, the Borrower may not assign or transfer any of its rights, obligations
or interest hereunder without the prior written consent of the Lenders and,
provided further, that, although any Lender may transfer, assign or grant
participations in its rights hereunder, such Lender shall remain a "Lender" for
all purposes hereunder (and may not transfer or assign all or any portion of its
Commitments hereunder except as provided in Sections 1.13 and 13.04(b)) and the
transferee, assignee or participant, as the case may be, shall not constitute a
"Lender" hereunder and, provided further, that no Lender shall transfer or grant
any participation under which the participant shall have rights to approve any
amendment to or waiver of this Agreement or any other Credit Document except to
the extent such amendment or waiver would (i) extend the final scheduled
maturity of any Loan, Note or Letter of Credit (unless such Letter of Credit is
not extended beyond the one year anniversary of the Final Maturity Date) in
which such participant is participating, or reduce the rate or extend the time
of payment of interest or Fees thereon (except in connection with a waiver of
applicability of any post-default increase in interest rates) or reduce the
principal amount thereof (it being understood that any amendment or modification
to the financial definitions in this Agreement or to Section 13.07(a) shall not
constitute a reduction in the rate of interest or Fees payable hereunder), or
increase the amount of the participant's participation over the amount thereof
then in effect (it being understood that a waiver of any Default or Event of
Default or of a mandatory reduction in the Total Commitment shall not constitute
a change in the terms of such participation, and that an increase in any
Commitment (or the available portion thereof) or Loan shall be permitted without
the consent of any participant if the participant's participation is not
increased as a result thereof), (ii) consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this Agreement or (iii)
release all or substantially all of the Collateral under all of the Security
Documents (except as expressly provided in the Credit Documents) supporting the
Loans or Letters of Credit hereunder in which such participant is participating.
In the case of any such participation, the participant shall not have any rights
under this Agreement or any of the other Credit Documents (the participant's
rights against such Lender in respect of such participation to be those set
forth in the agreement executed by such Lender in favor of the participant
relating thereto) and all amounts payable by the Borrower hereunder shall be
determined as if such Lender had not sold such participation.
(b) Notwithstanding the foregoing, any Lender (or any Lender together
with one or more other Lenders) may (x) assign all or a portion of its
Commitments and related outstanding Obligations (or, if the Commitments with
respect to the relevant Tranche have terminated, outstanding Obligations)
hereunder to (i)(A) its parent company and/or any affiliate of such Lender which
is at least 50% owned by such Lender or its parent company or (B) to one or more
other Lenders or any affiliate of any such other Lender which is at least 50%
owned by such other Lender or its parent company (provided that any fund that
invests in loans and is managed or advised by the same investment advisor of
another fund which is a Lender (or by an Affiliate of such investment advisor)
shall be treated as an affiliate of such other Lender for the purposes of this
sub-clause (x)(i)(B)), or (ii) in the case of any Lender that is a fund that
invests in loans, any other fund that invests in loans and is managed or advised
by the same investment advisor of any Lender or by an Affiliate of such
investment advisor or (y) assign all, or if less than all, a portion equal to at
least $1,000,000 in the aggregate for the assigning Lender or assigning Lenders
of such Commitments and related outstanding Obligations (or, if the Commitments
with respect to the relevant Tranche have terminated, outstanding Obligations)
hereunder to one or more Eligible Transferees (treating any fund that invests in
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loans and any other fund that invests in loans and is managed or advised by the
same investment advisor of such fund or by an Affiliate of such investment
advisor as a single Eligible Transferee), each of which assignees shall become a
party to this Agreement as a Lender by execution of an Assignment and Assumption
Agreement, provided that (i) at such time, Schedule I shall be deemed modified
to reflect the Commitments and/or outstanding Loans, as the case may be, of such
new Lender and of the existing Lenders, (ii) upon the surrender of the relevant
Notes by the assigning Lender (or, upon such assigning Lender's indemnifying the
