EXECUTION COPY
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CREDIT AGREEMENT
dated as of October 17, 1996,
as Amended and Restated as of August 7, 1997,
among
RYDER TRS, INC.,
THE LENDERS NAMED HEREIN,
CITICORP USA, INC.,
as Administrative Agent and as Collateral Agent
and
THE CHASE MANHATTAN BANK,
as Documentation Agent
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[CS&M Reference No. 6700-461]
TABLE OF CONTENTS
Page
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ARTICLE I
Definitions
SECTION 1.01. Defined Terms............................................ 1
SECTION 1.02. Terms Generally.......................................... 21
ARTICLE II
The Credits
SECTION 2.01. Commitments.............................................. 22
SECTION 2.02. Loans.................................................... 22
SECTION 2.03. Borrowing Procedure...................................... 23
SECTION 2.04. Evidence of Debt; Repayment of Loans..................... 23
SECTION 2.05. Fees..................................................... 24
SECTION 2.06. Interest on Loans........................................ 24
SECTION 2.07. Default Interest......................................... 25
SECTION 2.08. Alternate Rate of Interest............................... 25
SECTION 2.09. Termination and Reduction of Commitments................. 25
SECTION 2.10. Conversion and Continuation of Borrowings............... 26
SECTION 2.11. Intentionally Omitted.................................... 27
SECTION 2.12. Optional Prepayment...................................... 27
SECTION 2.13. Mandatory Prepayments.................................... 27
SECTION 2.14. Reserve Requirements; Change in Circumstances............ 28
SECTION 2.15. Change in Legality....................................... 29
SECTION 2.16. Indemnity................................................ 30
SECTION 2.17. Pro Rata Treatment....................................... 31
SECTION 2.18. Sharing of Setoffs....................................... 31
SECTION 2.19. Payments................................................. 31
SECTION 2.20. Taxes.................................................... 32
SECTION 2.21. Assignment of Commitments Under Certain Circumstances;
Duty to Mitigate....................................... 34
ARTICLE III
Representations and Warranties
SECTION 3.01. Organization; Powers..................................... 35
SECTION 3.02. Authorization............................................ 35
SECTION 3.03. Enforceability........................................... 35
SECTION 3.04. Governmental Approvals................................... 35
SECTION 3.05. Financial Statements..................................... 35
Contents, p. 2
SECTION 3.06. No Material Adverse Change............................... 36
SECTION 3.07. Title to Properties; Possession Under Leases............. 36
SECTION 3.08. Subsidiaries............................................. 36
SECTION 3.09. Litigation; Compliance with Laws......................... 36
SECTION 3.10. Agreements............................................... 37
SECTION 3.11. Federal Reserve Regulations.............................. 37
SECTION 3.12. Investment Company Act; Public Utility Holding
Company Act............................................ 37
SECTION 3.13. Use of Proceeds.......................................... 37
SECTION 3.14. Tax Returns.............................................. 37
SECTION 3.15. No Material Misstatements................................ 37
SECTION 3.16. Employee Benefit Plans................................... 38
SECTION 3.17. Environmental Matters.................................... 38
SECTION 3.18. Insurance................................................ 39
SECTION 3.19. Security Documents....................................... 39
SECTION 3.20. Location of Leased Premises; No Real Property............ 39
SECTION 3.21. Labor Matters............................................ 39
SECTION 3.22. Solvency................................................. 40
SECTION 3.23. Lease.................................................... 40
ARTICLE IV
Conditions of Lending
SECTION 4.01. All Borrowings........................................... 40
SECTION 4.02. Effectiveness............................................ 40
ARTICLE V
Affirmative Covenants
SECTION 5.01. Existence; Businesses and Properties..................... 41
SECTION 5.02. Insurance................................................ 41
SECTION 5.03. Obligations and Taxes.................................... 43
SECTION 5.04. Financial Statements, Reports, etc....................... 43
SECTION 5.05. Litigation and Other Notices............................. 44
SECTION 5.06. Employee Benefits........................................ 45
SECTION 5.07. Maintaining Records; Access to Properties and
Inspections............................................ 45
SECTION 5.08. Use of Proceeds.......................................... 45
SECTION 5.09. Compliance with Environmental Laws....................... 45
SECTION 5.10. Preparation of Environmental Reports..................... 45
SECTION 5.11. Audits................................................... 46
SECTION 5.12. Interest Rate Protection................................. 46
SECTION 5.13. Consents of Lessors...................................... 46
SECTION 5.14. Intentionally Omitted.................................... 46
SECTION 5.15. Vehicle Fleet............................................ 46
SECTION 5.16. Further Assurances....................................... 46
Contents, p. 3
ARTICLE VI
Negative Covenants
SECTION 6.01. Indebtedness............................................. 47
SECTION 6.02. Liens.................................................... 49
SECTION 6.03. Sale and Lease-Back Transactions......................... 50
SECTION 6.04. Investments, Loans and Advances.......................... 50
SECTION 6.05. Mergers, Consolidations, Sales of Assets and
Acquisitions........................................... 51
SECTION 6.06. Dividends and Distributions; Restrictions on Ability of
Subsidiaries to Pay Dividends.......................... 52
SECTION 6.07. Transactions with Affiliates............................. 52
SECTION 6.08. Business of Borrower and Subsidiaries.................... 52
SECTION 6.09. Other Indebtedness and Agreements........................ 52
SECTION 6.10. Capital Stock............................................ 53
SECTION 6.11. Total Debt Ratio......................................... 53
SECTION 6.12. Fixed Charge Coverage Ratio.............................. 53
SECTION 6.13. Non-Vehicle Consolidated Capital Expenditures............ 53
SECTION 6.14. Bank Accounts............................................ 54
SECTION 6.15. Fiscal Year.............................................. 54
ARTICLE VII
Events of Default 54
ARTICLE VIII
The Administrative Agent and the Collateral Agent 57
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices.................................................. 59
SECTION 9.02. Survival of Agreement.................................... 60
SECTION 9.03. Binding Effect........................................... 60
SECTION 9.04. Successors and Assigns................................... 60
SECTION 9.05. Expenses; Indemnity...................................... 63
SECTION 9.06. Right of Setoff.......................................... 65
SECTION 9.07. Applicable Law........................................... 65
SECTION 9.08. Waivers; Amendment....................................... 65
SECTION 9.09. Interest Rate Limitation................................. 66
SECTION 9.10. Entire Agreement......................................... 66
SECTION 9.11. Waiver of Jury Trial..................................... 66
Contents, p. 4
SECTION 9.12. Severability............................................. 67
SECTION 9.13. Counterparts............................................. 67
SECTION 9.14. Headings................................................. 67
SECTION 9.15. Jurisdiction; Consent to Service of Process.............. 67
SECTION 9.16. Confidentiality.......................................... 67
Exhibits and Schedules
Exhibit A Form of Administrative Questionnaire
Exhibit B Form of Assignment and Acceptance
Exhibit C Form of Borrowing Request
Exhibit D Form of Guarantee Agreement
Exhibit E Form of Indemnity, Subrogation and Contribution
Agreement
Exhibit F Form of Pledge Agreement
Exhibit G Form of Security Agreement
Exhibit H Form of Opinion of Xxxxxxx Xxxx & Xxxxxxxxx
Schedule 1.01 Guarantors
Schedule 2.01 Commitments
Schedule 3.04 Government Approvals
Schedule 3.07 Title
Schedule 3.08 Subsidiaries
Schedule 3.09 Litigation
Schedule 3.17 Environmental Matters
Schedule 3.18 Insurance
Schedule 3.20 Leased Real Property
Schedule 6.01(a) Indebtedness
Schedule 6.02(a) Liens
Schedule 9.04 Restricted Assignees
CREDIT AGREEMENT dated as of October 17, 1996, as amended
and restated as of August 7, 1997, among RYDER TRS, INC., a
Delaware corporation (the "Borrower"), the Lenders (as defined in
Article I), CITICORP USA, INC., a Delaware corporation, as
administrative agent (in such capacity, the "Administrative
Agent") and as collateral agent for the Lenders (in such
capacity, the "Collateral Agent") and THE CHASE MANHATTAN BANK, a
New York, banking corporation, as documentation agent (in such
capacity, the "Documentation Agent" and, together with the
Administrative Agent and the Collateral Agent, the "Agents").
The Borrower has (a) prepaid all outstanding Term Loans (as defined in the
Credit Agreement dated as of October 17, 1996, among the Borrower, the lenders
named therein, The Chase Manhattan Bank, as administrative agent, and Citicorp
USA, Inc., as documentation agent and collateral agent (the "Existing Credit
Agreement")), together with accrued interest thereon, and (b) permanently
reduced the Revolving Credit Commitments (as defined in the Existing Credit
Agreement) and, in connection therewith, prepaid Revolving Loans (as defined in
the Existing Credit Agreement) and cash collateralized Letters of Credit (as
defined in the Existing Credit Agreement) (collectively, the "Securitization
Prepayments"), in each case with the proceeds of a structured financing (the
"Securitization") consisting of a securitization of the Vehicles owned by Leasco
(such terms and each other capitalized term used but not defined herein having
the meanings given in Article I).
The Borrower has requested the Lenders to extend credit in the form of
Loans at any time and from time to time prior to the Maturity Date, in an
aggregate principal amount at any time outstanding not in excess of $40,000,000.
The proceeds of the Loans are to be used solely for general corporate purposes
in the ordinary course of the Borrower's and its Subsidiaries' business.
The Lenders are willing to extend such credit to the Borrower on the terms
and subject to the conditions set forth herein. Accordingly, the parties hereto
agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the following
terms shall have the meanings specified below:
"ABR Borrowing" shall mean a Borrowing comprised of ABR Loans.
"ABR Loan" shall mean any Loan bearing interest at a rate determined by
reference to the Alternate Base Rate in accordance with the provisions of
Article II.
"Account" shall mean any right to payment for goods sold or leased or for
services rendered, whether or not earned by performance.
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"Account Debtor" shall mean, with respect to any Account, the obligor with
respect to such Account.
"Acquisition" shall mean the acquisition of substantially all the assets of
the Seller's consumer truck rental business unit by the Borrower pursuant to the
Purchase Agreement.
"Acquisition Agreements" shall mean the Purchase Agreement, the
Stockholders' Agreement, the Vehicle Title Nominee Agreement, the Service
Agreements, the Trademark License Agreement, the Software License Agreement, the
Copyright License Agreement, the Patent License Agreement, the Shared Facility
Licenses, the Assumption Agreement and the Office Sublease Agreement (each
such term as defined in the Purchase Agreement) and any other agreement,
instrument or other document to be entered into or delivered by, between or
among the Borrower, the Seller and any of their respective Affiliates in
connection with the Acquisition, as each such agreement, instrument or document
may be amended, modified or supplemented from time to time in accordance with
the terms thereof and hereof.
"Adjusted Consolidated EBITDA" shall mean, for any period for any Person,
Consolidated EBITDA of such Person less the Financed Portion of Vehicle
Depreciation.
"Adjusted LIBO Rate" shall mean, with respect to any Eurodollar Borrowing
for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to the product of (a) the LIBO Rate in
effect for such Interest Period and (b) Statutory Reserves.
"Administrative Questionnaire" shall mean an Administrative Questionnaire
in the form of Exhibit A.
"Affiliate" shall mean, when used with respect to a specified person,
another person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the person
specified.
"Agents" shall have the meaning assigned to such term in the preamble to
this Agreement.
"Agent's Fees" shall have the meaning assigned to such term in Section
2.05(c).
"Aggregate Credit Exposure" shall mean the aggregate amount of the Lenders'
Credit Exposures.
"Aggregate Outstandings" shall have the meaning assigned to such term in
the Liquidity Agreement.
"Alternate Base Rate" shall mean, for any day, a rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to the greatest of (a) the
Prime Rate in effect on such day, (b) the Base CD Rate in effect on such day
plus 1% and (c) the Federal Funds Effective Rate in effect on such day plus 1/2
of 1%. If for any reason the Administrative Agent shall have determined (which
determination shall be conclusive absent manifest error) that it is unable to
ascertain the Base CD Rate or the Federal Funds Effective Rate or both for any
reason, including the inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with
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the terms of the definition thereof, the Alternate Base Rate shall be determined
without regard to clause (b) or (c), or both, of the preceding sentence, as
appropriate, until the circumstances giving rise to such inability no longer
exist. Any change in the Alternate Base Rate due to a change in the Prime Rate,
the Base CD Rate or the Federal Funds Effective Rate shall be effective on the
effective date of such change in the Prime Rate, the Base CD Rate or the Federal
Funds Effective Rate, respectively. The term "Prime Rate" shall mean the rate of
interest per annum publicly announced from time to time by the Administrative
Agent as its prime rate in effect at its principal office in New York City; each
change in the Prime Rate shall be effective on the date such change is publicly
announced as being effective. The term "Base CD Rate" shall mean the sum of (a)
the product of (i) the Three-Month Secondary CD Rate and (ii) Statutory Reserves
and (b) the Assessment Rate. The term "Federal Funds Effective Rate" shall mean,
for any day, the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers, as published on the next succeeding Business Day by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average of the quotations for the day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Amendment Agreement" shall mean the Amendment Agreement dated as of August
7, 1997, among the parties to this Agreement, The Chase Manhattan Bank, as
administrative agent under the Existing Credit Agreement, and the Departing
Lenders (as defined in the Amendment Agreement).
