AMENDED AND RESTATED
CREDIT AGREEMENT
among
DISPATCH MANAGEMENT SERVICES CORP.
as Borrower,
AND
THE MATERIAL SUBSIDIARIES OF THE BORROWER
as Guarantors,
AND
THE LENDERS IDENTIFIED HEREIN,
AND
NATIONSBANK, N.A.,
as Administrative Agent
DATED AS OF APRIL 8, 1999
NATIONSBANC XXXXXXXXXX SECURITIES LLC,
as Sole Lead Arranger and Sole Book Manager
TABLE OF CONTENTS
SECTION 1 DEFINITIONS AND ACCOUNTING TERMS...................................1
1.1 Definitions..........................................................1
1.2 Computation of Time Periods and Other Definitional Provisions........2
1.3 Accounting Terms.....................................................2
SECTION 2 CREDIT FACILITIES..................................................2
2.1 Revolving Loans......................................................2
2.2 Letter of Credit Subfacility.........................................2
2.3 Continuations and Conversions........................................2
2.4 Minimum Amounts......................................................2
2.5 Notes................................................................2
2.6 Currency Equivalents.................................................2
SECTION 3 GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT.......2
3.1 Interest.............................................................2
3.2 Place and Manner of Payments.........................................2
3.3 Prepayments..........................................................2
3.4 Fees.................................................................2
3.5 Payment in full at Maturity..........................................2
3.6 Computations of Interest and Fees....................................2
3.7 Pro Rata Treatment...................................................2
3.8 Sharing of Payments..................................................2
3.9 Capital Adequacy.....................................................2
3.10 Inability To Determine Eurocurrency Rate............................2
3.11 Illegality..........................................................2
3.12 Requirements of Law.................................................2
3.13 Taxes...............................................................2
3.14 Compensation........................................................2
3.15 Substitution of Lender..............................................2
3.16 Evidence of Debt....................................................2
SECTION 4 GUARANTY...........................................................2
4.1 Guaranty of Payment..................................................2
4.2 Obligations Unconditional............................................2
4.3 Modifications........................................................2
4.4 Waiver of Rights.....................................................2
4.5 Reinstatement........................................................2
4.6 Remedies.............................................................2
4.7 Limitation of Guaranty...............................................2
4.8 Rights of Contribution...............................................2
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SECTION 5 CONDITIONS PRECEDENT...............................................2
5.1 Closing Conditions...................................................2
5.2 Conditions to All Extensions of Credit...............................2
SECTION 6 REPRESENTATIONS AND WARRANTIES.....................................2
6.1 Financial Condition..................................................2
6.2 No Material Change...................................................2
6.3 Organization and Good Standing.......................................2
6.4 Due Authorization....................................................2
6.5 No Conflicts.........................................................2
6.6 Consents.............................................................2
6.7 Enforceable Obligations..............................................2
6.8 No Default...........................................................2
6.9 Ownership............................................................2
6.10 Indebtedness........................................................2
6.11 Litigation..........................................................2
6.12 Taxes...............................................................2
6.13 Compliance with Law.................................................2
6.14 ERISA...............................................................2
6.15 Subsidiaries........................................................2
6.16 Use of Proceeds.....................................................2
6.17 Government Regulation...............................................2
6.18 Environmental Matters...............................................2
6.19 Intellectual Property...............................................2
6.20 Solvency............................................................2
6.21 Investments.........................................................2
6.22 Location of Collateral..............................................2
6.23 Insurance Coverage..................................................2
6.24 Disclosure..........................................................2
6.25 Licenses, etc.......................................................2
6.26 No Burdensome Restrictions..........................................2
6.27 Collateral Documents................................................2
6.28 Year 2000 Compliance................................................2
6.29 Financial Assistance................................................2
6.30 Seller Obligations..................................................2
SECTION 7 AFFIRMATIVE COVENANTS..............................................2
7.1 Information Covenants................................................2
7.2 Financial Covenants..................................................2
7.3 Preservation of Existence and Franchises.............................2
7.4 Books and Records....................................................2
7.5 Compliance with Law..................................................2
7.6 Payment of Taxes and Other Indebtedness..............................2
7.7 Insurance............................................................2
7.8 Maintenance of Property..............................................2
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7.9 Performance of Obligations...........................................2
7.10 Collateral..........................................................2
7.11 Use of Proceeds.....................................................2
7.12 Audits/Inspections..................................................2
7.13 Additional Credit Parties...........................................2
7.14 Turnaround Consultant...............................................2
7.15 Lockbox Accounts....................................................2
7.16 Post-Closing Requirements...........................................2
SECTION 8 NEGATIVE COVENANTS.................................................2
8.1 Indebtedness.........................................................2
8.2 Liens................................................................2
8.3 Nature of Business...................................................2
8.4 Consolidation and Merger.............................................2
8.5 Sale or Lease of Assets..............................................2
8.6 Sale Leasebacks......................................................2
8.7 Advances, Investments and Loans......................................2
8.8 Restricted Payments..................................................2
8.9 Transactions with Affiliates.........................................2
8.10 Fiscal Year; Organizational Documents...............................2
8.11 No Limitations......................................................2
8.12 No Other Negative Pledges...........................................2
8.13 Capital Expenditures................................................2
SECTION 9 EVENTS OF DEFAULT..................................................2
9.1 Events of Default....................................................2
9.2 Acceleration; Remedies...............................................2
9.3 Allocation of Payments After Event of Default........................2
SECTION 10 AGENCY PROVISIONS.................................................2
10.1 Appointment.........................................................2
10.2 Delegation of Duties................................................2
10.3 Exculpatory Provisions..............................................2
10.4 Reliance on Communications..........................................2
10.5 Notice of Default...................................................2
10.6 Non-Reliance on Agents and Other Lenders............................2
10.7 Indemnification.....................................................2
10.8 Agents in Their Individual Capacity.................................2
10.9 Successor Agent.....................................................2
SECTION 11 MISCELLANEOUS.....................................................2
11.1 Notices.............................................................2
11.2 Right of Set-Off....................................................2
11.3 Benefit of Agreement................................................2
11.4 No Waiver; Remedies Cumulative......................................2
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11.5 Payment of Expenses; Indemnification................................2
11.6 Amendments, Waivers and Consents....................................2
11.7 Counterparts/Telecopy...............................................2
11.8 Headings............................................................2
11.9 Defaulting Lender...................................................2
11.10 Survival of Indemnification and Representations and Warranties.....2
11.11 Governing Law; Jurisdiction........................................2
11.12 Waiver of Jury Trial...............................................2
11.13 Time...............................................................2
11.14 Severability.......................................................2
11.15 Further Assurances.................................................2
11.16 Confidentiality....................................................2
11.17 Entirety...........................................................2
11.18 Judgment Currency..................................................2
11.19 Binding Effect; Continuing Agreement...............................2
11.20 Obligations Under Collateral Documents; Reaffirmation of
Credit Party Obligations........................................2
11.21 No Lender Defaults; Release........................................2
SCHEDULES
---------
Schedule 1.1(a) Commitment Percentages
Schedule 2.2(c) Existing Letters of Credit
Schedule 6.10 Indebtedness
Schedule 6.15 Subsidiaries
Schedule 6.18 Environmental
Schedule 6.19 Intellectual Property
Schedule 6.21 Investments
Schedule 6.22(a) Personal Property Locations
Schedule 6.22(b) Chief Executive Offices
Schedule 6.23 Insurance
Schedule 6.30 Seller Obligations
Schedule 8.2 Liens
Schedule 11.1 Notices
EXHIBITS
Exhibit 2.1(b) Form of Notice of Borrowing
Exhibit 2.3 Form of Notice of Continuation/Conversion
Exhibit 2.5 Form of Amended and Restated Revolving Note
Exhibit 7.1(d) Form of Officer's Certificate
Exhibit 7.13 Form of Joinder Agreement
Exhibit 11.3 Form of Assignment Agreement
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CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Credit Agreement"), is
entered into as of April 8, 1999 among DISPATCH MANAGEMENT SERVICES CORP., a
Delaware corporation (the "Borrower"), each of the Material Subsidiaries (as
defined herein) of the Borrower (individually a "Guarantor" and collectively the
"Guarantors"), the Lenders (as defined herein), NATIONSBANK, N.A., as
Administrative Agent for the Lenders and the Issuing Lender (as defined herein).
RECITALS
WHEREAS, the Borrower, the Guarantors, the Lenders and the Administrative
Agent are parties to that certain Credit Agreement dated as of the June 11, 1998
(as amended or modified, the "Existing Credit Agreement");
WHEREAS, the Borrower and the Guarantors have requested that the Existing
Credit Agreement be amended and restated to provide a senior secured credit
facility in an amount up to $78,484,833.98; and
WHEREAS, the Lenders party hereto have agreed to make the requested senior
secured credit facility available to the Borrower on the terms and conditions
hereinafter set forth.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 Definitions.
As used herein, the following terms shall have the meanings herein
specified unless the context otherwise requires. Defined terms herein shall
include in the singular number the plural and in the plural the singular:
"Additional Credit Party" means each Person that becomes a Guarantor
after the Closing Date, as provided in Section 7.13 or otherwise.
"Adjusted Base Rate" means the Base Rate plus the Applicable
Percentage.
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"Adjusted Eurocurrency Rate" means the Eurocurrency Rate plus the
Applicable Percentage.
"Administrative Agent" means NationsBank, N.A. (or any successor
thereto) or any successor administrative agent appointed pursuant to
Section 10.9.
"Affiliate" means, 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 a corporation if such Person possesses, directly or indirectly, the
power (i) to vote 10% or more of the securities having ordinary voting
power for the election of directors of such corporation or (ii) to direct
or cause direction of the management and policies of such corporation,
whether through the ownership of voting securities, by contract or
otherwise.
"Agency Services Address" means NationsBank, N.A., NC1-001-15-04, 000
Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attn: Agency Services,
or such other address as may be identified by written notice from the
Administrative Agent to the Borrower.
"Agents" mean the Administrative Agent and the Collateral Agent and
any successors and assigns in such capacity.
"Applicable Percentage" means the appropriate applicable percentages
corresponding to the Leverage Ratio in effect as of the most recent
Calculation Date as shown below:
=============================================================================================================
Applicable Percentage Applicable Percentage Applicable Percentage for
Pricing Level Leverage Ratio For Eurocurrency Loans For Base Rate Loans Letter of Credit Fees
-------------------------------------------------------------------------------------------------------------
I <=2.0 to 1.0 1.75% 0% 1.75%
-------------------------------------------------------------------------------------------------------------
II <=2.75 to 1.0 but 2.25% 0% 2.25%
>2.0 to 1.0
-------------------------------------------------------------------------------------------------------------
III <=3.25 to 1.0 but 3.00% .50% 2.50%
>2.75 to 1.0
-------------------------------------------------------------------------------------------------------------
IV <=3.75 to 1.0 but 3.375% 1.00% 2.50%
>3.25 to 1.0
-------------------------------------------------------------------------------------------------------------
V <=4.50 to 1.0 but 3.75% 1.50% 2.50%
>3.75 to 1.0
-------------------------------------------------------------------------------------------------------------
VI >4.50 to 1.0 4.00% 2.00% 2.50%
=============================================================================================================
The Applicable Percentage for Loans and the Letter of Credit Fees
shall, in each case, be determined and adjusted quarterly on the date (each
a "Calculation Date") five
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Business Days after the date by which the Borrower is required to provide
the officer's certificate in accordance with the provisions of Section
7.1(d); provided that the initial Applicable Percentage for Loans and the
Letter of Credit Fees shall be based on Pricing Level VI (as shown above)
and shall remain at Pricing Level VI until the first Calculation Date
subsequent to March 31, 1999 and, thereafter, the Pricing Level shall be
determined by the Leverage Ratio calculated as of the most recent
Calculation Date; and provided further that if the Borrower fails to
provide the officer's certificate required by Section 7.1(d) on or before
the most recent Calculation Date, the Applicable Percentage for Loans and
the Letter of Credit Fees from such Calculation Date shall be based on
Pricing Level VI until such time that an appropriate officer's certificate
is provided whereupon the Pricing Level shall be determined by the then
current Leverage Ratio. Each Applicable Percentage shall be effective from
one Calculation Date until the next Calculation Date. Any adjustment in the
Applicable Percentage shall be applicable only as to any new Loans made (or
to Loans continued or converted) or Letters of Credit issued.
The Borrower shall promptly deliver to the Administrative Agent, at
the address set forth on Schedule 11.1 and at the Agency Services Address,
information regarding any change in the Leverage Ratio that would change
the existing Pricing Level pursuant to the preceding paragraph.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
"Base Rate" means, for any day, the rate per annum (rounded upwards,
if necessary, to the nearest whole multiple of 1/100 of 1%) equal to the
greater of (a) the Federal Funds Rate in effect on such day plus 1/2 of 1%
or (b) the Prime Rate in effect on such day. If for any reason the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable after due inquiry to
ascertain the Federal Funds Rate for any reason, including the inability or
failure of the Administrative Agent to obtain sufficient quotations in
accordance with the terms hereof, the Base Rate shall be determined without
regard to clause (a) of the first sentence of this definition until the
circumstances giving rise to such inability no longer exist. Any change in
the Base Rate due to a change in the Prime Rate or the Federal Funds Rate
shall be effective on the effective date of such change in the Prime Rate
or the Federal Funds Rate, respectively.
"Base Rate Loan" means any Loan bearing interest at a rate determined
by reference to the Base Rate.
"Borrower" means Dispatch Management Services Corp., a Delaware
corporation, together with any successors and permitted assigns.
"Business Day" means any day other than a Saturday, a Sunday, a legal
holiday or a day on which banking institutions are authorized or required
by law or other governmental
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action to close in Charlotte, North Carolina or New York, New York;
provided that in the case of Eurocurrency Loans, such day is also a day on
which dealings between banks are carried on in U.S. dollar deposits in the
London interbank market.
"Calculation Date" has the meaning set forth in the definition of
Applicable Percentage.
"Capital Expenditures" means all expenditures of the Credit Parties
and their Subsidiaries which, in accordance with GAAP, would be classified
as capital expenditures, including, without limitation, Capital Leases.
"Capital Lease" means, as applied to any Person, any lease of any
property (whether real, personal or mixed) by that Person as lessee which,
in accordance with GAAP, is or should be accounted for as a capital lease
on the balance sheet of that Person and the amount of such obligation shall
be the capitalized amount thereof determined in accordance with GAAP.
"Cash Equivalents" means (a) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the
United States of America is pledged in support thereof) having maturities
of not more than twelve months from the date of acquisition, (b) U.S.
dollar denominated time and demand deposits and certificates of deposit of
(i) any Lender, (ii) any domestic commercial bank having capital and
surplus in excess of $500,000,000 or (iii) any bank whose short-term
commercial paper rating from S&P is at least A-1 or the equivalent thereof
or from Xxxxx'x is at least P-1 or the equivalent thereof (any such bank
being an "Approved Bank"), in each case with maturities of not more than
270 days from the date of acquisition, (c) commercial paper and variable or
fixed rate notes issued by any Approved Bank (or by the parent company
thereof) or any variable rate notes issued by, or guaranteed by, any
domestic corporation rated A-1 (or the equivalent thereof) or better by S&P
or P-1 (or the equivalent thereof) or better by Moody's and maturing within
six months of the date of acquisition, (d) repurchase agreements with a
bank or trust company (including any of the Lenders) or recognized
securities dealer having capital and surplus in excess of $500,000,000 for
direct obligations issued by or fully guaranteed by the United States of
America in which the Borrower shall have a perfected first priority
security interest (subject to no other Liens) and having, on the date of
purchase thereof, a fair market value of at least 100% of the amount of the
repurchase obligations and (e) Investments, classified in accordance with
GAAP as current assets, in money market investment programs registered
under the Investment Company Act of 1940, as amended, which are
administered by reputable financial institutions having capital of at least
$500,000,000 and the portfolios of which are limited to Investments of the
character described in the foregoing subdivisions (a) through (d).
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"Change of Control" means any of the following events: (a) any
"person" or "group" (within the meaning of Section 13(d) or 14(d) of the
Exchange Act) has become, directly or indirectly, the "beneficial owner"
(as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a
Person shall be deemed to have "beneficial ownership" of all shares that
any such Person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), by way of merger,
consolidation or otherwise, of 30% or more of the voting power of the
Voting Stock of the Borrower on a fully-diluted basis, after giving effect
to the conversion and exercise of all outstanding warrants, options and
other securities of the Borrower (whether or not such securities are then
currently convertible or exercisable), or (b) during any period of two
consecutive calendar years, individuals who at the beginning of such period
constituted the board of directors of the Borrower cease for any reason to
constitute a majority of the directors of the Borrower then in office
unless such new directors were elected by the directors of the Borrower who
constituted the board of directors of the Borrower at the beginning of such
period.
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986 and the rules and
regulations promulgated thereunder, as amended, modified, succeeded or
replaced from time to time.
"Collateral" means all assets of the Credit Parties in which, pursuant
to the Collateral Documents, a Lien has been granted in favor of the
Lenders.
"Collateral Agent" means NationsBank, N.A. (or any successor thereto)
or any successor collateral agent appointed pursuant to Section 10.9.
"Collateral Coverage Ratio" means the ratio of (a) Gross Accounts
Receivable that have been outstanding less than 60 days from the date of
invoice to (b) the sum of the aggregate amount of Revolving Loans
outstanding plus the aggregate amount of LOC Obligations outstanding.
"Collateral Documents" means the Security Agreements, the Pledge
Agreements, the UK Collateral Documents and such other documents executed
and delivered in connection with the attachment and perfection of the
Lenders' security interests in the assets of the Credit Parties, including
without limitation, UCC financing statements and collateral assignments of
intellectual property.
"Commitments" means the sum of the commitments of each Lender with
respect to the Revolving Committed Amount.
"Confirmation Letters" means any confirmation letter executed and
delivered by a Credit Party in favor of the Collateral Agent, for the
benefit of the Lenders, confirming its
- 5 -
obligations under the UK Collateral Documents and that the collateral
pledged by such Credit Party pursuant to the UK Collateral Documents
continues to secure the Credit Party Obligations, as such may be amended,
modified, extended, renewed, restated or replaced from time to time.
"Credit Documents" means this Credit Agreement, the Notes, any Joinder
Agreement, the Collateral Documents, the LOC Documents, and all other
related agreements and documents issued or delivered hereunder or
thereunder or pursuant hereto or thereto.
"Credit Parties" means the Borrower and the Guarantors and "Credit
Party" means any one of them.
"Credit Party Obligations" means, without duplication, (a) all of the
obligations of the Credit Parties to the Lenders (including the Issuing
Lender) and the Agents, whenever arising, under this Credit Agreement, the
Notes, the Collateral Documents or any of the other Credit Documents to
which any Credit Party is a party and (b) all liabilities and obligations
owing from such Credit Party to any Lender, or any Affiliate of a Lender,
arising under Hedging Agreements.
"Debentures" means any debenture executed and delivered by a Credit
Party in favor of the Collateral Agent for the benefit of the Lenders to
secure its obligations under the Credit Documents, as such may be amended,
modified, extended, renewed, restated or replaced from time to time.
"Default" means any event, act or condition which with notice or lapse
of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that, (a) has
failed to make a Loan or purchase a Participation Interest required
pursuant to the terms of this Credit Agreement (but only for so long as
such Loan is not made or such Participation Interest is not purchased), (b)
has failed to pay to the Agents or any Lender an amount owed by such Lender
pursuant to the terms of this Credit Agreement (but only for so long as
such amount has not been repaid) or (c) has been deemed insolvent or has
become subject to a bankruptcy or insolvency proceeding or to a receiver,
trustee or similar official.
"Dollars" and "$" means dollars in lawful currency of the United
States of America.
"EBITDA" means, for any period, with respect to the Credit Parties and
their Subsidiaries on a consolidated basis, the sum of (a) Net Income for
such period (excluding the effect of any extraordinary or other
non-recurring gains (including any gain from the sale of property) or
non-cash losses) plus (b) an amount which, in the determination of Net
Income for such period has been deducted for (i) Interest Expense for such
period, (ii) total
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Federal, state, foreign or other income taxes for such period, (iii) all
depreciation and amortization for such period, (iv) all other non-cash
charges, all as determined in accordance with GAAP and (v) such other
adjustments as proposed by the Borrower and as approved by the
Administrative Agent, in its reasonable discretion.
"Effective Date" means the date on which the conditions set forth in
Section 5.1 shall have been fulfilled (or waived in the sole discretion of
the Lenders) and on which the initial Loans shall have been made and/or the
initial Letters of Credit shall have been issued.
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a Lender;
and (c) any other Person approved by the Administrative Agent and the
Borrower (such approval not to be unreasonably withheld or delayed);
provided that (i) the Borrower's consent is not required during the
existence and continuation of an Event of Default, (ii) approval by the
Borrower shall be deemed given if no objection is received by the assigning
Lender and the Administrative Agent from the Borrower within two Business
Days after notice of such proposed assignment has been received by the
Borrower; and (iii) neither the Borrower nor an Affiliate of the Borrower
shall qualify as an Eligible Assignee.
"Environmental Claim" means any investigation, written notice,
violation, written demand, written allegation, action, suit, injunction,
judgment, order, consent decree, penalty, fine, lien, proceeding, or
written claim whether administrative, judicial, or private in nature
arising (a) pursuant to, or in connection with, an actual or alleged
violation of, any Environmental Law, (b) in connection with any Hazardous
Material, (c) from any assessment, abatement, removal, remedial,
corrective, or other response action in connection with an Environmental
Law or other order of a Governmental Authority or (d) from any actual or
alleged damage, injury, threat, or harm to health, safety, natural
resources, or the environment.
"Environmental Laws" means any current or future legal requirement of
any Governmental Authority pertaining to (a) the protection of health,
safety, and the indoor or outdoor environment, (b) the conservation,
management, or use of natural resources and wildlife, (c) the protection or
use of surface water and groundwater or (d) the management, manufacture,
possession, presence, use, generation, transportation, treatment, storage,
disposal, release, threatened release, abatement, removal, remediation or
handling of, or exposure to, any hazardous or toxic substance or material
or (e) pollution (including any release to land surface water and
groundwater) and includes, without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended
by the Superfund Amendments and Reauthorization Act of 1986, 42 USC 9601 et
seq., Solid Waste Disposal Act, as amended by the Resource Conservation and
Recovery Act of 1976 and Hazardous and Solid Waste Amendments of 1984, 42
USC 6901 et seq., Federal Water Pollution Control Act, as amended by the
Clean Water Act of 1977, 33 USC 1251 et seq., Clean Air Act of 1966, as
amended, 42 USC 7401 et seq., Toxic Substances Control Act of 1976, 15 USC
2601 et seq., Hazardous Materials Transportation Act, 49
- 7 -
USC App. 1801 et seq., Occupational Safety and Health Act of 1970, as
amended, 29 USC 651 et seq., Oil Pollution Act of 1990, 33 USC 2701 et
seq., Emergency Planning and Community Right-to-Know Act of 1986, 42 USC
11001 et seq., National Environmental Policy Act of 1969, 42 USC 4321 et
seq., Safe Drinking Water Act of 1974, as amended, 42 USC 300(f) et seq.,
any analogous implementing or successor law, and any amendment, rule,
regulation, order, or directive issued thereunder.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations thereunder, all as the same may be in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
"ERISA Affiliate" means an entity, whether or not incorporated, which
is under common control with any Credit Party or any of its Subsidiaries
within the meaning of Section 4001(a)(14) of ERISA, or is a member of a
group which includes any Credit Party or any of its Subsidiaries and which
is treated as a single employer under Sections 414(b), (c), (m), or (o) of
the Code.
"Eurocurrency Loan" means a Loan bearing interest based at a rate
determined by reference to the Eurocurrency Rate.
"Eurocurrency Rate" means, for the Interest Period for each
Eurocurrency Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate determined
pursuant to the following formula:
Eurocurrency Rate = London Interbank Offered Rate
------------------------------------
1 - Eurocurrency Reserve Percentage
"Eurocurrency Reserve Percentage" means for any day, that percentage
(expressed as a decimal) which is in effect from time to time under
Regulation D of the Board of Governors of the Federal Reserve System (or
any successor), as such regulation may be amended from time to time or any
successor regulation, as the maximum reserve requirement (including,
without limitation, any basic, supplemental, emergency, special, or
marginal reserves) applicable with respect to Eurocurrency liabilities as
that term is defined in Regulation D (or against any other category of
liabilities that includes deposits by reference to which the interest rate
of Eurocurrency Loans is determined), whether or not a Lender has any
Eurocurrency liabilities subject to such reserve requirement at that time.
Eurocurrency Loans shall be deemed to constitute Eurocurrency liabilities
and as such shall be deemed subject to reserve requirements without
benefits of credits for proration, exceptions or offsets that may be
available from time to time to a Lender. The Eurocurrency Rate shall be
adjusted automatically on and as of the effective date of any change in the
Eurocurrency Reserve Percentage.
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"Event of Default" means any of the events or circumstances specified
in Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder, as amended, modified,
succeeded or replaced from time to time.
"Existing Credit Agreement" has the meaning set forth in the preamble
hereof.
"Existing Letters of Credit" means the letters of credit described on
Schedule 2.2(c).
"Extension of Credit" means, as to any Lender, the making of a Loan by
such Lender (or a participation therein by a Lender) or the issuance of, or
participation in, a Letter of Credit by such Lender.
"Federal Funds Rate" means for any day the rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business
Day next succeeding such day; provided that (a) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day and (b) if no such
rate is so published on such next preceding Business Day, the Federal Funds
Rate for such day shall be the average rate quoted to the Administrative
Agent on such day on such transactions as determined by the Administrative
Agent.
"Fee Letter" means that certain letter agreement among the Borrower,
NMS and the Administrative Agent dated as of March 29, 1999.
"Funded Debt" means, without duplication, the sum of (a) all
Indebtedness of the Credit Parties and their Subsidiaries for borrowed
money, (b) all purchase money Indebtedness of the Credit Parties and their
Subsidiaries, (c) the principal portion of all obligations of the Credit
Parties and their Subsidiaries under Capital Leases, (d) all obligations,
contingent or otherwise, relative to the face amount of all letters of
credit (other than letters of credit supporting trade payables in the
ordinary course of business), whether or not drawn, and banker's
acceptances issued for the account of a Credit Party or its Subsidiaries
(it being understood that, to the extent an undrawn letter of credit
supports another obligation consisting of Indebtedness, in calculating
aggregated Indebtedness only such other obligation shall be included), (e)
all Guaranty Obligations of the Credit Parties and their Subsidiaries with
respect to Funded Debt of another Person, (f) all Funded Debt of another
entity secured by a Lien on any property of the Credit Parties and their
Subsidiaries whether or not such Funded Debt has been assumed by a Credit
Party or any of its
- 9 -
Subsidiaries, (g) all Funded Debt of any partnership or unincorporated
joint venture to the extent a Credit Party or one of its Subsidiaries is
legally obligated or has a reasonable expectation of being liable with
respect thereto, net of any assets of such partnership or joint venture and
(h) the principal balance outstanding under any synthetic lease, tax
retention operating lease, off-balance sheet loan or similar off-balance
sheet financing product where such transaction is considered borrowed money
indebtedness for tax purposes but is classified as an operating lease in
accordance with GAAP.
"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to Section 1.3.
"Governmental Authority" means any Federal, state, local, provincial
or foreign court or governmental agency, authority, instrumentality or
regulatory body.
"Gross Accounts Receivable" means, as of any date of determination
(and without duplication), the amount of all accounts receivable,
receivables and obligations for payment created or arising from the sale or
shipment of inventory or the rendering of services in the ordinary course
of business owned by or owing to the Credit Parties and in which the
Lenders have a first priority perfected security interest.
"Guarantor" means each of the Material Subsidiaries of the Borrower
and each Additional Credit Party, together with their successors and
assigns.
"Guaranty Obligations" means, with respect to any Person, without
duplication, any obligations (other than endorsements in the ordinary
course of business of negotiable instruments for deposit or collection)
guaranteeing any Indebtedness of any other Person in any manner, whether
direct or indirect, and including without limitation any obligation,
whether or not contingent, (a) to purchase any such Indebtedness or other
obligation or any property constituting security therefor, (b) to advance
or provide funds or other support for the payment or purchase of such
Indebtedness or obligation or to maintain working capital, solvency or
other balance sheet condition of such other Person (including, without
limitation, maintenance agreements, comfort letters, take or pay
arrangements, put agreements or similar agreements or arrangements) for the
benefit of the holder of Indebtedness of such other Person, (c) to lease or
purchase property, securities or services primarily for the purpose of
assuring the owner of such Indebtedness or (d) to otherwise assure or hold
harmless the owner of such Indebtedness or obligation against loss in
respect thereof. The amount of any Guaranty Obligation hereunder shall
(subject to any limitations set forth therein) be deemed to be an amount
equal to the outstanding principal amount (or maximum principal amount, if
larger) of the Indebtedness in respect of which such Guaranty Obligation is
made.
"Hazardous Materials" means any substance, material or waste defined
in or regulated under any Environmental Laws.
- 10 -
"Hedging Agreements" means, collectively, interest rate protection
agreements, foreign currency exchange agreements, commodity purchase or
option agreements or other interest or exchange rate or commodity price
hedging agreements, in each case, entered into or purchased by a Credit
Party.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, or
upon which interest payments are customarily made, (c) all obligations of
such Person under conditional sale or other title retention agreements
relating to property purchased by such Person to the extent of the value of
such property (other than customary reservations or retentions of title
under agreements with suppliers entered into in the ordinary course of
business), (d) all obligations, other than intercompany items, of such
Person issued or assumed as the deferred purchase price of property or
services purchased by such Person which would appear as liabilities on a
balance sheet of such Person, (e) all Indebtedness of others secured by (or
for which the holder of such Indebtedness has an existing right, contingent
or otherwise, to be secured by) any Lien on, or payable out of the proceeds
of production from, property owned or acquired by such Person, whether or
not the obligations secured thereby have been assumed, (f) all Guaranty
Obligations of such Person, (g) the principal portion of all obligations of
such Person under (i) Capital Leases and (ii) any synthetic lease, tax
retention operating lease, off-balance sheet loan or similar off-balance
sheet financing product of such Person where such transaction is considered
borrowed money indebtedness for tax purposes but is classified as an
operating lease in accordance with GAAP, (h) all obligations of such Person
to repurchase any securities which repurchase obligation is related to the
issuance thereof, including, without limitation, obligations commonly known
as residual equity appreciation potential shares, (i) all net obligations
of such Person in respect of Hedging Agreements, (j) the maximum amount of
all performance and standby letters of credit issued or bankers'
acceptances facilities created for the account of such Person and, without
duplication, all drafts drawn thereunder (to the extent unreimbursed), and
(k) the aggregate amount of uncollected accounts receivable of such Person
subject at such time to a sale of receivables (or similar transaction)
regardless of whether such transaction is effected without recourse to such
Person or in a manner that would not be reflected on the balance sheet of
such Person in accordance with GAAP. The Indebtedness of any Person shall
include the Indebtedness of any partnership or unincorporated joint venture
in which such Person is legally obligated.
"Interest Coverage Ratio" means, for any period, the ratio of EBITDA
to Interest Expense.