Borrower for any lost Note pursuant to a customary indemnification agreement)
new Notes will be issued, at the Borrower's expense, to such new Lender and to
the assigning Lender upon the request of such new Lender or assigning Lender,
such new Notes to be in conformity with the requirements of Section 1.05 (with
appropriate modifications) to the extent needed to reflect the revised
Commitments and/or outstanding Loans, as the case may be, (iii) the consent of
the Administrative Agent and, so long as no Specified Default or Event of
Default then exists and the Syndication Date has theretofore occurred, the
consent of the Borrower in each case shall be required in connection with any
such assignment pursuant to clause (y) above (each of which consents shall not
be unreasonably withheld or delayed), (iv) the Administrative Agent shall
receive at the time of each such assignment, from the assigning or assignee
Lender, the payment of a non-refundable assignment fee of $3,500 and (v) no such
transfer or assignment will be effective until recorded by the Administrative
Agent on the Register pursuant to Section 13.15. To the extent of any assignment
pursuant to this Section 13.04(b), the assigning Lender shall be relieved of its
obligations hereunder with respect to its assigned Commitments and outstanding
Loans. At the time of each assignment pursuant to this Section 13.04(b) to a
Person which is not already a Lender hereunder, the respective assignee Lender
shall, to the extent legally entitled to do so, provide to the Borrower the
appropriate Internal Revenue Service Forms (and, if applicable, a Section
4.04(b)(ii) Certificate) described in Section 4.04(b). To the extent that an
assignment of all or any portion of a Lender's Commitments and related
outstanding Obligations pursuant to Section 1.13 or this Section 13.04(b) would,
at the time of such assignment, result in increased costs under Section 1.10,
2.06 or 4.04 from those being charged by the respective assigning Lender prior
to such assignment, then the Borrower shall not be obligated to pay such
increased costs (although the Borrower, in accordance with and pursuant to the
other provisions of this Agreement, shall be obligated to pay any other
increased costs of the type described above resulting from changes in any
applicable law, treaty, governmental rule, regulation, guideline or order, or in
the interpretation thereof, after the date of the respective assignment).
Without the consent of the Administrative Agent, the Credit-Linked Deposit
funded by any CL Lender shall not be released in connection with any assignment
of its Credit-Linked Commitment, but shall instead be purchased by the relevant
assignee and continue to be held for application (if not already applied)
pursuant to Section 2.04(c) in respect of such assignee's obligations under the
Credit-Linked Commitment assigned to it.
(c) Nothing in this Agreement shall prevent or prohibit any Lender
from pledging its Loans and Notes hereunder to a Federal Reserve Bank in support
of borrowings made by such Lender from such Federal Reserve Bank and, with prior
notification to the Administrative Agent (but without the consent of the
Administrative Agent or the Borrower), any Lender which is a fund may pledge all
or any portion of its Loans and Notes to its trustee or to a collateral agent
providing credit or credit support to such Lender in support of its obligations
to such trustee, such collateral agent or a holder of such obligations, as the
case may be. No pledge pursuant to this clause (c) shall release the transferor
Lender from any of its obligations hereunder.
118
13.05 No Waiver; Remedies Cumulative. No failure or delay on the part
of the Administrative Agent, the Collateral Agent, any Issuing Lender or any
Lender in exercising any right, power or privilege hereunder or under any other
Credit Document and no course of dealing between the Borrower or any other
Credit Party and the Administrative Agent, the Collateral Agent, any Issuing
Lender or any Lender shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power or privilege hereunder or under any other
Credit Document preclude any other or further exercise thereof or the exercise
of any other right, power or privilege hereunder or thereunder. The rights,
powers and remedies herein or in any other Credit Document expressly provided
are cumulative and not exclusive of any rights, powers or remedies which the
Administrative Agent, the Collateral Agent, any Issuing Lender or any Lender
would otherwise have. No notice to or demand on any Credit Party in any case
shall entitle any Credit Party to any other or further notice or demand in
similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent, the Collateral Agent, any Issuing Lender or any Lender to
any other or further action in any circumstances without notice or demand.