"Applicable Amount of Unused Availability" shall mean, as of any date of
determination, the product of (a) the amount equal to (i) the Net Book Value of
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the Fleet on such date of determination multiplied by (A) one minus (B) the then
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Required Enhancement Percentage minus (ii) the Aggregate Outstandings on such
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date of determination and (b) 25%, if such date of determination is in 1997 or
1998 or 20%, for any date of determination on or after January 1, 1999.
"Applicable Percentage" of any Lender at any time shall mean the percentage
of the Total Commitment represented by such Lender's Commitment. In the event
the Commitments shall have expired or been terminated, the Applicable
Percentages shall be determined on the basis of the Commitments most recently in
effect.
"Assessment Rate" shall mean for any date the annual rate (rounded upwards,
if necessary, to the next 1/100 of 1%) most recently estimated by the
Administrative Agent as the then current net annual assessment rate that will be
employed in determining amounts payable by the Administrative Agent to the
Federal Deposit Insurance Corporation (or any successor thereto) for insurance
by such Corporation (or such successor) of time deposits made in dollars at the
Administrative Agent's domestic offices.
"Assignment and Acceptance" shall mean an assignment and acceptance entered
into by a Lender and an assignee, and accepted by the Administrative Agent, in
the form of Exhibit B or such other form as shall be approved by the
Administrative Agent.
"Average Amount of Unused Availability" shall mean, with respect to any
quarterly period, the arithmetic average of the Applicable Amount of Unused
Availability on the last day of each month of such quarter.
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"Board" shall mean the Board of Governors of the Federal Reserve System of
the United States of America.
"Book Value" shall mean at the time of any determination thereof the book
value, in dollars, of all Eligible Non-Vehicle Revenue-Producing Equipment,
Eligible Non-Vehicle Non-Revenue-Producing Equipment or Eligible Non-Revenue-
Producing Vehicles, as the case may be, as determined on a consolidated basis
for the Borrower and the Subsidiaries in accordance with GAAP.
"Borrowing" shall mean a group of Loans of a single Type made by the
Lenders on a single date and as to which a single Interest Period is in effect.
"Borrowing Base" shall mean, with respect to the Borrower, an amount equal
to the sum of (i) the sum, without duplication, obtained after multiplying the
applicable advance rate percentage set forth on Annex 1 to the Borrowing Base
Certificate by each of the following: (a) Eligible Accounts Receivable, (b) the
Book Value of Eligible Non-Vehicle Revenue-Producing Equipment and (c) the Book
Value of Eligible Non-Revenue-Producing Vehicles, plus (ii) the Eligible
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Intangible Assets Amount. The Borrowing Base shall be computed monthly in
accordance with Section 5.04(e). The Borrowing Base at any time in effect shall
be determined by reference to the Borrowing Base Certificate most recently
delivered hereunder. In the event of any material change in the value of any of
the assets specified in clause (i) (b) or (i)(c) above, the Agents may, as
applicable, (a) decrease the percentage of such assets included in the
calculation of the Borrowing Base (after no less than 10 Business Days' notice
to and consultation with the Borrower) or (b) with the approval of the
Supermajority Lenders, increase the percentage of such assets included in the
calculation of the Borrowing Base.
"Borrowing Base Certificate" shall have the meaning assigned to such term
in Section 5.04(e).
"Borrowing Request" shall mean a request by the Borrower in accordance with
the terms of Section 2.03 and substantially in the form of Exhibit C.
"Business Day" shall mean any day other than a Saturday, Sunday or day on
which banks in New York City are authorized or required by law to close;
provided, however, that when used in connection with a Eurodollar Loan, the term
"Business Day" shall also exclude any day on which banks are not open for
dealings in dollar deposits in the London interbank market.
"Capital Expenditure" shall mean (a) any expenditure (whether paid in cash
or other consideration or accrued as a liability) by the Borrower or any
Subsidiary that, in accordance with GAAP, is or should be included in "additions
to property, plant or equipment" or similar items reflected in the consolidated
statement of cash flows of the Borrower and the Subsidiaries and (b) to the
extent not covered by clause (a), any Capital Lease Obligation of the Borrower
or any Subsidiary.
"Capital Lease Obligations" of any person shall mean the obligations of
such person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
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accounted for as capital leases on a balance sheet of such person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Capitalized Cost" shall mean, with respect to each Vehicle, the aggregate
amount paid in connection with the purchase of such Vehicle by Leasco, such
aggregate amount to include amounts paid (i) to the manufacturer of the cargo
box of such Vehicle, (ii) to the Manufacturer of the chassis of such Vehicle,
(iii) in connection with the transportation or shipping of such Vehicle, (iv) as
dealer profit and delivery charges, (v) in connection with the appropriate
painting and labeling of such Vehicle and (vi) as miscellaneous and servicing
costs, but excluding any registration or titling fees.
A "Change in Control" shall be deemed to have occurred if (a) any person or
group (within the meaning of Rule 13d-5 of the Securities Exchange Act of 1934
as in effect on the Restatement Closing Date) shall own or control at any time
directly or indirectly, beneficially or of record, shares representing a greater
percentage of either (i) the outstanding common stock of the Borrower or (ii)
the aggregate ordinary voting power represented by all the outstanding capital
stock of the Borrower, than the percentage of such shares directly owned and
controlled, beneficially and of record, collectively by the Permitted Holders;
(b) the Permitted Holders shall cease to directly own and control at any time,
beneficially and of record, collectively at least 51% (or, at any time after an
IPO, at least 35%) of (i) the outstanding common stock of the Borrower or (ii)
the aggregate ordinary voting power represented by all the outstanding capital
stock of the Borrower (excluding, at any time prior to an IPO, up to 10% of such
common stock or voting power to the extent such common stock or the capital
stock representing such voting power is beneficially owned by the Management
Investors); (c) a majority of the voting seats (other than vacant seats) on the
board of directors of the Borrower shall at any time be occupied by persons who
were neither (i) nominated by a Permitted Holder or by a majority of the board
of directors of the Borrower nor (ii) appointed by directors so nominated; (d)
any change in control (or similar event, however denominated) with respect to
the Borrower or any Subsidiary shall occur under and as defined in the agreement
or indenture in respect of the Subordinated Notes or in any other agreement,
indenture or other instrument in respect of Indebtedness to which the Borrower
or any Subsidiary is a party; (e) any person or group, other than one or more
Permitted Holders, shall otherwise directly or indirectly Control the Borrower;
or (f) the Borrower shall (i) cease to own and control, directly or indirectly,
beneficially and of record, 100% of each class of outstanding capital stock of
each Subsidiary free and clear of all Liens (other than any Lien under the
Security Documents) or (ii) cease to have the power (regardless of whether such
power is exercised) to elect 100% of the board of directors of each Subsidiary.
"Closing Fee" shall have the meaning assigned to such term in Section
2.05(b).
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral" shall mean all the "Collateral" as defined in any Security
Document.
"Commitment" shall mean, with respect to each Lender, the commitment of
such Lender to make Loans hereunder as set forth on Schedule 2.01, or in the
Assignment and Acceptance pursuant to which such Lender assumed its Commitment,
as applicable, as the same may be (a) reduced from time to time pursuant to
Section 2.09 and (b) reduced or increased from time to time pursuant to
assignments by or to such Lender pursuant to Section 9.04.
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"Commitment Fee" shall have the meaning assigned to such term in Section
2.05(a).
"Confidential Information Memorandum" shall mean the Confidential
Information Memorandum of the Borrower dated June 1997.
"Consolidated Cash Flow Available for Fixed Charges" shall mean, for any
period, (a) Adjusted Consolidated EBITDA for such period, minus (b) the sum of
(i) the product of (x) an amount equal to the Vehicle Consolidated Capital
Expenditures for such period less Vehicle Sale Proceeds for such period
multiplied by (y) the then applicable Required Enhancement Percentage, (ii) Non-
Vehicle Consolidated Capital Expenditures for such period and (iii) income taxes
paid in cash for such period, each such component determined on a consolidated
basis for the Borrower and the Subsidiaries in accordance with GAAP.
"Consolidated Cash Interest Expense" shall mean, for any period, the gross
interest expense paid in cash by the Borrower and the Subsidiaries during such
period, determined on a consolidated basis in accordance with GAAP, but
excluding in any event fees and expenses paid in connection with the
Transactions and any Relocation Expenses. For purposes of the foregoing, gross
interest expense shall be determined after giving effect to any net payments
made or received by the Borrower and the Subsidiaries with respect to Interest
Rate Protection Agreements.
"Consolidated EBITDA" shall mean, for any period for any person,
Consolidated Net Income of such person for such period, plus, to the extent
deducted in computing such Consolidated Net Income for such period, (a) the sum
of (i) all income tax expense, (ii) total interest expense and (iii)
depreciation, depletion, amortization of intangibles and other non-cash charges
or non-cash losses, including financing and acquisition expenses incurred in
connection with the Transactions and any Relocation Expenses, minus, to the
extent added in computing such Consolidated Net Income for such period, (b) the
sum of (i) any interest income, (ii) any non-cash income or non-cash gains,
(iii) any extraordinary gains and (iv) all net income from Vehicle Sales and
Non-Vehicle Sales, each such component determined on a consolidated basis with
respect to such person and its subsidiaries in accordance with GAAP.
"Consolidated Net Income" shall mean, for any period for any person, net
income or loss of such person and its subsidiaries for such period determined on
a consolidated basis in accordance with GAAP, provided that there shall be
excluded from such calculation of net income or loss (a) the income of any
person in which any other person (other than such person or any of its
subsidiaries or any director holding qualifying shares in accordance with
applicable law) has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to such person or any of its
wholly owned subsidiaries by such other person during such period, (b) the
income (or loss) of any other person accrued prior to the date it becomes a
subsidiary of such person or is merged into or consolidated with such person or
any of its subsidiaries or the date that such other person's assets are acquired
by such person or any of its subsidiaries, (c) any after-tax gains or losses
attributable to sales of assets out of the ordinary course of business and (d)
to the extent not included in clauses (a) through (c) above, any non-cash
extraordinary gains or non-cash extraordinary losses.
"Control" shall mean the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a person,
whether through the ownership of voting
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securities, by contract or otherwise, and the terms "Controlling" and
"Controlled" shall have meanings correlative thereto.
"Credit Exposure" shall mean, with respect to any Lender at any time, the
aggregate principal amount at such time of all outstanding Loans of such Lender.
"Dealer" shall mean any person engaged, by or on behalf of the Borrower or
any Subsidiary (whether as an independent, commissioned agent or an employee),
in the Qualifying Rental of Vehicles or the bona fide sale or rental of other
equipment and products of the Borrower or any Subsidiary, including through
stores owned or operated by the Borrower or any Subsidiary.
"Default" shall mean any event or condition which upon notice, lapse of
time or both would constitute an Event of Default.
"Depreciation Charges" shall mean, with respect to each Vehicle for any
single month, the product of (a) the Depreciation Rate for such Vehicle
multiplied by (b) the Capitalized Cost of such Vehicle, and if such Depreciation
Charge is to be calculated for any period shorter than one month, such product
(x) multiplied by the number of days in such period and (y) divided by 30.
"Depreciation Rate" shall have the meaning assigned to such term in the
Lease.
"dollars" or "$" shall mean lawful money of the United States of America.
"Domestic Subsidiaries" shall mean all Subsidiaries incorporated or
organized under the laws of the United States of America, any State thereof or
the District of Columbia.