"Interest Expense" means, for any period, with respect to the Credit
Parties and their Subsidiaries on a consolidated basis, all cash interest
expense including the interest component under Capital Leases, as
determined in accordance with GAAP.
- 11 -
"Interest Payment Date" means (a) as to Base Rate Loans, the last day
of each calendar month and the Maturity Date and (b) as to Eurocurrency
Loans, the last day of each calendar month, the last day of each applicable
Interest Period and the Maturity Date.
"Interest Period" means, as to Eurocurrency Loans, a period of one,
two, three or six months' duration, as the Borrower may elect, commencing,
in each case, on the date of the borrowing (including continuations and
conversions thereof); provided, however, (a) if any Interest Period would
end on a day which is not a Business Day, such Interest Period shall be
extended to the next succeeding Business Day (except that where the next
succeeding Business Day falls in the next succeeding calendar month, then
on the next preceding Business Day), (b) no Interest Period shall extend
beyond the Maturity Date and (c) where an Interest Period begins on a day
for which there is no numerically corresponding day in the calendar month
in which the Interest Period is to end, such Interest Period shall end on
the last Business Day of such calendar month.
"Investment" in any Person means (a) the acquisition (whether for
cash, property, services, assumption of Indebtedness, securities or
otherwise) of assets, shares of capital stock, bonds, notes, debentures,
partnership, joint ventures or other ownership interests or other
securities of such other Person or (b) any deposit with, or advance, loan
or other extension of credit to, such Person (other than deposits made in
connection with the purchase of equipment or other assets in the ordinary
course of business) or (c) any other capital contribution to or investment
in such Person, including, without limitation, any Guaranty Obligation
(including any support for a Letter of Credit issued on behalf of such
Person) incurred for the benefit of such Person.
"Issuing Lender" means NationsBank, N.A. or any successor
Administrative Agent.
"Issuing Lender Fees" has the meaning set forth in Section 3.4(b).
"Joinder Agreement" means a Joinder Agreement substantially in the
form of Exhibit 7.13.
"Lender" means any of the Persons identified as a "Lender" on the
signature pages hereto, and any Eligible Assignee which may become a Lender
by way of assignment in accordance with the terms hereof, together with
their successors and permitted assigns.
"Letter of Credit" means a letter of credit issued for the account of
a Credit Party by the Issuing Lender pursuant to Section 2.2 or any
Existing Letter of Credit, as such letter of credit may be amended,
modified, extended, renewed or replaced.
"Leverage Ratio" means, as of the end of each fiscal quarter, the
ratio of (a) total Funded Debt on such date plus Seller Obligations
consisting of cash obligations outstanding
- 12 -
on such date to (b) an amount equal to EBITDA for the three month period
ending on such date multiplied by four.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or otherwise),
preference, priority or charge of any kind, including, without limitation,
any agreement to give any of the foregoing, any conditional sale or other
title retention agreement, and any lease in the nature thereof.
"Loan" or "Loans" means the Revolving Loans (or a portion of any
Revolving Loan), individually or collectively, as appropriate.
"LOC Documents" means, with respect to any Letter of Credit, such
Letter of Credit, any amendments thereto, any documents delivered in
connection therewith, any application therefor, and any agreements,
instruments, guarantees or other documents (whether general in application
or applicable only to such Letter of Credit) governing or providing for (a)
the rights and obligations of the parties concerned or at risk or (b) any
collateral security for such obligations.
"LOC Obligations" means, at any time, the sum of (a) the U.S. Dollar
Equivalent of the maximum amount which is, or at any time thereafter may
become, available to be drawn under Letters of Credit (including the
Existing Letters of Credit) then outstanding, assuming compliance with all
requirements for drawings referred to in such Letters of Credit plus (b)
the U.S. Dollar Equivalent of the aggregate amount of all drawings under
Letters of Credit honored by the Issuing Lender but not theretofore
reimbursed.
"LOC Participants" means the Lenders.
"London Interbank Offered Rate" means, with respect to any
Eurocurrency Loan for the Interest Period applicable thereto, the rate of
interest per annum (rounded upwards, if necessary, to the nearest 1/100 of
1%) appearing on Telerate Page 3750 (or any successor page) as the London
interbank offered rate for deposits in Dollars at approximately 11:00 A.M.
(London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period; provided, however, if
more than one rate is specified on Telerate Page 3750, the applicable rate
shall be the arithmetic mean of all such rates. If, for any reason, such
rate is not available, the term "London Interbank Offered Rate" shall mean,
with respect to any Eurocurrency Loan for the Interest Period applicable
thereto, the rate of interest per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as the
London interbank offered rate for deposits in Dollars at approximately
11:00 A.M. (London time) two Business Days prior to the first day of such
Interest Period for a term comparable to such Interest Period; provided,
however, if more than one rate is specified on Reuters Screen LIBO Page,
the applicable rate shall be the arithmetic mean of all such rates.
- 13 -
"Mandatory Borrowing" has the meaning set forth in Section 2.2(e).
"Material Adverse Effect" means a material adverse effect on (a) the
operations, financial condition, business or prospects of the Credit
Parties and their Subsidiaries taken as a whole, (b) the ability of a
Credit Party to perform its obligations under this Credit Agreement or any
of the other Credit Documents, or (c) the validity or enforceability of
this Credit Agreement, any of the other Credit Documents, or the rights and
remedies of the Lenders hereunder or thereunder taken as a whole.
"Material Subsidiaries" means (a) Dispatch Management Services
Acquisition Corp., a Delaware corporation, Dispatch Management Services San
Francisco Corp., a Delaware corporation, Dispatch Management Services New
York Corp., a New York corporation, Road Management Services Corporation, a
Delaware corporation, Dispatch Management Services (Europe) Limited, a
company formed under the laws of England and Wales, Bridge Wharf
Investments Limited, a company formed under the laws of England and Wales,
Security Business Services Limited, a company formed under the laws of
England and Wales, and Dispatch Management Services (UK) Limited f/k/a
Delta Air & Road Transport Limited, a company formed under the laws of
England and Wales, (b) any Subsidiary of a Credit Party that, together with
its Subsidiaries on a consolidated basis (i) during the twelve months
preceding such date of determination accounts for (or to which may be
attributed) 5% or more of the sales, revenues or assets (determined on a
consolidated basis) of the Credit Parties and their Subsidiaries or (ii) is
otherwise necessary for the ongoing business operations of the Credit
Parties and their Subsidiaries or (c) any other Subsidiary of a Credit
Party as requested by the Administrative Agent or the Required Lenders.
"Maturity Date" means May 31, 2000.
"Moody's" means Xxxxx'x Investors Service, Inc., or any successor or
assignee of the business of such company in the business of rating
securities.
"Multiemployer Plan" means a Plan covered by Title IV of ERISA which
is a multiemployer plan as defined in Section 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan covered by Title IV of ERISA,
other than a Multiemployer Plan, which any Credit Party or any of its
Subsidiaries or any ERISA Affiliate and at least one employer other than a
Credit Party or any of its Subsidiaries or any ERISA Affiliate are
contributing sponsors.
"Net Income" means, for any period, the net income after taxes for
such period of the Credit Parties and their Subsidiaries on a consolidated
basis, as determined in accordance with GAAP.
- 14 -
"NMS" means NationsBanc Xxxxxxxxxx Securities LLC.
"Non-Excluded Taxes" has the meaning set forth in Section 3.13.
"Note" or "Notes" means the Revolving Notes, individually or
collectively, as appropriate.
"Notice of Borrowing" means a request by the Borrower for a Revolving
Loan, in the form of Exhibit 2.1(b).
"Notice of Continuation/Conversion" means a request by the Borrower to
continue an existing Eurocurrency Loan to a new Interest Period or to
convert a Eurocurrency Loan to a Base Rate Loan or a Base Rate Loan to a
Eurocurrency Loan, in the form of Exhibit 2.3.
"Participation Interest" means the Extension of Credit by a Lender by
way of a purchase of a participation in Letters of Credit or LOC
Obligations as provided in Section 2.2 or in any Loans as provided in
Section 3.8.
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA and any successor thereto.
"Permitted Investments" means Investments which are (a) cash or Cash
Equivalents, (b) accounts receivable created, acquired or made in the
ordinary course of business and payable or dischargeable in accordance with
customary trade terms, (c) inventory, raw materials and general intangibles
acquired in the ordinary course of business, (d) Investments by one Credit
Party in another Credit Party, (e) loans to directors, officers or
employees in the ordinary course of business for reasonable business
expenses, not to exceed, in the aggregate, $500,000 at any one time; and
(f) subject to the terms of Section 8.13, Investments in Capital
Expenditures.
"Permitted Liens" means (a) Liens securing Credit Party Obligations,
(b) Liens for taxes not yet due or Liens for taxes being contested in good
faith by appropriate proceedings for which adequate reserves determined in
accordance with GAAP have been established (and as to which the property
subject to any such Lien is not yet subject to foreclosure, sale,
collection, levy or loss on account thereof), (c) Liens in respect of
property imposed by law arising in the ordinary course of business such as
materialmen's, mechanics', warehousemen's, carrier's, landlords' and other
nonconsensual statutory Liens which are not yet due and payable or which
are being contested in good faith by appropriate proceedings for which
adequate reserves determined in accordance with GAAP have been established
(and as to which the property subject to any such Lien is not yet subject
to foreclosure, sale or loss on account thereof), (d) pledges or deposits
made in the ordinary
- 15 -
course of business to secure payment of worker's compensation insurance,
unemployment insurance, pensions or social security programs, (e) Liens
arising from good faith deposits in connection with or to secure
performance of tenders, bids, leases, government contracts, performance and
return-of-money bonds and other similar obligations incurred in the
ordinary course of business (other than obligations in respect of the
payment of borrowed money), (f) Liens arising from good faith deposits in
connection with or to secure performance of statutory obligations and
surety and appeal bonds, (g) easements, rights-of-way, restrictions
(including zoning restrictions), matters of plat, minor defects or
irregularities in title and other similar charges or encumbrances not, in
any material respect, impairing the use of the encumbered property for its
intended purposes, (h) judgment Liens that would not constitute an Event of
Default, (i) Liens in connection with Indebtedness permitted by Section
8.1(e), (j) Liens arising by virtue of any statutory or common law
provision relating to banker's liens, rights of setoff or similar rights as
to deposit accounts or other funds maintained with a creditor depository
institution, and (k) Liens existing on the date hereof and identified on
Schedule 8.2; provided that no such Lien shall extend to any property other
than the property subject thereto on the Closing Date.
"Person" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other
enterprise (whether or not incorporated), or any Governmental Authority.
"Plan" means any employee benefit plan (as defined in Section 3(3) of
ERISA) which is covered by ERISA and with respect to which any Credit Party
or any of its Subsidiaries or any ERISA Affiliate is (or, if such plan were
terminated at such time, would under Section 4069 of ERISA be deemed to be)
an "employer" within the meaning of Section 3(5) of ERISA.
"Pledge Agreements" means any Pledge Agreement executed and delivered
by a Credit Party in favor of the Collateral Agent, for the benefit of the
Lenders, to secure its obligations under the Credit Documents, as amended,
modified, extended, renewed or replaced from time to time.
"Prime Rate" means the per annum rate of interest established from
time to time by the Administrative Agent at its principal office in
Charlotte, North Carolina (or such other principal office of the
Administrative Agent as communicated in writing to the Borrower and the
Lenders) as its Prime Rate. Any change in the interest rate resulting from
a change in the Prime Rate shall become effective as of 12:01 a.m. of the
Business Day on which each change in the Prime Rate is announced by the
Administrative Agent. The Prime Rate is a reference rate used by the
Administrative Agent in determining interest rates on certain loans and is
not intended to be the lowest rate of interest charged on any extension of
credit to any debtor.
- 16 -
"Regulation D, U or X" means Regulation D, U or X, respectively, 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.
"Reportable Event" means a "reportable event" as defined in Section
4043 of ERISA with respect to which the notice requirements to the PBGC
have not been waived.
"Required Lenders" means Lenders whose aggregate Credit Exposure (as
hereinafter defined) constitutes at least 66 2/3% of the Credit Exposure of
all Lenders at such time; provided, however, that if any Lender shall be a
Defaulting Lender at such time then there shall be excluded from the
determination of Required Lenders the aggregate principal amount of Credit
Exposure of such Lender at such time. For purposes of the preceding
sentence, the term "Credit Exposure" as applied to each Lender shall mean
(a) at any time prior to the termination of the Commitments, the sum of the
Revolving Loan Commitment Percentage of such Lender multiplied by the
Revolving Committed Amount and (b) at any time after the termination of the
Commitments, the sum of (i) the principal balance of the outstanding Loans
of such Lender plus (ii) such Lender's Participation Interests in the face
amount of the outstanding Letters of Credit.
"Requirement of Law" means, as to any Person, the articles or
certificate of incorporation and by-laws or other organizational or
governing documents of such Person, and any law, treaty, rule or regulation
or final, non-appealable determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such
Person or to which any of its material property is subject.
"Revolving Committed Amount" means (a) SEVENTY-EIGHT MILLION FOUR
HUNDRED EIGHTY-FOUR THOUSAND EIGHT HUNDRED THIRTY-THREE DOLLARS AND 98/100
($78,484,833.98) or such lesser amount as the Revolving Committed Amount
may be reduced pursuant to Section 2.1(d).
"Revolving Loan Commitment Percentage" means, for each Lender, the
percentage identified as its Revolving Loan Commitment Percentage on
Schedule 1.1(a), as such percentage may be modified in connection with any
assignment made in accordance with the provisions of Section 11.3.
"Revolving Loans" means the Revolving Loans made to the Borrower
pursuant to Section 2.1.
"Revolving Note" or "Revolving Notes" means the amended and restated
promissory notes of the Borrower in favor of each of the Lenders evidencing
the Revolving Loans provided pursuant to Section 2.1, individually or
collectively, as appropriate, as such promissory notes may be amended,
modified, supplemented, extended, renewed or replaced from time to time and
as evidenced in the form of Exhibit 2.7.
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"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc. or any successor or assignee of the business of
such division in the business of rating securities.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Security Agreements" means any security agreement executed and
delivered by a Credit Party in favor of the Collateral Agent for the
benefit of the Lenders to secure its obligations under the Credit
Documents, as such may be amended, modified, extended, renewed, restated or
replaced from time to time.
"Seller Obligations" means any seller obligations incurred by a Credit
Party in connection with an acquisition of the capital stock or assets of
any Person.
"Single Employer Plan" means any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan.
"Solvent" means, with respect to any Person as of a particular date,
that on such date (a) such Person is able to pay its debts and other
liabilities, contingent obligations and other commitments as they mature in
the normal course of business, (b) such Person does not intend to, and does
not believe that it will, incur debts or liabilities beyond such Person's
ability to pay as such debts and liabilities mature in their ordinary
course, (c) such Person is not engaged in a business or a transaction, and
is not about to engage in a business or a transaction, for which such
Person's assets would constitute unreasonably small capital after giving
due consideration to the prevailing practice in the industry in which such
Person is engaged or is to engage, (d) the fair value of the assets of such
Person is greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person and (e) the present fair
saleable value of the assets of such Person is not less than the amount
that will be required to pay the probable liability of such Person on its
debts as they become absolute and matured. In computing the amount of
contingent liabilities at any time, it is intended that such liabilities
will be computed at the amount which, in 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.
"Subsidiary" means, as to any Person, (a) 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, 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
directly or indirectly through Subsidiaries, and (b) any partnership,
association, joint venture, limited liability
- 18 -
company or other entity in which such person directly or indirectly through
Subsidiaries has more than a 50% equity interest at any time.
"Termination Event" means (a) with respect to any Single Employer
Plan, the occurrence of a Reportable Event or the substantial cessation of
operations (within the meaning of Section 4062(e) of ERISA); (b) the
withdrawal of any Credit Party or any of its Subsidiaries or any ERISA
Affiliate from a Multiple Employer Plan during a plan year in which it was
a substantial employer (as such term is defined in Section 4001(a)(2) of
ERISA), or the termination of a Multiple Employer Plan; (c) the
distribution of a notice of intent to terminate or the actual termination
of a Plan pursuant to Section 4041(a)(2) or 4041A of ERISA; (d) the
institution of proceedings to terminate or the actual termination of a Plan
by the PBGC under Section 4042 of ERISA; (e) any event or condition which
might reasonably constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan; or
(f) the complete or partial withdrawal of any Credit Party or any of its
Subsidiaries or any ERISA Affiliate from a Multiemployer Plan.
"UK Collateral Documents" means the Pledge Agreements and the
Debentures executed and delivered in connection with the Existing Credit
Agreement by the Borrower and the Guarantors incorporated in England and
Wales, and any Confirmation Letter executed and delivered in connection
with this Credit Agreement by such Credit Parties.
"U.S. Dollar Equivalent" means the amount of Dollars that would be
realized by converting a foreign currency into Dollars at approximately
11:00 a.m. (London time), as set forth on the applicable Telerate Screen,
on the date of determination; provided that if more than one rate is listed
then the applicable conversion rate shall be the arithmetic average of such
rates. If for any reason such conversion rates are not available, the U.S.
Dollar Equivalent shall be calculated using the arithmetic average of the
spot buying rates for such foreign currency in Dollars as quoted to the
Administrative Agent by three foreign exchange dealers of recognized
standing in the United States selected by the Administrative Agent at
approximately 11:00 a.m. (London time) on any date of determination.
"Voting Stock" means all classes of the capital stock (or other voting
interests) of such Person then outstanding and normally entitled to vote in
the election of directors.
"Year 2000 Problem" means any risk (a) that any computer hardware,
software or other equipment used by a Credit Party or any of its
Subsidiaries (or by any of its suppliers, vendors or customers that is
material to its business) will not function as effectively and reliably on
and after January 1, 2000 as it does prior to January 1, 2000 or (b) that
any computer applications used by a Credit Party or any of its Subsidiaries
may not be able to recognize and properly perform date-sensitive functions
after December 31, 1999, to the extent such risk would cause or be
reasonably expected to cause a Material Adverse Effect.
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1.2 Computation of Time Periods and Other Definitional Provisions.
For purposes of computation of periods of time hereunder, the word "from"
means "from and including" and the words "to" and "until" each mean "to but
excluding." References in this Credit Agreement to "Articles", "Sections",
"Schedules" or "Exhibits" shall be to Articles, Sections, Schedules or Exhibits
of or to this Credit Agreement unless otherwise specifically provided.
1.3 Accounting Terms.
Except as otherwise expressly provided herein, all accounting terms used
herein shall be interpreted, and all financial statements and certificates and
reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with
this Credit Agreement shall (except as otherwise expressly provided herein) be
made by application of GAAP applied on a basis consistent with the most recent
annual or quarterly financial statements delivered pursuant to Section 7.1 (or,
prior to the delivery of the first financial statements pursuant to Section 7.1,
consistent with the most recent financial statements delivered pursuant to
Section 7.1 of the Existing Credit Agreement); provided, however, if (a) the
Borrower shall object to determining such compliance on such basis at the time
of delivery of such financial statements due to any change in GAAP or the rules
promulgated with respect thereto or (b) the Administrative Agent or the Required
Lenders shall so object in writing within 30 days after delivery of such
financial statements, then such calculations shall be made on a basis consistent
with GAAP as in effect as of the date of the most recent financial statements
delivered by the Borrower to the Lenders to which no such objection shall have
been made.
SECTION 2
CREDIT FACILITIES
2.1 Revolving Loans.
(a) Revolving Loan Commitment. Subject to the terms and conditions set
forth herein, including but not limited to Section 5.2, each Lender
severally agrees to make revolving loans (each a "Revolving Loan" and
collectively the "Revolving Loans") to the Borrower, in Dollars, at any
time and from time to time, during the period from and including the
Effective Date to but not including the Maturity Date (or such earlier date
if the Revolving Committed Amount has been terminated as provided herein);
provided, however, that (i) the sum of the aggregate amount of Revolving
Loans outstanding plus the aggregate amount of LOC Obligations outstanding
shall not exceed the Revolving Committed Amount and (ii) with respect to
each individual Lender, the Lender's pro rata share of outstanding
Revolving Loans plus such Lender's pro rata share of outstanding LOC
Obligations shall not exceed such Lender's Revolving Loan Commitment
Percentage of the
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Revolving Committed Amount. Subject to the terms of this Credit Agreement
(including Section 3.3), the Borrower may borrow, repay and reborrow
Revolving Loans.
(b) Method of Borrowing for Revolving Loans. By no later than 11:00
a.m. (i) on the date of the requested borrowing of Revolving Loans that
will be Base Rate Loans or (ii) three Business Days prior to the date of
the requested borrowing of Revolving Loans that will be Eurocurrency Loans,
the Borrower shall telephone the Administrative Agent with the information
set forth below as well as submit a written Notice of Borrowing in the form
of Exhibit 2.1(b) to the Administrative Agent setting forth (A) the amount
requested, (B) whether such Revolving Loans shall accrue interest at the
Adjusted Base Rate or the Adjusted Eurocurrency Rate, (C) with respect to
Revolving Loans that will be Eurocurrency Loans, the Interest Period
applicable thereto and (D) certification that the Borrower has complied in
all respects with Section 5.2.
(c) Funding of Revolving Loans. Upon receipt of a Notice of Borrowing,
the Administrative Agent shall promptly inform the Lenders as to the terms
thereof. Each Lender shall make its Revolving Loan Commitment Percentage of
the requested Revolving Loans available to the Administrative Agent by 1:00
p.m. on the date specified in the Notice of Borrowing by deposit, in
Dollars, of immediately available funds at the offices of the
Administrative Agent at its principal office in Charlotte, North Carolina
or at such other address as the Administrative Agent may designate in
writing. The amount of the requested Revolving Loans will then be made
available to the Borrower by the Administrative Agent by crediting the
account of the Borrower on the books of such office of the Administrative
Agent, to the extent the amount of such Revolving Loans are made available
to the Administrative Agent.
No Lender shall be responsible for the failure or delay by any other
Lender in its obligation to make Revolving Loans hereunder; provided,
however, that the failure of any Lender to fulfill its obligations
hereunder shall not relieve any other Lender of its obligations hereunder.
Unless the Administrative Agent shall have been notified by any Lender
prior to the date of any such Revolving Loan that such Lender does not
intend to make available to the Administrative Agent its portion of the
Revolving Loans to be made on such date, the Administrative Agent may
assume that such Lender has made such amount available to the
Administrative Agent on the date of such Revolving Loans, and the
Administrative Agent in reliance upon such assumption, may (in its sole
discretion but without any obligation to do so) make available to the
Borrower a corresponding amount. If such corresponding amount is not in
fact made available to the Administrative Agent, the Administrative Agent
shall be able to recover such corresponding amount from such Lender. If
such Lender does not pay such corresponding amount upon the Administrative
Agent's demand therefor, the Administrative Agent will promptly notify the
Borrower, and the Borrower shall immediately pay such corresponding amount
to the Administrative Agent. The Administrative Agent shall also be
entitled to recover from the Lender or the Borrower, as the case may be,
interest on such corresponding amount in respect of each day
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from the date such corresponding amount was made available by the
Administrative Agent to the Borrower to the date such corresponding amount
is recovered by the Administrative Agent at a per annum rate equal to (i)
from the Borrower at the applicable rate for such Revolving Loan pursuant
to the Notice of Borrowing or (ii) from a Lender at the Federal Funds Rate.
(d) Reductions of Revolving Committed Amount.
(i) Independent of any other reduction of the Revolving Committed
Amount, the Revolving Committed Amount shall be reduced by $100,000 on
the last day of each month from the period beginning April 30, 1999
through December 31, 1999 and by $500,000 on the last day of each
month beginning January 31, 2000 and for each month thereafter. The
outstanding Revolving Loans shall be prepaid, if necessary, in the
amount necessary to give effect to such reduction in the Revolving
Committed Amount and such prepayment shall be applied in accordance
with the terms of Section 3.3(c).
(ii) Independent of any other reduction of the Revolving
Committed Amount, the Revolving Committed Amount shall be reduced by
an amount equal to the net collection of the accounts receivable
delivered to a collection agency pursuant to Section 7.16. The
Borrower shall cause the net collection of such accounts receivable to
be remitted directly to the Administrative Agent by such collection
agency. Such net collection shall constitute a prepayment of the
outstanding Revolving Loans pursuant to Section 3.3(b) and shall be
applied in accordance with the terms of Section 3.3(c).
(iii) If any Existing Letter of Credit is cancelled, terminated
or reduced and (A) such Existing Letter of Credit is not replaced in
accordance with the terms of Section 2.2(a) or (B) the reason for such
Letter of Credit no longer exists, as reasonably determined by the
Administrative Agent, then the Revolving Committed Amount shall be
reduced by an amount equal to the face amount (or the credit exposure
thereunder) of such Existing Letter of Credit that is cancelled or
terminated or the amount by which the face amount (or the credit
exposure thereunder) of such Existing Letter of Credit is reduced.
(iv) Any reduction in (or termination of) the Revolving Committed
Amount pursuant to this Section 2.1(d) shall be permanent and may not
be reinstated.
2.2 Letter of Credit Subfacility.
(a) Issuance. Subject to the terms and conditions hereof and of the
LOC Documents, if any, and any other terms and conditions which the Issuing
Lender may
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reasonably require (so long as such terms and conditions do not impose any
financial obligation on or require any Lien (not otherwise contemplated by
this Credit Agreement) to be given by any Credit Party or conflict with any
obligation of, or detract from any action which may be taken by, any Credit
Party or their Subsidiaries under this Credit Agreement), the Issuing
Lender may from time to time upon request, in its reasonable discretion,
issue (from the Effective Date to the Maturity Date and in a form
reasonably acceptable to the Issuing Lender), in Dollars or British Pounds
Sterling, and the LOC Participants shall participate in, Letters of Credit
in replacement of the Existing Letters of Credit (to the extent the need
for such Existing Letters of Credit still exists and is required to be
funded in cash or with another letter of credit, as reasonably determined
by the Administrative Agent) for the account of a Credit Party; provided,
however, that (i) the aggregate amount of LOC Obligations shall not at any
time exceed THREE MILLION EIGHT HUNDRED THIRTY-FOUR THOUSAND NINE HUNDRED
SEVENTY-FIVE DOLLARS ($3,834,975), (ii) the sum of the aggregate amount of
LOC Obligations outstanding plus Revolving Loans outstanding shall not
exceed the Revolving Committed Amount and (iii) with respect to each
individual LOC Participant, the LOC Participant's pro rata share of
outstanding Revolving Loans plus its pro rata share of outstanding LOC
Obligations shall not exceed such LOC Participant's Revolving Loan
Commitment Percentage of the Revolving Committed Amount. The Issuing Lender
may require the issuance and expiry date of each Letter of Credit to be a
Business Day. Each Letter of Credit shall be a standby letter of credit
issued to support the obligations (including pension or insurance
obligations), contingent or otherwise, of a Credit Party or any of its
Subsidiaries. Except as otherwise expressly agreed upon by all the LOC
Participants, no Letter of Credit shall have an original expiry date more
than one year from the date of issuance nor an expiry date (as extended or
otherwise) beyond the Maturity Date. Each Letter of Credit shall comply
with the related LOC Documents.
(b) Notice and Reports. The request for the issuance of a Letter of
Credit shall be submitted to the Issuing Lender at least three Business
Days prior to the requested date of issuance. The Issuing Lender will, at
least quarterly and more frequently upon request, provide to the
Administrative Agent for dissemination to the Lenders a detailed report
specifying the Letters of Credit which are then issued and outstanding and
any activity with respect thereto which may have occurred since the date of
the prior report, and including therein, among other things, the account
party, the beneficiary, the face amount, and the expiry date as well as any
payments or expirations which may have occurred. The Issuing Lender will
further provide to the Administrative Agent, promptly upon request, copies
of the Letters of Credit and the other LOC Documents.
(c) Participations.
(i) Each LOC Participant acknowledges and confirms that it has a
Participation Interest in the liability of the Issuing Lender under
each Existing Letter of Credit in an amount equal to its Revolving
Loan Commitment Percentage of the
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U.S. Dollar Equivalent of such Existing Letter of Credit. The
Borrower's reimbursement obligations in respect of each Existing
Letter of Credit, and each LOC Participant's obligations in connection
therewith, shall be governed by the terms of this Credit Agreement.
(ii) Each LOC Participant, upon issuance of a Letter of Credit,
shall be deemed to have purchased without recourse a risk
participation from the Issuing Lender in such Letter of Credit and
each LOC Document related thereto and the rights and obligations
arising thereunder and any collateral relating thereto, in each case
in an amount equal to its Revolving Loan Commitment Percentage of the
U.S. Dollar Equivalent of the obligations under such Letter of Credit,
and shall absolutely, unconditionally and irrevocably assume, as
primary obligor and not as surety, and be obligated to pay to the
Issuing Lender therefor and discharge when due, its Revolving Loan
Commitment Percentage of the U.S. Dollar Equivalent of the obligations
arising under such Letter of Credit. Without limiting the scope and
nature of each LOC Participant's participation in any Letter of
Credit, to the extent that the Issuing Lender has not been reimbursed
as required hereunder or under any such Letter of Credit, each such
LOC Participant shall pay to the Issuing Lender its Revolving Loan
Commitment Percentage of the U.S. Dollar Equivalent of such
unreimbursed drawing in same day funds on the day of notification by
the Issuing Lender of an unreimbursed drawing pursuant to the
provisions of subsection (d) or (e) hereof. The obligation of each LOC
Participant to so reimburse the Issuing Lender shall be absolute and
unconditional and shall not be affected by the occurrence of a
Default, an Event of Default or any other occurrence or event. Any
such reimbursement shall not relieve or otherwise impair the
obligation of the Borrower or any other Credit Party to reimburse the
Issuing Lender under any Letter of Credit, together with interest as
hereinafter provided.
(d) Reimbursement. In the event of any drawing under any Letter of
Credit, the Issuing Lender will promptly notify the Borrower. Unless the
Borrower shall immediately notify the Issuing Lender of its intent to
otherwise reimburse the Issuing Lender, the Borrower shall be deemed to
have requested a Revolving Loan at the Adjusted Base Rate in the U.S.
Dollar Equivalent of the amount of the drawing, the proceeds of which will
be used to satisfy the reimbursement obligations. The Borrower shall
reimburse the Issuing Lender on the day of drawing under any Letter of
Credit either with the proceeds of such Revolving Loan obtained hereunder
or otherwise in same day funds as provided herein or in the LOC Documents.