13.06 Payments Pro Rata. (a) Except as otherwise provided in this
Agreement, the Administrative Agent agrees that promptly after its receipt of
each payment from or on behalf of the Borrower in respect of any Obligations
hereunder, the Administrative Agent shall distribute such payment to the Lenders
entitled thereto (other than any Lender that has consented in writing to waive
its pro rata share of any such payment) pro rata based upon their respective
shares, if any, of the Obligations with respect to which such payment was
received.
(b) Each of the Lenders agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise), which is applicable to the payment of the principal of, or interest
on, the Loans, Unpaid Drawings, Commitment Commission, CL Facility Fees or WC
Letter of Credit Fees, of a sum which with respect to the related sum or sums
received by other Lenders is in a greater proportion than the total of such
Obligation then owed and due to such Lender bears to the total of such
Obligation then owed and due to all of the Lenders immediately prior to such
receipt, then such Lender receiving such excess payment shall purchase for cash
without recourse or warranty from the other Lenders an interest in the
Obligations of the respective Credit Party to such Lenders in such amount as
shall result in a proportional participation by all the Lenders in such amount;
provided that if all or any portion of such excess amount is thereafter
recovered from such Lenders, such purchase shall be rescinded and the purchase
price restored to the extent of such recovery, but without interest.
(c) Notwithstanding anything to the contrary contained herein, the
provisions of the preceding Sections 13.06(a) and (b) shall be subject to the
express provisions of this Agreement which require, or permit, differing
payments to be made to Non-Defaulting Lenders as opposed to Defaulting Lenders.
119
13.07 Calculations; Computations. (a) The financial statements to be
furnished to the Lenders pursuant hereto shall be made and prepared in
accordance with generally accepted accounting principles in the United States
consistently applied throughout the periods involved (except as set forth in the
notes thereto or as otherwise disclosed in writing by the Borrower to the
Lenders); provided that, (i) except as otherwise specifically provided herein,
all computations and all definitions (including accounting terms) used in
determining compliance with Sections 8.16 and 9.07 through 9.11, inclusive,
shall utilize generally accepted accounting principles and policies in
conformity with those used to prepare the audited historical financial
statements of the Borrower referred to in Section 7.05(a) and (ii) to the extent
expressly provided herein, certain calculations shall be made on a Pro Forma
Basis.
(b) All computations of interest, Commitment Commission and other
Fees hereunder shall be made on the basis of a year of 360 days for the actual
number of days (including the first day but excluding the last day; except that
in the case of WC Letter of Credit Fees and Facing Fees, the last day shall be
included) occurring in the period for which such interest, Commitment Commission
or Fees are payable.
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF
JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL, EXCEPT AS OTHERWISE
PROVIDED IN CERTAIN OF THE MORTGAGES, BE CONSTRUED IN ACCORDANCE WITH AND BE
GOVERNED BY THE LAW OF THE STATE OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING
WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN
THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF NEW YORK, IN EACH CASE WHICH ARE LOCATED IN THE COUNTY OF NEW YORK,
AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT,
THE BORROWER HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID
COURTS. THE BORROWER HEREBY FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH
COURTS LACK PERSONAL JURISDICTION OVER THE BORROWER, AND AGREES NOT TO PLEAD OR
CLAIM, IN ANY LEGAL ACTION PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER CREDIT DOCUMENTS BROUGHT IN ANY OF THE AFOREMENTIONED COURTS, THAT SUCH
COURTS LACK PERSONAL JURISDICTION OVER THE BORROWER. THE BORROWER FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED
COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE BORROWER AT ITS ADDRESS
SET FORTH OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS
AFTER SUCH MAILING. THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION TO SUCH
SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR
CLAIM IN ANY ACTION OR PROCEEDING COMMENCED HEREUNDER OR UNDER ANY OTHER CREDIT
DOCUMENT THAT SERVICE OF PROCESS WAS IN ANY WAY INVALID OR INEFFECTIVE. NOTHING
HEREIN SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT, ANY LENDER OR THE
HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE BORROWER IN ANY
OTHER JURISDICTION.