"Eligible Accounts Receivable" shall mean at the time of any determination
thereof all Accounts that satisfy the following criteria at the time of creation
and continue to meet the same at the time of such determination: (a) all
payments on such Account are by the terms of such Account due not later than 60
days after the date stated in the original related invoice; (b) such Account has
been invoiced and is not, and not more than 50% of the aggregate amount of
Accounts from the same Account Debtor and any Affiliates thereof are, more than
120 days past due; (c) such Account is denominated in dollars; (d) such Account
arose from a completed, outright and lawful sale of goods, Qualifying Rental of
Vehicles or, in connection with the Qualifying Rental of Vehicles, the rental of
equipment or from the completed performance and acceptance of services by the
Borrower or a Guarantor, all in the ordinary course of business at prices and on
terms and conditions no less favorable to the Borrower or such Guarantor than
could be obtained on an arm's length basis; (e) such Account is owned solely by
the Borrower or a Guarantor, is subject to a perfected first priority security
interest in favor of the Collateral Agent for the benefit of the Secured Parties
pursuant to the Security Documents and is not subject to any other Lien; (f)
such Account arose in the ordinary course of business of the Borrower or a
Guarantor and, to the best knowledge of the Borrower and its Subsidiaries, no
event of death, bankruptcy, insolvency or inability to pay creditors generally
of the Account Debtor thereunder has occurred, and no notice thereof has been
received; (g) such Account complies in all material respects with the
requirements of all applicable laws and regulations, whether Federal, state or
local; (h) with respect to such Account, the Account Debtor (i) is a United
States person (or, if such person is not a United States person, such Account is
supported by a letter of credit approved by the Administrative Agent in favor of
the Borrower or a Guarantor) or (ii) is not the United States of America or any
department, agency or
8
instrumentality thereof, unless the Borrower or a Guarantor duly assigns its
rights to payment of such Account to the Collateral Agent pursuant to the
Assignment of Claims Act of 1940, as amended, which assignment and related
documents and filings shall be in form and substance satisfactory to the
Collateral Agent; (i) such Account constitutes an "account" or "chattel paper"
within the meaning of the Uniform Commercial Code of the state in which the
Account is located; (j) such Account complies with all requirements of
applicable law, including the Federal Consumer Credit Protection Act, the
Federal Truth in Lending Act and Regulation Z of the Board; (k) with respect to
such Account (if such Account is for an amount greater than $250,000), the
Account Debtor has not been disapproved by the Required Lenders (based, in such
Lenders' reasonable judgment, upon the creditworthiness of such Account Debtor),
provided that this clause (k) shall not apply to any Accounts of the Seller
Parent or any of its Controlled Affiliates so long as the Seller Parent's long-
term, non-credit enhanced senior unsecured indebtedness is rated at least both
BBB by Standard & Poor's Ratings Service and Baa2 by Xxxxx'x Investors Service,
Inc.; (l) to the best knowledge of the Borrower and the Subsidiaries, such
Account is in full force and effect and constitutes a legal, valid and binding
obligation of the Account Debtor enforceable in accordance with its terms; (m)
the Account Debtor with respect to such Account has not asserted that such
Account is, and neither the Borrower nor any of its Subsidiaries is aware of any
basis upon which such Account could be, subject to any defense, offset,
deduction, credit or dispute (other than any commission payable to any Dealer in
the ordinary course of business); and (n) such Account is payable directly to
(i) the Collateral Proceeds Account (as defined in the Security Agreement) or
(ii) a Collection Deposit Account or Lockbox (as defined in the Security
Agreement) that is subject to a Lockbox and Depository Agreement (as defined in
the Security Agreement) duly executed and delivered to the Collateral Agent.
Notwithstanding the foregoing, all Accounts of any single Account Debtor (unless
otherwise agreed to by the Required Lenders) and its Affiliates which, in the
aggregate, exceed 5% of the total amount of all Eligible Accounts Receivable at
the time of any determination, shall be deemed not to be Eligible Accounts
Receivable to the extent of such excess, provided that the foregoing percentage
limitation shall not apply to any Accounts of the Seller Parent or any of its
Controlled Affiliates so long as the Seller Parent's long-term, non-credit
enhanced senior unsecured indebtedness is rated at least both BBB by Standard &
Poor's Ratings Service and Baa2 by Xxxxx'x Investors Service, Inc. In addition,
notwithstanding the foregoing, in determining the amount of Accounts to be
included as Eligible Accounts Receivable, the face amount of Accounts shall be
reduced by (a) the amount of all accrued and actual returns, discounts, claims,
credits or credits pending, charges, price adjustments, commissions or other
amounts due to Dealers or similar persons, freight or finance charges or other
allowances (including any amount that the Borrower or a Guarantor, as
applicable, may be obligated to rebate to a customer pursuant to the terms of
any agreement or understanding (written or oral)) and (b) the aggregate amount
of all cash received in respect of Accounts but not yet applied by the Borrower
or the applicable Guarantor to reduce the amount of the Accounts.
"Eligible Intangible Assets Amount" shall mean, on any date, the lesser of
(a) $25,000,000 and (b) the fair value of the Borrower's intangible assets on
such date, as determined from time to time at the direction of the
Administrative Agent (acting upon the reasonable request of the Required
Lenders) by an independent third party appraiser.
"Eligible Non-Revenue-Producing Vehicles" shall mean at the time of any
determination thereof, without duplication, all Vehicles that satisfy all the
requirements set forth in the definition of the term "Eligible Revenue-Producing
Vehicles" other than clause (c) of such definition. The standards of
eligibility for such Vehicles may be changed from time to time solely by the
Collateral
9
Agent in good faith and in the exercise of its reasonable judgment, with any
such changes to be effective after no less than 10 Business Days' notice to and
consultation with the Borrower.
"Eligible Non-Vehicle Non-Revenue-Producing Equipment" shall mean at the
time of any determination thereof, without duplication, all equipment of the
Borrower or a Guarantor (other than Vehicles) that satisfy all the requirements
set forth in the definition of the term "Eligible Non-Vehicle Revenue-Producing
Equipment" other than clause (d) of such definition. The standards of
eligibility for such Vehicles may be changed from time to time solely by the
Collateral Agent in good faith and in the exercise of its reasonable judgment,
with any such changes to be effective after no less than 10 Business Days'
notice to and consultation with the Borrower.
"Eligible Non-Vehicle Revenue-Producing Equipment" shall mean at the time
of any determination thereof, without duplication, all equipment of the Borrower
or a Guarantor (other than Vehicles) to the extent that: (a) the Borrower or a
Guarantor has good and unencumbered title thereto (subject to Permitted Liens);
(b) the Collateral Agent on behalf of the Secured Parties possesses a valid
first priority perfected security interest therein pursuant to the Security
Documents; (c) such equipment is located in the United States of America; (d)
the Dealer for such equipment is making such equipment available for bona fide
sale or rent in the ordinary course of such Dealer's business, and such
equipment is not stolen, lost or damaged beyond repair; (e) such equipment is
capitalized as an asset on the consolidated balance sheet of the Borrower in
accordance with GAAP; and (f) such equipment is not leased by a third party to
the Borrower or a Subsidiary. The standards of eligibility for such equipment
may be changed from time to time solely by the Collateral Agent in good faith
and in the exercise of its reasonable judgment, with any such changes to be
effective after no less than 10 Business Days' notice to and consultation with
the Borrower.
"Eligible Real Estate" shall mean at the time of any determination thereof,
without duplication, all real properties owned in fee by the Borrower or a
Guarantor to the extent that: (a) the Borrower or such Guarantor has good and
unencumbered title thereto (subject to Permitted Liens); (b) the Collateral
Agent on behalf of the Secured Parties possesses a valid first priority
perfected security interest therein pursuant to a mortgage or deed of trust and
other security documents in favor of the Collateral Agent, in each case in form
and substance reasonably satisfactory to the Collateral Agent; (c) such mortgage
or deed of trust and other security documents shall have been filed and recorded
as specified by the Collateral Agent and satisfactory evidence of such filing
and recording shall have been received by the Collateral Agent; (d) the
Collateral Agent shall have received such documents, including satisfactory
title insurance policies (together with endorsements, coinsurance and
reinsurance with respect thereto), surveys, abstracts, appraisals and legal
opinions, as are reasonably requested by the Collateral Agent with respect to
such real property; (e) arrangements reasonably satisfactory to the Collateral
Agent shall have been made with respect to the potential receipt and application
of proceeds from casualty or other damage to or condemnation of such real
property; and (f) such real property is located in the United States of America.
The standards of eligibility for such real property may be changed from time to
time solely by the Collateral Agent in good faith and in the exercise of its
reasonable judgment, with any such changes to be effective after no less than 10
Business Days' notice to and consultation with the Borrower.
"Eligible Revenue-Producing Vehicles" shall mean at the time of any
determination thereof, without duplication, all Vehicles to the extent that,
with respect to each such Vehicle: (a) the Borrower or a Guarantor has good and
unencumbered title thereto (subject to Permitted Liens, it
10
being acknowledged that Vehicles owned by Leasco do not constitute part of the
Collateral); (b) such Vehicle is located in the United States of America; (c)
the Dealer for such Vehicle is making such Vehicle available for Qualifying
Rentals in the ordinary course of such Dealer's business, and such Vehicle is
not stolen, lost or damaged beyond repair; (d) such Vehicle is capitalized as an
asset on the consolidated balance sheet of the Borrower in accordance with GAAP
(subject to the terms set forth in the proviso to Section 5.04(a)); (e) the
Borrower or a Guarantor has taken (or, in the case of the Borrower, has caused
Leasco to take) all actions with respect to such Vehicle as required by the
Security Agreement, including the provisions of Article VI thereof; and (f) such
Vehicle is not leased by a third party to the Borrower or a Subsidiary. The
standards of eligibility for such Vehicles may be changed from time to time
solely by the Collateral Agent in good faith and in the exercise of its
reasonable judgment, with any such changes to be effective after no less than 10
Business Days' notice to and consultation with the Borrower.
"Eligible Vehicle" shall mean a truck that is (i) manufactured by
Manufacturers and (ii) owned by Leasco free and clear of all Liens other than
Permitted Liens.
"environment" shall mean ambient air, surface water and groundwater
(including potable water, navigable water and wetlands), the land surface or
subsurface strata, the workplace or as otherwise defined in any Environmental
Law.
"Environmental Claim" shall mean any written accusation, allegation, notice
of violation, claim, demand, order, directive, cost recovery action or other
cause of action by, or on behalf of, any Governmental Authority or any person
for damages, injunctive or equitable relief, personal injury (including
sickness, disease or death), Remedial Action costs, tangible or intangible
property damage, natural resource damages, nuisance, pollution or any adverse
effect on the environment caused by any Hazardous Material, or for fines,
penalties or restrictions, resulting from or based upon (a) the existence, or
the continuation of the existence, of a Release (including sudden or non-sudden,
accidental or non-accidental Releases), (b) exposure to any Hazardous Material,
(c) the presence, use, handling, transportation, storage, treatment or disposal
of any Hazardous Material or (d) the violation or alleged violation of any
Environmental Law or Environmental Permit.
"Environmental Law" shall mean any and all applicable present and future
treaties, laws, rules, regulations, codes, ordinances, orders, decrees,
judgments, injunctions or binding agreements issued, promulgated or entered into
by any Governmental Authority, relating in any way to the environment,
preservation or reclamation of natural resources, the management, Release or
threatened Release of any Hazardous Material or to public health and safety
matters, including the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, 42 U.S.C. (S)(S) 9601 et seq. (collectively
"CERCLA"), the Solid Waste Disposal Act, as amended by the Resource Conservation
and Recovery Act of 1976 and Hazardous and Solid Waste Amendments of 1984, 42
U.S.C. (S)(S) 6901 et seq., the Federal Water Pollution Control Act, as amended
by the Clean Water Act of 1977, 33 U.S.C. (S)(S) 1251 et seq., the Clean Air Act
of 1970, as amended 42 U.S.C. (S)(S) 7401 et seq., the Toxic Substances Control
Act of 1976, 15 U.S.C. (S)(S) 2601 et seq., the Occupational Safety and Health
Act of 1970, as amended, 29 U.S.C. (S)(S) 651 et seq., the Emergency Planning
and Community Right-to-Know Act of 1986, 42 U.S.C. (S)(S) 11001 et seq., the
Safe Drinking Water Act of 1974, as amended, 42 U.S.C. (S)(S) 300(f) et seq.,
the Hazardous Materials Transportation Act, 49 U.S.C. (S)(S) 5101 et seq., and
any similar or implementing state or local law, and all amendments or
regulations promulgated under any of the foregoing.
11
"Environmental Permit" shall mean any permit, approval, authorization,
certificate, license, or variance required by or from any Governmental Authority
pursuant to any Environmental Law.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
the same may be amended from time to time.
"ERISA Affiliate" shall mean any trade or business (whether or not
incorporated) that, together with any Loan Party or Leasco, is treated as a
single employer under Section 414(b) or (c) of the Code, or solely for purposes
of Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.
"ERISA Event" shall mean (a) any "reportable event", as defined in Section
4043 of ERISA or the regulations issued thereunder, with respect to a Plan and
with respect to which the PBGC has neither waived the reporting requirements nor
publicly announced that it will not impose monetary penalties for failure to
meet the reporting requirements; (b) the adoption of any amendment to a Plan
that would require the provision of security pursuant to Section 401(a)(29) of
the Code or Section 307 of ERISA; (c) the existence with respect to any Plan of
an "accumulated funding deficiency" (as defined in Section 412 of the Code or
Section 302 of ERISA), whether or not waived; (d) the filing pursuant to Section
412(d) of the Code or Section 303(d) of ERISA of an application for a waiver of
the minimum funding standard with respect to any Plan; (e) the incurrence of any
liability under Title IV of ERISA with respect to the termination of any Plan or
the withdrawal or partial withdrawal of any Loan Party, Leasco or any of their
respective ERISA Affiliates from any Plan or Multiemployer Plan; (f) the receipt
by any Loan Party, Leasco or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to the intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (g) the receipt by any
Loan Party, Leasco or any ERISA Affiliate of any notice concerning the
imposition of Withdrawal Liability or a determination that a Multiemployer Plan
is, or is expected to be, insolvent or in reorganization, within the meaning of
Title IV of ERISA; (h) the occurrence of a "prohibited transaction" with respect
to a Plan pursuant to which any Loan Party, Leasco or any of their respective
subsidiaries is a "disqualified person" (within the meaning of Section 4975 of
the Code) or with respect to which any Loan Party, Leasco or any of their
respective subsidiaries could otherwise be liable; and (i) any other event or
condition with respect to a Plan or Multiemployer Plan that could reasonably be
expected to result in liability of any Loan Party or Leasco (other than for the
payment of premiums to the PBGC or the payment of contributions to any such Plan
or Multiemployer Plan made in the ordinary course of business).