If the Borrower shall fail to reimburse the Issuing Lender as provided
hereinabove, the unreimbursed amount of such drawing shall bear interest at
a per annum rate equal to the Base Rate plus the Applicable Percentage for
the Base Rate Loans that are Revolving Loans plus two percent (2%). The
Borrower's reimbursement obligations hereunder shall be absolute and
unconditional under all circumstances irrespective of (but without waiver
of) any rights of set-off, counterclaim or defense to payment the
applicable account party or the Borrower may claim or have against the
Issuing Lender, an Agent, the
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Lenders, the beneficiary of the Letter of Credit drawn upon or any other
Person, including without limitation, any defense based on any failure of
the applicable account party, the Borrower or any other Credit Party to
receive consideration or the legality, validity, regularity or
unenforceability of the Letter of Credit. The Issuing Lender will promptly
notify the LOC Participants of the amount of any unreimbursed drawing and
each LOC Participant shall promptly pay to the Issuing Lender, in Dollars
and in immediately available funds, the amount of such LOC Participant's
Revolving Loan Commitment Percentage of the U.S. Dollar Equivalent of such
unreimbursed drawing. Such payment shall be made on the day such notice is
received by such Lender from the Issuing Lender if such notice is received
at or before 12:00 Noon, otherwise such payment shall be made at or before
2:00 p.m. on the Business Day next succeeding the day such notice is
received. If such LOC Participant does not pay such amount to the Issuing
Lender in full upon such request, such LOC Participant shall, on demand,
pay to the Issuing Lender interest on the unpaid amount during the period
from the date the LOC Participant received the notice regarding the
unreimbursed drawing until such LOC Participant pays such amount to the
Issuing Lender in full at a rate per annum equal to, if paid within two
Business Days of the date of drawing, the Federal Funds Rate and thereafter
at a rate equal to the Base Rate. Each LOC Participant's obligation to make
such payment to the Issuing Lender, and the right of the Issuing Lender to
receive the same, shall be absolute and unconditional, shall not be
affected by any circumstance whatsoever and without regard to the
termination of this Credit Agreement or the Commitments hereunder, the
existence of a Default or Event of Default or the acceleration of the
obligations hereunder and shall be made without any offset, abatement,
withholding or reduction whatsoever. Simultaneously with the making of each
such payment by a LOC Participant to the Issuing Lender, such LOC
Participant shall, automatically and without any further action on the part
of the Issuing Lender or such LOC Participant, acquire a participation in
an amount equal to such payment (excluding the portion of such payment
constituting interest owing to the Issuing Lender) in the related
unreimbursed drawing portion of the LOC Obligation and in the interest
thereon and in the related LOC Documents, and shall have a claim against
the Borrower and the other Credit Parties with respect thereto.
(e) Repayment with Revolving Loans. On any day on which the Borrower
shall have requested, or been deemed to have requested, a Revolving Loan
borrowing to reimburse a drawing under a Letter of Credit (as set forth in
clause (d) above), the Administrative Agent shall give notice to the
Lenders that a Revolving Loan has been requested or deemed requested in
connection with a drawing under a Letter of Credit, in which case a
Revolving Loan borrowing comprised solely of Base Rate Loans (each such
borrowing, a "Mandatory Borrowing") shall be immediately made from all
Lenders (without giving effect to any termination of the Commitments
pursuant to Section 9.2) pro rata based on each Lender's respective
Revolving Loan Commitment Percentage and the proceeds thereof shall be paid
directly to the Issuing Lender for application to the respective LOC
Obligations. Each Lender hereby irrevocably agrees to make such Revolving
Loans immediately upon any such request or deemed request on account of
each such Mandatory
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Borrowing in the amount and in the manner specified in the preceding
sentence and on the same such date notwithstanding (i) the amount of
Mandatory Borrowing may not comply with the minimum amount for borrowings
of Revolving Loans otherwise required hereunder, (ii) whether any
conditions specified in Section 5.2 are then satisfied, (iii) whether a
Default or Event of Default then exists, (iv) failure of any such request
or deemed request for Revolving Loans to be made by the time otherwise
required hereunder, (v) the date of such Mandatory Borrowing, or (vi) any
reduction in the Revolving Committed Amount or any termination of the
Commitments. 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 or any other Credit Party),
then each such Lender hereby agrees that it shall forthwith fund (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) its Participation Interest in the outstanding LOC
Obligations; provided, further, that in the event any Lender shall fail to
fund its Participation Interest on the day the Mandatory Borrowing would
otherwise have occurred, then the amount of such Lender's unfunded
Participation Interest therein shall bear interest payable to the Issuing
Lender upon demand, at the rate equal to, if paid within two Business Days
of such date, the Federal Funds Rate, and thereafter at a rate equal to the
Base Rate.
(f) Modification and Extension. The issuance of any supplement,
modification, amendment, renewal, or extensions to any Letter of Credit
shall, for purposes hereof, be treated in all respects the same as the
issuance of a new Letter of Credit hereunder.
(g) Uniform Customs and Practices. The Issuing Lender may have the
Letters of Credit be subject to The Uniform Customs and Practice for
Documentary Credits, as published as of the date of issue by the
International Chamber of Commerce (Publication No. 500 or the most recent
publication, the "UCP"), in which case the UCP may be incorporated therein
and deemed in all respects to be a part thereof.
(h) Responsibility of Issuing Lender. It is expressly understood and
agreed as between the Lenders that the obligations of the Issuing Lender
hereunder to the LOC Participants are only those expressly set forth in
this Credit Agreement and that the Issuing Lender shall be entitled to
assume that the conditions precedent set forth in Section 5.2 have been
satisfied unless it shall have acquired actual knowledge that any such
condition precedent has not been satisfied; provided, however, that nothing
set forth in this Section 2.2 shall be deemed to prejudice the right of any
LOC Participant to recover from the Issuing Lender any amounts made
available by such LOC Participant to the Issuing Lender pursuant to this
Section 2.2 in the event that it is determined by a court of competent
jurisdiction that the payment with respect to a Letter of Credit
constituted gross negligence or willful misconduct on the part of the
Issuing Lender.
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(i) Conflict with LOC Documents. In the event of any conflict between
this Credit Agreement and any LOC Document, this Credit Agreement shall
govern.
(j) Indemnification of Issuing Lender.
(i) In addition to its other obligations under this Credit
Agreement, the Borrower hereby agrees to protect, indemnify, pay and
save the Issuing Lender harmless from and against any and all claims,
demands, liabilities, damages, losses, costs, charges and expenses
(including reasonable attorneys' fees) that the Issuing Lender may
incur or be subject to as a consequence, direct or indirect, of (A)
the issuance of any Letter of Credit or (B) the failure of the Issuing
Lender to honor a drawing under a Letter of Credit as a result of any
act or omission, whether rightful or wrongful, of any present or
future de jure or de facto Governmental Authority (all such acts or
omissions, herein called "Government Acts").
(ii) As between the Borrower and the Issuing Lender, the Borrower
shall assume all risks of the acts, omissions or misuse of any Letter
of Credit by the beneficiary thereof. The Issuing Lender shall not be
responsible for (except in the case of (A), (B) and (C) below if the
Issuing Lender has actual knowledge to the contrary): (A) the form,
validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application for
and issuance of any Letter of Credit, even if it should in fact prove
to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged; (B) the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer or
assign any Letter of Credit or the rights or benefits thereunder or
proceeds thereof, in whole or in part, that may prove to be invalid or
ineffective for any reason; (C) failure of the beneficiary of a Letter
of Credit to comply fully with conditions required in order to draw
upon a Letter of Credit; (D) errors, omissions, interruptions or
delays in transmission or delivery of any messages, by mail, cable,
telegraph, telex or otherwise, whether or not they be in cipher; (E)
errors in interpretation of technical terms; (F) any loss or delay in
the transmission or otherwise of any document required in order to
make a drawing under a Letter of Credit or of the proceeds thereof;
and (G) any consequences arising from causes beyond the control of the
Issuing Lender, including, without limitation, any Government Acts.
None of the above shall affect, impair, or prevent the vesting of the
Issuing Lender's rights or powers hereunder.
(iii) In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted
by the Issuing Lender, under or in connection with any Letter of
Credit or the related certificates, if taken or omitted in good faith,
shall not put the Issuing Lender under any resulting liability to the
Borrower or any other Credit Party. It is the intention of the parties
that this Credit Agreement shall be construed and applied to protect
and indemnify
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the Issuing Lender against any and all risks involved in the issuance
of the Letters of Credit, all of which risks are hereby assumed by the
Borrower, including, without limitation, any and all risks of the acts
or omissions, whether rightful or wrongful, of any present or future
Government Acts. The Issuing Lender shall not, in any way, be liable
for any failure by the Issuing Lender or anyone else to pay any
drawing under any Letter of Credit as a result of any Government Acts
or any other cause beyond the control of the Issuing Lender.
(iv) Nothing in this subsection (j) is intended to limit the
reimbursement obligation of the Borrower contained in this Section
2.2. The obligations of the Borrower under this subsection (j) shall
survive the termination of this Credit Agreement. No act or omission
of any current or prior beneficiary of a Letter of Credit shall in any
way affect or impair the rights of the Issuing Lender to enforce any
right, power or benefit under this Credit Agreement.
(v) Notwithstanding anything to the contrary contained in this
subsection (j), the Borrower shall have no obligation to indemnify the
Issuing Lender in respect of any liability incurred by the Issuing
Lender arising solely out of the gross negligence or willful
misconduct of the Issuing Lender, as determined by a court of
competent jurisdiction. Nothing in this Agreement shall relieve the
Issuing Lender of any liability to the Borrower in respect of any
action taken by the Issuing Lender which action constitutes gross
negligence or willful misconduct of the Issuing Lender or a violation
of the UCP or Uniform Commercial Code (as applicable), as determined
by a court of competent jurisdiction.
2.3 Continuations and Conversions.
The Borrower shall have the option, on any Business Day, to continue
existing Eurocurrency Loans for a subsequent Interest Period, to convert Base
Rate Loans into Eurocurrency Loans or to convert Eurocurrency Loans into Base
Rate Loans; provided, however, that (i) each such continuation or conversion
must be requested by the Borrower pursuant to a written Notice of
Continuation/Conversion, in the form of Exhibit 2.3, in compliance with the
terms set forth below, (ii) except as provided in Section 3.11, Eurocurrency
Loans may only be continued or converted into Base Rate Loans on the last day of
the Interest Period applicable thereto, (iii) Eurocurrency Loans may not be
continued nor may Base Rate Loans be converted into Eurocurrency Loans during
the existence and continuation of a Default or an Event of Default and (iv) any
request to continue a Eurocurrency Loan that fails to comply with the terms
hereof or any failure to request a continuation of a Eurocurrency Loan at the
end of an Interest Period shall constitute a conversion to a Base Rate Loan on
the last day of the applicable Interest Period. Each continuation or conversion
must be requested by the Borrower by telephone, as well as pursuant to a Notice
of Continuation/Conversion, no later than 11:00 a.m. (A) on the date for a
requested conversion of a Eurocurrency Loan made in Dollars to a Base Rate Loan
or (B) three Business Days prior to the date for a requested continuation of a
Eurocurrency Loan or conversion of a Base Rate Loan to a
- 28 -
Eurocurrency Loan, in each case pursuant to a written Notice of
Continuation/Conversion submitted to the Administrative Agent which shall set
forth (x) whether the Borrower wishes to continue or convert such Loans and (y)
if the request is to continue a Eurocurrency Loan or convert a Base Rate Loan to
a Eurocurrency Loan, the Interest Period applicable thereto.
2.4 Minimum Amounts.
Each request for a borrowing, conversion or continuation shall be subject
to the requirements that (a) each Eurocurrency Loan shall be in a minimum amount
of $2,500,000 and in integral multiples of $500,000 in excess thereof, (b) each
Base Rate Loan shall be in a minimum amount of the lesser of $500,000 (and
integral multiples of $100,000 in excess thereof) or the remaining amount
available under the Revolving Committed Amount and (c) no more than eight
Eurocurrency Loans shall be outstanding hereunder at any one time. For the
purposes of this Section, all Eurocurrency Loans with the same Interest Periods
that begin and end on the same date shall be considered as one Eurocurrency
Loan, but Eurocurrency Loans with different Interest Periods, even if they begin
on the same date, shall be considered as separate Eurocurrency Loans.
2.5 Notes.
The Revolving Loans made by each Lender shall be evidenced by a duly
executed amended and restated promissory note of the Borrower to each applicable
Lender in the face amount of its Revolving Loan Commitment Percentage of the
Revolving Committed Amount and in substantially the form of Exhibit 2.5.
2.6 Currency Equivalents.
For purposes of determining compliance with Sections 2.1(a), 2.2(a), 3.3(b)
and 5.2(d), the amount of each outstanding Letter of Credit issued in British
Pounds Sterling (a) shall be converted to its U.S. Dollar Equivalent on the date
of the issuance of such Letter of Credit (or, with respect to any Existing
Letters of Credit issued in British Pounds Sterling, its U.S. Dollar Equivalent
on the Closing Date) and (b) from and after any such date, shall be deemed to
remain equivalent to the U.S. Dollar Equivalent determined in accordance with
clause (a) notwithstanding any fluctuation in exchange rates occurring
thereafter.
SECTION 3
GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT
3.1 Interest.
(a) Interest Rate. All Base Rate Loans shall accrue interest at the
Adjusted Base Rate and all Eurocurrency Loans shall accrue interest at the
Adjusted Eurocurrency Rate.
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(b) Default Rate of Interest. Upon the occurrence, and during the
continuance, of an Event of Default, the principal of and, to the extent
permitted by law, interest on the Loans and any other amounts owing
hereunder or under the other Credit Documents (including without limitation
fees and expenses) shall bear interest, payable on demand, at a per annum
rate equal to 2% plus the rate which would otherwise be applicable (or if
no rate is applicable, then the rate for Base Rate Loans plus two percent
(2%) per annum).
(c) Interest Payments. Interest on Loans shall be due and payable in
arrears on each Interest Payment Date. If an Interest Payment Date falls on
a date which is not a Business Day, such Interest Payment Date shall be
deemed to be the next succeeding Business Day, except that in the case of
Eurocurrency Loans where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next preceding day.
3.2 Place and Manner of Payments.
All payments of principal, interest, fees, expenses and other amounts to be
made by a Credit Party under this Agreement shall be made without setoff,
deduction or counterclaim and received not later than 2:00 p.m. on the date when
due, in Dollars and in immediately available funds, by the Administrative Agent
at its offices in Charlotte, North Carolina. Payments received after such time
shall be deemed to have been received on the next Business Day. The Borrower
shall, at the time it makes any payment under this Credit Agreement, specify to
the Administrative Agent the Loans, Letters of Credit, fees or other amounts
payable by the Borrower hereunder to which such payment is to be applied (and in
the event that it fails to specify, or if such application would be inconsistent
with the terms hereof, the Administrative Agent shall, subject to Section 3.7,
distribute such payment to the Lenders in such manner as the Administrative
Agent may deem appropriate). The Administrative Agent will distribute such
payments to the applicable Lenders on the same Business Day if any such payment
is received prior to 2:00 p.m.; otherwise the Administrative Agent will
distribute such payment to the applicable Lenders on the next succeeding
Business Day. Whenever any payment hereunder 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 (subject to accrual of interest and fees for the period
of such extension), except that in the case of Eurocurrency Loans, if the
extension would cause the payment to be made in the next following calendar
month, then such payment shall instead be made on the next preceding Business
Day.
3.3 Prepayments.
(a) Voluntary Prepayments. The Borrower shall have the right to prepay
Loans in whole or in part from time to time without premium or penalty (to
be applied as set forth in Section 3.3(c) below); provided, however, that
(i) Eurocurrency Loans may only be prepaid on three Business Days' prior
written notice to the Administrative Agent and any prepayment of
Eurocurrency Loans will be subject to Section 3.14, (ii) each such partial
prepayment of Eurocurrency Loans shall be in the minimum principal amount
of
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$2,500,000 and integral multiples of $500,000 in excess thereof and (iii)
each such partial payment of Base Rate Loans shall be in the minimum
principal amount of $500,000 and integral multiples of $100,000 in excess
thereof.
(b) Mandatory Prepayments.
(i) If the sum of the aggregate amount of Revolving Loans
outstanding plus LOC Obligations outstanding exceeds the Revolving
Committed Amount, the Borrower shall immediately make a principal
payment to the Administrative Agent in the manner and in an amount
such that the sum of the aggregate amount of Revolving Loans
outstanding plus LOC Obligations outstanding is less than or equal to
the Revolving Committed Amount.
(ii) The Borrower shall prepay the outstanding Revolving Loans in
an amount necessary to give effect to any reduction in the Revolving
Committed Amount pursuant to Section 2.1(d)(i) or (ii).
(c) Application of Prepayments. All amounts required to be paid
pursuant to Sections 3.3(a) and 3.3(b) shall be applied first to Revolving
Loans, and second to a cash collateral account in respect of LOC
Obligations. Within the parameters of the applications set forth above,
prepayments shall be applied first to Base Rate Loans and then to
Eurocurrency Loans in direct order of Interest Period maturities. All
prepayments hereunder shall be subject to Section 3.14.
3.4 Fees.
(a) Upfront Fee. In consideration of the Revolving Committed Amount
being made available by the Lenders hereunder, the Borrower agrees to pay
to the Administrative Agent, for the pro rata benefit of each Lender (based
on each Lender's Revolving Loan Commitment Percentage of the Revolving
Committed Amount), a one-time fee of .25% of the Revolving Committed Amount
(the "Upfront Fee"). One-half of the Upfront Fee shall be due and payable
on the Closing Date and the remaining one-half of the Upfront Fee shall be
due and payable on or before May 31, 1999.
(b) Letter of Credit Fees.
(i) Letter of Credit Fees. In consideration of the issuance of
Letters of Credit hereunder, the Borrower agrees to pay to the Issuing
Lender for the pro rata benefit of the applicable Lenders (based on
each Lender's Revolving Loan Commitment Percentage of the Revolving
Committed Amount), a per annum fee (the "Letter of Credit Fees") equal
to the Applicable Percentage for the Letter of Credit Fees on the U.S.
Dollar Equivalent of the average daily maximum amount available to be
drawn under each such Letter of Credit from the date of issuance to
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the date of expiration. The Letter of Credit Fees will be payable in
arrears on the last day of each fiscal quarter of the Borrower (as
well as on the Maturity Date) for the immediately preceding fiscal
quarter (or portion thereof), beginning with the first of such dates
to occur after the Closing Date.
(ii) Issuing Lender Fees. In addition to the Letter of Credit
Fees payable pursuant to subsection (i) above, the Borrower shall pay
to the Issuing Lender for its own account, without sharing by the
other Lenders, the customary incidental and/or out of pocket charges
from time to time to the Issuing Lender for its services in connection
with the issuance, amendment, payment, transfer, administration,
cancellation and conversion of, and drawings under, Letters of Credit
(collectively, the "Issuing Lender Fees").
(c) Administrative Agent Fees. The Borrower agrees to pay to the
Administrative Agent, for its own account, an annual administration fee and
an arrangement fee in accordance with the terms of the Fee Letter.
3.5 Payment in full at Maturity.
On the Maturity Date, the entire outstanding principal balance of all Loans
and all LOC Obligations, together with accrued but unpaid interest and all other
sums owing with respect thereto, shall be due and payable in full, unless
accelerated sooner pursuant to Section 9.
3.6 Computations of Interest and Fees.
(a) Except for Base Rate Loans, in which case interest shall be
computed on the basis of a 365 or 366 day year as the case may be, all
computations of interest and fees hereunder shall be made on the basis of
the actual number of days elapsed over a year of 360 days. Interest shall
accrue from and include the date of borrowing (or continuation or
conversion) but exclude the date of payment.
(b) It is the intent of the Lenders and the Credit Parties to conform
to and contract in strict compliance with applicable usury law from time to
time in effect. All agreements between the Lenders and the Borrower are
hereby limited by the provisions of this paragraph which shall override and
control all such agreements, whether now existing or hereafter arising and
whether written or oral. In no way, nor in any event or contingency
(including but not limited to prepayment or acceleration of the maturity of
any obligation), shall the interest taken, reserved, contracted for,
charged, or received under this Credit Agreement, under the Notes or
otherwise, exceed the maximum nonusurious amount permissible under
applicable law. If, from any possible construction of any of the Credit
Documents or any other document, interest would otherwise be payable in
excess of the maximum nonusurious amount, any such construction shall be
subject to the provisions of this paragraph and such documents shall be
automatically reduced to the maximum
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nonusurious amount permitted under applicable law, without the necessity of
execution of any amendment or new document. If any Lender shall ever
receive anything of value which is characterized as interest on the Loans
under applicable law and which would, apart from this provision, be in
excess of the maximum lawful amount, an amount equal to the amount which
would have been excessive interest shall, without penalty, be applied to
the reduction of the principal amount owing on the Loans and not to the
payment of interest, or refunded to the Borrower or the other payor thereof
if and to the extent such amount which would have been excessive exceeds
such unpaid principal amount of the Loans. The right to demand payment of
the Loans or any other indebtedness evidenced by any of the Credit
Documents does not include the right to accelerate the payment of any
interest which has not otherwise accrued on the date of such demand, and
the Lenders do not intend to charge or receive any unearned interest in the
event of such demand. All interest paid or agreed to be paid to the Lenders
with respect to the Loans shall, to the extent permitted by applicable law,
be amortized, prorated, allocated, and spread throughout the full stated
term (including any renewal or extension) of the Loans so that the amount
of interest on account of such indebtedness does not exceed the maximum
nonusurious amount permitted by applicable law.
3.7 Pro Rata Treatment.
Except to the extent otherwise provided herein:
(a) Loans. Each Revolving Loan borrowing (including, without
limitation, each Mandatory Borrowing), each payment or prepayment of
principal of any Loan, each payment of fees (other than the Issuing Lender
Fees retained by the Issuing Lender for its own account and the
Administrative Fees retained by the Administrative Agent for its own
account), each reduction of the Revolving Committed Amount, and each
conversion or continuation of any Loan, shall (except as otherwise provided
in Section 3.11) be allocated pro rata among the relevant Lenders in
accordance with the respective Revolving Loan Commitment Percentages of
such Lenders (or, if the Commitments of such Lenders have expired or been
terminated, in accordance with the respective principal amounts of the
outstanding Loans and Participation Interests of such Lenders); provided
that, if any Lender shall have failed to pay its applicable pro rata share
of any Revolving Loan, then any amount to which such Lender would otherwise
be entitled pursuant to this subsection (a) shall instead be payable to the
Administrative Agent until the share of such Loan not funded by such Lender
has been repaid; provided further, that in the event any amount paid to any
Lender pursuant to this subsection (a) is rescinded or must otherwise be
returned by the Administrative Agent, each Lender shall, upon the request
of the Administrative Agent, repay to the Administrative Agent the amount
so paid to such Lender, with interest for the period commencing on the date
such payment is returned by the Administrative Agent until the date the
Administrative Agent receives such repayment at a rate per annum equal to,
during the period to but excluding the date two Business Days after such
request, the Federal Funds Rate, and thereafter, the Base Rate plus two
percent (2%) per annum; and
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(b) Letters of Credit. Each payment of unreimbursed drawings in
respect of LOC Obligations shall be allocated to each LOC Participant pro
rata in accordance with its Revolving Loan Commitment Percentage; provided
that, if any LOC Participant shall have failed to pay its applicable pro
rata share of any drawing under any Letter of Credit, then any amount to
which such LOC Participant would otherwise be entitled pursuant to this
subsection (b) shall instead be payable to the Issuing Lender until the
share of such unreimbursed drawing not funded by such Lender has been
repaid; provided further, that in the event any amount paid to any LOC
Participant pursuant to this subsection (b) is rescinded or must otherwise
be returned by the Issuing Lender, each LOC Participant shall, upon the
request of the Issuing Lender, repay to the Administrative Agent for the
account of the Issuing Lender the amount so paid to such LOC Participant,
with interest for the period commencing on the date such payment is
returned by the Issuing Lender until the date the Issuing Lender receives
such repayment at a rate per annum equal to, during the period to but
excluding the date two Business Days after such request, the Federal Funds
Rate, and thereafter, the Base Rate plus two percent (2%) per annum.
3.8 Sharing of Payments.
The Lenders agree among themselves that, except to the extent otherwise
provided herein, in the event that any Lender shall obtain payment in respect of
any Loan, unreimbursed drawing with respect to any LOC Obligations or any other
obligation owing to such Lender under this Credit Agreement through the exercise
of a right of setoff, banker's lien or counterclaim, or pursuant to a secured
claim under Section 506 of the Bankruptcy Code or other security or interest
arising from, or in lieu of, such secured claim, received by such Lender under
any applicable bankruptcy, insolvency or other similar law or otherwise, or by
any other means, in excess of its pro rata share of such payment as provided for
in this Credit Agreement, such Lender shall promptly pay in cash or purchase
from the other Lenders a participation in such Loans, LOC Obligations, and other
obligations in such amounts, and make such other adjustments from time to time,
as shall be equitable to the end that all Lenders share such payment in
accordance with their respective ratable shares as provided for in this Credit
Agreement. The Lenders further agree among themselves that if payment to a
Lender obtained by such Lender through the exercise of a right of setoff,
banker's lien, counterclaim or other event as aforesaid shall be rescinded or
must otherwise be restored, each Lender which shall have shared the benefit of
such payment shall, by payment in cash or a repurchase of a participation
theretofore sold, return its share of that benefit (together with its share of
any accrued interest payable with respect thereto) to each Lender whose payment
shall have been rescinded or otherwise restored. The Borrower agrees that any
Lender so purchasing such a participation may, to the fullest extent permitted
by law, exercise all rights of payment, including setoff, banker's lien or
counterclaim, with respect to such participation as fully as if such Lender were
a holder of such Loan, LOC Obligation or other obligation in the amount of such
participation. Except as otherwise expressly provided in this Credit Agreement,
if any Lender or an Agent shall fail to remit to an Agent or any other Lender an
amount payable by such Lender or such Agent to such Agent or such other Lender
pursuant to this Credit Agreement on the date when such
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amount is due, such payments shall be made together with interest thereon for
each date from the date such amount is due until the date such amount is paid to
such Agent or such other Lender at a rate per annum equal to the Federal Funds
Rate. If under any applicable bankruptcy, insolvency or other similar law, any
Lender receives a secured claim in lieu of a setoff to which this Section 3.8
applies, such Lender shall, to the extent practicable, exercise its rights in
respect of such secured claim in a manner consistent with the rights of the
Lenders under this Section 3.8 to share in the benefits of any recovery on such
secured claim.
3.9 Capital Adequacy.
If, after the date hereof, any Lender has determined that the adoption or
the becoming effective of, or any change in, or any change by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof in the interpretation or administration of, any
applicable law, rule or regulation regarding capital adequacy, or compliance by
such Lender, or its parent corporation, with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on such Lender's (or parent corporation's) capital or assets as a
consequence of its commitments or obligations hereunder to a level below that
which such Lender, or its parent corporation, could have achieved but for such
adoption, effectiveness, change or compliance (taking into consideration such
Lender's (or parent corporation's) policies with respect to capital adequacy),
then, upon notice from such Lender to the Borrower, the Borrower shall be
obligated to pay to such Lender such additional amount or amounts as will
compensate such Lender on an after-tax basis (after taking into account
applicable deductions and credits in respect of the amount indemnified) for such
reduction. Each determination by any such Lender of amounts owing under this
Section shall, absent manifest error, be conclusive and binding on the parties
hereto. This covenant shall survive the termination of this Credit Agreement and
the payment of the Loans and all other amounts payable hereunder.
3.10 Inability To Determine Eurocurrency Rate.
If the Administrative Agent shall have determined in good faith (which
determination shall be conclusive and binding upon the Borrower) that by reason
of circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the Eurocurrency Rate, the Administrative Agent shall
give notice thereof to the Borrower and the Lenders as soon as practicable
thereafter, and will also give prompt written notice to the Borrower when such
conditions no longer exist. If such notice is given (a) any Eurocurrency Loans
requested to be made on the first day of such Interest Period shall be made as
Base Rate Loans, (b) any Loans that were to have been converted on the first day
of such Interest Period to or continued as Eurocurrency Loans shall be converted
to or continued as Base Rate Loans and (c) any outstanding Eurocurrency Loans
shall be converted, on the first day of such Interest Period, to Base Rate
Loans. Until such notice has been withdrawn by the Administrative Agent, no
further Eurocurrency Loans shall be made or continued as such, nor shall the
Borrower have the right to convert Base Rate Loans to Eurocurrency Loans.
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3.11 Illegality.
Notwithstanding any other provision herein, if the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for any Lender to make
or maintain Eurocurrency Loans as contemplated by this Credit Agreement, (a)
such Lender shall promptly give written notice of such circumstances to the
Borrower and the Administrative Agent (which notice shall be withdrawn whenever
such circumstances no longer exist), (b) the commitment of such Lender hereunder
to make Eurocurrency Loans, continue Eurocurrency Loans as such and convert a
Base Rate Loan to Eurocurrency Loans shall forthwith be canceled and, until such
time as it shall no longer be unlawful for such Lender to make or maintain
Eurocurrency Loans, such Lender shall then have a commitment only to make a Base
Rate Loan when a Eurocurrency Loan is requested and (c) such Lender's Loans then
outstanding as Eurocurrency Loans, if any, shall be converted automatically to
Base Rate Loans on the last day of the then current Interest Periods with
respect to such Loans or within such earlier period as required by law. If any
such conversion of a Eurocurrency Loan occurs on a day which is not the last day
of the then current Interest Period with respect thereto, the Borrower shall pay
to such Lender such amounts, if any, as may be required pursuant to Section
3.14.
3.12 Requirements of Law.
If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof applicable to any Lender, or compliance by
any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority, in each case made
subsequent to the Closing Date (or, if later, the date on which such Lender
becomes a Lender):
(a) shall subject such Lender to any tax of any kind whatsoever with
respect to any Letter of Credit, any Eurocurrency Loans made by it or its
obligation to make Eurocurrency Loans, or change the basis of taxation of
payments to such Lender in respect thereof (except for Non-Excluded Taxes
covered by Section 3.13 (including Non-Excluded Taxes imposed solely by
reason of any failure of such Lender to comply with its obligations under
Section 3.13(b)) and changes in taxes measured by or imposed upon the
overall net income, or franchise tax (imposed in lieu of such net income
tax), of such Lender or its applicable lending office, branch, or any
affiliate thereof);
(b) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of funds by, any
office of such Lender; or
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(c) shall impose on such Lender any other condition (excluding any tax
of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurocurrency Loans or issuing or participating in
Letters of Credit or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, upon notice to the Borrower from such Lender,
through the Administrative Agent, in accordance herewith, the Borrower shall be
obligated to promptly pay such Lender, upon its demand, any additional amounts
necessary to compensate such Lender on an after-tax basis (after taking into
account applicable deductions and credits in respect of the amount indemnified)
for such increased cost or reduced amount receivable, provided that, in any such
case, the Borrower may elect to convert the Eurocurrency Loans made by such
Lender hereunder to Base Rate Loans by giving the Administrative Agent at least
one Business Day's notice of such election, in which case the Borrower shall
promptly pay to such Lender, upon demand, without duplication, such amounts, if
any, as may be required pursuant to Section 3.14. If any Lender becomes entitled
to claim any additional amounts pursuant to this Section 3.12, it shall provide
prompt notice thereof to the Borrower, through the Administrative Agent,
certifying (x) that one of the events described in this Section 3.12 has
occurred and describing in reasonable detail the nature of such event, (y) as to
the increased cost or reduced amount resulting from such event and (z) as to the
additional amount demanded by such Lender and a reasonably detailed explanation
of the calculation thereof. Such a certificate as to any additional amounts
payable pursuant to this Section 3.12 submitted by such Lender, through the
Administrative Agent, to the Borrower shall be conclusive and binding on the
parties hereto in the absence of manifest error. This covenant shall survive the
termination of this Credit Agreement and the payment of the Loans and all other
amounts payable hereunder.