120
(b) THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR
PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER
CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY
FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT
THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN
AN INCONVENIENT FORUM.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING
OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
13.09 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Administrative Agent.
13.10 Effectiveness. This Agreement shall become effective on the
date (the "Effective Date") on which the Borrower, the Administrative Agent and
each of the Lenders shall have signed a counterpart hereof (whether the same or
different counterparts) and shall have delivered the same to the Administrative
Agent at the Notice Office or, in the case of the Lenders, shall have given to
the Administrative Agent telephonic (confirmed in writing), written or telex
notice (actually received) at such office that the same has been signed and
mailed to it. The Administrative Agent will give the Borrower and each Lender
prompt written notice of the occurrence of the Effective Date.
13.11 Headings Descriptive. The headings of the several sections and
subsections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.
13.12 Amendment or Waiver; etc. (a) Neither this Agreement nor any
other Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the respective Credit Parties party hereto or thereto and
the Required Lenders (although additional parties may be added to (and annexes
may be modified to reflect such additions), and Subsidiaries of the Borrower may
be released from, the Subsidiaries Guaranty and the Security Documents in
accordance with the provisions hereof and thereof without the consent of the
other Credit Parties party thereto or the Required Lenders), provided that no
such change, waiver, discharge or termination shall, without the consent of each
121
Lender (other than a Defaulting Lender) (with Obligations being directly
affected in the case of following clause (i)), (i) extend the final scheduled
maturity of any Loan or Note or extend the stated expiration date of any Letter
of Credit beyond the one year anniversary of the Final Maturity Date, or reduce
the rate or extend the time of payment of interest or Fees thereon (except in
connection with the waiver of applicability of any post-default increase in
interest rates), or reduce the principal amount thereof (it being understood
that any amendment or modification to the financial definitions in this
Agreement or to Section 13.07(a) shall not constitute a reduction in the rate of
interest or Fees for the purposes of this clause (i)), (ii) release all or
substantially all of the Collateral (except as expressly provided in the Credit
Documents) under all the Security Documents, (iii) amend, modify or waive any
provision of this Section 13.12(a) (except for technical amendments with respect
to additional extensions of credit pursuant to this Agreement which afford the
protections to such additional extensions of credit of the type provided to the
Term Loans, the Revolving Loan Commitments and the Credit-Linked Commitments on
the Effective Date), (iv) reduce the percentage specified in the definition of
Required Lenders (it being understood that, with the consent of the Required
Lenders, additional extensions of credit pursuant to this Agreement may be
included in the determination of the Required Lenders on substantially the same
basis as the extensions of Term Loans, Revolving Loan Commitments and
Credit-Linked Commitments are included on the Effective Date), or (v) consent to
the assignment or transfer by the Borrower of any of its rights and obligations
under this Agreement; provided further, that no such change, waiver, discharge
or termination shall (1) increase the Commitments of any Lender over the amount
thereof then in effect without the consent of such Lender (it being understood
that waivers or modifications of conditions precedent, covenants, Defaults or
Events of Default or of a mandatory reduction in the Total Commitment shall not
constitute an increase of the Commitment of any Lender, and that an increase in
the available portion of any Commitment of any Lender shall not constitute an
increase of the Commitment of such Lender), (2) without the consent of each
Issuing Lender, amend, modify or waive any provision of Section 2 or alter its
rights or obligations with respect to Letters of Credit, (3) without the consent
of the Swingline Lender, alter the Swingline Lender's rights or obligations with
respect to Swingline Loans, (4) without the consent of the Administrative Agent
(including, without limitation, in its capacity as holder of the Credit-Linked
Deposits), amend, modify or waive any provision of Section 12 or any other
provision of this Agreement as same relates to the rights or obligations of the
Administrative Agent, or (5) without the consent of the Collateral Agent, amend,
modify or waive any provision relating to the rights or obligations of the
Collateral Agent.