"Eurodollar Borrowing" shall mean a Borrowing comprised of Eurodollar
Loans.
"Eurodollar Loan" shall mean any Loan bearing interest at a rate determined
by reference to the Adjusted LIBO Rate in accordance with the provisions of
Article II.
"Event of Default" shall have the meaning assigned to such term in Article
VII.
"Fee Letter" shall mean the Fee Letter dated July 31, 1997, between the
Borrower and the Administrative Agent.
"Fees" shall mean the Commitment Fees and the Agent's Fees.
12
"Financed Portion of Vehicle Depreciation" shall mean, for any period the
product of (a) one minus the then applicable Required Enhancement Percentage
expressed as a figure (e.g., if the Required Enhancement Percentage is 19.5%,
----
then for purposes of this calculation it should be expressed as 0.195) and (b)
the Depreciation Charges for the Vehicles for such period.
"Financial Officer" of any corporation shall mean the chief financial
officer, principal accounting officer, Treasurer or Controller of such
corporation.
"Xxxxx" shall mean FCTR, Inc., a special purpose Delaware corporation that
is a wholly owned Subsidiary of the Borrower.
"Fixed Charge Coverage Ratio" shall mean, for any period, the ratio of (a)
the sum of Consolidated Cash Flow Available for Fixed Charges plus Average
Amount of Unused Availability, in each case, for such period to (b) Fixed
Charges for such period.
"Fixed Charges" shall mean, for any period, the sum of (a) Consolidated
Cash Interest Expense for such period, (b) scheduled principal payments of
Indebtedness made by the Borrower or any Subsidiary to any person other than the
Borrower or any wholly owned Subsidiary of the Borrower during such period and
(c) any dividends paid by the Borrower during such period.
"Fleet" shall mean Eligible Vehicles owned by Leasco subject to the Lease,
considered as a group.
"Foreign Subsidiary" shall mean any Subsidiary that is not a Domestic
Subsidiary.
"GAAP" shall mean generally accepted accounting principles applied on a
consistent basis.
"Governmental Authority" shall mean any Federal, state, local or foreign
court or governmental agency, authority, instrumentality or regulatory body.
"Guarantee" of or by any person shall mean any obligation, contingent or
otherwise, of such person guaranteeing or having the economic effect of
guaranteeing any Indebtedness of any other person (the "primary obligor") in any
manner, whether directly or indirectly, and including any obligation of such
person, direct or indirect, (a) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Indebtedness or to purchase (or to advance
or supply funds for the purchase of) any security for the payment of such
Indebtedness, (b) to purchase or lease property, securities or services for the
purpose of assuring the owner of such Indebtedness of the payment of such
Indebtedness or (c) to maintain working capital, equity capital or any other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness; provided, however, that the
term "Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business.
"Guarantee Agreement" shall mean the amended and restated Guarantee
Agreement, substantially in the form of Exhibit D, made by the Guarantors in
favor of the Collateral Agent for the benefit of the Secured Parties.
13
"Guarantors" shall mean each person listed on Schedule 1.01(a) and each
other person that becomes a party to a Guarantee Agreement as the Guarantor, and
the permitted successors and assigns of each such person.
"Hazardous Materials" shall mean all explosive or radioactive substances or
wastes, hazardous or toxic substances or wastes, pollutants, including petroleum
or petroleum distillates, asbestos or asbestos-containing materials,
polychlorinated biphenyls ("PCBs") or PCB-containing materials or equipment,
radon gas, infectious or medical wastes and all other substances or wastes of
any nature regulated pursuant to any Environmental Law.
"Indebtedness" of any person shall mean, without duplication, (a) all
obligations of such Person for borrowed money, (b) that portion of obligations
with respect to any lease of any property (whether real, personal or mixed) that
is properly classified as a liability on a balance sheet in conformity with
GAAP, (c) notes payable and drafts accepted representing extensions of credit
whether or not representing obligations for borrowed money, (d) any obligation
owed for all or any part of the deferred purchase price for property or services
(excluding trade accounts payable and accrued obligations incurred in the
ordinary course of business), which purchase price is due more than six months
after the date of placing such property in final service or taking final
delivery and title thereto or the completion of such services, (e) all
Indebtedness of others secured by any Lien on any property or asset owned by
that Person regardless of whether the indebtedness secured thereby shall have
been assumed by that Person (provided that if the obligations so secured have
not been assumed by such Person, such obligations shall be deemed to be in an
amount equal to the fair market value of such property, as determined in good
faith by the board of directors of such Person) and (f) all Guarantees of such
Person in respect of any of the foregoing. The Indebtedness of any person shall
include the Indebtedness of any partnership in which such person is a general
partner.
"Indemnity, Subrogation and Contribution Agreement" shall mean the amended
and restated Indemnity, Subrogation and Contribution Agreement, substantially in
the form of Exhibit E, among the Borrower, the Guarantors and the Collateral
Agent.
"Interest Coverage Ratio" shall mean, for any period, the ratio of (a)
Consolidated EBITDA of the Borrower for such period to (b) Consolidated Cash
Interest Expense for such period.
"Interest Payment Date" shall mean, with respect to any Loan, the last day
of the Interest Period applicable to the Borrowing of which such Loan is a part
and, in the case of a Eurodollar Borrowing with an Interest Period of more than
three months' duration, each day that would have been an Interest Payment Date
had successive Interest Periods of three months' duration been applicable to
such Borrowing, and, in addition, the date of any prepayment of such Borrowing
or conversion of such Borrowing to a Borrowing of a different Type.
"Interest Period" shall mean (a) as to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically
corresponding day (or, if there is no numerically corresponding day, on the last
day) in the calendar month that is 1, 2, 3 or 6 months thereafter, as the
Borrower may elect and (b) as to any ABR Borrowing, the period commencing on the
date of such Borrowing and ending on the earliest of (i) the next succeeding
March 31, June 30, September 30 or December 31, (ii) the Maturity Date and (iii)
the date such Borrowing is converted to a Borrowing of a different Type in
accordance with Section 2.10 or repaid or
14
prepaid in accordance with Section 2.11 or 2.12; provided, however, that if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless, in the case
of a Eurodollar Borrowing only, such next succeeding Business Day would fall in
the next calendar month, in which case such Interest Period shall end on the
next preceding Business Day. Interest shall accrue from and including the first
day of an Interest Period to but excluding the last day of such Interest Period.
"Interest Rate Protection Agreement" shall mean any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement or
similar agreement or arrangement designed to protect the Borrower or any of the
Subsidiaries against fluctuations in interest rates and not entered into for
speculation.
"Investors" shall mean Questor and certain other investors arranged by
Questor.
"IPO" shall mean a fully distributed initial public offering of common
stock of the Borrower pursuant to an effective registration statement under the
Securities Act of 1933.
"Leasco" shall mean RCTR, Inc., a special purpose Delaware corporation that
is a wholly owned Subsidiary of the Borrower.
"Lease" shall mean the Master Motor Vehicle Lease Agreement dated as of
October 17, 1996, as amended and restated as of July 31, 1997, between Leasco,
as lessor, and the Borrower, as lessee, as the same may be further amended,
modified or supplemented from time to time in accordance with the terms hereof
and thereof.
"Lenders" shall mean (a) the financial institutions listed on Schedule 2.01
(other than any such financial institution that has ceased to be a party hereto
pursuant to an Assignment and Acceptance) and (b) any financial institution that
has become a party hereto pursuant to an Assignment and Acceptance.
"Letter Agreement" shall mean the letter agreement dated October 15, 1996,
between the Borrower and Xxx Xxxx & Associates, Inc., as the same may be
amended, modified or supplemented from time to time in accordance with the terms
hereof and thereof.
"Letter of Credit Agreement" shall mean the Letter of Credit Agreement
dated as of July 31, 1997, between the Borrower and Citibank, N.A., as issuing
bank, as amended, supplemented or otherwise modified from time to time.
"LIBO Rate" shall mean, with respect to any Eurodollar Borrowing, the rate
(rounded upwards, if necessary, to the next 1/16 of 1%) at which dollar deposits
approximately equal in principal amount to, the Administrative Agent's portion
of such Eurodollar Borrowing and for a maturity comparable to such Interest
Period are offered to the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period.
"Lien" shall mean, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, encumbrance, charge or security interest in or on such
asset, (b) the interest of a vendor or a lessor
15
under any conditional sale agreement, capital lease or title retention agreement
(or any financing lease having substantially the same economic effect as any of
the foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"Liquidity Agreement" shall mean the Liquidity Agreement dated as of July
31, 1997, among Xxxxx, the financial institutions named therein and Citibank,
N.A.
"Loan Documents" shall mean this Agreement, the Amendment Agreement, the
Guarantee Agreement, the Security Documents and the Indemnity, Subrogation and
Contribution Agreement.
"Loan Parties" shall mean the Borrower and the Guarantors.
"Loans" shall mean the loans made by the Lenders to the Borrower pursuant
to Section 2.01. Each Loan shall be a Eurodollar Loan or an ABR Loan.
"Management Agreement" shall mean the Management Agreement dated as of
October 17, 1996, between the Borrower and Questor Management (and its permitted
successors and assigns thereunder), as the same may be amended, modified or
supplemented from time to time in accordance with the terms hereof and thereof.
"Management Investors" shall mean management and other employees of the
Borrower and the Subsidiaries who are as of the Restatement Closing Date or
become in the future purchasers of common stock of the Borrower pursuant to any
Option Plan.
"Manufacturer" shall have the meaning assigned to such term in the Lease.
"Margin Stock" shall have the meaning assigned to such term in Regulation
U.
"Material Adverse Effect" shall mean (a) a materially adverse effect on the
business, assets, operations, prospects or condition, financial or otherwise, of
the Loan Parties taken as a whole, (b) material impairment of the ability of the
Borrower or any other Loan Party to perform any of its obligations under any
Loan Document to which it is or will be a party or (c) material impairment of
the rights of or benefits available to the Lenders under any Loan Document.
"Maturity Date" shall mean the fifth anniversary of the Restatement Closing
Date.
"Multiemployer Plan" shall mean a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
"Net Book Value" shall mean (a) with respect to each Vehicle, such
Vehicle's Capitalized Cost minus the aggregate Depreciation Charges accrued with
respect to such Vehicle through the last day of the Related Month and (b) with
respect to the Fleet, the sum of the Capitalized Costs of each Vehicle included
in the Fleet minus the aggregate Depreciation Charges accrued with respect to
such Vehicles through the last day of the Related Month.
"Net Cash Proceeds" shall mean with respect to any Vehicle Sale or Non-
Vehicle Sale, the cash proceeds thereof net of (a) reasonable costs of sale
(including payment of the outstanding
16
principal amount of, premium or penalty, if any, interest and other amounts on
any Indebtedness (other than Loans) required to be repaid under the terms
thereof as a result of such Sale), (b) taxes paid or payable in the year such
Sale occurs as a result thereof and (c) amounts provided as a reserve, in
accordance with GAAP, against any liabilities under any indemnification
obligations associated with such Sale, provided that, to the extent and at the
time any such amounts are released from such reserve, such amounts shall
constitute Net Cash Proceeds.
"Non-Vehicle Consolidated Capital Expenditures" shall mean, for any period,
the sum of all Capital Expenditures (other than Vehicle Capital Expenditures)
during such period.
"Non-Vehicle Sale" shall mean any sale, lease, transfer, assignment, loss,
damage or destruction (in the case of loss, damage or destruction, to the extent
covered by insurance) or other disposition (by merger or otherwise) to any
person (other than the Borrower or any wholly owned Subsidiary of the Borrower)
of equipment previously made available by a Dealer for bona fide sale or rent in
the ordinary course of such Dealer's business.
"Non-Vehicle Sale Proceeds" shall mean, for any period, all Net Cash
Proceeds received during such period by the Borrower or any Subsidiary from Non-
Vehicle Sales.
"Obligations" shall mean all obligations defined as "Obligations" in the
Guarantee Agreement and the Security Documents.
"Option Plans" shall mean any employee stock option or stock purchase plan
or other employee benefit plan of the Borrower or any Subsidiary in existence
from time to time.
"PBGC" shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA.
"Perfection Certificate" shall mean the Perfection Certificate
substantially in the form of Annex 2 to the Security Agreement.
"Permitted Holder" shall mean Questor and any Affiliate thereof that is
reasonably satisfactory to the Administrative Agent.
"Permitted Investments" shall mean:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are
backed by the full faith and credit of the United States of America), in
each case maturing within one year from the date of acquisition thereof;
(b) investments in commercial paper maturing within 270 days from the
date of acquisition thereof and having, at such date of acquisition, the
highest credit rating obtainable from Standard & Poor's Ratings Service or
from Xxxxx'x Investors Service, Inc.;
(c) investments in certificates of deposit, banker's acceptances and
time deposits maturing within one year from the date of acquisition thereof
issued or guaranteed by or
17
placed with, and money market deposit accounts issued or offered by, any
domestic office of any commercial bank organized under the laws of the
United States of America or any State thereof that has a combined capital
and surplus and undivided profits of not less than $250,000,000 and is
rated (or the long-term, non-credit enhanced senior unsecured indebtedness
of the holding company of such commercial bank is rated) A or better by
Standard & Poor's Ratings Service or A2 or better by Xxxxx'x Investors
Service, Inc.; and
(d) other investment instruments approved in writing by the Required
Lenders and offered by financial institutions which have a combined capital
and surplus and undivided profits of not less than $250,000,000.