3.13 Taxes.
(a) Except as provided below in this Section 3.13, all payments made
by the Borrower under this Credit Agreement and any Notes shall be made
free and clear of, and without deduction or withholding for or on account
of, any present or future income, stamp or other taxes, levies, imposts,
duties, charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any court, or
governmental body, agency or other official, excluding taxes measured by or
imposed upon the net income of any Lender or its applicable lending office,
or any branch or affiliate thereof, and all franchise taxes, branch taxes,
taxes on doing business or taxes on the capital or net worth of any Lender
or its applicable lending office, or any branch or affiliate thereof, in
each case imposed in lieu of net income taxes: (i) by the jurisdiction
under the laws of which such Lender, applicable lending office, branch or
affiliate is organized or is located, or in which its principal executive
office is located, or any nation within which such jurisdiction is located
or any political subdivision thereof; or (ii) by reason of any connection
between the jurisdiction imposing such tax and such Lender, applicable
lending office, branch or affiliate other than a connection arising solely
from such Lender having executed, delivered
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or performed its obligations, or received payment under or enforced, this
Credit Agreement or any Notes. If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings ("Non-Excluded
Taxes") are required to be withheld from any amounts payable to an Agent or
any Lender hereunder or under any Notes, (A) the amounts so payable to an
Agent or such Lender shall be increased to the extent necessary to yield to
an Agent or such Lender (after payment of all Non-Excluded Taxes) interest
or any such other amounts payable hereunder at the rates or in the amounts
specified in this Credit Agreement and any Notes, provided, however, that
the Borrower shall be entitled to deduct and withhold any Non-Excluded
Taxes and shall not be required to increase any such amounts payable to any
Lender that is not organized under the laws of the United States of America
or a state thereof if such Lender fails to comply with the requirements of
paragraph (b) of this Section 3.13 whenever any Non-Excluded Taxes are
payable by the Borrower, and (B) as promptly as possible after requested
the Borrower shall send to such Agent for its own account or for the
account of such Lender, as the case may be, a certified copy of an original
official receipt received by the Borrower showing payment thereof. If the
Borrower fails to pay any Non-Excluded Taxes when due to the appropriate
taxing authority or fails to remit to the Administrative Agent the required
receipts or other required documentary evidence, the Borrower shall
indemnify the Agents and any Lender for any incremental Non-Excluded Taxes,
interest or penalties that may become payable by an Agent or any Lender as
a result of any such failure. The agreements in this subsection shall
survive the termination of this Credit Agreement and the payment of the
Loans and all other amounts payable hereunder.
(b) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof shall:
(i) (A) on or before the date of any payment by the Borrower
under this Credit Agreement or Notes to such Lender, deliver to the
Borrower and the Administrative Agent (x) two duly completed copies of
United States Internal Revenue Service Form 1001 or 4224, or successor
applicable form, as the case may be, certifying that it is entitled to
receive payments under this Credit Agreement and any Notes without
deduction or withholding of any United States federal income taxes and
(y) an Internal Revenue Service Form W-8 or W-9, or successor
applicable form, as the case may be, certifying that it is entitled to
an exemption from United States backup withholding tax;
(B) deliver to the Borrower and the Administrative Agent two
further copies of any such form or certification on or before the date
that any such form or certification expires or becomes obsolete and
after the occurrence of any event requiring a change in the most
recent form previously delivered by it to the Borrower; and
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(C) obtain such extensions of time for filing and complete such
forms or certifications as may reasonably be requested by the Borrower
or the Administrative Agent; or
(ii) in the case of any such Lender that is not a "bank" within
the meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (A)
represent to the Borrower (for the benefit of the Borrower and the
Agents) that it is not a bank within the meaning of Section
881(c)(3)(A) of the Internal Revenue Code, (B) agree to furnish to the
Borrower, on or before the date of any payment by the Borrower, with a
copy to the Administrative Agent, two accurate and complete original
signed copies of Internal Revenue Service Form W-8, or successor
applicable form certifying to such Lender's legal entitlement at the
date of such certificate to an exemption from U.S. withholding tax
under the provisions of Section 881(c) of the Internal Revenue Code
with respect to payments to be made under this Credit Agreement and
any Notes (and to deliver to the Borrower and the Administrative Agent
two further copies of such form on or before the date it expires or
becomes obsolete and after the occurrence of any event requiring a
change in the most recently provided form and, if necessary, obtain
any extensions of time reasonably requested by the Borrower or the
Administrative Agent for filing and completing such forms), and (C)
agree, to the extent legally entitled to do so, upon reasonable
request by the Borrower, to provide to the Borrower (for the benefit
of the Borrower and the Agents) such other forms as may be reasonably
required in order to establish the legal entitlement of such Lender to
an exemption from withholding with respect to payments under this
Credit Agreement and any Notes.
Notwithstanding the above, if any change in treaty, law or regulation has
occurred after the date such Person becomes a Lender hereunder which
renders all such forms inapplicable or which would prevent such Lender from
duly completing and delivering any such form with respect to it and such
Lender so advises the Borrower and the Administrative Agent, then such
Lender shall be exempt from such requirements. Each Person that shall
become a Lender or a participant of a Lender pursuant to Section 11.3
shall, upon the effectiveness of the related transfer, be required to
provide all of the forms, certifications and statements required pursuant
to this subsection (b); provided that in the case of a participant of a
Lender, the obligations of such participant of a Lender pursuant to this
subsection (b) shall be determined as if the participant of a Lender were a
Lender except that such participant of a Lender shall furnish all such
required forms, certifications and statements to the Lender from which the
related participation shall have been purchased.
3.14 Compensation.
The Borrower promises to indemnify each Lender and to hold each Lender
harmless from any loss or expense which such Lender may sustain or incur as a
consequence of (a) default by the Borrower in making a borrowing of, conversion
into or continuation of Eurocurrency Loans after
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the Borrower has given a notice requesting the same in accordance with the
provisions of this Credit Agreement, (b) default by the Borrower in making any
prepayment of a Eurocurrency Loan after the Borrower has given a notice thereof
in accordance with the provisions of this Credit Agreement and (c) the making of
a prepayment of Eurocurrency Loans on a day which is not the last day of an
Interest Period with respect thereto. Such indemnification may include an amount
equal to (i) the amount of interest which would have accrued on the amount so
prepaid, or not so borrowed, converted or continued, for the period from the
date of such prepayment or of such failure to borrow, convert or continue to the
last day of the applicable Interest Period (or, in the case of a failure to
borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) in each case at the applicable rate of interest for
such Eurocurrency Loans provided for herein (excluding, however, the Applicable
Percentage included therein, if any) minus (ii) the amount of interest (as
reasonably determined by such Lender) which would have accrued to such Lender on
such amount by placing such amount on deposit for a comparable period with
leading banks in the interbank Eurocurrency market. The agreements in this
Section shall survive the termination of this Credit Agreement and the payment
of the Loans and all other amounts payable hereunder.
3.15 Substitution of Lender.
If (a) the obligation of any Lender to make Eurocurrency Loans has been
suspended pursuant to Section 3.11 or (b) any Lender has demanded compensation
under Section 3.9, 3.11, 3.12, 3.13 or 3.14, the Borrower shall have the right,
with the assistance of the Administrative Agent, to seek a mutually satisfactory
substitute lender or lenders. Any substitution under this Section 3.15 may be
accomplished, at the Borrower's option, either (i) by the replaced Lender
assigning its rights and obligations hereunder to a replacement lender or
lenders pursuant to Section 11.3(b) at a mutually agreeable price or (ii) by the
Borrower prepaying all outstanding Loans and LOC Obligations from the replaced
Lender and terminating such Lender's Commitment on a date specified in a notice
delivered to the Administrative Agent and the replaced Lender at least three
Business Days before the date so specified (and compensating such Lender for any
resulting funding losses as provided in Section 3.14) and concurrently a
replacement Lender or Lenders assuming a Commitment in an amount equal to the
Commitment being terminated and making Loans in the same aggregate amount and
having the same maturity date or dates, respectively, as the Loans being
prepaid, all pursuant to documents reasonably satisfactory to the Administrative
Agent (and in the case of any document to be signed by the replaced Lender,
reasonably satisfactory to such Lender). No such substitution shall relieve the
Borrower of their obligations to compensate and/or indemnify the replaced Lender
as required by Section 3.9, 3.11, 3.12, 3.13 or 3.14 with respect to the period
before it is replaced and to pay all accrued interest, accrued fees and other
amounts owing to the replaced Lender hereunder.
3.16 Evidence of Debt.
(a) Each Lender shall maintain an account or accounts evidencing each
Loan made by such Lender to the Borrower from time to time, including the
amounts of
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principal and interest payable and paid to such Lender from time to time
under this Credit Agreement. Each Lender will make reasonable efforts to
maintain the accuracy of its account or accounts and to promptly update its
account or accounts from time to time, as necessary.
(b) The Administrative Agent shall maintain the Register pursuant to
Section 11.3(c), and a subaccount for each Lender, in which Register and
subaccounts (taken together) shall be recorded (i) the amount, type and
Interest Period of each such Loan hereunder, (ii) the amount of any
principal or interest due and payable or to become due and payable to each
Lender hereunder and (iii) the amount of any sum received by the
Administrative Agent hereunder from or for the account of the Borrower and
each Lender's share thereof. The Administrative Agent will make reasonable
efforts to maintain the accuracy of the subaccounts referred to in the
preceding sentence and to promptly update such subaccounts from time to
time, as necessary.
(c) The entries made in the accounts, Register and subaccounts
maintained pursuant to subsection (b) of this Section 3.16 (and, if
consistent with the entries of the Administrative Agent, subsection (a))
shall be prima facie evidence of the existence and amounts of the
obligations of the Borrower therein recorded; provided, however, that the
failure of any Lender or the Administrative Agent to maintain any such
account, such Register or such subaccount, as applicable, or any error
therein, shall not in any manner affect the obligation of the Borrower to
repay the Loans made by such Lender in accordance with the terms hereof.
SECTION 4
GUARANTY
4.1 Guaranty of Payment.
Subject to Section 4.7 below, each of the Guarantors hereby, jointly and
severally, unconditionally guarantees to each Lender, each Affiliate of Lender
that enters into a Hedging Agreement and the Agents the prompt payment of the
Credit Party Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration or otherwise) and the timely performance
of all other obligations under the Credit Documents and such Hedging Agreements.
This Guaranty is a guaranty of payment and not of collection and is a continuing
guaranty and shall apply to all Credit Party Obligations whenever arising.
4.2 Obligations Unconditional.
The obligations of the Guarantors hereunder are absolute and unconditional,
irrespective of the value, genuineness, validity, regularity or enforceability
of any of the Credit Documents or the
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Hedging Agreements, or any other agreement or instrument referred to therein, to
the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever which might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor. Each Guarantor agrees that this
Guaranty may be enforced by the Lenders without the necessity at any time of
resorting to or exhausting any other security or collateral and without the
necessity at any time of having recourse to the Notes or any other of the Credit
Documents or any collateral, if any, hereafter securing the Credit Party
Obligations or otherwise and each Guarantor hereby waives the right to require
the Lenders to proceed against the Borrower or any other Person (including a
co-guarantor) or to require the Lenders to pursue any other remedy or enforce
any other right. Each Guarantor further agrees that it shall have no right of
subrogation, indemnity, reimbursement or contribution against the Borrower or
any other Guarantor of the Credit Party Obligations for amounts paid under this
Guaranty until such time as the Lenders (and any Affiliates of Lenders entering
into Hedging Agreements) have been paid in full, all Commitments under the
Credit Agreement have been terminated and no Person or Governmental Authority
shall have any right to request any return or reimbursement of funds from the
Lenders in connection with monies received under the Credit Documents. Each
Guarantor further agrees that nothing contained herein shall prevent the Lenders
from suing on the Notes or any of the other Credit Documents or any of the
Hedging Agreements or foreclosing its security interest in or Lien on any
Collateral, if any, securing the Credit Party Obligations or from exercising any
other rights available to it under this Credit Agreement, the Notes, any other
of the Credit Documents, or any other instrument of security, if any, and the
exercise of any of the aforesaid rights and the completion of any foreclosure
proceedings shall not constitute a discharge of any of any Guarantor's
obligations hereunder; it being the purpose and intent of each Guarantor that
its obligations hereunder shall be absolute, independent and unconditional under
any and all circumstances. Neither any Guarantor's obligations under this
Guaranty nor any remedy for the enforcement thereof shall be impaired, modified,
changed or released in any manner whatsoever by an impairment, modification,
change, release or limitation of the liability of the Borrower or by reason of
the bankruptcy or insolvency of the Borrower. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of any of the Credit Party
Obligations and notice of or proof of reliance of by any Agent or any Lender
upon this Guarantee or acceptance of this Guarantee. The Credit Party
Obligations, and any of them, shall conclusively be deemed to have been created,
contracted or incurred, or renewed, extended, amended or waived, in reliance
upon this Guarantee. All dealings between the Borrower and any of the
Guarantors, on the one hand, and the Agents and the Lenders, on the other hand,
likewise shall be conclusively presumed to have been had or consummated in
reliance upon this Guarantee. The Guarantors further agree to all rights of
set-off as set forth in Section 11.2.
4.3 Modifications.
Each Guarantor agrees that (a) all or any part of the Collateral now or
hereafter held for the Credit Party Obligations, if any, may be exchanged,
compromised or surrendered from time to time; (b) the Lenders shall not have any
obligation to protect, perfect, secure or insure any such security interests,
liens or encumbrances now or hereafter held, if any, for the Credit Party
Obligations or the properties subject thereto; (c) the time or place of payment
of the Credit Party
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Obligations may be changed or extended, in whole or in part, to a time certain
or otherwise, and may be renewed or accelerated, in whole or in part; (d) the
Borrower and any other party liable for payment under the Credit Documents may
be granted indulgences generally; (e) any of the provisions of the Notes or any
of the other Credit Documents may be modified, amended or waived; (f) any party
(including any co-guarantor) liable for the payment thereof may be granted
indulgences or be released; and (g) any deposit balance for the credit of the
Borrower or any other party liable for the payment of the Credit Party
Obligations or liable upon any security therefor may be released, in whole or in
part, at, before or after the stated, extended or accelerated maturity of the
Credit Party Obligations, all without notice to or further assent by such
Guarantor, which shall remain bound thereon, notwithstanding any such exchange,
compromise, surrender, extension, renewal, acceleration, modification,
indulgence or release.
4.4 Waiver of Rights.
Each Guarantor expressly waives to the fullest extent permitted by
applicable law: (a) notice of acceptance of this Guaranty by the Lenders and of
all extensions of credit to the Borrower by the Lenders; (b) presentment and
demand for payment or performance of any of the Credit Party Obligations; (c)
protest and notice of dishonor or of default (except as specifically required in
the Credit Agreement) with respect to the Credit Party Obligations or with
respect to any security therefor; (d) notice of the Lenders obtaining, amending,
substituting for, releasing, waiving or modifying any security interest, lien or
encumbrance, if any, hereafter securing the Credit Party Obligations, or the
Lenders' subordinating, compromising, discharging or releasing such security
interests, liens or encumbrances, if any; and (e) all other notices to which
such Guarantor might otherwise be entitled.
4.5 Reinstatement.
The obligations of the Guarantors under this Section 4 shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Credit Party Obligations is
rescinded or must be otherwise restored by any holder of any of the Credit Party
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Agents and each Lender on demand for all reasonable costs and expenses
(including, without limitation, reasonable fees of counsel) incurred by an Agent
or such Lender in connection with such rescission or restoration, including any
such costs and expenses incurred in defending against any claim alleging that
such payment constituted a preference, fraudulent transfer or similar payment
under any bankruptcy, insolvency or similar law.
4.6 Remedies.
The Guarantors agree that, as between the Guarantors, on the one hand, and
the Agents and the Lenders, on the other hand, the Credit Party Obligations may
be declared to be forthwith due and payable as provided in Section 9 (and shall
be deemed to have become automatically due and
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payable in the circumstances provided in Section 9) notwithstanding any stay,
injunction or other prohibition preventing such declaration (or preventing such
Credit Party Obligations from becoming automatically due and payable) as against
any other Person and that, in the event of such declaration (or such Credit
Party Obligations being deemed to have become automatically due and payable),
such Credit Party Obligations (whether or not due and payable by any other
Person) shall forthwith become due and payable by the Guarantors. The Guarantors
acknowledge and agree that their obligations hereunder are secured in accordance
with the terms of the Security Agreements and the other Collateral Documents and
that the Lenders may exercise their remedies thereunder in accordance with the
terms thereof.
4.7 Limitation of Guaranty.
Notwithstanding any provision to the contrary contained herein or in any of
the other Credit Documents, to the extent the obligations of any Guarantor shall
be adjudicated to be invalid or unenforceable for any reason (including, without
limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of such Guarantor
hereunder shall be limited to the maximum amount that is permissible under
applicable law (whether federal or state or otherwise and including, without
limitation, the Bankruptcy Code).
4.8 Rights of Contribution.
The Credit Parties agree among themselves that, in connection with payments
made hereunder, each Credit Party shall have contribution rights against the
other Credit Parties as permitted under applicable law. Such contribution rights
shall be subordinate and subject in right of payment to the obligations of the
Credit Parties under the Credit Documents and no Credit Party shall exercise
such rights of contribution until all Credit Party Obligations have been paid in
full and the Commitments terminated.
SECTION 5
CONDITIONS PRECEDENT
5.1 Closing Conditions.
The obligation of the Lenders to enter into this Credit Agreement and make
the initial Extension of Credit is subject to satisfaction (or waiver) of the
following conditions:
(a) Executed Credit Documents. Receipt by the Administrative Agent of
duly executed copies of: (i) this Credit Agreement; (ii) the Notes; and
(iii) all other Credit Documents not previously executed and delivered in
connection with the Existing Credit Agreement, each in form and substance
reasonably acceptable to the Administrative Agent in its sole discretion.
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(b) Authority Documents. Receipt by the Administrative Agent of the
following:
(i) Corporate Documents. With respect to each Credit Party that
is a corporation:
(A) Charter Documents. Copies of the articles or
certificates of incorporation or other charter documents of each
Credit Party certified to be true and complete as of a recent
date by the appropriate Governmental Authority of the state or
other jurisdiction of its incorporation and certified by a
secretary or assistant secretary of such Credit Party to be true
and correct as of the Effective Date.
(B) Bylaws. A copy of the bylaws of each Credit Party
certified by a secretary or assistant secretary of such Credit
Party to be true and correct as of the Effective Date.
(C) Resolutions. Copies of resolutions of the Board of
Directors of each Credit Party approving and adopting the Credit
Documents to which it is a party, the transactions contemplated
therein and authorizing execution and delivery thereof, certified
by a secretary or assistant secretary of such Credit Party to be
true and correct and in force and effect as of the Effective
Date.
(D) Good Standing. With respect to each Credit Party
domiciled in the United States, copies of (A) certificates of
good standing, existence or its equivalent with respect to each
Credit Party certified as of a recent date by the appropriate
Governmental Authorities of the state or other jurisdiction of
incorporation and each other jurisdiction in which the failure to
so qualify and be in good standing would have a Material Adverse
Effect on the business or operations of a Credit Party in such
jurisdiction and (B) to the extent available, a certificate
indicating payment of all corporate franchise taxes certified as
of a recent date by the appropriate governmental taxing
authorities.
(E) Incumbency. An incumbency certificate of each Credit
Party certified by a secretary or assistant secretary to be true
and correct as of the Effective Date.
(c) Opinion of Counsel. Receipt by the Administrative Agent of
opinions, including without limitation, foreign counsel opinions (which
shall cover, among other things, authority, legality, validity, binding
effect, enforceability and continued perfection
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of liens), reasonably satisfactory to the Administrative Agent, addressed
to the Administrative Agent on behalf of the Lenders and dated as of the
Effective Date, from legal counsel to the Credit Parties.
(d) Financial Statements. Receipt by the Lenders of such financial
information regarding the Credit Parties and their Subsidiaries as they may
request.
(e) Material Adverse Effect. Since December 31, 1998, no event or
condition has occurred which has had or could be reasonably expected to
have a Material Adverse Effect.
(f) Evidence of Insurance. Receipt by the Collateral Agent of copies
of insurance policies or certificates of insurance of the Credit Parties
evidencing liability and casualty insurance meeting the requirements set
forth in the Credit Documents, including, but not limited to, naming the
Collateral Agent as additional insured or loss payee on behalf of the
Lenders.
(g) Consents. Receipt by the Administrative Agent of evidence that all
governmental, shareholder and third party consents and approvals, if any,
have been received and no condition or Requirement of Law exists which
could reasonably be likely to restrain, prevent or impose any material
adverse conditions on the transactions contemplated hereby.
(h) Litigation. There shall not exist any pending or, to the knowledge
of any Credit Party, threatened action, suit, investigation or proceeding
against a Credit Party or any of its Subsidiaries that would have or would
reasonably be expected to have a Material Adverse Effect.
(i) Officer's Certificates. The Administrative Agent shall have
received a certificate or certificates executed by the chief financial
officer of the Borrower as of the Effective Date stating that (i) the
Credit Parties and each of their Subsidiaries are in compliance with all
existing material financial obligations, (ii) no action, suit,
investigation or proceeding is pending or, to the knowledge of any Credit
Party, threatened in any court or before any arbitrator or governmental
instrumentality that purports to affect the Credit Parties, any of their
Subsidiaries or any transaction contemplated by the Credit Documents, if
such action, suit, investigation or proceeding would have or might
reasonably be expected to have a Material Adverse Effect, (iii) the
financial statements and information delivered to the Administrative Agent
on or before the Effective Date were prepared in good faith and in
accordance with GAAP and (iv) immediately after giving effect to this
Credit Agreement, the other Credit Documents and all the transactions
contemplated therein to occur on such date, (A) each Credit Party and each
of their Subsidiaries is Solvent, (B) no Default or Event of Default
exists, (C) all representations and warranties contained herein and in the
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other Credit Documents are true and correct in all material respects, and
(D) the Credit Parties are in compliance with each of the financial
covenants set forth in Section 7.2.
(j) Fees and Expenses. Payment by the Credit Parties of the Upfront
Fee and the fees and expenses owed by them to the Administrative Agent as
set forth in the Fee Letter.
(k) UCC and IP Filings. The Collateral Agent shall have received such
UCC financing statements and such patent, trademark and copyright filings
as requested by the Collateral Agent.
(l) Other. Receipt by the Lenders of such other documents,
instruments, agreements or information as reasonably and timely requested
by any Lender, including, but not limited to, information regarding
litigation, tax, accounting, labor, insurance, pension liabilities (actual
or contingent), real estate leases, material contracts, debt agreements,
property ownership and contingent liabilities of the Credit Parties and
their Subsidiaries.
5.2 Conditions to All Extensions of Credit.
In addition to the conditions precedent stated elsewhere herein, the
Lenders shall not be obligated to make Loans nor shall an Issuing Lender be
required to issue or extend a Letter of Credit unless:
(a) Notice. (i) In the case of any new Revolving Loan, the Borrower
shall have delivered a Notice of Borrowing, duly executed and completed, by
the time specified in Section 2.1 and (ii) in the case of any Letter of
Credit, the Issuing Lender shall have received an appropriate request for
issuance in accordance with the provisions of Section 2.2.
(b) Representations and Warranties. The representations and warranties
made by the Credit Parties in any Credit Document are true and correct in
all material respects at and as if made as of such date except to the
extent they expressly relate to an earlier date.
(c) No Default. No Default or Event of Default shall exist and be
continuing either prior to or after giving effect thereto.
(d) Availability. Immediately after giving effect to the making of a
Loan (and the application of the proceeds thereof) or to the issuance of a
Letter of Credit, as the case may be, the sum of Revolving Loans
outstanding plus LOC Obligations outstanding shall not exceed the Revolving
Commitment Amount.
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The delivery of each Notice of Borrowing and each request for a Letter of Credit
shall constitute a representation and warranty by the Borrower of the
correctness of the matters specified in subsections (b), (c), and (d) above.
SECTION 6
REPRESENTATIONS AND WARRANTIES
The Credit Parties hereby represent to the Administrative Agent and each
Lender that:
6.1 Financial Condition.
(a) The financial statements delivered to the Lenders pursuant to
Section 5.1(d) and pursuant to Section 7.1(a) and (b): (i) have been
prepared in accordance with GAAP and (ii) present fairly the consolidated
and consolidating (as applicable) financial condition, results of
operations and cash flows of the Credit Parties and their Subsidiaries as
of such date and for such periods.
(b) Since December 31, 1997, there has been no sale, transfer or other
disposition by any Credit Party or any of their Subsidiaries of any
material part of the business or property of the Credit Parties, taken as a
whole, other than the liquidation of Brookside Systems and Programming
Limited, and no purchase or other acquisition by any of them of any
business or property (including any capital stock of any other Person)
material in relation to the consolidated financial condition of the Credit
Parties, taken as a whole, in each case which is not (i) reflected in the
most recent financial statements delivered to the Lenders pursuant to
Section 7.1 or in the notes thereto or (ii) otherwise permitted by the
terms of this Credit Agreement and communicated to the Administrative
Agent.
6.2 No Material Change.
Since December 31, 1998, there has been no development or event relating to
or affecting a Credit Party or any of its Subsidiaries which has had or would be
reasonably expected to have a Material Adverse Effect.
6.3 Organization and Good Standing.
Each Credit Party (a) is a corporation duly incorporated, validly existing
and (to the extent relevant) in good standing under the laws of the State (or
other jurisdiction) of its incorporation, (b) is duly qualified and in good
standing as a foreign corporation and authorized to do business in every
jurisdiction unless the failure to be so qualified, in good standing or
authorized would not
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have a Material Adverse Effect and (c) has the requisite corporate power and
authority to own its properties and to carry on its business as now conducted
and as proposed to be conducted.
6.4 Due Authorization.
Each Credit Party (a) has the requisite corporate power and authority to
execute, deliver and perform this Credit Agreement and the other Credit
Documents to which it is a party and to incur the obligations herein and therein
provided for and (b) is duly authorized to, and has been authorized by all
necessary corporate action, to execute, deliver and perform this Credit
Agreement and the other Credit Documents to which it is a party.
6.5 No Conflicts.
Neither the execution and delivery of the Credit Documents, nor the
consummation of the transactions contemplated therein, nor performance of and
compliance with the terms and provisions thereof by such Credit Party will (a)
violate or conflict with any provision of its articles or certificate of
incorporation or bylaws (or equivalent charter documents), (b) violate,
contravene or materially conflict with any Requirement of Law or any other law,
regulation (including, without limitation, Regulation U or Regulation X), order,
writ, judgment, injunction, decree or permit applicable to it, (c) violate,
contravene or conflict with contractual provisions of, or cause an event of
default under, any indenture, loan agreement, mortgage, deed of trust, contract
or other agreement or instrument to which it is a party or by which it may be
bound, the violation of which could have or might be reasonably expected to have
a Material Adverse Effect, or (d) result in or require the creation of any Lien
(other than those contemplated in or created in connection with the Credit
Documents) upon or with respect to its properties.
6.6 Consents.
Except for (a) consents, approvals and authorizations which have been
obtained and (b) filings that have been made by the Lenders with respect to the
Liens on the Collateral, no consent, approval, authorization or order of, or
filing, registration or qualification with, any court or Governmental Authority
or third party in respect of any Credit Party is required in connection with the
execution, delivery or performance of this Credit Agreement or any of the other
Credit Documents by such Credit Party.
6.7 Enforceable Obligations.
This Credit Agreement and the other Credit Documents have been duly
executed and delivered and constitute legal, valid and binding obligations of
each Credit Party enforceable against such Credit Party in accordance with their
respective terms, except as may be limited by bankruptcy, insolvency,
reorganization or moratorium laws or similar laws affecting creditors' rights
generally or by general equitable principles.
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6.8 No Default.
No Credit Party, nor any of their Subsidiaries, is in default in any
respect under any contract, lease, loan agreement, indenture, mortgage, security
agreement or other agreement or obligation to which it is a party or by which
any of its properties is bound which default would have or would be reasonably
expected to have a Material Adverse Effect. No Default or Event of Default has
occurred or exists except as previously disclosed in writing to the Lenders.
6.9 Ownership.
Each Credit Party, and each of its Subsidiaries, is the owner of, and has
good and marketable title to, all of its respective assets and none of such
assets is subject to any Lien other than Permitted Liens.
6.10 Indebtedness.
The Credit Parties and their Subsidiaries have no Indebtedness except (a)
as disclosed in the financial statements referenced in Section 6.1, (b) as set
forth on Schedule 6.10 and (c) as otherwise permitted by this Credit Agreement.
6.11 Litigation.
There are no actions, suits or legal, equitable, arbitration or
administrative proceedings, pending or, to the knowledge of any Credit Party,
threatened against, a Credit Party or any of its Subsidiaries which could have
or might be reasonably expected to have a Material Adverse Effect.
6.12 Taxes.
Each Credit Party, and each of its Subsidiaries, has filed, or caused to be
filed, all tax returns (federal, state, local and foreign) required to be filed
and paid (a) all amounts of taxes shown thereon to be due and payable (including
interest and penalties) and (b) all other taxes, fees, assessments and other
governmental charges (including mortgage recording taxes, documentary stamp
taxes and intangibles taxes) that are due and payable, except for such taxes (i)
which are not yet delinquent or (ii) that are being contested in good faith and
by proper proceedings, and against which adequate reserves are being maintained
in accordance with GAAP. To the knowledge of the Credit Parties, there are no
material amounts claimed to be due against any of them by any Governmental
Authority.
6.13 Compliance with Law.
Each Credit Party, and each of its Subsidiaries, is in compliance with all
Requirements of Law and all other laws, rules, regulations, orders and decrees
(including without limitation
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Environmental Laws) applicable to it, or to its properties, unless such failure
to comply would not have or would not be reasonably expected to have a Material
Adverse Effect.
6.14 ERISA.
Except as would not result or be reasonably expected to result in a
Material Adverse Effect:
(a) During the five-year period prior to the date on which this
representation is made or deemed made: (i) no Termination Event has
occurred, and, to the knowledge of the Credit Parties, no event or
condition has occurred or exists as a result of which any Termination Event
could reasonably be expected to occur, with respect to any Plan; (ii) no
"accumulated funding deficiency," as such term is defined in Section 302 of
ERISA and Section 412 of the Code, whether or not waived, has occurred with
respect to any Plan; (iii) each Plan has been maintained, operated, and
funded in compliance with its own terms and in material compliance with the
provisions of ERISA, the Code, and any other applicable federal or state
laws; and (iv) no lien in favor or the PBGC or a Plan has arisen or is
reasonably likely to arise on account of any Plan.
(b) The actuarial present value of all "benefit liabilities" under
each Single Employer Plan (determined within the meaning of Section
401(a)(2) of the Code, utilizing the actuarial assumptions used to fund
such Plans), whether or not vested, did not, as of the last annual
valuation date prior to the date on which this representation is made or
deemed made, exceed the current value of the assets of such Plan allocable
to such accrued liabilities.