(b) If, in connection with any proposed change, waiver, discharge or
termination of any of the provisions of this Agreement as contemplated by
clauses (i) through (v), inclusive, of the first proviso to Section 13.12(a),
the consent of the Required Lenders is obtained but the consent of one or more
of such other Lenders whose consent is required is not obtained, then the
Borrower shall have the right, so long as all non-consenting Lenders whose
individual consent is required are treated as described in either clauses (A) or
(B) below, to either (A) replace each such non-consenting Lender or Lenders (or,
at the option of the Borrower if the respective Lender's consent is required
with respect to less than all Tranches of Outstandings (or related Commitments),
to replace only the respective Tranche of Commitments and/or Outstandings of the
respective non-consenting Lender which gave rise to the need to obtain such
Lender's individual consent) with one or more Replacement Lenders pursuant to
Section 1.13 so long as at the time of such replacement, each such Replacement
Lender consents to the proposed change, waiver, discharge or termination or (B)
terminate such non-consenting Lender's Revolving Loan Commitment (if such
122
Lender's consent is required as a result of its Revolving Loan Commitment),
Credit-Linked Commitment (if such Lender's consent is required as a result of
its Credit-Linked Commitment) and/or repay each Tranche of outstanding Loans of
such Lender which gave rise to the need to obtain such Lender's consent and/or
cash collateralize its applicable Percentage of the Letter of Credit
Outstandings, in accordance with Sections 3.02(b) and/or 4.01(b), provided that,
unless the Commitments that are terminated and Loans that are repaid pursuant to
preceding clause (B) are immediately replaced in full at such time through the
addition of new Lenders or the increase of the Commitments and/or outstanding
Loans of existing Lenders (who in each case must specifically consent thereto),
then in the case of any action pursuant to preceding clause (B) the Required
Lenders (determined after giving effect to the proposed action) shall
specifically consent thereto, provided further, that in any event the Borrower
shall not have the right to replace a Lender, terminate its Commitments or repay
its Loans solely as a result of the exercise of such Lender's rights (and the
withholding of any required consent by such Lender) pursuant to the second
proviso to Section 13.12(a).
13.13 Survival. All indemnities set forth herein including, without
limitation, in Sections 1.10, 1.11, 2.06, 4.04, 12.06 and 13.01 shall survive
the execution, delivery and termination of this Agreement and the Notes and the
making and repayment of the Obligations.
13.14 Domicile of Loans. Each Lender may transfer and carry its Loans
and/or participations in outstanding Letters of Credit at, to or for the account
of any office, Subsidiary or Affiliate of such Lender. Notwithstanding anything
to the contrary contained herein, to the extent that a transfer of Loans and/or
participations in outstanding Letters of Credit pursuant to this Section 13.14
would, at the time of such transfer, result in increased costs under Section
1.10, 1.11, 2.06 or 4.04 from those being charged by the respective Lender prior
to such transfer, then the Borrower shall not be obligated to pay such increased
costs (although the Borrower shall be obligated to pay any other increased costs
of the type described above resulting from changes in any applicable law,
treaty, governmental rule, regulation, guideline or order, or in the
interpretation thereof, after the date of the respective transfer).