"Permitted Lien" shall have the meaning given such term in Section 6.02.
"person" shall mean any natural person, corporation, business trust, joint
venture, association, company, partnership or government, or any agency or
political subdivision thereof.
"Plan" shall mean any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 307 of ERISA, and in respect of which any Loan Party,
Leasco or any ERISA Affiliate is (or, if such plan were terminated, would under
Section 4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5)
of ERISA.
"Pledge Agreement" shall mean the amended and restated Pledge Agreement,
substantially in the form of Exhibit F, between the Borrower and the
Subsidiaries parties thereto and the Collateral Agent for the benefit of the
Secured Parties.
"Properties" shall have the meaning given such term in Section 3.17.
"Purchase Agreement" shall mean the Asset and Stock Purchase Agreement
dated as of September 19, 1996, by and between the Seller and the Borrower, as
the same may be amended, modified or supplemented from time to time in
accordance with the terms thereof and hereof.
"Qualifying Rental" shall mean, with respect to any Vehicle, the bona fide
rental of such Vehicle by any person, other than an Affiliate of the Borrower or
any Subsidiary, for a period of no more than 90 days, provided that such initial
period of no more than 90 days may be extended or renewed for successive periods
of no more than 90 days if (a) the aggregate length of such initial rental
period and all extensions and renewals thereof does not exceed one year, (b)
there is no significant penalty or purchase obligation for any failure to extend
or renew such rental and (c) such Vehicle is not identified with such person's
name, color or logo (other than any legally required placard indicating the
identity of such person).
"Questor" shall collectively mean Questor Partners Fund, L.P., a Delaware
limited partnership, and Questor Side-by-Side Partners, L.P., a Delaware limited
partnership.
"Questor Management" shall mean Questor Management Company, a Delaware
corporation.
"Register" shall have the meaning given such term in Section 9.04(d).
18
"Regulation G" shall mean Regulation G of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Regulation U" shall mean Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Regulation X" shall mean Regulation X of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Related Month" shall mean, with respect to any date, the most recently
ended calendar month; provided, however, that the initial Related Month shall be
the period from the Restatement Closing Date to and including the last day of
the calendar month in which the Restatement Closing Date occurs.
"Release" shall mean any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposing,
depositing, dispersing, emanating or migrating of any Hazardous Material in,
into, onto or through the environment.
"Related Documents" shall have the meaning assigned to such term in the
Liquidity Agreement.
"Relocation Expenses" shall mean all fees and expenses (including write-
offs) incurred in connection with the relocation of the principal executive
office of the Borrower and its Subsidiaries from Miami, Florida to Denver,
Colorado.
"Remedial Action" shall mean (a) "remedial action" as such term is defined
in CERCLA, 42 U.S.C. Section 9601(24), and (b) all other actions required by any
Governmental Authority or voluntarily undertaken to: (i) clean up, remove,
treat, xxxxx or in any other way address any Hazardous Material in the
environment; (ii) prevent the Release or threat of Release, or minimize the
further Release of any Hazardous Material so it does not migrate or endanger or
threaten to endanger public health, welfare or the environment; or (iii) perform
studies and investigations in connection with, or as a precondition to, (i) or
(ii) above.
"Required Enhancement Percentage" shall have the meaning assigned to such
term in the Liquidity Agreement.
"Required Lenders" shall mean, at any time, Lenders having Loans, and
unused Commitments representing a majority of the sum of all Loans outstanding,
and unused Commitments at such time.
"Responsible Officer" shall mean, with respect to any corporation, the
President, the Chief Financial Officer, the Chief Executive Officer, the
Controller, any Vice President or the Treasurer of such corporation.
"Restatement Closing Date" shall mean August 8, 1997.
"Restatement Transactions" shall have the meaning given such term in
Section 3.02.
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"Secured Parties" shall have the meaning given such term in the Security
Agreement.
"Securitization" shall have the meaning given such term in the preamble to
this Agreement.
"Securitization Documents" shall mean the Related Documents as defined in
the Liquidity Agreement.
"Securitization Prepayments" shall have the meaning given such term in the
preamble to this Agreement.
"Security Agreement" shall mean the amended and restated Security
Agreement, substantially in the form of Exhibit G, between the Borrower and the
Subsidiaries parties thereto and the Collateral Agent for the benefit of the
Secured Parties.
"Security Documents" shall mean the Security Agreement, the Pledge
Agreement and each of the security agreements and other instruments and
documents executed and delivered pursuant to any of the foregoing or pursuant to
Section 5.16.
"Seller" shall mean Ryder Truck Rental, Inc., a Florida corporation.
"Seller Parent" shall mean Ryder System, Inc., a Florida corporation, and
its successors and assigns.
"Statutory Reserves" shall mean a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board and any other banking authority, domestic or foreign,
to which the Administrative Agent or any Lender (including any branch,
Affiliate, or other fronting office making or holding a Loan) is subject (a)
with respect to the Base CD Rate, for new negotiable nonpersonal time deposits
in dollars of over $100,000 with maturities approximately equal to three months,
and (b) with respect to the Adjusted LIBO Rate, for Eurocurrency Liabilities (as
defined in Regulation D of the Board). Such reserve percentages shall include
those imposed pursuant to such Regulation D. Eurodollar Loans shall be deemed
to constitute Eurocurrency Liabilities and to be subject to such reserve
requirements without benefit of or credit for proration, exemptions or offsets
that may be available from time to time to any Lender under such Regulation D.
Statutory Reserves shall be adjusted automatically on and as of the effective
date of any change in any reserve percentage.
"Stockholders' Agreement" shall mean the Stockholders' Agreement dated as
October 17, 1996, among Questor and the other Investors, as the same may be
amended, modified or supplemented from time to time in accordance with the terms
thereof and hereof.
"Subordinated Demand Note" shall mean the subordinated note of Leasco to
the Borrower, dated August 7, 1997, payable on demand.
"Subordinated Notes" shall mean the 10% Senior Subordinated Notes due 2006,
of the Borrower, in an aggregate principal amount of $175,000,000.
20
"subsidiary" shall mean, with respect to any person (herein referred to as
the "parent"), any corporation, partnership, association or other business
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or more
than 50% of the general partnership interests are, at the time any determination
is being made, owned, controlled or held, or (b) that is, at the time any
determination is made, otherwise Controlled, by the parent or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the
parent.
"Subsidiary" shall mean any subsidiary of the Borrower.
"Supermajority Lenders" shall mean, at any time, Lenders having Loans and
unused Commitments representing at least 75% of the sum of all Loans outstanding
and unused Commitments at such time.
"Three-Month Secondary CD Rate" shall mean, for any day, the secondary
market rate for three-month certificates of deposit reported as being in effect
on such day (or, if such day shall not be a Business Day, the next preceding
Business Day) by the Board through the public information telephone line of the
Federal Reserve Bank of New York (which rate will, under the current practices
of the Board, be published in Federal Reserve Statistical Release H.15(519)
during the week following such day), or, if such rate shall not be so reported
on such day or such next preceding Business Day, the average of the secondary
market quotations for three-month certificates of deposit of major money center
banks in New York City received at approximately 10:00 a.m., New York City time,
on such day (or, if such day shall not be a Business Day, on the next preceding
Business Day) by the Administrative Agent from three New York City negotiable
certificate of deposit dealers of recognized standing selected by it.
"Total Commitment" shall mean, at any time, the aggregate amount of the
Commitments as in effect at such time.
"Total Debt" shall mean, at any date and without duplication, the aggregate
amount of all Indebtedness of the Borrower and the Subsidiaries at such date as
determined on a consolidated basis in accordance with GAAP.
"Total Debt Ratio" shall mean, as of the last day of any fiscal quarter of
the Borrower, the ratio of (a) Total Debt on such date to (b) Consolidated
EBITDA of the Borrower for the period of four consecutive fiscal quarters ending
on such date.
"Transactions" shall mean the Acquisition and the financing thereof
(including, without limitation, the Subordinated Notes) and the transactions
contemplated by the Related Documents.
"Type", when used in respect of any Loan or Borrowing, shall refer to the
Rate by reference to which interest on such Loan or on the Loans comprising such
Borrowing is determined. For purposes hereof, the term "Rate" shall include the
Adjusted LIBO Rate and the Alternate Base Rate.
"Vehicle" shall mean any truck or other vehicle owned by the Borrower or
any Subsidiary and registered and based in the United States of America, the
body (including the box or storage
21
component) and equipment mounted thereon and all accessions, attachments and
accessories of any type or description attached to such truck or vehicle.
"Vehicle Consolidated Capital Expenditures" shall mean, for any period, the
sum of all Capital Expenditures made in such period for the acquisition of
Vehicles, which such Capital Expenditures shall include credits, allowances and
similar items received by the Borrower or any Subsidiary for Vehicle trade-ins.
"Vehicle Sale" shall mean any sale, lease (other than pursuant to a
Qualifying Rental), transfer, assignment, loss, damage or destruction (in the
case of loss, damage or destruction, to the extent covered by insurance) or
other disposition (by merger or otherwise) of Vehicles to any person other than
the Borrower or any wholly owned Subsidiary of the Borrower.
"Vehicle Sale Proceeds" shall mean, for any period, the sum of (a) all Net
Cash Proceeds received during such period by the Borrower or any Subsidiary from
Vehicle Sales and (b) the aggregate amount of credits, allowances and similar
items received during such period by the Borrower or any Subsidiary for Vehicle
trade-ins.
"Vehicle Title Nominee Agreement" shall mean the Vehicle Title Nominee
Agreement dated as of October 17, 1996, between the Seller and Leasco, as the
same may be amended, modified or supplemented from time to time in accordance
with the terms thereof and hereof.
"wholly owned Subsidiary" of any person shall mean a subsidiary of such
person of which securities (except for directors' qualifying shares) or other
ownership interests representing 100% of the equity or 100% of the ordinary
voting power or 100% of the general partnership interests are, at the time any
determination is being made, owned, controlled or held by such person or one or
more wholly owned subsidiaries of such person or by such person and one or more
wholly owned subsidiaries of such person.
"Withdrawal Liability" shall mean liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Terms Generally. The definitions in Section 1.01 shall
apply equally to both the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
All references herein to Articles, Sections, Exhibits and Schedules shall be
deemed references to Articles and Sections of, and Exhibits and Schedules to,
this Agreement unless the context shall otherwise require. Except as otherwise
expressly provided herein, (a) any reference in this Agreement to any Loan
Document shall mean such document as amended, restated, supplemented or
otherwise modified from time to time and (b) all terms of an accounting or
financial nature shall be construed in accordance with GAAP, as in effect from
time to time; provided, however, that for purposes of determining compliance
with the covenants contained in Article VI, all accounting terms herein shall be
interpreted and all accounting determinations hereunder shall be made in
accordance with GAAP as in effect on the Restatement Closing Date and applied on
a basis consistent with the application used in the financial statements
referred to in Section 3.05(a).
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ARTICLE II
The Credits
SECTION 2.01. Commitments. Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, each Lender
agrees, severally and not jointly, to make Loans to the Borrower, at any time
and from time to time on or after the Restatement Closing Date, and until the
earlier of the Maturity Date and the termination of the Commitment of such
Lender in accordance with the terms hereof, in an aggregate principal amount at
any time outstanding that will not result in such Lender's Credit Exposure
exceeding the lesser of (i) such Lender's Commitment and (ii) such Lender's
Applicable Percentage of the Borrowing Base in effect at such time. Within the
limits set forth in the preceding sentence and subject to the terms, conditions
and limitations set forth herein, the Borrower may borrow, pay or prepay and
reborrow Loans.
SECTION 2.02. Loans. (a) Each Loan shall be made as part of a Borrowing
consisting of Loans made by the Lenders ratably in accordance with their
Commitments; provided, however, that the failure of any Lender to make any Loan
shall not in itself relieve any other Lender of its obligation to lend hereunder
(it being understood, however, that no Lender shall be responsible for the
failure of any other Lender to make any Loan required to be made by such other
Lender). The Loans comprising any Borrowing shall be in an aggregate principal
amount that is (i) an integral multiple of $250,000 and not less than $1,000,000
or (ii) equal to the remaining available balance of the applicable Commitments.
(b) Subject to Sections 2.08 and 2.15, each Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower may request pursuant
to Section 2.03. Each Lender may at its option make any Eurodollar Loan by
causing any domestic or foreign branch or Affiliate of such Lender to make such
Loan; provided that any exercise of such option shall not affect the obligation
of the Borrower to repay such Loan in accordance with the terms of this
Agreement. Borrowings of more than one Type may be outstanding at the same
time; provided, however, that the Borrower shall not be entitled to request any
Borrowing that, if made, would result in more than ten Eurodollar Borrowings
outstanding hereunder at any time. For purposes of the foregoing, Borrowings
having different Interest Periods, regardless of whether they commence on the
same date, shall be considered separate Borrowings.