(c) Neither a Credit Party, nor any of their Subsidiaries nor any
ERISA Affiliate has incurred, or, to the knowledge of the Credit Parties,
are reasonably expected to incur, any withdrawal liability under ERISA to
any Multiemployer Plan or Multiple Employer Plan. Neither a Credit Party,
any of their Subsidiaries nor any ERISA Affiliate has received any
notification that any Multiemployer Plan is in reorganization (within the
meaning of Section 4241 of ERISA), is insolvent (within the meaning of
Section 4245 of ERISA), or has been terminated (within the meaning of Title
IV of ERISA), and no Multiemployer Plan is, to the knowledge of the Credit
Parties, reasonably expected to be in reorganization, insolvent, or
terminated.
(d) No prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Code) or breach of fiduciary responsibility
has occurred with respect to a Plan which has subjected or is reasonably
likely to subject a Credit Party or any of its Subsidiaries or any ERISA
Affiliate to any liability under Sections 406, 409, 502(i), or 502(l) of
ERISA or Section 4975 of the Code, or under any agreement or other
instrument pursuant to which a Credit Party or any of its Subsidiaries or
any ERISA Affiliate has agreed or is required to indemnify any person
against any such liability.
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(e) The present value (determined using actuarial and other
assumptions which are reasonable with respect to the benefits provided and
the employees participating) of the liability of the Credit Parties and
their Subsidiaries and each ERISA Affiliate for post-retirement welfare
benefits to be provided to their current and former employees under Plans
which are welfare benefit plans (as defined in Section 3(1) of ERISA), net
of all assets under all such Plans allocable to such benefits, are
reflected on the Financial Statements in accordance with FASB 106.
(f) Each Plan which is a welfare plan (as defined in Section 3(1) of
ERISA) to which Sections 601-609 of ERISA and Section 4980B of the Code
apply has been administered in compliance in all material respects with
such sections.
6.15 Subsidiaries.
Set forth on Schedule 6.15 is a complete and accurate list of all
Subsidiaries of each Credit Party. With respect to each Credit Party, the stock
of which is being pledged as collateral hereunder, information on Schedule 6.15
includes jurisdiction of incorporation, the number of shares of each class of
capital stock or amount of other equity interests outstanding, the number and
percentage of outstanding shares or other equity ownership of each class owned
(directly or indirectly) by such Credit Party; and the number and effect, if
exercised, of all outstanding options, warrants, rights of conversion or
purchase and all other similar rights with respect thereto. The outstanding
capital stock and other equity interests of all such Subsidiaries is validly
issued, fully paid and non-assessable and is owned by each such Credit Party,
directly or indirectly, free and clear of all Liens (other than Permitted
Liens). Other than as set forth in Schedule 6.15, neither any Credit Party nor
any Subsidiary thereof has outstanding any securities convertible into or
exchangeable for its capital stock or other equity ownership nor does any such
Person have outstanding any rights to subscribe for or to purchase or any
options for the purchase of, or any agreements providing for the issuance
(contingent or otherwise) of, or any calls, commitments or claims of any
character relating to its capital stock or other equity ownership. Schedule 6.15
may be updated from time to time by the Borrower by giving written notice
thereof to the Administrative Agent. As of the Closing Date, all of the Material
Subsidiaries are set forth as Guarantors on the signature pages hereto.
6.16 Use of Proceeds.
The proceeds of the Loans hereunder will be used solely for the purposes
specified in Section 7.11. No proceeds of the Loans hereunder have been or will
be used (a) to acquire, directly or indirectly, any security in any transaction
which is subject to Sections 13 or 14 of the Securities Exchange Act of 1934, as
amended, (including, without limitation, Sections 13(d) and 14(d) thereof) or to
refinance any Indebtedness used to acquire any such securities or (b) for the
acquisition of another Person unless the board of directors (or other comparable
governing body) or stockholders, as appropriate, of such Person has approved
such acquisition.
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6.17 Government Regulation.
(a) No part of the Letters of Credit or proceeds of the Loans will be
used, directly or indirectly, for the purpose of purchasing or carrying any
"margin stock" (within the meaning of Regulation U), or for the purpose of
purchasing or carrying or trading in any securities. If requested by any
Lender or the Administrative Agent, the Borrower will furnish to the
Administrative Agent and each Lender a statement to the foregoing effect in
conformity with the requirements of FR Form U-1 referred to in Regulation
U. No Indebtedness being reduced or retired out of the proceeds of the
Loans was or will be incurred for the purpose of purchasing or carrying any
margin stock within the meaning of Regulation U or any "margin security"
within the meaning of Regulation T. "Margin stock" within the meaning of
Regulation U does not constitute more than 25% of the value of the
consolidated assets of the Credit Parties and their Subsidiaries. None of
the transactions contemplated by the Credit Documents (including, without
limitation, the direct or indirect use of the proceeds of the Loans) will
violate or result in a violation of the Securities Act of 1933, as amended,
or the Securities Exchange Act of 1934, as amended, or regulations issued
pursuant thereto, or Regulation T, U or X.
(b) No Credit Party, nor any of their Subsidiaries, is subject to
regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act or the Investment Company Act of 1940, each as amended.
In addition, no Credit Party, nor any of their Subsidiaries, is (i) an
"investment company" registered or required to be registered under the
Investment Company Act of 1940, as amended, and is not controlled by such a
company, or (ii) a "holding company", or a "subsidiary company" of a
"holding company", or an "affiliate" of a "holding company" or of a
"subsidiary" of a "holding company", within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
(c) No director, executive officer or principal shareholder of any
Credit Party or any of their Subsidiaries is a director, executive officer
or principal shareholder of any Lender. For the purposes hereof the terms
"director", "executive officer" and "principal shareholder" (when used with
reference to any Lender) have the respective meanings assigned thereto in
Regulation O issued by the Board of Governors of the Federal Reserve
System.
6.18 Environmental Matters.
To the best of the Credit Parties' knowledge, except as set forth on
Schedule 6.18:
(a) Each of the properties owned or leased by a Credit Party or any of
its Subsidiaries (the "Real Properties") and all operations at the Real
Properties are in compliance with all applicable Environmental Laws, and
there is no violation of any Environmental Law with respect to the Real
Properties or the businesses operated by the
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Credit Parties or any of their Subsidiaries (the "Businesses"), and there
are no conditions relating to the Businesses or Real Properties that would
reasonably be expected to give rise to liability under any applicable
Environmental Laws.
(b) No Credit Party has received any written notice of, or inquiry
from any Governmental Authority regarding, any violation, alleged
violation, non-compliance, liability or potential liability regarding
Hazardous Materials or compliance with Environmental Laws with regard to
any of the Real Properties or the Businesses, nor, to the knowledge of a
Credit Party or any of its Subsidiaries, is any such notice being
threatened.
(c) Hazardous Materials have not been transported or disposed of from
the Real Properties, or generated, treated, stored or disposed of at, on or
under any of the Real Properties or any other location, in each case by, or
on behalf or with the permission of, a Credit Party or any of its
Subsidiaries in a manner that would give rise to liability under any
applicable Environmental Laws.
(d) No judicial proceeding or governmental or administrative action is
pending or, to the knowledge of a Credit Party or any of its Subsidiaries,
threatened, under any Environmental Law to which a Credit Party or any of
its Subsidiaries is or will be named as a party, nor are there any consent
decrees or other decrees, consent orders, administrative orders or other
orders, or other administrative or judicial requirements outstanding under
any Environmental Law with respect to a Credit Party or any of its
Subsidiaries, the Real Properties or the Businesses.
(e) There has been no release (including, without limitation,
disposal) or threat of release of Hazardous Materials at or from the Real
Properties, or arising from or related to the operations of a Credit Party
or any of its Subsidiaries in connection with the Real Properties or
otherwise in connection with the Businesses where such release constituted
a violation of, or would give rise to liability under, any applicable
Environmental Laws.
(f) None of the Real Properties contains, or has previously contained,
any Hazardous Materials at, on or under the Real Properties in amounts or
concentrations that, if released, constitute or constituted a violation of,
or could give rise to liability under, Environmental Laws.
(g) No Credit Party, nor any of its Subsidiaries, has assumed any
liability of any Person (other than another Credit Party, or one of its
Subsidiaries) under any Environmental Law.
6.19 Intellectual Property.
Each Credit Party owns, or has the legal right to use, all patents,
trademarks, tradenames, copyrights, technology, know-how and processes (the
"Intellectual Property") necessary for each of
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them to conduct its business as currently conducted except for those the failure
to own or have such legal right to use would not have or be reasonably expected
to have a Material Adverse Effect. Set forth on Schedule 6.19 is a list of all
patents, registered and material unregistered trademarks, tradenames and
registered copyrights owned by each Credit Party or that any Credit Party has
the right to use. Except as provided on Schedule 6.19, no claim has been
asserted and is pending by any Person challenging or questioning the use of any
Intellectual Property owned by a Credit Party or that any Credit Party has a
right to use or the validity or effectiveness of any such Intellectual Property,
nor does any Credit Party have knowledge of any such claim, and to the Credit
Parties' knowledge the use of any Intellectual Property by the Credit Parties or
any of their Subsidiaries does not infringe on the rights of any Person, except
for such claims and infringements that in the aggregate, would not have or be
reasonably expected to have a Material Adverse Effect. Schedule 6.19 may be
updated from time to time by the Borrower by giving written notice thereof to
the Administrative Agent.
6.20 Solvency.
Each Credit Party is and, after consummation of the transactions
contemplated by this Credit Agreement, will be Solvent.
6.21 Investments.
All Investments of each Credit Party and its Subsidiaries are (a) as set
forth on Schedule 6.21 or (b) Permitted Investments.
6.22 Location of Collateral.
Set forth on Schedule 6.22(a) is a list of all locations where any personal
property of a Credit Party is located. Set forth on Schedule 6.22(b) is the
chief executive office and principal place of business of each Credit Party.
Schedule 6.22(a) and 6.22(b) may be updated from time to time by the Borrower by
giving written notice thereof to the Administrative Agent.
6.23 Insurance Coverage.
The present insurance coverage of the Credit Parties and their Subsidiaries
is outlined as to carrier, policy number, expiration date, type and amount on
Schedule 6.23. Schedule 6.23 may be updated from time to time by giving written
notice thereof to the Administrative Agent.
6.24 Disclosure.
Neither this Credit Agreement nor any financial statements delivered to the
Lenders nor any other document, certificate or statement furnished to the
Lenders by or on behalf of any Credit Party in connection with the transactions
contemplated hereby contains any untrue statement of a
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material fact or omits to state a material fact necessary in order to make the
statements contained therein or herein, taken as a whole, not misleading.
6.25 Licenses, etc.
The Credit Parties have obtained and hold in full force and effect, all
franchises, licenses, permits, certificates, authorizations, qualifications,
accreditations, easements, rights of way and other rights, consents and
approvals which are necessary for the operation of their respective businesses
as presently conducted, except where the failure to obtain the same would not
have a Material Adverse Effect.
6.26 No Burdensome Restrictions.
No Credit Party, nor any of their Subsidiaries, is a party to any agreement
or instrument or subject to any other obligation or any charter or corporate
restriction or any provision of any applicable law, rule or regulation which,
individually or in the aggregate, would have or be reasonably expected to have a
Material Adverse Effect.
6.27 Collateral Documents.
The Collateral Documents continue to provide valid security interests in,
and Liens on, the Collateral purported to be covered thereby, which security
interests and Liens are perfected security interests and Liens, prior to all
other Liens other than Permitted Liens.
6.28 Year 2000 Compliance.
Each Credit Party reasonably believes that the Year 2000 Problem has been
appropriately addressed by it and the Year 2000 Problem will not exist with
respect to it or any of its Subsidiaries on and after January 1, 2000, to the
extent such Year 2000 Problem would cause or be reasonably expected to cause a
Material Adverse Effect.
6.29 Financial Assistance.
None of the obligations of the Credit Parties under the Credit Documents
infringe Section 151 of the Companies Xxx 0000 or any similar obligation whether
in the United Kingdom or elsewhere or involve the giving of unlawful financial
assistance.
6.30 Seller Obligations.
Set forth on Schedule 6.30 is a list of all outstanding Seller Obligations
and the scheduled payments with respect to such Seller Obligations.
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SECTION 7
AFFIRMATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long as this Credit
Agreement is in effect and until the Loans and LOC Obligations, together with
interest and fees and other obligations then due and payable hereunder, have
been paid in full and the Commitments and Letters of Credit hereunder shall have
terminated:
7.1 Information Covenants.
The Credit Parties will furnish, or cause to be furnished, to the
Administrative Agent and each of the Lenders:
(a) Annual Financial Statements. As soon as available, and in any
event within 90 days (or 105 days if the Borrower exercises its right to an
automatic filing extension under the Securities Exchange Act of 1934) after
the close of each fiscal year of the Borrower, a consolidated and
consolidating balance sheet and income statement of the Credit Parties and
their Subsidiaries, as of the end of such fiscal year, together with
related consolidated and consolidating statements of operations and
consolidated statements of retained earnings and of cash flows for such
fiscal year, setting forth in comparative form consolidated and
consolidating figures for the preceding fiscal year, all such consolidated
financial information described above to be in reasonable form and detail
and audited by independent certified public accountants of recognized
national standing reasonably acceptable to the Administrative Agent (it
being understood that Price Waterhouse Coopers is acceptable to the
Administrative Agent) and whose opinion shall be to the effect that such
financial statements have been prepared in accordance with GAAP (except for
changes with which such accountants concur) and shall not be limited as to
the scope of the audit or qualified in any manner.
(b) Quarterly Financial Statements. As soon as available, and in any
event within 45 days after the close of each of the first three fiscal
quarters of the Borrower, (i) a consolidated and consolidating balance
sheet and income statement of the Credit Parties and their Subsidiaries, as
of the end of such fiscal quarter, together with related consolidated and
consolidating statements of operations and consolidated statements of
retained earnings and of cash flows for such fiscal quarter in each case
setting forth in comparative form consolidated and consolidating figures
for (A) the corresponding period of the preceding fiscal year and (B)
management's proposed budget for such period, all such financial
information described above to be in reasonable form and detail and
reasonably acceptable to the Administrative Agent (it being understood that
delivery of the Borrower's Form 10-Q shall be sufficient for meeting this
requirement), and accompanied by a certificate of the chief financial
officer of the Borrower to the effect that such quarterly financial
statements fairly present in all material respects the financial condition
of the Credit Parties and their
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Subsidiaries and have been prepared in accordance with GAAP, subject to
changes resulting from audit and normal year-end audit adjustments, (ii)
company-prepared consolidated and consolidating statements of operations
for such fiscal quarter setting forth in comparative form consolidated and
consolidating figures for management's proposed budget for such period and
(iii) a management discussion and analysis of operating results for such
fiscal quarter.
(c) Monthly and Weekly Reports. As soon as available, and in any event
(i) within 30 days after the end of each calendar month, (A) a summary of
aged accounts receivable as of the end of such month and (B) such other
monthly reports as reasonably requested by the Administrative Agent or the
Lenders and (ii) within 7 days after the end of each week, such weekly
reports as reasonably requested by the Administrative Agent or the Lenders.
(d) Officer's Certificate. At the time of delivery of the financial
statements provided for in Sections 7.1(a), (b) and (c) above, a
certificate of the chief financial officer of the Borrower substantially in
the form of Exhibit 7.1(d), (i) demonstrating compliance with the financial
covenants contained in Section 7.2 by calculation thereof as of the end of
each such fiscal period, (ii) demonstrating compliance with any other terms
of this Credit Agreement as reasonably requested by the Administrative
Agent and (iii) stating that no Default or Event of Default exists, or if
any Default or Event of Default does exist, specifying the nature and
extent thereof and what action the Borrower proposes to take with respect
thereto.
(e) Annual Business Plan and Budgets. Prior to the end of each fiscal
year of the Borrower, an annual business plan and budget of the Credit
Parties and their Subsidiaries on a consolidated basis containing, among
other things, pro forma financial projections for the next fiscal year.
(f) Accountant's Certificate. Within the period for delivery of the
annual financial statements provided in Section 7.1(a), a certificate of
the accountants conducting the annual audit stating that they have reviewed
this Credit Agreement and stating further whether, in the course of their
audit, they have become aware of any Default or Event of Default under
Section 7.2 and, if any such Default or Event of Default exists, specifying
the nature and extent thereof.
(g) Auditor's Reports. Promptly upon receipt thereof, and in any event
within two Business Days after receipt thereof, (i) a copy of a "management
letter" submitted by independent accountants to the Credit Parties in
connection with an annual audit of the books of the Credit Parties and
their Subsidiaries and (ii) a copy of any other "management letter"
submitted by independent accountants to a Credit Party or any of its
Subsidiaries in connection with any interim or special audit of the books
of a Credit Party or any of its Subsidiaries.
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(h) Reports. Promptly upon transmission or receipt thereof, (a) copies
of any filings and registrations with, and reports to or from, the
Securities and Exchange Commission, or any successor agency, and copies of
all financial statements, proxy statements, notices and reports as a Credit
Party or any of its Subsidiaries shall send to its shareholders generally
and (b) upon the written request of the Administrative Agent, all reports
and written information to and from the United States Environmental
Protection Agency, or any state or local agency responsible for
environmental matters, the United States Occupational Health and Safety
Administration, or any state or local agency responsible for health and
safety matters, or any successor agencies or authorities concerning
environmental, health or safety matters.
(i) Notices. Upon an officer of a Credit Party obtaining knowledge
thereof, the Borrower will give written notice to the Administrative Agent
promptly (and in any event within five Business Days) of (a) the occurrence
of an event or condition consisting of a Default or Event of Default,
specifying the nature and existence thereof and what action the Borrower
proposes to take with respect thereto, and (b) the occurrence of any of the
following with respect to a Credit Party or any of its Subsidiaries (i) the
pendency or commencement of any litigation, arbitral or governmental
proceeding against a Credit Party or any of its Subsidiaries which if
adversely determined would have or would be reasonably expected to have a
Material Adverse Effect, (ii) the institution of any proceedings against a
Credit Party or any of its Subsidiaries with respect to, or the receipt of
written notice by such Person of potential liability or responsibility for
violation, or alleged violation of any federal, state or local law, rule or
regulation, (including but not limited to, Environmental Laws) the
violation of which would have or would be reasonably expected to have a
Material Adverse Effect or (iii) any information that a Credit Party or any
of its Subsidiaries may have a Year 2000 Problem on or after January 1,
2000.
(j) ERISA. Upon any of the Credit Parties obtaining knowledge thereof,
the Borrower will give written notice to the Administrative Agent promptly
(and in any event within five Business Days) of: (i) any event or
condition, including, but not limited to, any Reportable Event, that
constitutes, or might reasonably lead to, a Termination Event; (ii) with
respect to any Multiemployer Plan, the receipt of notice as prescribed in
ERISA or otherwise of any withdrawal liability assessed against the Credit
Parties or any of their ERISA Affiliates, or of a determination that any
Multiemployer Plan is in reorganization or insolvent (both within the
meaning of Title IV of ERISA); (iii) the failure to make full payment on or
before the due date (including extensions) thereof of all amounts which a
Credit Party or any of its Subsidiaries or ERISA Affiliates is required to
contribute to each Plan pursuant to its terms and as required to meet the
minimum funding standard set forth in ERISA and the Code with respect
thereto; or (iv) any change in the funding status of any Plan that could
have a Material Adverse Effect; together, with a description of any such
event or condition or a copy of any such notice and a statement by the
principal financial officer of the Borrower briefly setting forth the
details regarding such event, condition, or
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notice, and the action, if any, which has been or is being taken or is
proposed to be taken by the Credit Parties with respect thereto. Promptly
upon request, a Credit Party shall furnish the Administrative Agent and
each of the Lenders with such additional information concerning any Plan as
may be reasonably requested, including, but not limited to, copies of each
annual report/return (Form 5500 series), as well as all schedules and
attachments thereto required to be filed with the Department of Labor
and/or the Internal Revenue Service pursuant to ERISA and the Code,
respectively, for each "plan year" (within the meaning of Section 3(39) of
ERISA).
(k) Environmental.
(i) Subsequent to a notice from any Governmental Authority that
would reasonably cause concern, or during the existence of an Event of
Default, and upon the written request of Administrative Agent, the
Credit Parties will furnish or cause to be furnished to the
Administrative Agent, at the Credit Parties' expense, a report of an
environmental assessment of reasonable scope, form and depth,
including, where appropriate, invasive soil or groundwater sampling,
by a consultant reasonably acceptable to the Administrative Agent
addressing the subject of such notice or, if during the existence of
an Event of Default, regarding any release or threat of release of
Hazardous Materials on any property owned, leased or operated by a
Credit Party and the compliance by the Credit Parties with
Environmental Laws. If the Credit Parties fail to deliver such an
environmental report within seventy-five (75) days after receipt of
such written request, then the Administrative Agent may arrange for
same, and the Credit Parties hereby grant to the Administrative Agent
and its representatives access to the Real Properties and a license of
a scope reasonably necessary to undertake such an assessment
(including, where appropriate, invasive soil or groundwater sampling).
The reasonable cost of any assessment arranged for by the
Administrative Agent pursuant to this provision will be payable by the
Credit Parties on demand and added to the obligations secured by the
Collateral Documents.
(ii) Each Credit Party will conduct and complete all
investigations, studies, sampling, and testing and all remedial,
removal, and other actions necessary to address all Hazardous
Materials on, from, or affecting any real property owned or leased by
a Credit Party to the extent necessary to be in compliance with all
Environmental Laws and all other applicable federal, state, and local
laws, regulations, rules and policies and with the orders and
directives of all Governmental Authorities exercising jurisdiction
over such real property to the extent any failure would have or be
reasonably expected to have a Material Adverse Effect.
(l) Year 2000 Information. The Credit Parties will provide the
Lenders, on or before June 30, 1999 and September 30, 1999, a report on the
actions taken prior to such
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date and all actions proposed to be taken subsequent to such date to
address the Year 2000 Problem. Upon the written request of the
Administrative Agent, the Credit Parties shall provide such information,
assurances and documentation (including, but not limited to, the results of
internal and external audit reports prepared in connection therewith and
any reports or certifications from independent consultants received by the
Credit Parties) reasonably acceptable to the Administrative Agent that the
Credit Parties and their Subsidiaries will not have a Year 2000 Problem on
or after January 1, 2000.
(m) Other Information. With reasonable promptness upon any such
request, such other information regarding the business, properties or
financial condition of the Credit Parties and their Subsidiaries as the
Administrative Agent may reasonably request.
7.2 Financial Covenants.
(a) Minimum EBITDA.
(i) EBITDA, as of the last day of each fiscal quarter of the
Borrower, shall be greater than or equal to the amount shown below for
the period corresponding thereto:
Fiscal quarter ending 3/31/99 $2,350,000
Fiscal quarter ending 6/30/99 $4,750,000
Fiscal quarter ending 9/30/99 $5,920,000
(ii) As of the last day of each fiscal quarter of the Borrower,
beginning with the fiscal quarter ending December 31, 1999, either (A)
EBITDA for such fiscal quarter shall be greater than or equal to
$6,500,000 or (B) the Leverage Ratio shall be less than 3.0 to 1.0.
(b) Collateral Coverage Ratio. The Collateral Coverage Ratio, as of
the last day of each calendar month, shall be greater than or equal to the
ratio shown below for the period corresponding thereto:
Closing Date through August 31, 1999 35%
September 1, 1999 through November 30, 1999 37.5%
December 1, 1999 and thereafter 40%
(c) Interest Coverage Ratio. The Interest Coverage Ratio, for the
three month period ending on the last day of each fiscal quarter of the
Borrower, shall be greater than or equal to the ratio shown below for the
period corresponding thereto:
Fiscal quarter ending 3/31/99 1.25 : 1.00
Fiscal quarter ending 6/30/99 2.00 : 1.00
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Fiscal quarter ending 9/30/99 and thereafter 2.50 : 1.00
(d) Minimum Net Income. Each month the Net Income of the Borrower and
its Subsidiaries on a consolidated basis (before taxes and excluding the
effect of any extraordinary or other non-recurring gains (including any
gain from the sale of property) or one-time non-cash losses), beginning
with Net Income as of June 30, 1999, shall be positive.
7.3 Preservation of Existence and Franchises.
Each of the Credit Parties will do all things necessary to preserve and
keep in full force and effect its existence, rights, franchises and authority
except as permitted by Section 8.4.
7.4 Books and Records.
Each of the Credit Parties will keep complete and accurate books and
records of its transactions in accordance with GAAP (including the establishment
and maintenance of appropriate reserves).
7.5 Compliance with Law.
Each of the Credit Parties will comply with all material laws, rules,
regulations and orders, and all applicable material restrictions imposed by all
Governmental Authorities, applicable to it and its property (including, without
limitation, Environmental Laws).
7.6 Payment of Taxes and Other Indebtedness.
Each of the Credit Parties will pay, settle or discharge (a) all material
taxes, assessments and governmental charges or levies imposed upon it, or upon
its income or profits, or upon any of its properties, before they shall become
delinquent, (b) all lawful claims (including claims for labor, materials and
supplies) which, if unpaid, might give rise to a Lien upon any of its
properties, and (c) all of its other Indebtedness as it shall become due (to the
extent such repayment is not otherwise prohibited by this Agreement); provided,
however, that a Credit Party shall not be required to pay any such tax,
assessment, charge, levy, claim or Indebtedness which is being contested in good
faith by appropriate proceedings and as to which adequate reserves therefor have
been established in accordance with GAAP, unless the failure to make any such
payment (i) would give rise to an immediate right to foreclose or collect on a
Lien securing such amounts or (ii) would have or reasonably be expected to have
a Material Adverse Effect.
7.7 Insurance.
Each of the Credit Parties will at all times maintain in full force and
effect insurance (including worker's compensation insurance, liability
insurance, casualty insurance and business
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interruption insurance) in such amounts, covering such risks and liabilities and
with such deductibles or self-insurance retentions as are in accordance with
normal industry practice. All policies shall have the Collateral Agent, on
behalf of the Lenders, as an additional insured.
In the event there occurs any material loss, damage to or destruction of the
Collateral of any Credit Party or any part thereof, such Credit Party shall
promptly give written notice thereof to the Administrative Agent generally
describing the nature and extent of such damage or destruction. Subsequent to
any loss, damage to or destruction of the Collateral of any Credit Party or any
part thereof, such Credit Party, whether or not the insurance proceeds, if any,
received on account of such damage or destruction shall be sufficient for that
purpose, at such Credit Party's cost and expense, will promptly repair or
replace the Collateral of such Credit Party so lost, damaged or destroyed;
provided, however, that such Credit Party need not repair or replace the
Collateral of such Credit Party so lost, damaged or destroyed to the extent the
failure to make such repair or replacement (a) is desirable to the proper
conduct of the business of such Credit Party in the ordinary course and
otherwise is in the best interest of such Credit Party and (b) would not
materially impair the rights and benefits of the Agents or the Lenders under
this Credit Agreement or any other Credit Document. In the event a Credit Party
shall receive any insurance proceeds, as a result of any loss, damage or
destruction of Collateral, in a net amount in excess of $1,000,000, such Credit
Party will immediately pay over such proceeds to the Administrative Agent as
cash collateral for the Credit Party Obligations. The Administrative Agent
agrees to release such insurance proceeds to such Credit Party for replacement
or restoration of the portion of the Collateral of such Credit Party lost,
damaged or destroyed if (A) within 30 days from the date the Administrative
Agent receives such insurance proceeds, the Administrative Agent has received
written application for such release from such Credit Party together with
evidence reasonably satisfactory to it that the Collateral lost, damaged or
destroyed has been or will be replaced or restored to its condition (or by
Collateral having a value at least equal to the condition of the asset subject
to the loss, damage or destruction) immediately prior to the loss, destruction
or other event giving rise to the payment of such insurance proceeds and (B) on
the date of such release no Default or Event of Default exists. If the
conditions in the preceding sentence are not met, the Administrative Agent may
or, upon the request of the Required Lenders, shall at any time after the first
Business Day subsequent to the date 30 days after it received such insurance
proceeds, apply such insurance proceeds as a mandatory prepayment of the Credit
Party Obligations for application in accordance with the terms of Section
3.3(c). All insurance proceeds shall be subject to the security interest of the
Lenders under the Collateral Documents.
7.8 Maintenance of Property.
Each of the Credit Parties will maintain and preserve its properties and
equipment in good repair, working order and condition, normal wear and tear
excepted, and will make, or cause to be made, in such properties and equipment
from time to time all repairs, renewals, replacements, extensions, additions,
betterments and improvements thereto as may be needed or proper, to the extent
and in the manner customary for companies in similar businesses.
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7.9 Performance of Obligations.
Each of the Credit Parties will perform in all material respects all of its
obligations under the terms of all material agreements, indentures, mortgages,
security agreements or other debt instruments to which it is a party or by which
it is bound.
7.10 Collateral.
If, subsequent to the Closing Date, a Credit Party shall (a) acquire any
real property, any intellectual property or any securities or (b) acquire any
other personal property required to be delivered to the Collateral Agent as
Collateral hereunder or under any of the Collateral Documents, the Borrower
shall immediately notify the Collateral Agent of same. If requested by the
Collateral Agent, each Credit Party shall take such action, at its own expense,
to ensure that the Lenders have a perfected Lien in all owned real property and
such personal property of the Credit Parties as set forth in the Security
Agreements (whether now owned or hereafter acquired), subject only to Permitted
Liens. Each Credit Party shall adhere to the covenants regarding the location of
personal property as set forth in the Security Agreements.
7.11 Use of Proceeds.
The Credit Parties will use the proceeds of the Loans solely (a) to provide
working capital and (b) for general corporate purposes. The Credit Parties will
use the Letters of Credit solely for the purposes set forth in Section 2.2(a).
7.12 Audits/Inspections.
Upon reasonable notice and during normal business hours, each Credit Party
will permit representatives appointed by the Administrative Agent or the
Lenders, including, without limitation, independent accountants, agents,
attorneys and appraisers to visit and inspect such Credit Party's property,
including its books and records, its accounts receivable and inventory, its
facilities and its other business assets, and to make photocopies or photographs
thereof and to write down and record any information such representative obtains
and shall permit the Administrative Agent, a Lender or its representatives to
investigate and verify the accuracy of information provided to the Lenders,
including, without limitation, the performance of collateral valuation reviews
from time to time, and to discuss all such matters with the officers, employees
and representatives of the Credit Parties. The Credit Parties agree that the
Collateral Agent may conduct such collateral reviews, at the Credit Parties'
expense, during the existence of a Default or an Event of Default or at any time
when circumstances would deem it reasonable to conduct such review.