13.15 Register. The Borrower hereby designates the Administrative
Agent to serve as its agent, solely for purposes of this Section 13.15, to
maintain a register (the "Register") on which it will record the Commitments
from time to time of each of the Lenders, the Loans made by each of the Lenders,
the Unpaid Drawings that the Borrower has elected to keep outstanding in
accordance with the terms of this Agreement, the amount of any principal or
interest due and payable with respect to such Loans and such Unpaid Drawings and
each repayment in respect of the principal amount, and related interest amounts
of the Loans of each Lender and in respect of each Unpaid Drawing, and the names
of each of the Issuing Lenders, the amount that is due and payable with respect
to the Letters of Credit issued by such Issuing Lenders and paid, by the
Borrower to, or for the account of, each Issuing Lender, including the amount of
Letter of Credit Outstandings (specifying the amount of any Unpaid Drawings) due
and payable to an Issuing Lender. Failure to make any such recordation, or any
error in such recordation, shall not affect the Borrower's obligations in
respect of such Loans or Unpaid Drawings. With respect to any Lender, the
transfer of the Commitments of such Lender and the rights to the principal of,
and interest on, any Loan made pursuant to such Commitments or Unpaid Drawings
shall not be effective until such transfer is recorded on the Register
maintained by the Administrative Agent with respect to ownership of such
123
Commitments and Loans or Unpaid Drawings and prior to such recordation all
amounts owing to the transferor with respect to such Commitments and Loans or
Unpaid Drawings shall remain owing to the transferor. The registration of
assignment or transfer of all or part of any Commitments and Loans or Unpaid
Drawings shall be recorded by the Administrative Agent on the Register only upon
the acceptance by the Administrative Agent of a properly executed and delivered
Assignment and Assumption Agreement pursuant to Section 13.04(b). Coincident
with the delivery of such an Assignment and Assumption Agreement to the
Administrative Agent for acceptance and registration of assignment or transfer
of all or part of a Loan, or as soon thereafter as practicable, the assigning or
transferor Lender shall surrender the Note (if any) evidencing such Loan, and
thereupon one or more new Notes in the same aggregate principal amount shall be
issued to the assigning or transferor Lender and/or the new Lender at the
request of any such Lender. The Borrower agrees to indemnify the Administrative
Agent from and against any and all losses, claims, damages and liabilities of
whatsoever nature which may be imposed on, asserted against or incurred by the
Administrative Agent in performing its duties under this Section 13.15 except to
the extent resulting from the Administrative Agent's gross negligence or willful
misconduct (as determined by a court of competent jurisdiction in a final and
non-appealable decision). In addition, the Borrower shall have the right, upon
its written request to the Administrative Agent, to review a copy of the
Register at any reasonable time.
13.16 Confidentiality. (a) Subject to the provisions of clause (b) of
this Section 13.16, each Lender agrees that it will use its reasonable efforts
not to disclose without the prior consent of the Borrower (other than to its
employees, auditors, advisors or counsel or to another Lender if such Lender or
such Lender's holding or parent company in its reasonable discretion determines
that any such party should have access to such information, provided such
Persons shall be subject to the provisions of this Section 13.16 to the same
extent as such Lender) any information with respect to the Borrower or any of
its Subsidiaries which is now or in the future furnished pursuant to this
Agreement or any other Credit Document and which is designated as confidential
by the Borrower, provided that any Lender may disclose any such information (i)
as has become generally available to the public other than by virtue of a breach
of this Section 13.16(a) by the respective Lender, (ii) as may be required or
appropriate in any report, statement or testimony submitted to any municipal,
state or Federal regulatory body having or claiming to have jurisdiction over
such Lender or to the Federal Reserve Board or the Federal Deposit Insurance
Corporation or similar organizations (whether in the United States or elsewhere)
or their successors, (iii) as may be required or appropriate in respect to any
summons or subpoena or in connection with any litigation, (iv) in order to
comply with any law, order, regulation or ruling applicable to such Lender, (v)
to the Administrative Agent or the Collateral Agent, (vi) to any direct or
indirect contractual counterparty in any swap, hedge or similar agreement (or to
any such contractual counterparty's professional advisor), so long as such
contractual counterparty (or such professional advisor) agrees to be bound by
the provisions of this Section 13.16, and (vii) to any prospective or actual
transferee or participant in connection with any contemplated transfer or
participation of any of the Notes or Commitments or any interest therein by such
Lender, provided that such prospective transferee agrees to be bound by the
confidentiality provisions contained in this Section 13.16.
(b) The Borrower hereby acknowledges and agrees that each Lender may
share with any of its affiliates, and such affiliates may share with such
Lender, any information related to the Borrower or any of its Subsidiaries
(including, without limitation, any non-public customer information regarding
the creditworthiness of the Borrower and its Subsidiaries), provided such
Persons shall be subject to the provisions of this Section 13.16 to the same
extent as such Lender.