(c) Each Lender shall make each Loan to be made by it hereunder on the
proposed date thereof by wire transfer of immediately available funds to such
account in New York City as the Administrative Agent may designate not later
than 11:00 a.m., New York City time, and the Administrative Agent shall by 12:00
(noon), New York City time, credit the amounts so received to an account in the
name of the Borrower, maintained with the Administrative Agent or the Collateral
Agent and designated by the Borrower in the applicable Borrowing Request or, if
a Borrowing shall not occur on such date because any condition precedent herein
specified shall not have been met, return the amounts so received to the
respective Lenders.
(d) Unless the Administrative Agent shall have received notice from a
Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's portion of such Borrowing,
the Administrative Agent may assume that such Lender has
23
made such portion available to the Administrative Agent on the date of such
Borrowing in accordance with paragraph (c) above and the Administrative Agent
may, in reliance upon such assumption, make available to the Borrower on such
date a corresponding amount. If the Administrative Agent shall have so made
funds available then, to the extent that such Lender shall not have made such
portion available to the Administrative Agent, such Lender and the Borrower
severally agree to repay to the Administrative Agent forthwith on demand such
corresponding amount together with interest thereon, for each day from the date
such amount is made available to the Borrower until the date such amount is
repaid to the Administrative Agent at (i) in the case of the Borrower, the
interest rate applicable at the time to the Loans comprising such Borrowing and
(ii) in the case of such Lender, a rate determined by the Administrative Agent
to represent its cost of overnight or short-term funds (which determination
shall be conclusive absent manifest error). If such Lender shall repay to the
Administrative Agent such corresponding amount, (i) such amount shall constitute
such Lender's Loan as part of such Borrowing for purposes of this Agreement, and
(ii) if the Borrower also shall have made such corresponding amount available to
the Administrative Agent, the Administrative Agent will promptly return such
corresponding amount to the Borrower.
(e) Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request any Borrowing if the Interest Period requested
with respect thereto would end after the Maturity Date.
SECTION 2.03. Borrowing Procedure. In order to request a Borrowing, the
Borrower shall hand deliver or telecopy to the Administrative Agent a duly
completed Borrowing Request (a) in the case of a Eurodollar Borrowing, not later
than 11:00 a.m., New York City time, three Business Days before a proposed
Borrowing, and (b) in the case of an ABR Borrowing, not later than 12:00 noon,
New York City time, on the day of a proposed Borrowing. Each Borrowing Request
shall be irrevocable, shall be signed by or on behalf of the Borrower and shall
specify the following information: (i) whether such Borrowing is to be a
Eurodollar Borrowing or an ABR Borrowing; (ii) the date of such Borrowing (which
shall be a Business Day); (iii) the number and location of the account to which
funds are to be disbursed (which shall be an account that complies with the
requirements of Section 2.02(c)); (iv) the amount of such Borrowing; (v) if such
Borrowing is to be a Eurodollar Borrowing, the Interest Period with respect
thereto; and (vi) the expected Aggregate Credit Exposure on the date of such
Borrowing (after giving effect to such Borrowing) and the Borrowing Base as set
forth in the most recently provided Borrowing Base Certificate; provided,
however, that, notwithstanding any contrary specification in any Borrowing
Request, each requested Borrowing shall comply with the requirements set forth
in Section 2.02. If no election as to the Type of Borrowing is specified in any
such notice, then the requested Borrowing shall be an ABR Borrowing. If no
Interest Period with respect to any Eurodollar Borrowing is specified in any
such notice, then the Borrower shall be deemed to have selected an Interest
Period of one month's duration. The Administrative Agent shall promptly advise
the applicable Lenders of any notice given pursuant to this Section 2.03 (and
the contents thereof), and of each Lender's portion of the requested Borrowing.
SECTION 2.04. Evidence of Debt; Repayment of Loans. (a) The Borrower
hereby unconditionally promises to pay to the Administrative Agent for the
account of each Lender the then unpaid principal amount of each Loan on the
Maturity Date.
24
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower to such Lender
resulting from each Loan made by such Lender from time to time, including the
amounts of principal and interest payable and paid such Lender from time to time
under this Agreement.
(c) The Administrative Agent shall maintain accounts in which it will
record (i) the amount of each Loan made hereunder, the Type thereof and the
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Lender
hereunder and (iii) the amount of any sum received by the Administrative Agent
hereunder from the Borrower or any Guarantor and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to paragraphs (b)
and (c) above shall be prima facie evidence of the existence and amounts of the
obligations therein recorded; provided, however, that the failure of any Lender
or the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligations of the Borrower to repay the Loans in
accordance with their terms.
(e) Notwithstanding any other provision of this Agreement, in the event
any Lender shall request and receive a promissory note payable to such Lender
and its registered assigns, the interests represented by such note shall at all
times (including after any assignment of all or part of such interests pursuant
to Section 9.04) be represented by one or more promissory notes payable to the
payee named therein or its registered assigns.
SECTION 2.05. Fees. (a) The Borrower agrees to pay to each Lender,
through the Administrative Agent, on the last day of March, June, September and
December in each year and on each date on which any Commitment of such Lender
shall expire or be terminated as provided herein, a commitment fee (a
"Commitment Fee") of .50% per annum on the average daily unused amount of the
Commitments of such Lender during the preceding quarter (or other period
commencing with the Restatement Closing Date or ending with the Maturity Date or
the date on which the Commitments of such Lender shall expire or be terminated).
All Commitment Fees shall be computed on the basis of the actual number of days
elapsed in a year of 360 days. The Commitment Fee due to each Lender shall
commence to accrue on the Restatement Closing Date and shall cease to accrue on
the date on which the Commitment of such Lender shall expire or be terminated as
provided herein.
(b) The Borrower agrees to pay to each Lender, through the Administrative
Agent, on the Restatement Closing Date, a closing fee (the "Closing Fee") of
.25% of the Commitment of such Lender.
(c) The Borrower agrees to pay to the Administrative Agent, for its own
account, the fees set forth in the Fee Letter at the times and in the amounts
specified therein (the "Agent's Fees").
All Fees shall be paid on the dates due, in immediately available funds,
to the Administrative Agent for distribution, if and as appropriate, among the
Lenders. Once paid, none of the Fees shall be refundable under any
circumstances.
SECTION 2.06. Interest on Loans. (a) Subject to the provisions of
Section 2.07, the Loans comprising each ABR Borrowing shall bear interest
(computed on the basis of the actual
25
number of days elapsed over a year of 365 or 366 days, as the case may be, when
the Alternate Base Rate is determined by reference to the Prime Rate and over a
year of 360 days at all other times) at a rate per annum equal to the Alternate
Base Rate plus 1.00%.
(b) Subject to the provisions of Section 2.07, the Loans comprising each
Eurodollar Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 360 days) at a rate per annum equal to the
Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus
2.00%.
Interest on each Loan shall be payable on the Interest Payment Dates
applicable to such Loan except as otherwise provided in this Agreement. The
applicable Alternate Base Rate or Adjusted LIBO Rate for each Interest Period or
day within an Interest Period, as the case may be, shall be determined by the
Administrative Agent, and such determination shall be conclusive absent manifest
error.
SECTION 2.07. Default Interest. If the Borrower shall default in the
payment of the principal of or interest on any Loan or any other amount becoming
due hereunder, by acceleration or otherwise, or under any other Loan Document,
the Borrower shall on demand from time to time pay interest, to the extent
permitted by law, on such defaulted amount to but excluding the date of actual
payment (after as well as before judgment) (a) in the case of overdue principal
on any ABR Borrowing, at the rate otherwise applicable to the Loans comprising
such Borrowing pursuant to Section 2.06(a) plus 2.00% per annum, (b) in the case
of overdue principal on any Eurodollar Borrowing, (i) during the remaining
portion, if any, of the Interest Period for such Borrowing, at the rate
otherwise applicable to the Loans comprising such Borrowing pursuant to Section
2.06(b) plus 2.00% per annum and (ii) at all times after the last day of the
Interest Period for such Borrowing, at the rate that would have been applicable
to such Loans pursuant to Section 2.06(a) had such Loans been ABR Loans plus
2.00% per annum and (c) in all other cases, at a rate per annum (computed on the
basis of the actual number of days elapsed over a year of 365 or 366 days, as
the case may be, when determined by reference to the Prime Rate and over a year
of 360 days at all other times) equal to the sum of the Alternate Base Rate plus
2.00%.
SECTION 2.08. Alternate Rate of Interest. In the event, and on each
occasion, that on the day two Business Days prior to the commencement of any
Interest Period for a Eurodollar Borrowing the Administrative Agent shall have
determined that dollar deposits in the principal amounts of the Loans comprising
such Borrowing are not generally available in the London interbank market, or
that the rates at which such dollar deposits are being offered will not
adequately and fairly reflect the cost to any Lender of making or maintaining
its Eurodollar Loan during such Interest Period, or that reasonable means do not
exist for ascertaining the Adjusted LIBO Rate, the Administrative Agent shall,
as soon as practicable thereafter, give written or telecopy notice of such
determination to the Borrower and the Lenders. In the event of any such
determination, until the Administrative Agent shall have advised the Borrower
and the Lenders that the circumstances giving rise to such notice no longer
exist, any request by the Borrower for a Eurodollar Borrowing pursuant to
Section 2.03 or 2.10 shall be deemed to be a request for an ABR Borrowing. Each
determination by the Administrative Agent hereunder shall be conclusive absent
manifest error.
SECTION 2.09. Termination and Reduction of Commitments. (a) The
Commitments shall automatically terminate on the Maturity Date. Notwithstanding
the foregoing, the Commitments
26
shall automatically terminate at 5:00 p.m., New York City time, on September 17,
1997, if the conditions set forth in Section 7 of the Amendment Agreement shall
have not been satisfied by such time.
(b) Upon at least three Business Days' prior irrevocable written or
telecopy notice to the Administrative Agent, the Borrower may at any time in
whole permanently terminate, or from time to time in part permanently reduce,
the Commitments; provided, however, that (i) each partial reduction of the
Commitments shall be in an integral multiple of $250,000 and in a minimum amount
of $1,000,000 and (ii) the Total Commitment shall not be reduced to an amount
that is less than the Aggregate Credit Exposure at the time.
(c) Each reduction in the Commitments hereunder shall be made ratably
among the Lenders in accordance with their respective Commitments. The Borrower
shall pay to the Administrative Agent for the account of the applicable Lenders,
on the date of each termination or reduction, the Commitment Fees on the amount
of the Commitments so terminated or reduced accrued to but excluding the date of
such termination or reduction.
SECTION 2.10. Conversion and Continuation of Borrowings. The Borrower
shall have the right at any time upon prior irrevocable notice to the
Administrative Agent (a) not later than 12:00 (noon), New York City time, on the
day of conversion, to convert any Eurodollar Borrowing into an ABR Borrowing,
(b) not later than 10:00 a.m., New York City time, three Business Days prior to
conversion or continuation, to convert any ABR Borrowing into a Eurodollar
Borrowing or to continue any Eurodollar Borrowing as a Eurodollar Borrowing for
an additional Interest Period, and (c) not later than 10:00 a.m., New York City
time, three Business Days prior to conversion, to convert the Interest Period
with respect to any Eurodollar Borrowing to another permissible Interest Period,
subject in each case to the following:
(i) each conversion or continuation shall be made pro rata among the
Lenders in accordance with the respective principal amounts of the Loans
comprising the converted or continued Borrowing;
(ii) if less than all the outstanding principal amount of any
Borrowing shall be converted or continued, then each resulting Borrowing
shall satisfy the limitations specified in Sections 2.02(a) and 2.02(b)
regarding the principal amount and maximum number of Borrowings of the
relevant Type;
(iii) each conversion shall be effected by each Lender and the
Administrative Agent by recording for the account of such Lender the new
Loan of such Lender resulting from such conversion and reducing the Loan
(or portion thereof) of such Lender being converted by an equivalent
principal amount; accrued interest on any Eurodollar Loan (or portion
thereof) being converted shall be paid by the Borrower at the time of
conversion;
(iv) if any Eurodollar Borrowing is converted at a time other than the
end of the Interest Period applicable thereto, the Borrower shall pay, upon
demand, any amounts due to the Lenders pursuant to Section 2.16;
(v) any portion of a Borrowing maturing or required to be repaid in
less than one month may not be converted into or continued as a Eurodollar
Borrowing;
27
(vi) any portion of a Eurodollar Borrowing that cannot be converted
into or continued as a Eurodollar Borrowing by reason of the immediately
preceding clause shall be automatically converted at the end of the
Interest Period in effect for such Borrowing into an ABR Borrowing; and
(vii) upon notice to the Borrower from the Administrative Agent given
at the request of the Required Lenders, after the occurrence and during the
continuance of a Default or Event of Default, no outstanding Loan may be
converted into, or continued as, a Eurodollar Loan.