7.13 Additional Credit Parties.
At the time any Person becomes a Subsidiary of a Credit Party, the Borrower
shall so notify the Administrative Agent and promptly thereafter (but in any
event within 30 days after
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the date thereof) shall cause such Person to (a) if it is a Material Subsidiary,
execute a Joinder Agreement in substantially the same form as Exhibit 7.13, (b)
cause all of the capital stock of such Person to be delivered to the Collateral
Agent (together with undated stock powers signed in blank) and pledged to the
Collateral Agent pursuant to an appropriate pledge agreement in substantially
the form of the Pledge Agreements (or a joinder to an existing Pledge Agreement)
or in a form of a UK Collateral Document, as applicable, and otherwise in a form
acceptable to the Collateral Agent, (c) pledge all of its assets to the
Collateral Agent pursuant to a security agreement in substantially the form of
the Security Agreements (or a joinder to an existing Security Agreement) or in a
form of a UK Collateral Document, as applicable, and otherwise in a form
acceptable to the Collateral Agent, and (d) if such Person has any Material
Subsidiaries, (A) deliver all of the capital stock of such Material Subsidiaries
owned by it (together with undated stock powers signed in blank) to the
Collateral Agent and (B) execute a pledge agreement in substantially the form of
the Pledge Agreements (or a joinder to an existing Pledge Agreement) or in a
form of a UK Collateral Document, as applicable, and otherwise in a form
acceptable to the Collateral Agent, (e) if such Person owns or leases any real
property, execute any and all necessary mortgages, deeds of trust, deeds to
secure debt or other appropriate real estate collateral documentation in a form
acceptable to the Collateral Agent (or cause to be delivered in a commercially
reasonable manner a landlord waiver or estoppel letter with respect thereto in a
form acceptable to the Collateral Agent) and (f) deliver such other
documentation as the Collateral Agent may reasonably request in connection with
the foregoing, including, without limitation, appropriate UCC-1 financing
statements (or their equivalent), certified resolutions and other organizational
and authorizing documents of such Person and favorable opinions of counsel to
such Person (which shall cover, among other things, the legality, validity,
binding effect and enforceability of the documentation referred to above), all
in form, content and scope reasonably satisfactory to the Collateral Agent.
7.14 Turnaround Consultant.
Within 45 days after the Closing Date, the Borrower will engage, for its
own account, an independent turnaround consultant with extensive experience and
a good reputation in the turnaround consulting industry. The scope of such
turnaround consultant's engagement shall be sufficiently broad to enable the
turnaround consultant to actively assist the Borrower with the implementation
and execution of its business plan.
7.15 Lockbox Accounts.
(a) The Credit Parties will notify and direct each of their U.S.
customers to remit payments directly to lockbox accounts arranged and
maintained with one or more Lenders.
(b) Within 30 days upon receipt of a request from the Lenders or the
Administrative Agent on behalf of the Lenders, the Credit Parties will
notify and direct each of their U.K. customers to remit payments directly
to lockbox accounts arranged and
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maintained with one or more financial institutions acceptable to the
Borrower and the Lenders.
7.16 Post-Closing Requirements.
(a) Within 30 days after the Closing Date, the Borrower shall deliver
to the Lenders a schedule of accounts receivable which will be sent to an
independent collection agency pursuant to a commercially reasonable
contract.
(b) Within 30 days after the Closing Date, the Borrower shall deliver
to the Administrative Agent copies of certificates of good standing,
existence or its equivalent with respect to each U.S. Credit Party
certified as of a recent date by the appropriate Governmental Authorities
of each state in which such Credit Party operates.
(c) Within 30 days after the Closing Date (or such later date as
agreed to by the Administrative Agent), the Borrower shall deliver to the
Administrative Agent, with respect Security Despatch Limited, a company
formed under the laws of England and Wales and an indirect Subsidiary of
the Borrower, (i) a Joinder Agreement, (ii) a Debenture and (iii) such
other UK Collateral Documents, charter documents, opinions of counsel and
other documents and instruments as the Administrative Agent may require in
its reasonable discretion.
SECTION 8
NEGATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long as this Credit
Agreement is in effect and until the Loans and LOC Obligations, together with
interest, fees and other obligations then due and payable hereunder, have been
paid in full and the Commitments and Letters of Credit hereunder shall have
terminated:
8.1 Indebtedness.
No Credit Party will, nor will it permit any of its Subsidiaries to,
contract, create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement and the other
Credit Documents;
(b) Indebtedness existing as of the Closing Date as referenced in
Section 6.10 (and renewals, refinancings, replacements or extensions
thereof on terms and conditions no more favorable, in the aggregate, to
such Person than such existing Indebtedness and in a
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principal amount not in excess of that outstanding as of the date of such
renewal, refinancing, replacement or extension);
(c) Indebtedness in respect of current accounts payable and accrued
expenses incurred in the ordinary course of business and to the extent not
current, accounts payable and accrued expenses that are subject to bona
fide dispute;
(d) Indebtedness owing by a Credit Party to another Credit Party.
(e) purchase money Indebtedness (including Capital Leases) to finance
the purchase of fixed assets (including equipment); provided that (i) the
total of all such Indebtedness for all such Persons taken together shall
not exceed an aggregate principal amount of $2,500,000 at any one time
outstanding (in addition to any such Indebtedness referred to in subsection
(b) above); (ii) such Indebtedness when incurred shall not exceed the
purchase price of the asset(s) financed; and (iii) no such Indebtedness
shall be refinanced for a principal amount in excess of the principal
balance outstanding thereon at the time of such refinancing;
(f) Indebtedness arising from Hedging Agreements entered into in the
ordinary course and not for speculative purposes with the prior written
consent of the Lenders, such consent not to be unreasonably withheld;
(g) Indebtedness arising from judgments that do not cause an Event of
Default;
(h) Indebtedness referenced on Schedule 6.30; and
(i) other Indebtedness permitted in writing by the Lenders.
8.2 Liens.
No Credit Party will, nor will it permit its Subsidiaries to, contract,
create, incur, assume or permit to exist any Lien with respect to any of its
property or assets of any kind (whether real or personal, tangible or
intangible), whether now owned or after acquired, except for Permitted Liens.
8.3 Nature of Business.
Without the prior written consent of the Required Lenders, no Credit Party
will, nor will it permit its Subsidiaries to, alter the character of its
business from that conducted as of the Effective Date or engage in any business
other than the courier business or in related businesses that support the
courier business.
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8.4 Consolidation and Merger.
No Credit Party will, nor will it permit any Subsidiary to, enter into any
transaction of merger or consolidation or liquidate, wind up or dissolve itself;
provided that a Credit Party or a Subsidiary of a Credit Party may merge or
consolidate with or into another Person if the following conditions are
satisfied:
(a) the Administrative Agent is given prior written notice of such
action;
(b) if the merger or consolidation involves a Credit Party, the Person
formed by such consolidation or into which a Credit Party is merged shall
either (i) be such Credit Party or (ii) be a Material Subsidiary and
expressly assume in writing all of the obligations of such Credit Party
under the Credit Documents; provided that if the transaction is between the
Borrower and another Person, the Borrower must be the surviving entity;
(c) the Credit Parties execute and deliver such documents, instruments
and certificates as the Administrative Agent may request (including, if
necessary, to maintain its perfection and priority in the Collateral
pledged pursuant to the Collateral Documents);
(d) immediately after giving effect to such transaction, no Default or
Event of Default shall have occurred and be continuing; and
(e) the Borrower delivers to the Administrative Agent an officer's
certificate demonstrating compliance with clause (b) above, if applicable,
and an opinion of counsel stating that such consolidation or merger and any
written agreement entered into in connection therewith, comply with this
Section 8.4.
8.5 Sale or Lease of Assets.
No Credit Party will, nor will it permit its Subsidiaries to, convey, sell,
lease, transfer or otherwise voluntarily dispose of, in one transaction or a
series of transactions, all or any part of its business or assets whether now
owned or hereafter acquired, including, without limitation, inventory,
receivables, equipment, real property interests (whether owned or leasehold) and
securities, other than (a) any inventory sold or otherwise disposed of in the
ordinary course of business; (b) the sale, lease, transfer or other disposal by
a Credit Party (other than the Borrower) of any or all of its assets to the
Borrower or to another Credit Party; (c) obsolete, slow-moving, idle or worn-out
assets no longer used or useful in its business or the trade in of equipment for
equipment in better condition or of better quality; (d) the transfer of assets
which constitute a Permitted Investment; (e) the issuance of capital stock by
the Borrower (i) as payment for any Seller Obligations, (ii) in connection with
the exercise of any stock options issued pursuant to the Borrower's stock option
plan and (iii) pursuant to the Stockholders Rights Agreement adopted by the
Board of Directors of the Borrower on December 14, 1998; and (f) other sales of
assets consented to in writing by the Lenders, such consent not to be
unreasonably withheld.
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Upon a sale of assets permitted by this Section 8.5, the Collateral Agent
shall promptly deliver to the Borrower, upon the Borrower's request and at the
Borrower's expense, such documentation as is reasonably necessary to evidence
the release of the Lenders' security interest in such assets, including, without
limitation, amendments or terminations of UCC financing statements (or their
equivalent).
8.6 Sale Leasebacks.
No Credit Party will, nor will it permit its Subsidiaries to, directly or
indirectly become or remain liable as lessee or as guarantor or other surety
with respect to any lease of any property (whether real or personal or mixed),
whether now owned or hereafter acquired, (a) which such Credit Party or its
Subsidiary has sold or transferred or is to sell or transfer to any other Person
other than a Credit Party or (b) which such Credit Party or its Subsidiary
intends to use for substantially the same purpose as any other property which
has been sold or is to be sold or transferred by such Credit Party to any Person
in connection with such lease, other than such transactions permitted in writing
by the Lenders.
8.7 Advances, Investments and Loans.
No Credit Party will, nor will it permit its Subsidiaries to, make any
Investments except for Permitted Investments; provided that the Borrower may
propose other Investments to the Administrative Agent and, upon the written
consent of the Required Lenders, the Borrower may make such Investments. No
Credit Party will, nor will it permit its Subsidiaries to, acquire any assets or
capital stock (or other equity interest) of any Person (other than a Credit
Party in accordance with the terms of this Credit Agreement) without the prior
written consent of the Lenders.
8.8 Restricted Payments.
No Credit Party will, nor will it permit its Subsidiaries to, directly or
indirectly, (a) declare or pay any dividends or make any other distribution upon
any shares of its capital stock of any class, (b) purchase, redeem or otherwise
acquire or retire or make any provisions for redemption, acquisition or
retirement of any shares of its capital stock of any class or any warrants or
options to purchase any such shares; provided that (i) any Subsidiary of a
Credit Party may pay dividends to its parent and (ii) Subsidiaries of the
Borrower may declare and make non-cash dividends or distributions or (c) make
any prepayment with respect to any seller obligation incurred in connection with
an acquisition, including, without limitation, the Seller Obligations set forth
on Schedule 6.30.
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8.9 Transactions with Affiliates.
Other than transactions between Credit Parties, no Credit Party will, nor
will it permit its Subsidiaries to, enter into any transaction or series of
transactions, whether or not in the ordinary course of business, with any
officer, director, shareholder, Subsidiary or Affiliate other than on terms and
conditions substantially as favorable as would be obtainable in a comparable
arm's-length transaction with a Person other than an officer, director,
shareholder, Subsidiary or Affiliate.
8.10 Fiscal Year; Organizational Documents.
No Credit Party will, nor will it permit its Subsidiaries to, (a) change
its fiscal year or (b) in any manner that would reasonably be likely to
adversely affect the rights of the Lenders, change its articles or certificate
of incorporation or its bylaws.
8.11 No Limitations.
No Credit Party will, nor will it permit its Subsidiaries to, directly or
indirectly, create or otherwise cause, incur, assume, suffer or permit to exist
or become effective any consensual encumbrance or restriction of any kind on the
ability of any such Person to (a) pay dividends or make any other distribution
on any of such Person's capital stock, (b) pay any Indebtedness owed to any
other Credit Party, (c) make loans or advances to any other Credit Party or (d)
transfer any of its property to any other Credit Party, except for encumbrances
or restrictions existing under or by reason of (i) customary non-assignment or
net worth provisions in any lease governing a leasehold interest, (ii) any
agreement or other instrument of a Person existing at the time it becomes a
Subsidiary of a Credit Party; provided that such encumbrance or restriction is
not applicable to any other Person, or any property of any other Person, other
than such Person becoming a Subsidiary of a Credit Party and was not entered
into in contemplation of such Person becoming a Subsidiary of a Credit Party,
and (iii) this Credit Agreement and the other Credit Documents.
8.12 No Other Negative Pledges.
No Credit Party will, nor will it permit its Subsidiaries to, enter into,
assume or become subject to any agreement prohibiting or otherwise restricting
the creation or assumption of any Lien upon its properties or assets, whether
now owned or hereafter acquired, or requiring the grant of any security for such
obligation if security is given for some other obligation except as set forth in
the Credit Documents.
8.13 Capital Expenditures.
No Credit Party will, nor will it permit its Subsidiaries to, make any
Capital Expenditures other than (a) until June 30, 1999, Capital Expenditures
consisting of normal and customary maintenance expenditures as identified in the
weekly and monthly projections provided to the Lenders pursuant to Section
7.1(c) and (b) after June 30, 1999, such Capital Expenditures as may
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be approved in writing by the Lenders in their reasonable discretion. The
Borrower will provide a schedule of Capital Expenditures by June 30, 1999 for
consideration by the Lenders.
SECTION 9
EVENTS OF DEFAULT
9.1 Events of Default.
An Event of Default shall exist upon the occurrence of any of the following
specified events (each an "Event of Default"):
(a) Payment. Any Credit Party shall default in the payment (i) when
due of any principal of any of the Loans or any reimbursement obligation
arising from drawings under Letters of Credit or (ii) within five days of
when due of any interest on the Loans or any fees or other amounts owing
hereunder, under any of the other Credit Documents or in connection
herewith.
(b) Representations. Any representation, warranty or statement made or
deemed to be made by any Credit Party herein, in any of the other Credit
Documents, or in any statement or certificate delivered or required to be
delivered pursuant hereto or thereto shall prove untrue in any material
respect on the date as of which it was made or deemed to have been made.
(c) Covenants. Any Credit Party shall:
(i) default in the due performance or observance of any term,
covenant or agreement contained in Sections 7.2, 7.3, 7.5, 7.11, 7.12,
or 8.1 through 8.13 inclusive;
(ii) default in the due performance or observance by it of any
term, covenant or agreement contained in Sections 7.1 and 7.14 and
such default shall continue unremedied for a period of five Business
Days; or
(iii) default in the due performance or observance by it of any
term, covenant or agreement (other than those referred to in
subsections (a), (b) or (c)(i) or (ii) of this Section 9.1) contained
in this Credit Agreement and such default shall continue unremedied
for a period of at least 30 days after the earlier of an officer of a
Credit Party becoming aware of such default or notice thereof given by
the Administrative Agent.
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(d) Other Credit Documents. (i) Any Credit Party shall default in the
due performance or observance of any term, covenant or agreement in any of
the other Credit Documents and such default shall continue unremedied for a
period of at least 30 days after the earlier of an officer of a Credit
Party becoming aware of such default or notice thereof given by the
Administrative Agent, or (ii) any Credit Document shall fail to be in full
force and effect or any Credit Party shall so assert or any Credit Document
shall fail to give the Collateral Agent and/or the Lenders the security
interests, liens, rights, powers and privileges purported to be created
thereby.
(e) Guaranties. The guaranty given by the Credit Parties hereunder or
by any Additional Credit Party hereafter or any provision thereof shall
cease to be in full force and effect, or any guarantor thereunder or any
Person acting by or on behalf of such guarantor shall deny or disaffirm
such Guarantor's obligations under such guaranty.
(f) Bankruptcy, etc. The occurrence of any of the following with
respect to a Credit Party or any of its Subsidiaries (i) a court or
governmental agency having jurisdiction in the premises shall enter a
decree or order for relief in respect of a Credit Party or any of its
Subsidiaries in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or appoint a
receiver, liquidator, assignee, custodian, trustee, sequestrator,
administrator or similar official of a Credit Party or any of its
Subsidiaries or for any substantial part of its property or ordering the
winding up or liquidation of, or an administrator in respect of, its
affairs; or (ii) an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect is commenced
against a Credit Party or any of its Subsidiaries and such petition remains
unstayed and in effect for a period of 60 consecutive days; or (iii) a
Credit Party or any of its Subsidiaries shall commence a voluntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or consent to the entry of an order for relief in an
involuntary case under any such law, or consent to the appointment or
taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator, administrator or similar official of such Person or any
substantial part of its property or make any general assignment for the
benefit of creditors; or (iv) a Credit Party or any of its Subsidiaries
shall admit in writing its inability to pay its debts generally as they
become due or any action shall be taken by such Person in furtherance of
any of the aforesaid purposes.
(g) Defaults under Other Agreements.
(i) A Credit Party or any of its Subsidiaries shall default in
the due performance or observance (beyond the applicable grace period
with respect thereto) of any material obligation or condition of any
contract or lease to which it is a party; or
(ii) With respect to any Indebtedness in excess of $1,000,000
(other than Indebtedness outstanding under this Credit Agreement) of a
Credit Party or any of
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its Subsidiaries (i) such Person shall (A) default in any payment
(beyond the applicable grace period with respect thereto, if any) with
respect to any such Indebtedness, or (B) default (after giving effect
to any applicable grace period) in the observance or performance
relating to such Indebtedness or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event
or condition shall occur or condition exist, the effect of which
default or other event or condition is to cause, or permit, the holder
or holders of such Indebtedness (or trustee or agent on behalf of such
holders) to cause (determined without regard to whether any notice or
lapse of time is required) any such Indebtedness to become due prior
to its stated maturity; or (ii) any such Indebtedness shall be
declared due and payable, or required to be prepaid other than by a
regularly scheduled required prepayment prior to the stated maturity
thereof; or (iii) any such Indebtedness shall mature and remain
unpaid.
(h) Judgments. One or more judgments, orders, or decrees shall be
entered against any one or more of the Credit Parties and their
Subsidiaries involving a liability of $1,000,000 or more, in the aggregate,
(to the extent not paid or covered by insurance provided by a carrier who
has acknowledged coverage) and such judgments, orders or decrees (i) are
the subject of any enforcement proceeding commenced by any creditor or (ii)
shall continue unsatisfied, undischarged and unstayed for a period ending
on the first to occur of (A) the last day on which such judgment, order or
decree becomes final and unappealable or (B) 60 days.
(i) ERISA. The occurrence of any of the following events or conditions
if such occurrence would have or be reasonably likely to have a Material
Adverse Effect: (A) any "accumulated funding deficiency," as such term is
defined in Section 302 of ERISA and Section 412 of the Code, whether or not
waived, shall exist with respect to any Plan, or any lien shall arise on
the assets of a Credit Party or any of their Subsidiaries or any ERISA
Affiliate in favor of the PBGC or a Plan; (B) a Termination Event shall
occur with respect to a Single Employer Plan, which is, in the reasonable
opinion of the Administrative Agent, likely to result in the termination of
such Plan for purposes of Title IV of ERISA; (C) a Termination Event shall
occur with respect to a Multiemployer Plan or Multiple Employer Plan, which
is, in the reasonable opinion of the Administrative Agent, likely to result
in (i) the termination of such Plan for purposes of Title IV of ERISA, or
(ii) a Credit Party or any of their Subsidiaries or any ERISA Affiliate
incurring any liability in connection with a withdrawal from,
reorganization of (within the meaning of Section 4241 of ERISA), or
insolvency (within the meaning of Section 4245 of ERISA) of such Plan; or
(D) any prohibited transaction (within the meaning of Section 406 of ERISA
or Section 4975 of the Code) or breach of fiduciary responsibility shall
occur which may subject a Credit Party or any of their Subsidiaries or any
ERISA Affiliate to any liability under Sections 406, 409, 502(i), or 502(l)
of ERISA or Section 4975 of the Code, or under any agreement or other
instrument pursuant to which a Credit Party or any of their Subsidiaries or
any ERISA Affiliate has agreed or is required to indemnify any person
against any such liability.
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(j) Ownership. There shall occur a Change of Control.
(k) Qualified Auditor's Opinion. The opinion of Price Waterhouse
Coopers (or any other auditing firm) in connection with the annual
financial statements of the Credit Parties and their Subsidiaries for the
fiscal year ending December 31, 1998 shall be limited as to the scope of
the audit or qualified in any manner.
9.2 Acceleration; Remedies.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived in writing by the
Required Lenders (or the Lenders as may be required hereunder), the
Administrative Agent may or shall, upon the request and direction of the
Required Lenders, take the following actions without prejudice to the rights of
the Agents or any Lender to enforce its claims against the Credit Parties,
except as otherwise specifically provided for herein:
(a) Termination of Commitments. Declare the Commitments terminated
whereupon the Commitments shall be immediately terminated.
(b) Acceleration of Loans. Declare the unpaid principal of and any
accrued interest in respect of all Loans, any reimbursement obligations
arising from drawings under Letters of Credit and any and all other
indebtedness or obligations of any and every kind owing by a Credit Party
to any of the Lenders hereunder to be due whereupon the same shall be
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Credit Parties.
(c) Cash Collateral. Direct the Borrower to pay (and the Borrower
agrees that upon receipt of such notice, or upon the occurrence of an Event
of Default under Section 9.1(f), they will immediately pay) to the
Administrative Agent additional cash, to be held by the Administrative
Agent, for the benefit of the Lenders, in a cash collateral account as
additional security for the LOC Obligations in respect of subsequent
drawings under all then outstanding Letters of Credit in an amount equal to
the U.S. Dollar Equivalent of the maximum aggregate amount which may be
drawn under all Letters of Credits then outstanding.
(d) Enforcement of Rights. Enforce any and all rights and interests
created and existing under the Credit Documents, including, without
limitation, all rights and remedies existing under the Collateral
Documents, all rights and remedies against a Guarantor and all rights of
set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(f) shall occur, then the Commitments shall automatically terminate and all
Loans, all reimbursement obligations under
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Letters of Credit, all accrued interest in respect thereof, all accrued and
unpaid fees and other indebtedness or obligations owing to the Lenders hereunder
shall immediately become due and payable without the giving of any notice or
other action by the Agents or the Lenders, which notice or other action is
expressly waived by the Credit Parties.
Notwithstanding the fact that enforcement powers reside primarily with the
Administrative Agent, each Lender has, to the extent permitted by law, a
separate right of payment and shall be considered a separate "creditor" holding
a separate "claim" within the meaning of Section 101(5) of the Bankruptcy Code
or any other insolvency statute.
9.3 Allocation of Payments After Event of Default.
Notwithstanding any other provisions of this Credit Agreement, after the
occurrence of an Event of Default, all amounts collected or received by an Agent
or any Lender on account of amounts outstanding under any of the Credit
Documents or in respect of the Collateral shall be paid over or delivered as
follows:
FIRST, to the payment of all reasonable out-of-pocket costs and
expenses (including without limitation reasonable attorneys' fees) of the
Agents or any of the Lenders in connection with enforcing the rights of the
Lenders under the Credit Documents and any protective advances made by the
Agents or any of the Lenders with respect to the Collateral under or
pursuant to the terms of the Collateral Documents, pro rata as set forth
below;
SECOND, to payment of any fees owed to an Agent, the Issuing Lender or
any Lender, pro rata as set forth below;
THIRD, to the payment of all accrued interest payable to the Lenders
hereunder, pro rata as set forth below;
FOURTH, to the payment of the outstanding principal amount of the
Loans and unreimbursed drawings under Letters of Credit, and to the payment
or cash collateralization of the outstanding LOC Obligations, pro rata as
set forth below;
FIFTH, to all other obligations which shall have become due and
payable under the Credit Documents and not repaid pursuant to clauses
"FIRST" through "FOURTH" above;
SIXTH, to any principal amounts outstanding under Hedging Agreements
between a Credit Party and a Lender, pro rata as set forth below; and
SEVENTH, to the payment of the surplus, if any, to whoever may be
lawfully entitled to receive such surplus.
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In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (b) each of the Lenders shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans, and
LOC Obligations held by such Lender bears to the aggregate then outstanding
Loans and LOC Obligations, or, in the case of clause "SIXTH" above, the
proportion of then outstanding obligations under Hedging Agreements) of amounts
available to be applied; and (c) to the extent that any amounts available for
distribution pursuant to clause "FOURTH" above are attributable to the issued
but undrawn amount of outstanding Letters of Credit, such amounts shall be held
by the Collateral Agent in a cash collateral account and applied (x) first, to
reimburse the Issuing Lender from time to time for any drawings under such
Letters of Credit and (y) then, following the expiration of all Letters of
Credit, to all other obligations of the types described in clauses "FOURTH" and
"FIFTH" above in the manner provided in this Section 9.3.
SECTION 10
AGENCY PROVISIONS
10.1 Appointment.
Each Lender hereby designates and appoints NationsBank, N.A. as
Administrative Agent and Collateral Agent of such Lender to act as specified
herein and the other Credit Documents, and each such Lender hereby authorizes
the Agents, as the agents for such Lender, to take such action on its behalf
under the provisions of this Credit Agreement and the other Credit Documents and
to exercise such powers and perform such duties as are expressly delegated by
the terms hereof and of the other Credit Documents, together with such other
powers as are reasonably incidental thereto. Notwithstanding any provision to
the contrary elsewhere herein and in the other Credit Documents, the Agents
shall not have any duties or responsibilities, except those expressly set forth
herein and therein, or any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Credit Agreement or any of the other Credit
Documents, or shall otherwise exist against the Agents. The provisions of this
Section are solely for the benefit of the Agents and the Lenders and none of the
Credit Parties shall have any rights as a third party beneficiary of the
provisions hereof. In performing its functions and duties under this Credit
Agreement and the other Credit Documents, each Agent shall act solely as an
agent of the Lenders and does not assume and shall not be deemed to have assumed
any obligation or relationship of agency or trust with or for any Credit Party.
10.2 Delegation of Duties.
An Agent may execute any of its duties hereunder or under the other Credit
Documents by or through agents or attorneys-in-fact and shall be entitled to
advice of counsel concerning all matters pertaining to such duties. An Agent
shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
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10.3 Exculpatory Provisions.
Neither the Agents nor any of their officers, directors, employees, agents,
attorneys-in-fact or affiliates shall be liable for any action lawfully taken or
omitted to be taken by it or such Person under or in connection herewith or in
connection with any of the other Credit Documents (except for its or such
Person's own gross negligence or willful misconduct) or responsible in any
manner to any of the Lenders for any recitals, statements, representations or
warranties made by any of the Credit Parties contained herein or in any of the
other Credit Documents or in any certificate, report, document, financial
statement or other written or oral statement referred to or provided for in, or
received by an Agent under or in connection herewith or in connection with the
other Credit Documents, or enforceability or sufficiency therefor of any of the
other Credit Documents, or for any failure of the Borrower to perform its
obligations hereunder or thereunder. The Agents shall not be responsible to any
Lender for the effectiveness, genuineness, validity, enforceability,
collectibility or sufficiency of this Credit Agreement, or any of the other
Credit Documents or for any representations, warranties, recitals or statements
made herein or therein or made by the Borrower or any Credit Party in any
written or oral statement or in any financial or other statements, instruments,
reports, certificates or any other documents in connection herewith or therewith
furnished or made by an Agent to the Lenders or by or on behalf of the Credit
Parties to the Agents or any Lender or be required to ascertain or inquire as to
the performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained herein or therein or as to the use of the
proceeds of the Loans or the use of the Letters of Credit or of the existence or
possible existence of any Default or Event of Default or to inspect the
properties, books or records of the Credit Parties. The Agents are not trustees
for the Lenders and owe no fiduciary duty to the Lenders.
10.4 Reliance on Communications.
The Agents shall be entitled to rely, and shall be fully protected in
relying, upon any note, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document or conversation believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or
Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to any of the Credit Parties, independent accountants and
other experts selected by the Agents with reasonable care). The Agents may deem
and treat the Lenders as the owner of its interests hereunder for all purposes
unless a written notice of assignment, negotiation or transfer thereof shall
have been filed with the Administrative Agent in accordance with Section
11.3(b). The Agents shall be fully justified in failing or refusing to take any
action under this Credit Agreement or under any of the other Credit Documents
unless it shall first receive such advice or concurrence of the Required Lenders
as it deems appropriate or it shall first be indemnified to its satisfaction by
the Lenders against any and all liability and expense which may be incurred by
it by reason of taking or continuing to take any such action. The Agents shall
in all cases be fully protected in acting, or in refraining from acting,
hereunder or under any of the other Credit Documents in accordance with a
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request of the Required Lenders (or to the extent specifically provided in
Section 11.6, all the Lenders) and such request and any action taken or failure
to act pursuant thereto shall be binding upon all the Lenders (including their
successors and assigns).
10.5 Notice of Default.
An Agent shall not be deemed to have knowledge or notice of the occurrence
of any Default or Event of Default hereunder unless such Agent has received
notice from a Lender or a Credit Party referring to the Credit Document,
describing such Default or Event of Default and stating that such notice is a
"notice of default." In the event that the Administrative Agent receives such a
notice, the Administrative Agent shall give prompt notice thereof to the
Lenders. The Administrative Agent shall take such action with respect to such
Default or Event of Default as shall be reasonably directed by the Required
Lenders and as is permitted by the Credit Documents.
10.6 Non-Reliance on Agents and Other Lenders.
Each Lender expressly acknowledges that neither the Agents, NMS nor any of
their officers, directors, employees, agents, attorneys-in-fact or affiliates
has made any representations or warranties to it and that no act by the Agents
or any affiliate thereof hereinafter taken, including any review of the affairs
of any Credit Party, shall be deemed to constitute any representation or
warranty by the Agents to any Lender. Each Lender represents to the Agents and
NMS that it has, independently and without reliance upon the Agents or NMS or
any other Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
assets, operations, property, financial and other conditions, prospects and
creditworthiness of the Credit Parties and made its own decision to make its
Loans hereunder and enter into this Credit Agreement. Each Lender also
represents that it will, independently and without reliance upon the Agents or
NMS or any other Lender, and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Credit
Agreement, and to make such investigation as it deems necessary to inform itself
as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of the Credit Parties. Except for
notices, reports and other documents expressly required to be furnished to the
Lenders by the Administrative Agent hereunder, the Agents and NMS shall not have
any duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, assets, property, financial or
other conditions, prospects or creditworthiness of the Credit Parties which may
come into the possession of the Agents, NMS or any of their officers, directors,
employees, agents, attorneys-in-fact or affiliates.
10.7 Indemnification.
The Lenders agree to indemnify each Agent in its capacity as such (to the
extent not reimbursed by the Borrower and without limiting the obligation of the
Borrower to do so), ratably according to their respective Commitments (or if the
Commitments have expired or been
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terminated, in accordance with the respective principal amounts of outstanding
Loans and Participation Interest of the Lenders), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including without limitation at any time following payment in full of the
Credit Party Obligations) be imposed on, incurred by or asserted against an
Agent in its capacity as such in any way relating to or arising out of this
Credit Agreement or the other Credit Documents or any documents contemplated by
or referred to herein or therein or the transactions contemplated hereby or
thereby or any action taken or omitted by an Agent under or in connection with
any of the foregoing; provided that no Lender shall be liable for the payment of
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
gross negligence or willful misconduct of an Agent. If any indemnity furnished
to an Agent for any purpose shall, in the opinion of such Agent, be insufficient
or become impaired, such Agent may call for additional indemnity and cease, or
not commence, to do the acts indemnified against until such additional indemnity
is furnished. The agreements in this Section shall survive the payment of the
Credit Party Obligations and all other amounts payable hereunder and under the
other Credit Documents.
10.8 Agents in Their Individual Capacity.
Each Agent and its affiliates may make loans to, accept deposits from and
generally engage in any kind of business with the Borrower or any other Credit
Party as though such Agent were not an Agent hereunder. With respect to the
Loans made and Letters of Credit issued and all obligations owing to it, an
Agent shall have the same rights and powers under this Credit Agreement as any
Lender and may exercise the same as though they were not an Agent, and the terms
"Lender" and "Lenders" shall include each Agent in its individual capacity.