124
(c) Neither the Administrative Agent, any Lender, any of their
respective affiliates nor any Credit Party provide accounting, tax or legal
advice. Notwithstanding anything provided herein, and any express or implied
claims of exclusivity or proprietary rights, each party hereto hereby agrees and
acknowledges that each such party (and each of their employees, representatives
or other agents) are authorized to disclose to any and all Persons, beginning
immediately upon commencement of their discussions and without limitation of any
kind, the U.S. federal, state or local tax treatment and tax structure of the
Transaction, and all materials of any kind (including opinions or other tax
analyses) that are provided by any such party to any other party relating to
such tax treatment and tax structure, except to the extent that such disclosure
is subject to restrictions reasonably necessary to comply with securities laws.
In this regard, each party hereto acknowledges and agrees that disclosure of the
tax treatment and tax structure of the Transaction has not been and is not
limited in any manner by an express or implied understanding or agreement
(whether oral or written, and whether or not such understanding or agreement is
legally binding), except to the extent that such disclosure is subject to
restrictions reasonably necessary to comply with securities laws. For purposes
of this authorization, "tax treatment" means the purported or claimed tax
treatment of the Transaction, and "tax structure" means any fact that may be
relevant to understanding the purported or claimed tax treatment of the
Transaction. This paragraph is intended to reflect the understanding of the
parties hereto that the Transaction has not been offered under "conditions of
confidentiality" as that phrase is used in Treasury Regulation xx.xx.
1.6011-4(b)(3)(i) and 301.6111-2(c)(1), and shall be interpreted in a manner
consistent therewith.
* * *
125
IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
officers to execute and deliver this Agreement as of the date first above
written.
Address:
0000 Xxxxxxxx Xxxxxxx Xxxxx, Xxxxx 000 MAGELLAN HEALTH SERVICES, INC.
Xxxxxxxx, Xxxxxxxx 00000
Attention: President and Chief Executive
Officer By:
-----------------------------
Tel. No.: (000) 000-0000 Name:
Fax No.: (000) 000-0000 Title:
With a copy to:
0000 Xxxxxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Tel. No.: (000) 000-0000 Fax No.: (000) 000-0000
DEUTSCHE BANK AG, NEW YORK BRANCH,
Individually and as Administrative Agent
By:
------------------------------------------
Name:
Title:
By:
------------------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON, acting
through its CAYMAN ISLANDS BRANCH
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title:
GENERAL ELECTRIC CAPITAL CORPORATION
By:
-------------------------------------
Name:
Title:
SCHEDULE I
----------
COMMITMENTS
-----------
Term Loan Revolving Loan Credit-Linked
Lender Commitment Commitment Commitment
------ ---------- ---------- ----------
Deutsche Bank AG, New York Branch $94,444,444.44 $37,500,000.00 $75,555,555.56
Credit Suisse First Boston, acting through its $0 $7,500,000.00 $0
Cayman Islands Branch
General Electric Capital Corporation $5,555,555.56 $5,000,000.00 $4,444,444.44
--------------- -------------- --------------
TOTAL: $100,000,000 $50,000,000 $80,000,000
SCHEDULE II
-----------
LENDER ADDRESSES
----------------
Lender Address
------ -------
Deutsche Bank AG, New York Branch Deutsche Bank AG, New York Branch
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxx
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
Credit Suisse First Boston, acting through its Cayman Islands Credit Suisse First Boston
Branch Loan Operations
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xx Xxxxxxxxx
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
General Electric Capital Corporation GE Commercial Finance
Healthcare Financial Services
0 Xxxxxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxx III, Vice President
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
xxxx.xxxxx@xx.xxx
SCHEDULE III
------------
ERISA PLANS
-----------
SCHEDULE IV
-----------
REAL PROPERTY
-------------
SCHEDULE V
----------
SUBSIDIARIES
------------
SCHEDULE VI
-----------
EXISTING INDEBTEDNESS
---------------------
SCHEDULE VII
------------
INSURANCE
---------
SCHEDULE VIII
-------------
EXISTING LIENS
--------------
SCHEDULE IX
-----------
EXISTING INVESTMENTS
--------------------
SCHEDULE X
----------
CERTAIN TAX MATTERS
-------------------