Each notice pursuant to this Section 2.10 shall be irrevocable and shall
refer to this Agreement and specify (i) the identity and amount of the Borrowing
that the Borrower requests be converted or continued, (ii) whether such
Borrowing is to be converted to or continued as a Eurodollar Borrowing or an ABR
Borrowing, (iii) if such notice requests a conversion, the date of such
conversion (which shall be a Business Day) and (iv) if such Borrowing is to be
converted to or continued as a Eurodollar Borrowing, the Interest Period with
respect thereto. If no Interest Period is specified in any such notice with
respect to any conversion to or continuation as a Eurodollar Borrowing, the
Borrower shall be deemed to have selected an Interest Period of one month's
duration. The Administrative Agent shall advise the Lenders of any notice given
pursuant to this Section 2.10 and of each Lender's portion of any converted or
continued Borrowing. If the Borrower shall not have given notice in accordance
with this Section 2.10 to continue any Borrowing into a subsequent Interest
Period (and shall not otherwise have given notice in accordance with this
Section 2.10 to convert such Borrowing), such Borrowing shall, at the end of the
Interest Period applicable thereto (unless repaid pursuant to the terms hereof),
automatically be continued into a new Interest Period as an ABR Borrowing.
SECTION 2.11. Intentionally Omitted.
SECTION 2.12. Optional Prepayment. (a) The Borrower shall have the right
at any time and from time to time to prepay any Borrowing, in whole or in part,
upon prior written or telecopy notice (or telephone notice promptly confirmed by
written or telecopy notice) to the Administrative Agent before 11:00 a.m., New
York City time at least three Business Days (in the case of Eurodollar
Borrowings) before such prepayment, or on the day of such prepayment (in the
case of ABR Borrowings); provided, however, that each partial prepayment shall
be in an amount that is an integral multiple of $250,000 and not less than
$1,000,000.
(b) Intentionally Omitted.
(c) Each notice of prepayment shall specify the prepayment date and the
principal amount of each Borrowing (or portion thereof) to be prepaid, shall be
irrevocable and shall commit the Borrower to prepay such Borrowing by the amount
stated therein on the date stated therein. All prepayments under this Section
2.12 shall be subject to Section 2.16 but otherwise without premium or penalty.
All prepayments under this Section 2.12 shall be accompanied by accrued interest
on the principal amount being prepaid to the date of payment.
SECTION 2.13. Mandatory Prepayments. (a) In the event of any termination
of all the Commitments, the Borrower shall prepay all its outstanding Borrowings
on the date of such termination. In the event of any partial reduction of the
Commitments, then (i) at or prior to the
28
effective date of such reduction, the Administrative Agent shall notify the
Borrower and the Lenders of the Aggregate Credit Exposure after giving effect
thereto and (ii) if the Aggregate Credit Exposure would exceed the Total
Commitment after giving effect to such reduction, then the Borrower shall, on
the date of such reduction and in an amount sufficient to eliminate such excess,
prepay the then outstanding Loans (if any).
(b) If on any date the Aggregate Credit Exposure shall exceed the
Borrowing Base, the Borrower shall on such date apply an amount equal to such
excess to prepay the then outstanding Loans (if any).
(c) Amounts to be applied pursuant to this Section 2.13 to the prepayment
of Loans shall be applied first to reduce outstanding ABR Loans. Any amounts
remaining after each such application shall, at the option of the Borrower, be
applied to prepay Eurodollar Loans immediately and/or shall be deposited in the
Prepayment Account (as defined below). The Administrative Agent shall apply any
cash deposited in the Prepayment Account to prepay Eurodollar Loans on the last
day of their Interest Periods (or, at the direction of the Borrower, on any
earlier date) until all outstanding Loans have been prepaid or until all the
allocable cash on deposit with respect to such Loans has been exhausted. For
purposes of this Agreement, the term "Prepayment Account" shall mean an account
established by the Borrower with the Administrative Agent and over which the
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal for application in accordance with this paragraph
(c). The Administrative Agent will, at the request of the Borrower, invest
amounts on deposit in the Prepayment Account in Permitted Investments that
mature prior to the last day of the applicable Interest Periods of the
Eurodollar Borrowings to be prepaid; provided, however, that (i) the
Administrative Agent shall not be required to make any investment that, in its
sole judgment, would require or cause the Administrative Agent to be in, or
would result in any, violation of any law, statute, rule or regulation and
(ii) the Administrative Agent shall have no obligation to invest amounts on
deposit in the Prepayment Account if a Default or Event of Default shall have
occurred and be continuing. The Borrower shall indemnify the Administrative
Agent for any losses relating to the investments so that the amount available to
prepay Eurodollar Borrowings on the last day of the applicable Interest Period
is not less than the amount that would have been available had no investments
been made pursuant thereto. Other than any interest earned on such investments,
the Prepayment Account shall not bear interest. Interest or profits, if any, on
such investments shall be deposited in the Prepayment Account and reinvested and
disbursed as specified above. If the maturity of the Loans has been accelerated
pursuant to Article VII, the Administrative Agent may, in its sole discretion,
apply all amounts on deposit in the Prepayment Account to satisfy any of the
Obligations. The Borrower hereby grants to the Administrative Agent, for its
benefit and the benefit of the Lenders, a security interest in the Prepayment
Account to secure the Obligations.
SECTION 2.14. Reserve Requirements; Change in Circumstances. (a)
Notwithstanding any other provision of this Agreement, if after the date of this
Agreement any change in applicable law or regulation or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the force of
law) shall change the basis of taxation of payments to any Lender of the
principal of or interest on any Eurodollar Loan made by such Lender or any Fees
or other amounts payable hereunder (other than changes in respect of taxes
imposed on the overall net income of such Lender by the jurisdiction in which
such Lender has its principal office or by any political subdivision or taxing
authority therein), or shall impose, modify or deem applicable any reserve,
special deposit or similar
29
requirement against assets of, deposits with or for the account of or credit
extended by any Lender (except any such reserve requirement which is reflected
in the Adjusted LIBO Rate) or shall impose on such Lender or the London
interbank market any other condition affecting this Agreement or Eurodollar
Loans made by such Lender, and the result of any of the foregoing shall be to
increase the cost to such Lender of making or maintaining any Eurodollar Loan,
then the Borrower will pay to such Lender, upon demand such additional amount or
amounts as will compensate such Lender for such additional costs incurred or
reduction suffered.
(b) If any Lender shall have reasonably determined that the adoption after
the Restatement Closing Date of any law, rule, regulation, agreement or
guideline regarding capital adequacy, or any change after the Restatement
Closing Date in any such law, rule, regulation, agreement or guideline (whether
such law, rule, regulation, agreement or guideline has been adopted) or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof, or compliance by any Lender
(or any lending office of such Lender) or any Lender's holding company with any
request or directive regarding capital adequacy (whether or not having the force
of law) of any Governmental Authority has or would have the effect of reducing
the rate of return on such Lender's capital or on the capital of such Lender's
holding company, if any, as a direct consequence of this Agreement or the Loans
made to a level below that which such Lender or such Lender's holding company
could have achieved but for such applicability, adoption, change or compliance
(taking into consideration such Lender's policies and the policies of such
Lender's holding company with respect to capital adequacy) by an amount deemed
by such Lender to be material, then from time to time the Borrower shall pay to
such Lender such additional amount or amounts as will compensate such Lender or
such Lender's holding company for any such reduction suffered.
(c) A certificate of a Lender setting forth in reasonable detail the
amount or amounts necessary to compensate such Lender or its holding company, as
applicable, as specified in paragraph (a) or (b) above and the events giving
rise to such compensation shall be delivered to the Borrower and shall be
conclusive absent manifest error. The Borrower shall pay such Lender the amount
shown as due on any such certificate delivered by it within 10 Business Days
after its receipt of the same.
(d) Failure or delay on the part of any Lender to demand compensation for
any increased costs or reduction in amounts received or receivable or reduction
in return on capital shall not constitute a waiver of such Lender's right to
demand such compensation. The protection of this Section shall be available to
each Lender regardless of any possible contention of the invalidity or
inapplicability of the law, rule, regulation, agreement, guideline or other
change or condition that shall have occurred or been imposed.
SECTION 2.15. Change in Legality. (a) Notwithstanding any other
provision of this Agreement, if, after the Restatement Closing Date, any change
in any law or regulation or in the interpretation thereof by any Governmental
Authority charged with the administration or interpretation thereof shall make
it unlawful for any Lender to make or maintain any Eurodollar Loan or to give
effect to its obligations as contemplated hereby with respect to any Eurodollar
Loan, then, by written notice to the Borrower and to the Administrative Agent:
(i) such Lender may declare that Eurodollar Loans will not thereafter
(for the duration of such unlawfulness) be made by such Lender hereunder
(or be continued for
30
additional Interest Periods and ABR Loans will not thereafter (for such
duration) be converted into Eurodollar Loans), whereupon any request for a
Eurodollar Borrowing (or to convert an ABR Borrowing to a Eurodollar
Borrowing or to continue a Eurodollar Borrowing for an additional Interest
Period) shall, as to such Lender only, be deemed a request for an ABR Loan
(or a request to continue an ABR Loan as such for an additional Interest
Period or to convert a Eurodollar Loan into an ABR Loan, as the case may
be), unless such declaration shall be subsequently withdrawn; and
(ii) such Lender may require that all outstanding Eurodollar Loans
made by it be converted to ABR Loans, in which event all such Eurodollar
Loans shall be automatically converted to ABR Loans as of the effective
date of such notice as provided in paragraph (b) below.
In the event any Lender shall exercise its rights under (i) or (ii) above, all
payments and prepayments of principal that would otherwise have been applied to
repay the Eurodollar Loans that would have been made by such Lender or the
converted Eurodollar Loans of such Lender shall instead be applied to repay the
ABR Loans made by such Lender in lieu of, or resulting from the conversion of,
such Eurodollar Loans.
(b) For purposes of this Section 2.15, a notice to the Borrower by any
Lender shall be effective as to each Eurodollar Loan made by such Lender, if
lawful, on the last day of the Interest Period currently applicable to such
Eurodollar Loan; in all other cases such notice shall be effective on the date
of receipt by the Borrower.
SECTION 2.16. Indemnity. The Borrower shall indemnify each Lender against
any loss or expense that such Lender may sustain or incur as a consequence of
(a) any event, other than a default by such Lender in the performance of its
obligations hereunder, which results in (i) such Lender receiving or being
deemed to receive any amount on account of the principal of any Eurodollar Loan
prior to the end of the Interest Period in effect therefor, (ii) the conversion
of any Eurodollar Loan to an ABR Loan, or the conversion of the Interest Period
with respect to any Eurodollar Loan, in each case other than on the last day of
the Interest Period in effect therefor, or (iii) any Eurodollar Loan to be made
by such Lender (including any Eurodollar Loan to be made pursuant to a
conversion or continuation under Section 2.10) not being made after notice of
such Loan shall have been given by the Borrower hereunder (any of the events
referred to in this clause (a) being called a "Breakage Event") or (b) any
default in the making of any payment or prepayment required to be made
hereunder. In the case of any Breakage Event, such loss shall be an amount
equal to the excess, as reasonably determined by such Lender, of (i) its cost of
obtaining funds for the Eurodollar Loan that is the subject of such Breakage
Event for the period from the date of such Breakage Event to the last day of the
Interest Period in effect (or that would have been in effect) for such Loan over
(ii) the amount of interest likely to be realized by such Lender in redeploying
the funds released or not utilized by reason of such Breakage Event for such
period. A certificate of any Lender setting forth in reasonable detail any
amount or amounts which such Lender is entitled to receive pursuant to this
Section 2.16 and a description of such Breakage Event shall be delivered to the
Borrower and shall be conclusive absent manifest error.
SECTION 2.17. Pro Rata Treatment. Except as required under Section 2.15,
each Borrowing, each payment or prepayment of principal of any Borrowing, each
payment of interest on the Loans, each payment of the Commitment Fees, each
reduction of the Commitments and each
31
conversion of any Borrowing to or continuation of any Borrowing as a Borrowing
of any Type shall be allocated pro rata among the Lenders in accordance with
their respective Commitments (or, if such Commitments shall have expired or been
terminated, in accordance with the respective principal amounts of their
outstanding Loans). Each Lender agrees that in computing such Lender's portion
of any Borrowing to be made hereunder, the Administrative Agent may, in its
discretion, round each Lender's percentage of such Borrowing to the next higher
or lower whole dollar amount.
SECTION 2.18. Sharing of Setoffs. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim against
the Borrower or any other Loan Party, or pursuant to a secured claim under
Section 506 of Title 11 of the United States 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, obtain payment (voluntary or involuntary) in respect of any
Loan or Loans as a result of which the unpaid principal portion of its Loans
shall be proportionately less than the unpaid principal portion of the Loans of
any other Lender, it shall be deemed simultaneously to have purchased from such
other Lender at face value, and shall promptly pay to such other Lender the
purchase price for, a participation in the Loans of such other Lender, so that
the aggregate unpaid principal amount of the Loans and participations in Loans
held by each Lender shall be in the same proportion to the aggregate unpaid
principal amount of all Loans then outstanding as the principal amount of its
Loans prior to such exercise of banker's lien, setoff or counterclaim or other
event was to the principal amount of all Loans outstanding prior to such
exercise of banker's lien, setoff or counterclaim or other event; provided,
however, that if any such purchase or purchases or adjustments shall be made
pursuant to this Section 2.18 and the payment giving rise thereto shall
thereafter be recovered, such purchase or purchases or adjustments shall be
rescinded to the extent of such recovery and the purchase price or prices or
adjustment restored without interest. The Borrower expressly consents to the
foregoing arrangements and agrees that any Lender holding a participation in a
Loan deemed to have been so purchased may exercise any and all rights of
banker's lien, setoff or counterclaim with respect to any and all moneys owing
by the Borrower to such Lender by reason thereof as fully as if such Lender had
made a Loan directly to the Borrower in the amount of such participation.