10.9 Successor Agent.
Any Agent may, at any time, resign upon 20 days written notice to the
Lenders. Upon any such resignation, the Required Lenders shall have the right to
appoint a successor Agent. If no successor Agent shall have been so appointed by
the Required Lenders, and shall have accepted such appointment, within 60 days
after the notice of resignation, then the retiring Agent shall select a
successor Agent; provided such successor is an Eligible Assignee. Upon the
acceptance of any appointment as an Agent hereunder by a successor, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations as an Agent, as
appropriate, under this Credit Agreement and the other Credit Documents and the
provisions of this Section 10 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was an Agent under this Credit Agreement.
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SECTION 11
MISCELLANEOUS
11.1 Notices.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device) to the
number set out below, (c) the Business Day following the day on which the same
has been delivered prepaid to a reputable national overnight air courier
service, or (d) the third Business Day following the day on which the same is
sent by certified or registered mail, postage prepaid, in each case to the
respective parties at the address or telecopy numbers set forth on Schedule
11.1, or at such other address as such party may specify by written notice to
the other parties hereto.
11.2 Right of Set-Off.
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
of an Event of Default and the commencement of remedies described in Section
9.2, each Lender is authorized at any time and from time to time, without
presentment, demand, protest or other notice of any kind (all of which rights
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 such Lender (including, without limitation, branches, agencies or
Affiliates of such Lender wherever located) to or for the credit or the account
of any Credit Party against obligations and liabilities of such Credit Party to
the Lenders hereunder, under the Notes, the other Credit Documents or otherwise,
irrespective of whether the Administrative Agent or the Lenders shall have made
any demand hereunder and although such obligations, liabilities or claims, or
any of them, may be contingent or unmatured, and any such set-off shall be
deemed to have been made immediately upon the occurrence of an Event of Default
even though such charge is made or entered on the books of such Lender
subsequent thereto. The Credit Parties hereby agree that any Person purchasing a
participation in the Loans and Commitments hereunder pursuant to Section 11.3(c)
or 3.8 may exercise all rights of set-off with respect to its participation
interest as fully as if such Person were a Lender hereunder.
11.3 Benefit of Agreement.
(a) Generally. This Credit 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 that none of the Credit Parties may
assign and transfer any of its interests (except as permitted by Section
8.4 or 8.5) without the prior written consent of the Lenders; and provided
further that the rights of each Lender to transfer, assign or grant
participations in
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its rights and/or obligations hereunder shall be limited as set forth below
in this Section 11.3.
(b) Assignments. Each Lender may assign to one or more Eligible
Assignees all or a portion of its rights and obligations under this Credit
Agreement (including, without limitation, all or a portion of its Loans,
its Notes, and its Commitment); provided, however, that:
(i) each such assignment shall be to an Eligible Assignee;
(ii) except in the case of an assignment to another Lender or an
assignment of all of a Lender's rights and obligations under this
Credit Agreement, any such partial assignment shall be in an amount at
least equal to $5,000,000 (or, if less, the remaining amount of the
Commitment being assigned by such Lender) or an integral multiple of
$1,000,000 in excess thereof;
(iii) each such assignment by a Lender shall be of a constant,
and not varying, percentage of all of its rights and obligations under
this Credit Agreement and the Notes; and
(iv) the parties to such assignment shall execute and deliver to
the Administrative Agent for its acceptance an Assignment Agreement in
substantially the form of Exhibit 11.3(b), together with a processing
fee from the assignor of $3,500.
Upon execution, delivery, and acceptance of such Assignment Agreement, the
assignee thereunder shall be a party hereto and, to the extent of such
assignment, have the obligations, rights, and benefits of a Lender
hereunder and the assigning Lender shall, to the extent of such assignment,
relinquish its rights and be released from its obligations under this
Credit Agreement. Upon the consummation of any assignment pursuant to this
Section 11.3(b), the assignor, the Administrative Agent and the Borrower
shall make appropriate arrangements so that, if required, new Notes are
issued to the assignor and the assignee. If the assignee is not
incorporated under the laws of the United States of America or a state
thereof, it shall deliver to the Borrower and the Administrative Agent
certification as to exemption from deduction or withholding of taxes in
accordance with Section 3.11.
By executing and delivering an assignment agreement in accordance with this
Section 11.3(b), the assigning Lender thereunder and the assignee
thereunder shall be deemed to confirm to and agree with each other and the
other parties hereto as follows: (A) such assigning Lender warrants that it
is the legal and beneficial owner of the interest being assigned thereby
free and clear of any adverse claim and the assignee warrants that it is an
Eligible Assignee; (B) except as set forth in clause (A) above, such
assigning Lender makes
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no representation or warranty and assumes no responsibility with respect to
any statements, warranties or representations made in or in connection with
this Credit Agreement, any of the other Credit Documents or any other
instrument or document furnished pursuant hereto or thereto, or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Credit Agreement, any of the other Credit Documents or any
other instrument or document furnished pursuant hereto or thereto or the
financial condition of any Credit Party or the performance or observance by
any Credit Party of any of its obligations under this Credit Agreement, any
of the other Credit Documents or any other instrument or document furnished
pursuant hereto or thereto; (C) such assignee represents and warrants that
it is legally authorized to enter into such assignment agreement; (D) such
assignee confirms that it has received a copy of this Credit Agreement, the
other Credit Documents and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter
into such assignment agreement; (E) such assignee will independently and
without reliance upon the Agents, such assigning Lender or any other
Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Credit Agreement and the other
Credit Documents; (F) such assignee appoints and authorizes the Agents to
take such action on its behalf and to exercise such powers under this
Credit Agreement or any other Credit Document as are delegated to the
Agents by the terms hereof or thereof, together with such powers as are
reasonably incidental thereto; and (G) such assignee agrees that it will
perform in accordance with their terms all the obligations which by the
terms of this Credit Agreement and the other Credit Documents are required
to be performed by it as a Lender.
(c) Register. The Administrative Agent shall maintain a copy of each
Assignment Agreement delivered to and accepted by it and a register for the
recordation of the names and addresses of the Lenders and the Commitment
of, and principal amount of the Loans owing to, each Lender from time to
time (the "Register"). The entries in the Register shall be conclusive and
binding for all purposes, absent manifest error, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register as a Lender hereunder for all purposes of this
Credit Agreement. The Register shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(d) Acceptance. Upon its receipt of an Assignment Agreement executed
by the parties thereto, together with any Note subject to such assignment
and payment of the processing fee, the Administrative Agent shall, if such
Assignment Agreement has been completed and is in substantially the form of
Exhibit 11.3(b) hereto, (i) accept such Assignment Agreement, (ii) record
the information contained therein in the Register and (iii) give prompt
notice thereof to the parties thereto.
(e) Participations. Each Lender may sell participations to one or more
Persons in all or a portion of its rights, obligations or rights and
obligations under this
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Credit Agreement (including all or a portion of its Commitment and its
Loans); provided, however, that (i) such Lender's obligations under this
Credit Agreement shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) the participant shall be entitled to the benefit of the
yield protection provisions contained in Sections 3.9 through 3.14,
inclusive, and the right of set-off contained in Section 11.2, and (iv) the
Borrower shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Credit
Agreement, and such Lender shall retain the sole right to enforce the
obligations of the Borrower relating to its Loans and its Notes and to
approve any amendment, modification, or waiver of any provision of this
Credit Agreement (other than amendments, modifications, or waivers
decreasing the amount of principal of or the rate at which interest is
payable on such Loans or Notes, extending any scheduled principal payment
date or date fixed for the payment of interest on such Loans or Notes, or
extending its Commitment).
(f) Nonrestricted Assignments. Notwithstanding any other provision set
forth in this Credit Agreement, any Lender may at any time assign and
pledge all or any portion of its Loans and its Notes to any Federal Reserve
Bank as collateral security pursuant to Regulation A and any Operating
Circular issued by such Federal Reserve Bank. No such assignment shall
release the assigning Lender from its obligations hereunder.
(g) Information. Any Lender may furnish any information concerning the
Borrower or any of its Subsidiaries in the possession of such Lender from
time to time to assignees and participants (including prospective assignees
and participants), subject, however, to the provisions of Section 11.16
hereof.
11.4 No Waiver; Remedies Cumulative.
No failure or delay on the part of an Agent 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 Credit Party and the Agents 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 and remedies
provided herein are cumulative and not exclusive of any rights or remedies which
the Agents 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 Agents or the Lenders to any other or further action in any
circumstances without notice or demand.
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11.5 Payment of Expenses; Indemnification.
The Credit Parties agree to: (a) pay all reasonable out-of-pocket costs and
expenses of (i) the Administrative Agent, NMS and the Lenders in connection with
(A) the negotiation, preparation, execution and delivery and administration of
this Credit Agreement and the other Credit Documents and the documents and
instruments referred to therein (including, without limitation, the reasonable
fees and expenses of Xxxxx & Xxx Xxxxx, special counsel to the Administrative
Agent, Xxxxxx Xxxxxxxx, special foreign counsel to the Administrative Agent, and
counsel for each of the Lenders) and (B) any amendment, waiver or consent
relating hereto and thereto including, but not limited to, any such amendments,
waivers or consents resulting from or related to any work-out, renegotiation or
restructure relating to the performance by the Credit Parties under this Credit
Agreement and (ii) the Agents and the Lenders in connection with (A) after the
occurrence of a Default or and Event of Default, enforcement of the Credit
Documents and the documents and instruments referred to therein, including,
without limitation, in connection with any such enforcement, the reasonable fees
and disbursements of counsel for the Agents and each of the Lenders, and (B) any
bankruptcy or insolvency proceeding of a Credit Party or any of its Subsidiaries
and (b) indemnify each of the Agents, NMS, the Lenders and each of their
respective officers, directors, employees, representatives and agents from and
hold each of them harmless against any and all losses, liabilities, claims,
damages or expenses incurred by any of them as a result of, or arising out of,
or in any way related to, or by reason of, any investigation, litigation or
other proceeding (whether or not any Agent, NMS or any Lender is a party
thereto) related to (i) the entering into and/or performance of any Credit
Document or the use of proceeds of any Loans (including other extensions of
credit) hereunder or the consummation of any other transactions contemplated in
any Credit Document, including, without limitation, the reasonable fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding, (ii) any Environmental Claim, and (iii) any
claims for Non-Excluded Taxes (but excluding in the case of (i), (ii) and (iii)
above, any such losses, liabilities, claims, damages or expenses to the extent
incurred by reason of gross negligence or willful misconduct on the part of the
Person to be indemnified).
11.6 Amendments, Waivers and Consents.
Neither this Credit Agreement nor any other Credit Document nor any of the
terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing and signed by the Required Lenders and the then Credit Parties; provided
that no such amendment, change, waiver, discharge or termination shall without
the written consent of each Lender affected thereby:
(a) extend the Maturity Date;
(b) reduce the rate or extend the time of payment of interest (other
than as a result of waiving the applicability of any post-default increase
in interest rates) thereon or fees hereunder;
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(c) reduce or waive the principal amount of any Loan;
(d) increase or extend the Commitment of a Lender (it being understood
and agreed that a waiver of any Default or Event of Default or a waiver of
any mandatory reduction in the Commitments shall not constitute a change in
the terms of any Commitment of any Lender);
(e) release all or substantially all of the Collateral securing the
Credit Party Obligations hereunder (provided that the Collateral Agent may,
without consent from any other Lender, release any Collateral that is sold
or transferred by a Credit Party in conformance with Section 8.5);
(f) release the Borrower from its obligations or release all or
substantially all of the other Credit Parties from their respective
obligations under the Credit Documents;
(g) amend, modify or waive any provision of this Section 11.6 or
Section 3.4(a), 3.4(b)(i), 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14,
9.1(a), 11.2, 11.3 or 11.5;
(h) reduce any percentage specified in, or otherwise modify, the
definition of Required Lenders; or
(i) consent to the assignment or transfer by the Borrower of any of
its rights and obligations under (or in respect of) the Credit Documents.
Notwithstanding the above, no provisions of Section 10 may be amended or
modified without the written consent of the Agents and no provisions of Section
2.2 may be amended or modified without the written consent of the Issuing
Lender.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any reorganization plan that affects the Loans or the
Letters of Credit, and each Lender acknowledges that the provisions of Section
1126(c) of the Bankruptcy Code supersedes the unanimous consent provisions set
forth herein and (y) the Required Lenders may consent to allow a Credit Party to
use cash collateral in the context of a bankruptcy or insolvency proceeding.
11.7 Counterparts/Telecopy.
This Credit Agreement may be executed in any number of counterparts, each
of which where so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. Delivery of executed counterparts
by telecopy shall be as effective as an original and shall constitute a
representation that an original will be delivered.
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11.8 Headings.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
11.9 Defaulting Lender.
Each Lender understands and agrees that if such Lender is a Defaulting
Lender then notwithstanding the provisions of Section 11.6 it shall not be
entitled to vote on any matter requiring the consent of the Required Lenders or
to object to any matter requiring the consent of all the Lenders; provided,
however, that all other benefits and obligations under the Credit Documents
shall apply to such Defaulting Lender.
11.10 Survival of Indemnification and Representations and Warranties.
All indemnities set forth herein and all representations and warranties
made herein shall survive the execution and delivery of this Credit Agreement,
the making of the Loans, the issuance of the Letters of Credit and the repayment
of the Loans, LOC Obligations and other obligations and the termination of the
Commitments hereunder.
11.11 Governing Law; Jurisdiction.
(a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS (OTHER THAN THE UK
COLLATERAL DOCUMENTS) AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NORTH CAROLINA. 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 North Carolina or of
the United States for the Western District of North Carolina, and, by
execution and delivery of this Credit Agreement, each Credit Party hereby
irrevocably accepts for itself and in respect of its property, generally
and unconditionally, the jurisdiction of such courts. Each Credit Party
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 it at
the address for notices pursuant to Section 11.1, such service to become
effective 10 days after such mailing. Nothing herein shall affect the right
of a Lender to serve process in any other manner permitted by law or to
commence legal proceedings or to otherwise proceed against a Credit Party
in any other jurisdiction. Each Credit Party agrees that a final judgment
in any action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided
by law; provided that nothing in this Section 11.11(a) is intended to
impair a Credit Party's right under applicable law to appeal or seek a stay
of any judgment.
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(b) Each Credit Party 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
subsection (a) hereof 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) With respect to each Guarantor which is not incorporated or
organized under the laws of any State of the United States or the District
of Columbia:
(i) (A) Without limiting the generality of subsections (a) and
(b) of this Section 11.12, such Guarantor agrees that any controversy
or claim with respect to it arising out of or relating to this Credit
Agreement or the other Credit Documents may, at the sole option of the
Administrative Agent and the Lenders, be settled immediately by
submitting the same to binding arbitration in the City of Charlotte,
North Carolina (or such other place as the parties may agree) in
accordance with the Commercial Arbitration Rules of the American
Arbitration Association. Upon the request and submission of any
controversy or claim for arbitration hereunder, the Administrative
Agent shall give such Guarantor not less than 45 days written notice
of the request for arbitration, the nature of the controversy or
claim, and the time and place set for arbitration. Such Guarantor
agrees that such notice is reasonable to enable it sufficient time to
prepare and present its case before the arbitration panel. Judgment on
the award rendered by the arbitration panel may be entered in any
court in which any action could have been brought or maintained
pursuant to subparagraph (ii) below, including, without limitation,
any court of the State of North Carolina or any Federal court sitting
in the State of North Carolina. The expenses of arbitration shall be
paid by such Guarantor.
(B) The provisions of subparagraph (A) above are intended to
comply with the requirements of the Convention on the Recognition and
Enforcement of Foreign Arbitral Awards (the "Convention"). To the
extent that any provisions of such subparagraph (A) are not consistent
with or fail to conform to the requirements set out in the Convention,
such subparagraph (A) shall be deemed amended to conform to the
requirements of the Convention.
(C) Such Guarantor hereby specifically consents and submits to
the jurisdiction of the courts of the State of North Carolina and
courts of the United States located in the State of North Carolina for
purposes of entry of a judgment or arbitration award entered by the
arbitration panel.
(D) Such Guarantor hereby irrevocably appoints Marko Bogoievski
with an address on the date hereof at 00 Xxxx 00xx Xxxxxx, Xxx Xxxx,
XX 00000
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(the "North Carolina Process Agent"), as process agent in its name,
place and stead to receive and forward service of any and all writs,
summonses and other legal process in any suit, action or proceeding
brought in the State of North Carolina, agrees that such service in
any such suit, action or proceeding may be made upon the North
Carolina Process Agent and agrees to take all such action as may be
necessary to continue said appointment in full force and effect or to
appoint another agent so that such Guarantor will at all times have an
agent in the State of North Carolina for service of process for the
above purposes.
(ii) The guarantee of such Guarantor hereunder is (in part) an
international transaction in which payment of Dollars in Charlotte,
North Carolina, is of the essence, and Dollars shall be the currency
of account in all events. The payment obligation of such Guarantor
shall not be discharged by an amount paid in another currency or in
another place, whether pursuant to a judgment or otherwise, to the
extent that the amount so paid on prompt conversion to Dollars and
transfer to Charlotte, North Carolina, under normal banking procedures
does not yield the amount of Dollars in Charlotte, North Carolina due
hereunder. In the event that any payment by such Guarantor, whether
pursuant to a judgment or otherwise, upon conversion and transfer does
not result in payment of such amount of Dollars in Charlotte, North
Carolina, the Administrative Agent and the Lenders shall have a
separate cause of action against such Guarantor for the additional
amount necessary to yield the amount due and owing to the
Administrative Agent and the Lenders.
11.12 Waiver of Jury Trial.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
11.13 Time.
All references to time herein shall be references to Eastern Standard Time
or Eastern Daylight time, as the case may be, unless specified otherwise.
11.14 Severability.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
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11.15 Further Assurances.
The Credit Parties agree, upon the request of the Administrative Agent, to
promptly take such actions, as reasonably requested, as is necessary to carry
out the intent of this Credit Agreement and the other Credit Documents,
including, but not limited to, such actions as are necessary to ensure that the
Lenders have a perfected security interest in the Collateral subject to no Liens
other than Permitted Liens.
11.16 Confidentiality.
Each Lender agrees that it will use its reasonable best efforts to keep
confidential and to cause any representative designated under Section 7.12 to
keep confidential any non-public information from time to time supplied to it
under any Credit Document; provided, however, that nothing herein shall prevent
the disclosure of any such information to (a) the extent a Lender in good faith
believes such disclosure is required by Requirement of Law, (b) counsel for a
Lender or to its accountants, (c) bank examiners or auditors or comparable
Persons, (d) any affiliate of a Lender, (e) any other Lender, or any assignee,
transferee or participant, or any potential assignee, transferee or participant,
of all or any portion of any Lender's rights under this Credit Agreement who is
notified of the confidential nature of the information or (f) any other Person
in connection with any litigation to which any one or more of the Lenders is a
party; and provided further that no Lender shall have any obligation under this
Section 11.16 to the extent any such information becomes available on a
non-confidential basis from a source other than a Credit Party or that any
information becomes publicly available other than by a breach of this Section
11.16 by any Lender or representative thereof.
11.17 Entirety.
This Credit Agreement together with the other Credit Documents and the Fee
Letter represent the entire agreement of the parties hereto and thereto, and
supersede all prior agreements and understandings, oral or written, if any,
including any commitment letters or correspondence relating to the Credit
Documents or the transactions contemplated herein and therein.
11.18 Judgment Currency.
(a) Each Credit Party's obligations under the Credit Documents to make
payments in Dollars (the "Obligation Currency") shall not be discharged or
satisfied by any tender or recovery pursuant to any judgment expressed in
or converted into any currency other than the Obligation Currency, except
to the extent that such tender or recovery results in the effective receipt
by an Agent or a Lender of the full amount of the Obligation Currency
expressed to be payable to such Agent or such Lender under the Credit
Documents. If, for the purpose of obtaining or enforcing judgment against
any Credit Party in any court or in any jurisdiction, it becomes necessary
to convert into or
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from any currency other than the Obligation Currency (such other currency
being hereinafter referred to as the "Judgment Currency") an amount due in
the Obligation Currency, the conversion shall be made at the U.S. Dollar
Equivalent, determined as of the Business Day immediately preceding the day
on which the judgment is given (such Business Day being hereinafter
referred to as the "Judgment Currency Conversion Date").
(b) If there is a change in the rate of exchange prevailing between
the Judgment Currency Conversion Date and the date of actual payment of the
amount due, such amount payable by the applicable Credit Party shall be
reduced or increased, as applicable, such that the amount paid in the
Judgment Currency, when converted at the rate of exchange prevailing on the
date of payment, will produce the amount of the Obligation Currency which
could have been purchased with the amount of Judgment Currency stipulated
in the judgment or judicial award at the rate of exchange prevailing on the
Judgment Currency Conversion Date.
11.19 Binding Effect; Continuing Agreement.
(a) This Credit Agreement shall become effective at such time when all
of the conditions set forth in Section 5.1 have been satisfied or waived by
the Lenders and it shall have been executed by the Borrower, the Guarantors
and the Agents, and the Agents shall have received copies hereof (telefaxed
or otherwise) which, when taken together, bear the signatures of each
Lender, and thereafter this Credit Agreement shall be binding upon and
inure to the benefit of the Borrower, the Guarantors, the Agents and each
Lender and their respective successors and assigns. Upon this Credit
Agreement becoming effective, (i) the Existing Credit Agreement shall be
deemed superseded by this Credit Agreement and the Credit Parties and the
Lenders party to the Existing Credit Agreement shall no longer have any
obligations thereunder (other than those obligations in the Existing Credit
Agreement that expressly survive the termination thereof) and (ii) that
certain Forbearance Agreement, dated as of March 26, 1999, among the
parties hereto shall be superseded.
(b) This Credit Agreement shall be a continuing agreement and shall
remain in full force and effect until all Loans, LOC Obligations, interest,
fees and other Credit Party Obligations have been paid in full and all
Commitments and Letters of Credit have been terminated. Upon termination,
the Credit Parties shall have no further obligations (other than the
indemnification provisions that survive) under the Credit Documents and the
Collateral Agent shall, at the request and expense of the Borrower, deliver
all Collateral in its possession to the Borrower and release all Liens on
Collateral; provided that should any payment, in whole or in part, of the
Credit Party Obligations be rescinded or otherwise required to be restored
or returned by an Agent or any Lender, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise, then the Credit
Documents shall automatically be reinstated and all Liens of the Lenders
shall reattach to the Collateral and all amounts required to be restored or
returned and all costs and expenses incurred by an
- 90 -
Agent or Lender in connection therewith shall be deemed included as part of
the Credit Party Obligations.
11.20 Obligations Under Collateral Documents; Reaffirmation of Credit Party
Obligations.
Each of the Credit Parties (a) acknowledges that, notwithstanding the
amendment and restatement of the Existing Credit Agreement hereunder, the
security interests in the Collateral granted to the Collateral Agent, on behalf
of the Lenders, by the Credit Parties pursuant to the Collateral Documents are
valid and enforceable first priority perfected security interests that secure
the Credit Party Obligations, (b) reaffirms its Credit Party Obligations under
the Credit Agreement, the Collateral Documents and the other Credit Documents
and agrees that such Credit Party Obligations are unconditional and not subject
to any offsets, defenses or counterclaims and (c) to the extent necessary,
hereby grants to the Collateral Agent, on behalf of the Lenders, as security for
the Credit Party Obligations, all of its rights, title and interests in the
Collateral.
11.21 No Lender Defaults; Release.
Each of the Credit Parties (a) acknowledges and confirms that the Agents
and the Lenders have performed fully all of their respective obligations under
the Existing Credit Agreement and the credit documents related thereto and (b)
releases the Administrative Agent, the Lenders, and the Administrative Agent's
and the Lenders' respective Affiliates, Subsidiaries, officers, employees,
representatives, agents, counsel and directors from any and all actions, causes
of action, claims, demands, damages and liabilities of whatever kind or nature,
in law or in equity, now known or unknown, suspected or unsuspected to the
extent that any of the foregoing arises from any action or failure to act on or
prior to the date hereof.
- 91 -
Each of the parties hereto has caused a counterpart of this Credit
Agreement to be duly executed and delivered as of the date first above written.
BORROWER:
---------
DISPATCH MANAGEMENT SERVICES CORP.
a Delaware corporation
By:____________________________________
Name:__________________________________
Title:_________________________________
GUARANTORS:
-----------
DISPATCH MANAGEMENT SERVICES
ACQUISITION CORP.,
a Delaware corporation
By:____________________________________
Name:__________________________________
Title:_________________________________
DISPATCH MANAGEMENT SERVICES
SAN FRANCISCO CORP.,
a Delaware corporation
By:____________________________________
Name:__________________________________
Title:_________________________________
DISPATCH MANAGEMENT SERVICES
NEW YORK CORP.,
a New York corporation
By:____________________________________
Name:__________________________________
Title:_________________________________
SIGNATURTE PAGE TO
AMENDED AND RESTATED
CREDIT AGREEMENT
ROAD MANAGEMENT SERVICES CORPORATION,
a Delaware corporation
By:____________________________________
Name:__________________________________
Title:_________________________________
DISPATCH MANAGEMENT SERVICES (EUROPE)
LIMITED,
a company formed under the laws of
England and Wales
By:____________________________________
Name:__________________________________
Title:_________________________________
BRIDGE WHARF INVESTMENTS LIMITED,
a company formed under the laws of
England and Wales
By:____________________________________
Name:__________________________________
Title:_________________________________
SECURITY BUSINESS SERVICES LIMITED,
a company formed under the laws of
England and Wales
By:____________________________________
Name:__________________________________
Title:_________________________________
DISPATCH MANAGEMENT SERVICES (UK)
LIMITED f/k/a Delta Air & Road
Transport Limited, a company formed
under the laws of England and Wales
By:____________________________________
Name:__________________________________
Title:_________________________________
SIGNATURTE PAGE TO
AMENDED AND RESTATED
CREDIT AGREEMENT
LENDERS:
--------
NATIONSBANK, N.A.,
individually in its capacity as a
Lender and in its capacity as
Administrative Agent and Collateral
Agent
By:____________________________________
Name:__________________________________
Title:_________________________________
SIGNATURTE PAGE TO
AMENDED AND RESTATED
CREDIT AGREEMENT
FIRST UNION NATIONAL BANK
By:____________________________________
Name:__________________________________
Title:_________________________________
SIGNATURTE PAGE TO
AMENDED AND RESTATED
CREDIT AGREEMENT
BANKBOSTON, N.A.
By:____________________________________
Name:__________________________________
Title:_________________________________
SIGNATURTE PAGE TO
AMENDED AND RESTATED
CREDIT AGREEMENT
CIBC, INC.
By:____________________________________
Name:__________________________________
Title:_________________________________
SIGNATURTE PAGE TO
AMENDED AND RESTATED
CREDIT AGREEMENT
FLEET BANK, N.A.
By:____________________________________
Name:__________________________________
Title:_________________________________
SIGNATURTE PAGE TO
AMENDED AND RESTATED
CREDIT AGREEMENT
Schedule 1.1(a) to
Credit Agreement
Commitment Percentages
----------------------
Revolving Loan Revolving
Lender Commitment Percentage Committed Amount
------ --------------------- ----------------
NationsBank, N.A. 23.809523810% $18,686,865.23
BankBoston, N.A. 23.809523810% $18,686,865.23
First Union National Bank 23.809523810% $18,686,865.23
CIBC Inc. 14.285714286% $11,212,119.14
Fleet Bank, N.A. 14.285714286% $11,212,119.14
Schedule 2.2(c) to
Credit Agreement
Existing Letters of Credit
--------------------------
$950,000 letter of credit issued on February 10, 1998 by NationsBank, N.A. to
Xxxx X. Xxxxxx.
(pound)750,000 letter of credit issued on August 20, 1998 by NationsBank, N.A.
to Barclay's Bank.
(pound)1,000,000 letter of credit issued on August 20, 1998 by NationsBank, N.A.
to National Westminster Bank PLC (NatWest).
Schedule 6.10 to
Credit Agreement
Indebtedness
------------
1. Dispatch Management Services (UK) Limited (f/k/a Delta Air & Road Transport
Limited) - overdraft line of credit not to exceed(pound)1,000,000.
2. Security Business Services Ltd. - overdraft line of credit not to
exceed(pound)750,000.
3. Senior Credit Facility - funded $ 74,649,859
4. Seller Obligations
Cash portion of seller obligations - short term 7,207,000
Cash portion of seller obligations - long term 5,337,000
Cash portion of seller obligations - stock to be issued 3,196,770
------------
Total seller obligations 15,740,816
5. Lease Obligations
Short-term lease obligations 886,000
Long-term lease obligations 729,180
-------------
Total lease obligations 1,615,180
Schedule 6.15 to
Credit Agreement
Subsidiaries
------------
Jurisdiction % Shares
of Number of Owned by Options/
Credit Party Subsidiary Incorporation Issued Shares Credit Party Warrant
------------ ---------- ------------- ------------- ------------ --------
1. Dispatch Management Dispatch Management Services Delaware 1 100% N/A
Services Corp. Acquisition Corp.
Dispatch Management Services Delaware 1 100% N/A
San Francisco Corp.
Dispatch Management Services Delaware 1 100% N/A
New York Corp.
Road Management Services Delaware 1,000 100% N/A
Corporation
Dispatch Management Services England and 15,457,056 100% N/A
(Europe) Limited Wales
Balmerino Holdings Limited New Zealand N/A 100% N/A
Dispatch Management Services Western 1 100% N/A
Australia Pty Ltd Australia
2. Dispatch Management Bridge Wharf Investments Limited England and 75,000 ordinary 100% N/A
Services (Europe) Wales Shares
Limited
Security Business Services England and 840,892 ordinary A 100% N/A
Limited Wales Shares
59,108 ordinary B
Shares
Dispatch Management Services England and 390,871 ordinary A 100% N/A
(UK) Limited Wales Shares
386,899 ordinary B
Shares
773,798 ordinary C
Shares
3. Security Business Services Security Despatch Limited England and 1,243,362 ordinary 100% N/A
Limited Wales shares
Schedule 6.18 to
Credit Agreement
Environmental
-------------
None
Schedule 6.19 to
Credit Agreement
Intellectual Property
---------------------
Trademarks
----------
US/International Service Xxxx State Service
Owner Xxxx Registration No. Xxxx No.
----- ---- ---------------- --------
Dispatch Management Services Corp. DMS 2,208,273
(Application No. 75/289,608)
Dispatch Management Services Corp. RMS 2,205,099
(Application No. 75/289,623)
Dispatch Management Services Corp. 1-800-DELIVER 1,809,612
(assigned to DMS 11/04/98)
Dispatch Management Services San AERO SPECIAL DELIVERY (AND DESIGN) 1979837
Francisco Corp.
Dispatch Management Services San SPARKIE'S DELIVERY SERVICE (AND 45416
Francisco Corp. DESIGN) (California)
Dispatch Management Services FLEETFOOT MESSENGER SERVICE 26,884
Acquisition Corp. d/b/a Fleetfoot (STYLIZED) (Washington)
Messenger Service
Bridge Wharf Investments Ltd. WEST I WEST 1 (AND DESIGN) 131302500
Dispatch Management Services (UK) DELTA (AND DESIGN) 1278896
Limited (f/k/a Delta Air & Road
Transport Limited)
Patents
-------
None
Copyrights
----------
None
Additional information regarding trademark activity of the Credit Parties is
attached hereto as Exhibit A.
Exhibit A to
Schedule 6.19 to
Credit Agreement
U.S. Service Xxxx Application for MISCELLANEOUS DESIGN (Kiwi Bird logo)
Application No. 75/282,846 filed on April 28, 1997 with the U.S. Patent and
Trademark Office.
Application abandoned; a new application will be filed in the near future.
U.S. Service Xxxx Application for MMS
Application No. 75/289,622 filed on May 9, 1997 with the U.S. Patent and
Trademark Office.
Application abandoned.
U.S. Service Xxxx/Trademark Application for KES and KIWI EXPRESS SYSTEMS
U.S. Copyright Application for Computer Source Code
According to Xxxxx Xxxxx, who has been asked by Xxxxx Xxxxxxxxx to serve as
an intermediary between DMS and Xxxxxxxxxxx & Xxxxxxx, the attorneys who
have been retained to register the KES and KIWI EXPRESS SYSTEMS marks and
the computer source code copyright, no applications to register either the
service marks or the copyright have yet been filed.
Right to Use U.S. Service Xxxx 800-COURIER
Dispatch Management Services Corp. obtained the right to use the
U.S./Canadian service xxxx 800-COURIER pursuant to an Assignment Agreement,
dated as of November 5, 1997, among ATC Telecom, Ltd., ATC Telecom, Inc.,
[new corporate name of what was formerly 800 COURIER INC.], Aexpak
Worldwide, Inc., Xxxxxxx Xxxxxxxxx, Express-It Courier Services, Inc.,
800-Courier, Inc. f/k/a Express-It Courier Services Network, Inc.
("Network"), American Eagle Endeavors, Inc., American Eagle Express, Inc.
(a Minnesota corporation), American Eagle Express, Inc. (an Arizona
corporation), Xxxxx Xxxxxxxx, Xxxxxxxxx Xxxxxxx and Dispatch Management
Services Corp. The Owner of the service xxxx is ATC Telecom, Inc. The
registration number of the U.S. service xxxx is 1800259 and the
registration number of the Canadian service xxxx is TMA 393370.
Schedule 6.21 to
Credit Agreement
Investments
-----------
None
Schedule 6.22(a) to
Credit Agreement
Personal Property Locations
---------------------------
Credit Party Locations
------------ ---------
1. Dispatch Management Services Corp. Lake Success, New York
2. Dispatch Management Services Acquisition Corp. Atlanta, Georgia
(Xxxxxx County)
Beltsville, Maryland
Boston, Massachusetts
Charlotte, North Carolina
(Mecklenburg County)
Chicago, Illinois
Dallas, Texas
Denver, Colorado
Detroit, Michigan
Houston, Texas
Minneapolis, Minnesota
Nashua, New Hampshire
Nashville, Tennessee
Philadelphia, Pennsylvania
Phoenix, Arizona
Portland, Oregon
Seattle, Washington
Washington, D.C.
3. Dispatch Management Services New York Corp. Clifton, New Jersey
Elizabeth, New Jersey
West Orange, New Jersey
New York, New York
4. Dispatch Management Services San Francisco Corp. Culver City, California
Los Angeles, California
San Francisco, California
5. Road Management Services Corp. Winchester, Massachusetts
6. Dispatch Management Services (Europe) Limited England
7. Bridge Wharf Investments Limited England
8. Security Business Services Limited England
9. Dispatch Management Services (UK) Limited England
Schedule 6.22(b) to
Credit Agreement
Chief Executive Offices
-----------------------
Credit Party Chief Executive Offices
------------ -----------------------
1. Dispatch Management Services Corp. Lake Success, New York
2. Dispatch Management Services Acquisition Corp. Lake Success, New York
3. Dispatch Management Services New York Corp. New York, New York
4. Dispatch Management Services San Francisco Corp. San Francisco, California
5. Road Management Services Corp. Winchester, Massachusetts
6. Dispatch Management Services (Europe) Limited London, England
7. Xxxxxx Xxxxx Xxxxxxxxxxx Xxxxxxx Xxxxxx, Xxxxxxx
8. Security Business Services Limited London, England
9. Dispatch Management Services (UK) Limited London, England
Schedule 6.23 to
Credit Agreement
Insurance
---------
See attached
Schedule 6.30 to
Credit Agreement
Seller Obligations
------------------
See Attached
Schedule 8.2 to
Credit Agreement
Liens
-----
LIEN SEARCH RESULTS IN CHRONOLOGICAL ORDER
FOR
BULLIT COURIER
===================================================================================================================================
NAME AS SEARCH FED ST. FILE
SHOWN ON SECURED THRU TAX TAX DATE SEARCH
STATEMENT PARTY JURISDICTIONS DATE UCC LIENS LIENS JUDGE & NO. RESULTS
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Xxxxxx Xxxxxxx Xxx Xxxx Secretary 5/20/98 X X CLEAR
of State
-----------------------------------------------------------------------------------------------------------------------------------
Bullit Courier Criminal Court of New York City 3/16/98 X X X X 598049/94N Judgment -
000 Xxxxx Xxxxxx the City of New York Register 5/21/98 5/21/98 3/21/96 $200.00
Brooklyn, NY 000 Xxxxxxxx
Xxx Xxxx, XX 00000
-----------------------------------------------------------------------------------------------------------------------------------
Bullit Courier Criminal Court of New York City 3/16/98 X X X X 94N598320X Judgment -
000 Xxxxx Xxxxxx the City of New York Register 5/21/98 5/21/98 3/29/96 $250.00
Brooklyn, NY 000 Xxxxxxxx
Xxx Xxxx, XX 00000
-----------------------------------------------------------------------------------------------------------------------------------
Bullit Courier Criminal Court of New York City 3/16/98 X X X X 598051/94N Judgment -
000 Xxxxx Xxxxxx the City of New York Register 5/21/98 5/21/98 4/1/96 $200.00
Brooklyn, NY 000 Xxxxxxxx
Xxx Xxxx, XX 00000
-----------------------------------------------------------------------------------------------------------------------------------
Bullit Courier Criminal Court of New York City 3/16/98 X X X X 598321/94N Judgment -
000 Xxxxx Xxxxxx the City of New York Register 5/21/98 5/21/98 4/3/96 $1000.00
Brooklyn, NY 000 Xxxxxxxx
Xxx Xxxx, XX 00000
===================================================================================================================================
Schedule 8.2 to
Credit Agreement
LIEN SEARCH RESULTS IN CHRONOLOGICAL ORDER
FOR
EXPRESS DELIVERY
====================================================================================================================================
NAME AS SEARCH FED ST. FILE
SHOWN ON SECURED THRU TAX TAX DATE SEARCH
STATEMENT PARTY JURISDICTIONS DATE UCC LIENS LIENS JUDGE & NO. RESULTS
====================================================================================================================================
Express Delivery New York Secretary 5/20/98 X X CLEAR
of State
-----------------------------------------------------------------------------------------------------------------------------------
Express Delivery Inc. New York State New York City 3/16/98 X X X X 001909584-01 New York
000 Xxxxxx Xx. Department of Register 5/21/98 5/21/98 5/18/98 State Tax
Xxx Xxxx, XX 00000 Taxation and Finance Xxxxxxx
00 Xxxxxx Xxxxx $2,826.27
Xxxxxxxx, XX 00000
-----------------------------------------------------------------------------------------------------------------------------------
Express Delivery Inc. Commissioner of New York City 3/16/98 X X X X 001001642-01 Judgment
000 Xxxxxx Xx. Labor Register 5/21/98 5/21/98 6/6/97 $7,046.06
Xxx Xxxx, XX 00000 Department of Labor
Albany, NY
-----------------------------------------------------------------------------------------------------------------------------------
Express Delivery Inc. Commissioner of New York City 3/16/98 X X X X 001003874-01 Judgment
000 Xxxxxx Xx. Labor Register 5/21/98 5/21/98 6/20/97 $8,303.48
Xxx Xxxx, XX 00000 Department of Labor
Albany, NY
-----------------------------------------------------------------------------------------------------------------------------------
Express Delivery Inc. Commissioner of New York City 3/16/98 X X X X 001018426-01 Judgment
000 Xxxxxx Xx. Labor Register 5/21/98 5/21/98 8/26/97 $3,677.40
Xxx Xxxx, XX 00000 Department of Labor
Albany, NY
-----------------------------------------------------------------------------------------------------------------------------------
Express Delivery Inc. Commissioner of New York City 3/16/98 X X X X 001050048-01 Judgment
000 Xxxxxx Xx. Labor Register 5/21/98 5/21/98 12/23/97 $1,712.03
Xxx Xxxx, XX 00000 Department of Labor
Albany, NY
====================================================================================================================================
Schedule 11.1 to
Credit Agreement
Notices
-------
Credit Parties
--------------
Name of Credit Party
c/o Marko Bogoievski
Dispatch Management Services Corp.
0000 Xxxxxx Xxxxxx, Xxxxx X000
Xxxx Xxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Xxxxxx Xxxx, General Counsel
Dispatch Management Services Corp.
00000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Agent
-----
NationsBank, N.A.
Attn: Xxxxxxx Xxxxxx
Xxxxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
NationsBank, N.A.
Attn: Xxxxxxxxx Xxxxx
6610 Rockledge Drive
3rd Floor, MD2-600-0301
Xxxxxxxx, XX 00000
Schedule 11.1 to
Credit Agreement
Lenders
-------
NationsBank, N.A.
Attn: Xxxxxxxxx Xxxxx
6610 Rockledge Drive
3rd Floor, MD2-600-0301
Xxxxxxxx, XX 00000
BankBoston, N.A.
Attn: C. Xxxxxxxxxxx Xxxxx
Transportation Division
Mail Stop 01-06-01
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
First Union National Bank
Attn: Xxxxx Xxx
0000 Xxxxx Xxxxxx Xxxx, 0 Xxxxx
XxXxxx, XX 00000
CIBC, Inc.
Attn: Xxxxxx Xxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Fleet Bank, N.A.
Attn: Xxx Xxxxxxx
000 Xxxx Xxxxxx
Mail Code XXX0X00X
Xxxxxxxx, XX 00000
Exhibit 2.1(b) to
Credit Agreement
FORM OF NOTICE OF BORROWING
TO: NATIONSBANK, N.A., as Administrative Agent
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
RE: Amended and Restated Credit Agreement dated as of April 8, 1999 among
Dispatch Management Services Corp. (the "Borrower"), the Material
Subsidiaries of the Borrower, NationsBank, N.A., as Administrative
Agent, and the Lenders party thereto (as the same may be amended,
modified, extended or restated from time to time, the "Credit
Agreement")
DATE: _____________, ____
1. This Notice of Borrowing is made pursuant to the terms of the Credit
Agreement. All capitalized terms used herein unless otherwise defined shall
have the meanings set forth in the Credit Agreement.
2. Please be advised that the Borrower is requesting a Revolving Loan in the
amount of $______________ to be funded on ____________, ____ at the
interest rate option set forth in paragraph 3 below.
3. The interest rate option applicable to the requested Revolving Loan shall
be equal to:
a. ________ the Adjusted Base Rate
b. ________ the Adjusted Eurocurrency Rate for an Interest Period of:
________ one month
________ two months
________ three months
________ six months
4. On and as of the date of the requested Revolving Loan, immediately after
giving effect to the funding and the application thereof, the sum of the
aggregate amount of Revolving Loans outstanding plus the aggregate amount
of LOC Obligations outstanding will be $__________, which is less than or
equal to the Revolving Committed Amount.
5. On and as of the date of the requested Revolving Loan, immediately after
giving effect to the funding and the application thereof, the
representations and warranties made by the Credit Parties in any Credit
Document are true and correct in all material respects except to the extent
they expressly relate to an earlier date.
6. No Default or Event of Default exists or is continuing or will be caused by
giving effect to this Notice of Borrowing.
DISPATCH MANAGEMENT SERVICES CORP.
By:____________________________________
Name:__________________________________
Title:_________________________________
Exhibit 2.3 to
Credit Agreement
FORM OF NOTICE OF CONTINUATION/CONVERSION
TO: NATIONSBANK, N.A., as Administrative Agent
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
RE: Amended and Restated Credit Agreement entered into as of April 8, 1999
among Dispatch Management Services Corp. (the "Borrower"), the
Material Subsidiaries of the Borrower, NationsBank, N.A., as
Administrative Agent, and the Lenders party thereto (as the same may
be amended, modified, extended or restated from time to time, the
"Credit Agreement")
DATE: _____________, ____
1. This Notice of Continuation/Conversion is made pursuant to the terms of the
Credit Agreement. All capitalized terms used herein unless otherwise
defined shall have the meanings set forth in the Credit Agreement.
2. Please be advised that the Borrower is requesting that a portion of the
current outstanding Revolving Loans, in the amount of $ , be continued or
converted at the interest rate option set forth in paragraph 3 below.
3. The interest rate option applicable to the continuation or conversion of
all or part of the existing Revolving Loans shall be equal to:
a. ________ the Adjusted Base Rate
b. ________ the Adjusted Eurocurrency Rate for an Interest Period of:
________ one month
________ two months
________ three months
________ six months
4. Subsequent to the continuation or conversion of the Revolving Loans, as
requested herein, the sum of the aggregate amount of Revolving Loans
outstanding plus the aggregate amount of LOC Obligations outstanding will
be $_______, which is less than or equal to the Revolving Committed Amount.
5. No Default or Event of Default has occurred and is continuing or would be
caused by giving effect to this Notice of Continuation/ Conversion.
DISPATCH MANAGEMENT SERVICES CORP.
By:____________________________________
Name:__________________________________
Title:_________________________________
Exhibit 2.5 to
Credit Agreement
FORM OF AMENDED AND RESTATED
REVOLVING NOTE
__________, 1999
FOR VALUE RECEIVED, DISPATCH MANAGEMENT SERVICES CORP., a Delaware
corporation (the "Borrower"), hereby promises to pay to the order of
______________ (the "Lender"), at the office of NationsBank, N.A. (the
"Administrative Agent") as set forth in that certain Amended and Restated Credit
Agreement dated as of April 8, 1999 among the Borrower, the Material
Subsidiaries of the Borrower, the Lenders named therein (including the Lender)
and NationsBank, N.A., as Administrative Agent (as the same may be amended,
modified, extended or restated from time to time, the "Credit Agreement") (or at
such other place or places as the holder of this Revolving Note may designate),
the aggregate principal amount of all advances made by the Lender as Revolving
Loans (and not otherwise repaid), in Dollars and in immediately available funds,
on the dates and in the principal amounts provided in the Credit Agreement, and
to pay interest on the unpaid principal amount of each Revolving Loan made by
the Lender, at such office, in like money and funds, for the period commencing
on the date of each Revolving Loan until each Revolving Loan shall be paid in
full, at the rates per annum and on the dates provided in the Credit Agreement.
This Note is one of the Revolving Notes referred to in the Credit Agreement
and evidences Revolving Loans made by the Lender thereunder. The Lender shall be
entitled to the benefits of the Credit Agreement. Capitalized terms used in this
Revolving Note have the respective meanings assigned to them in the Credit
Agreement and the terms and conditions of the Credit Agreement are expressly
incorporated herein and made a part hereof.
The Credit Agreement provides for the acceleration of the maturity of the
Revolving Loans evidenced by this Revolving Note upon the occurrence of certain
events (and for payment of collection costs in connection therewith) and for
prepayments of Revolving Loans upon the terms and conditions specified therein.
In the event this Revolving Note is not paid when due at any stated or
accelerated maturity, the Borrower agrees to pay, in addition to the principal
and interest, all costs of collection, including reasonable attorney fees.
Except as permitted by Section 11.3(b) of the Credit Agreement, this
Revolving Note may not be assigned by the Lender to any other Person.
The date, amount, type, interest rate and duration of Interest Period (if
applicable) of each Revolving Loan made by the Lender to the Borrower, and each
payment made on account of the principal thereof, shall be recorded by the
Administrative Agent and the Lender on its books; provided that the failure of
the Administrative Agent or the Lender to make any such recordation shall not
affect the obligations of the Borrower to make a payment when due of any amount
owing hereunder or under this Revolving Note in respect of the Revolving Loans
to be evidenced by this Revolving Note, and each such recordation shall be prima
facie evidence of the obligations owing under this Revolving Note absent
manifest error.
THIS REVOLVING NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NORTH CAROLINA.
This Amended and Restated Revolving Note is given in replacement and
substitution of that certain Revolving Note, dated as of _____________, 199__,
executed and delivered by the Borrower in favor of the Lender and represents the
same indebtedness as that replaced Note.
IN WITNESS WHEREOF, the Borrower has caused this Note to be executed as of
the date first above written.
DISPATCH MANAGEMENT SERVICES CORP.,
a Delaware corporation
By:____________________________________
Name:__________________________________
Title:_________________________________
Exhibit 7.1(d) to
Credit Agreement
FORM OF OFFICER'S CERTIFICATE
TO: NationsBank, N.A., as Administrative Agent
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
RE: Amended and Restated Credit Agreement dated as of April 8, 1999 among
Dispatch Management Services Corp. (the "Borrower"), the Material
Subsidiaries of the Borrower, NationsBank, N.A., as Administrative
Agent, and the Lenders party thereto (as the same may be amended,
modified, extended or restated from time to time, the "Credit
Agreement")
DATE: ______________ ___, _______
--------------------------------------------------------------------------------
Pursuant to the terms of the Credit Agreement, I, ______________, Chief
Financial Officer of Dispatch Management Services Corp. hereby certify that, as
of the fiscal quarter/month ending ______________, the statements below are
accurate and complete in all respects (all capitalized terms used below shall
have the meanings set forth in the Credit Agreement):
a. Attached hereto as Schedule 1 are calculations (calculated as of
the date of the financial statements/reports referred to in paragraph c.
below) demonstrating compliance by the Credit Parties with the financial
covenants contained in Section 7.2 of the Credit Agreement.
b. No Default or Event of Default exists under the Credit Agreement,
except as indicated on a separate page attached hereto, together with an
explanation of the action taken or proposed to be taken by the Borrower
with respect thereto.
c. [The quarterly/annual financial statements for the fiscal
quarter/year ended __________ which accompany this certificate fairly
present in all material respects the financial condition of the Credit
Parties and their Subsidiaries and have been prepared in accordance with
GAAP, subject to changes resulting from normal year-end audit adjustments.]
[The summary of aged accounts receivable and other monthly reports for the
month ended __________ which accompany this certificate are true and
correct in all material respects and fairly present in all material
respects the financial condition of the Credit Parties and their
Subsidiaries.]
DISPATCH MANAGEMENT SERVICES CORP.
By:_____________________________________
Chief Financial Officer
Schedule 1 to
Exhibit 7.1(d) to
Credit Agreement
*A. Minimum EBITDA.
1. Net Income $__________________
2. +/- extraordinary gains/non-cash losses $__________________
3. + Interest Expense $__________________
4. + Taxes $__________________
5. + Depreciation/Amortization $__________________
6. + Non-Cash Charges $__________________
7. + Approved Adjustments $__________________
8. EBITDA for quarter $__________________
9. Annualized EBITDA (Line 8 x 4) $__________________
10. Funded Debt (if applicable) $__________________
11. Seller Obligations (if applicable) $__________________
12. Leverage Ratio (if applicable)
(Line 10 + Line 11 + Line 8) : 1.0
------
Minimum EBITDA Required:
Fiscal quarter ending 3/31/99 $2,350,000
Fiscal quarter ending 6/30/99 $4,750,000
Fiscal quarter ending 9/30/99 $5,920,000
Fiscal quarter ending 12/31/99 and thereafter $6,500,000
or Line 12 shall be <3.0:1.0
-------
Schedule 1 to
Exhibit 7.1(d) to
Credit Agreement
*B. Collateral Coverage Ratio.
1. Gross Accounts Receivable <60 days $__________________
2. Revolving Loans Outstanding $__________________
3. LOC Obligations Outstanding $__________________
4. Collateral Coverage Ratio: %
(Line 1 + Line 2 + Line 3) -----
Minimum Collateral Coverage Ratio Required:
Closing Date through 8/31/99 35 %
----
9/1/99 through 11/30/99 37.5 %
------
12/1/99 and thereafter 40 %
----
*C. Interest Coverage Ratio.
1. EBITDA (see Line A8 above) $__________________
2. Interest Expense $__________________
3. Interest Charge Coverage Ratio : 1.0
------
(Line 1 + Line 2)
Minimum Interest Coverage Ratio Required:
Fiscal quarter ending 3/31/99 1.25 : 1.0
----------
Fiscal quarter ending 6/30/99 2.00 : 1.0
----------
Fiscal quarter ending 9/30/99 and thereafter 2.50 : 1.0
----------
D. Minimum Net Income.
For the month ended _________, the Net Income of the Borrower and its
Subsidiaries on a consolidated basis (before taxes and excluding the effect of
any extraordinary or other non-recurring gains (including any gain from the sale
of property) or one-time non-cash losses) was positive.
* Financial Covenants A, B and C are calculated quarterly only. Such
calculations will not be made or presented with the monthly reports described in
paragraph c. of the Officer's Certificate above.
Exhibit 7.13 to
Credit Agreement
FORM OF JOINDER AGREEMENT
THIS JOINDER AGREEMENT (this "Agreement"), dated as of _____________,
_____, is entered into between _____________________, a ___________________ (the
"Subsidiary"), and NATIONSBANK, N.A., in its capacity as Administrative Agent
(the "Administrative Agent") under that certain Amended and Restated Credit
Agreement, dated as of April 8, 1999 (as the same may be amended, modified,
extended or restated from time to time, the "Credit Agreement"), among Dispatch
Management Services Corp. (the "Borrower"), the Material Subsidiaries of the
Borrower, the Lenders party thereto and the Administrative Agent. All
capitalized terms used herein and not otherwise defined shall have the meanings
set forth in the Credit Agreement.
The Subsidiary and the Administrative Agent, for the benefit of the
Lenders, hereby agree as follows:
1. The Subsidiary hereby acknowledges, agrees and confirms that, by its
execution of this Agreement, the Subsidiary will be deemed to be a Credit Party
under the Credit Agreement and a "Guarantor" for all purposes of the Credit
Agreement and shall have all of the obligations of a Credit Party and Guarantor
thereunder as if it had executed the Credit Agreement. The Subsidiary hereby
ratifies, as of the date hereof, and agrees to be bound by, all of the terms,
provisions and conditions contained in the Credit Agreement, including without
limitation (a) all of the representations and warranties of the Credit Parties
set forth in Section 6 of the Credit Agreement, (b) all of the affirmative and
negative covenants set forth in Sections 7 and 8 of the Credit Agreement and (c)
all of the guaranty obligations set forth in Section 4 of the Credit Agreement.
Without limiting the generality of the foregoing terms of this paragraph 1, the
Subsidiary, subject to the limitations set forth in Section 4.7 of the Credit
Agreement, hereby guarantees, jointly and severally with the other Guarantors,
to the Administrative Agent and the Lenders, as provided in Section 4 of the
Credit Agreement, the prompt payment when due, by acceleration or otherwise, of
the Credit Party Obligations, including in the case of any extension of time of
payment or renewal of any of the Credit Party Obligations, the prompt payment
and performance in full when due (whether at extended maturity, as a mandatory
prepayment, by acceleration, as a mandatory cash collateralization or otherwise)
in accordance with the terms of such extension or renewal. Without limiting the
generality of the foregoing terms of this paragraph 1, the Subsidiary hereby (a)
acknowledges, agrees and confirms that, by its execution of this Agreement, the
Subsidiary will be deemed a party to the Security Agreement as a "Credit Party"
and a party to the Pledge Agreement as a "Pledgor", (b) acknowledges and agrees
that its obligations under the Credit Agreement are secured in accordance with
the terms of the Security Agreement, the Pledge Agreement and the other
Collateral Documents and that the Lenders may exercise their remedies thereunder
in accordance with the terms thereof, (c) grants to the Collateral Agent, for
the benefit of the Lenders, a continuing security interest in, and a right to
set off against, any and all right, title and interest of the Subsidiary in and
to the Collateral (as defined in the Security Agreement) and (d) pledges and
grants to the Collateral Agent, for the benefit of the Lenders, a security
interest in the Pledged Shares (as defined in the Pledge Agreement) identified
on Schedule A attached hereto and all of the Pledged Collateral (as defined in
the Pledge
Agreement). The Subsidiary hereby represents and warrants to the Administrative
Agent and the Lenders that (a) set forth on Schedule B attached hereto is a list
of (i) all locations where any personal property of the Subsidiary is located
and (ii) the chief executive offices and principal place of business of the
Subsidiary, (b) set forth on Schedule C attached hereto is a list of all
registrations and applications for Intellectual Property owned by the Subsidiary
and a list of all license agreements to which the Subsidiary is a party relating
to Intellectual Property that the Subsidiary has a right to use, (c) set forth
on Schedule D attached hereto is a complete and accurate list of all
Subsidiaries of the Subsidiary and (d) set forth on Schedule E attached hereto
are any tradenames of the Subsidiary. Each of Schedule 6.22(a) and Schedule
6.22(b) of the Credit Agreement and Schedule 5(c) of the Security Agreement are
hereby deemed amended to include the information on Schedule B through Schedule
E attached hereto, as applicable.
3. The address of the Subsidiary for purposes of Section 11.1 of the Credit
Agreement is as follows:
___________________________
___________________________
___________________________
___________________________
4. The Subsidiary hereby waives acceptance by the Administrative Agent and
the Lenders of the guaranty by the Subsidiary under the Credit Agreement upon
the execution of this Agreement by the Subsidiary.
5. This Agreement may be executed in any number of counterparts, each of
which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument.
6. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NORTH CAROLINA.
IN WITNESS WHEREOF, the Subsidiary has caused this Agreement to be duly
executed by its authorized officer, and the Administrative Agent, for the
benefit of the Lenders, has caused the same to be accepted by its authorized
officer, as of the day and year first above written.
[SUBSIDIARY]
By:_______________________________________
Name:_____________________________________
Title:____________________________________
Acknowledged and accepted:
NATIONSBANK, N.A., as Administrative Agent
By:_______________________________________
Name:_____________________________________
Title:____________________________________
Exhibit 11.3 to
Credit Agreement
FORM OF ASSIGNMENT AGREEMENT
Reference is made to that certain Amended and Restated Credit Agreement,
dated as of April 8, 1999, among Dispatch Management Services Corp. (the
"Borrower"), the Material Subsidiaries of the Borrower, the Lenders party
thereto and NationsBank, N.A., as Administrative Agent for the Lenders (as the
same may be amended, modified, extended or restated from time to time, the
"Credit Agreement"). Terms defined in the Credit Agreement are used herein with
the same meanings.
1. The Assignor hereby sells and assigns to the Assignee, without recourse
and without representation and warranty except as expressly set forth herein,
and the Assignee hereby purchases and assumes from the Assignor, without
recourse and without representation and warranty except as expressly set forth
herein, the interests set forth below (the "Assigned Interest") in the
Assignor's rights and obligations under the Credit Agreement, including, without
limitation, the interests set forth below in the Revolving Loan Commitment
Percentage of the Assignor on the Effective Date (as defined below) and the
Loans and LOC Obligations owing to the Assignor in connection with the Assigned
Interest which are outstanding on the Effective Date. The purchase of the
Assigned Interest shall be at par (unless otherwise agreed to by the Assignor
and the Assignee) and periodic payments made with respect to the Assigned
Interest which (a) accrued prior to the Effective Date shall be remitted to the
Assignor and (b) accrue from and after the Effective Date shall be remitted to
the Assignee.
2. The Assignor (a) represents and warrants to the Assignee that it is the
legal and beneficial owner of the Assigned Interest and that the Assigned
Interest has not previously been transferred or encumbered and is free and clear
of any adverse claim; (b) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Documents or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Documents or any other instrument or document furnished pursuant thereto; (c)
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of the Credit Parties or the performance or
observance by the Credit Parties of any of their obligations under the Credit
Documents or any other instrument or document furnished pursuant thereto; and
(d) attaches the Note held by the Assignor and requests that the Administrative
Agent exchange such Note for a new Note payable to the order of the Assignee in
an amount equal to the Commitment assumed by the Assignee pursuant hereto and to
the Assignor in an amount equal to the Commitment retained by the Assignor, if
any, as specified herein.
3. The Assignee (a) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements referred to in
Section 7.1 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment; (b) agrees that it will, independently and without reliance upon the
Administrative Agent, the Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement; (c) confirms that it is an
Eligible Assignee; (d) appoints and authorizes the Administrative Agent to take
such action as agent on its behalf and to exercise such powers and discretion
under the Credit Agreement as are delegated to the Administrative Agent by the
terms thereof, together with such powers and discretion as are reasonably
incidental thereto; (e) agrees that it will perform in accordance with their
terms all of the obligations that by the terms of the Credit Agreement are
required to be performed by it as a Lender; and (f) attaches any U.S. Internal
Revenue Service or other forms required under Section 3.13.
4. Following the execution of this Assignment, it will be delivered to the
Administrative Agent, together with the transfer fee required pursuant to
Section 11.3(b) of the Credit Agreement, for acceptance and recording by the
Administrative Agent. The effective date for this Assignment (the "Effective
Date") shall be the date of acceptance hereof by the Administrative Agent and
the Borrower, as applicable, unless otherwise specified herein.
5. Upon the consent of the Borrower and the Administrative Agent, as
applicable, as of the Effective Date, (a) the Assignee shall be a party to the
Credit Agreement and, to the extent provided in this Assignment, have the rights
and obligations of a Lender thereunder and (b) the Assignor shall, to the extent
provided in this Assignment, relinquish its rights and be released from its
obligations under the Credit Agreement.
6. This Assignment shall be governed by, and construed in accordance with,
the laws of the State of North Carolina.
7. This Assignment may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
8. Terms of Assignment
(a) Legal Name of Assignor: ________________
(b) Legal Name of Assignee: ________________
(c) Effective Date of Assignment: ________________
(d) Revolving Loan Commitment
Percentage Assigned: _______________%
(e) Total Revolving Loans
outstanding as of
Effective Date $_______________
(f) Principal Amount of Revolving Loans
assigned on Effective Date (the amount
set forth in (e) multiplied by the
percentage set forth in (d)) $_______________
(g) LOC Obligations outstanding as of
Effective Date $_______________
(h) Principal Amount of LOC Obligations
assigned on Effective Date (the amount
set forth in (g) multiplied by the
percentage set forth in (d)) $_______________
(i) Revolving Commitment Amount $_______________
(j) Principal Amount of Revolving Committed
Amount assigned on Effective Date (the
amount set forth in (i) multiplied by
the percentage set forth in (e)) $_______________
The terms set forth above are hereby agreed to:
_______________________, as Assignor
By:_____________________________________________
Name:___________________________________________
Title:__________________________________________
____________________, as Assignee
By:_____________________________________________
Name:___________________________________________
Title:__________________________________________
CONSENTED TO (if applicable):
DISPATCH MANAGEMENT SERVICES CORP.
By:____________________________________
Name:__________________________________
Title:_________________________________
NATIONSBANK, N.A.,
as Administrative Agent
By:____________________________________
Name:__________________________________
Title:_________________________________