SECTION 2.19. Payments. (a) The Borrower shall make each payment
(including principal of or interest on any Borrowing or any Fees or other
amounts) hereunder and under any other Loan Document not later than 12:00
(noon), New York City time, on the date when due in immediately available
dollars, without setoff, defense or counterclaim. Each such payment (other than
Agent's Fees, which shall be paid directly to the Administrative Agent or the
Collateral Agent, as the case may be), shall be made to the Administrative Agent
at its offices at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx.
(b) Whenever any payment (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder or under any other Loan
Document shall become due, or otherwise would occur, on a day that is not a
Business Day, such payment may be made on the next succeeding Business Day, and
such extension of time shall in such case be included in the computation of
interest or Fees, if applicable.
SECTION 2.20. Taxes. (a) Any and all payments by or on behalf of the
Borrower or any Loan Party hereunder and under any other Loan Document shall be
made, in accordance with
32
Section 2.19, free and clear of and without deduction for any and all current or
future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding (i) income taxes imposed on the net
income of the Administrative Agent, the Collateral Agent, any Lender (or any
transferee or assignee thereof, including a participation holder (any such
entity a "Transferee")) and (ii) franchise taxes imposed on the net income of
the Administrative Agent, the Collateral Agent, any Lender (or Transferee), in
each case by the jurisdiction under the laws of which the Administrative Agent,
the Collateral Agent, such Lender (or Transferee) is organized or any political
subdivision thereof (all such nonexcluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities, collectively or individually, being
called "Taxes"). If the Borrower or any Loan Party shall be required to deduct
any Taxes from or in respect of any sum payable hereunder or under any other
Loan Document to the Administrative Agent, the Collateral Agent, any Lender (or
any Transferee), (i) the sum payable shall be increased by the amount (an
"additional amount") necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section
2.20) the Administrative Agent, the Collateral Agent, such Lender (or
Transferee), as the case may be, shall receive an amount equal to the sum it
would have received had no such deductions been made, (ii) the Borrower or such
Loan Party shall make such deductions and (iii) the Borrower or such Loan Party
shall pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable law.
(b) In addition, the Borrower agrees to pay to the relevant Governmental
Authority in accordance with applicable law any current or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies that arise from any payment made hereunder or under any other Loan
Document or from the execution, delivery or registration of, or otherwise with
respect to, this Agreement or any other Loan Document ("Other Taxes").
(c) The Borrower will indemnify the Administrative Agent, the Collateral
Agent and each Lender (or Transferee) for the full amount of Taxes and Other
Taxes paid by the Administrative Agent, the Collateral Agent, such Lender (or
Transferee), as the case may be, and any liability (including penalties,
interest and expenses (including reasonable attorney's fees and expenses))
arising therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally asserted by the relevant Governmental Authority.
A certificate as to the amount of such payment or liability prepared by the
Administrative Agent, the Collateral Agent, a Lender (or Transferee), or the
Administrative Agent on its behalf, absent manifest error, shall be final,
conclusive and binding for all purposes. Such indemnification shall be made
within 30 days after the date the Administrative Agent, the Collateral Agent,
any Lender (or Transferee), as the case may be, makes written demand therefor.
(d) As soon as practicable after the date of any payment of Taxes or Other
Taxes by the Borrower or any other Loan Party to the relevant Governmental
Authority, the Borrower or such other Loan Party will deliver to the
Administrative Agent, at its address referred to in Section 9.01, the original
or a certified copy of a receipt issued by such Governmental Authority
evidencing payment thereof.
(e) Each Lender (or Transferee) that is organized under the laws of a
jurisdiction other than the United States, any State thereof or the District of
Columbia (a "Non-U.S. Lender") shall deliver to the Borrower and the
Administrative Agent two copies of either United States Internal Revenue Service
Form 1001 or Form 4224, or, in the case of a Non-U.S. Lender claiming exemption
from U.S. Federal withholding tax under Section 871(h) or 881(c) of the Code
with respect to payments
33
of portfolio interest, a Form W-8, or any subsequent versions thereof or
successors thereto (and, if such Non-U.S. Lender delivers a Form W-8, a
certificate representing that such Non-U.S. Lender is not a bank for purposes of
Section 881(c) of the Code, is not a 10-percent shareholder (within the meaning
of Section 871(h)(3)(B) of the Code) of the Borrower and is not a controlled
foreign corporation related to the Borrower (within the meaning of Section
864(d)(4) of the Code)), properly completed and duly executed by such Non-U.S.
Lender claiming complete exemption from, or reduced rate of, U.S. Federal
withholding tax on payments by the Borrower under this Agreement and the other
Loan Documents. Such forms shall be delivered by each Non-U.S. Lender on or
before the date it becomes a party to this Agreement (or, in the case of a
Transferee that is a participation holder, on or before the date such
participation holder becomes a Transferee hereunder) and on or before the date,
if any, such Non-U.S. Lender changes its applicable lending office by
designating a different lending office (a "New Lending Office"). In addition,
each Non-U.S. Lender shall deliver such forms promptly upon the obsolescence or
invalidity of any form previously delivered by such Non-U.S. Lender.
(f) The Borrower shall not be required to indemnify any Non-U.S. Lender or
to pay any additional amounts to any Non-U.S. Lender, in respect of United
States Federal withholding tax pursuant to paragraph (a) or (c) above to the
extent that (i) the obligation to withhold amounts with respect to United States
Federal withholding tax existed on the date such Non-U.S. Lender became a party
to this Agreement (or, in the case of a Transferee that is a participation
holder, on the date such participation holder became a Transferee hereunder) or,
with respect to payments to a New Lending Office, the date such Non-U.S. Lender
designated such New Lending Office with respect to a Loan; provided, however,
that this paragraph (f) shall not apply (x) to any Transferee or New Lending
Office that becomes a Transferee or New Lending Office as a result of an
assignment, participation, transfer or designation made at the request of the
Borrower and (y) to the extent the indemnity payment or additional amounts any
Transferee, or any Lender (or Transferee), acting through a New Lending Office,
would be entitled to receive (without regard to this paragraph (f)) do not
exceed the indemnity payment or additional amounts that the person making the
assignment, participation or transfer to such Transferee, or Lender (or
Transferee) making the designation of such New Lending Office, would have been
entitled to receive in the absence of such assignment, participation, transfer
or designation, (ii) the obligation to pay such additional amounts would not
have arisen but for a failure by such Non-U.S. Lender to comply with the
provisions of paragraph (e) above (other than a failure by reason of a change in
law or treaty occurring after the date referred to in clause (i) above that
imposes or increases U.S. Federal withholding tax on payments by the Borrower or
any Loan Party under this Agreement and the other Loan Documents) or (iii) a
representation or warranty made or deemed to be made by a Non-U.S. Lender
pursuant to the provisions of paragraph (e) above proving to have been
incorrect, false or misleading in any material respect when so made or deemed to
have been made.
(g) Nothing contained in this Section 2.20 shall require any Lender (or
any Transferee) or the Administrative Agent or the Collateral Agent to make
available any of its tax returns (or any other information that it deems to be
confidential or proprietary).
SECTION 2.21. Assignment of Commitments Under Certain Circumstances; Duty
to Mitigate. (a) In the event (i) any Lender delivers a certificate requesting
compensation pursuant to Section 2.14, (ii) any Lender delivers a notice
described in Section 2.15 or (iii) the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority on account of any
Lender pursuant to Section 2.20, the Borrower may, at its sole expense and
effort (including
34
with respect to the processing and recordation fee referred to in Section
9.04(b)), upon notice to such Lender and the Administrative Agent, require such
Lender to transfer and assign, without recourse (in accordance with and subject
to the restrictions contained in Section 9.04), all of its interests, rights and
obligations under this Agreement to an assignee that shall assume such assigned
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (x) such assignment shall not conflict with any law,
rule or regulation or order of any court or other Governmental Authority having
jurisdiction, (y) the Borrower shall have received the prior written consent of
the Administrative Agent, which consent shall not unreasonably be withheld, and
(z) the Borrower or such assignee shall have paid to the affected Lender in
immediately available funds an amount equal to the sum of the principal of and
interest accrued to the date of such payment on the outstanding Loans of such
Lender, plus all Fees and other amounts accrued for the account of such Lender
hereunder (including any amounts under Section 2.14 and Section 2.16); provided
further that, if prior to any such transfer and assignment the circumstances or
event that resulted in such Lender's claim for compensation under Section 2.14
or notice under Section 2.15 or the amounts paid pursuant to Section 2.20, as
the case may be, cease to cause such Lender to suffer increased costs or
reductions in amounts received or receivable or reduction in return on capital,
or cease to have the consequences specified in Section 2.15, or cease to result
in amounts being payable under Section 2.20, as the case may be (including as a
result of any action taken by such Lender pursuant to paragraph (b) below), or
if such Lender shall waive its right to claim further compensation under Section
2.14 in respect of such circumstances or event or shall withdraw its notice
under Section 2.15 or shall waive its right to further payments under Section
2.20 in respect of such circumstances or event, as the case may be, then such
Lender shall not thereafter be required to make any such transfer and assignment
hereunder.
(b) If (i) any Lender shall request compensation under Section 2.14, (ii)
any Lender delivers a notice described in Section 2.15 or (iii) the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority on account of any Lender, pursuant to Section 2.20, then such Lender
shall use reasonable efforts (which shall not require such Lender to incur an
unreimbursed loss or unreimbursed cost or expense or otherwise take any action
inconsistent with its internal policies or legal or regulatory restrictions or
suffer any disadvantage or burden deemed by it to be significant) (x) to file
any certificate or document reasonably requested in writing by the Borrower or
(y) to assign its rights and delegate and transfer its obligations hereunder to
another of its offices, branches or affiliates, if such filing or assignment
would reduce its claims for compensation under Section 2.14 or enable it to
withdraw its notice pursuant to Section 2.15 or would reduce amounts payable
pursuant to Section 2.20, as the case may be, in the future. The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such filing or assignment, delegation and transfer.
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Administrative Agent, the
Collateral Agent and each of the Lenders that:
SECTION 3.01. Organization; Powers. The Borrower and each of the
Subsidiaries (a) is a corporation duly organized, validly existing and in good
standing under the laws of the
35
jurisdiction of its organization, (b) has all requisite power and authority to
own its property and assets and to carry on its business as now conducted and as
proposed to be conducted, (c) is qualified to do business in, and is in good
standing in, every jurisdiction where such qualification is required, except
where the failure so to qualify could not reasonably be expected to result in a
Material Adverse Effect, and (d) has the corporate power and authority to
execute, deliver and perform its obligations under each of the Loan Documents
and each other agreement or instrument contemplated hereby to which it is or
will be a party and, in the case of the Borrower, to borrow hereunder.
SECTION 3.02. Authorization. The execution, delivery and performance by
each Loan Party and Leasco, as applicable, of each of the Loan Documents and the
Lease, the borrowings hereunder, the Securitization and the other transactions
contemplated hereby and by the other Loan Documents, the Lease, the
Securitization Documents and the Related Documents (collectively, the
Restatement Transactions) (a) have been duly authorized by all requisite
corporate and, if required, stockholder action, (b) will not violate any
provision of the certificate or articles of incorporation or other constitutive
documents or by-laws of the Borrower or any Subsidiary and (c) will not (i)
violate (A) any material provision of any law, statute, rule or regulation, (B)
any order of any Governmental Authority or (C) any material provision of any
indenture, agreement or other instrument to which the Borrower or any Subsidiary
is a party or by which any of them or any of their property is or may be bound,
(ii) be in conflict with, result in a breach of or constitute (alone or with
notice or lapse of time or both) a default under, or give rise to any right to
accelerate or to require the prepayment, repurchase or redemption of any
obligation under, any such indenture, agreement or other instrument or (iii)
result in the creation or imposition of any Lien upon or with respect to any
property or assets now owned or hereafter acquired by the Borrower or any
Subsidiary (other than any Lien created hereunder, under the Security Documents
or as permitted by Sections 6.02(a) and (c)).
SECTION 3.03. Enforceability. This Agreement has been duly executed and
delivered by the Borrower and constitutes, and each other Loan Document when
executed and delivered by each Loan Party thereto will constitute, a legal,
valid and binding obligation of such Loan Party enforceable against such Loan
Party in accordance with its terms.
SECTION 3.04. Governmental Approvals. Except as set forth on Schedule
3.04, no action, consent or approval of, registration or filing with or any
other action by any Governmental Authority is or will be required in connection
with the Restatement Transactions, except for such as have been made or obtained
and are in full force and effect.
SECTION 3.05. Financial Statements. The Borrower has heretofore furnished
to the Lenders its consolidated and combined balance sheets and related
statements of income and cash flow at December 31, 1996 and for the period from
September 5, 1996 through and including December 31, 1996, and the three months
ended March 31, 1997, together with the notes and schedules thereto. Such
financial statements (including the notes and schedules thereto) present fairly
the results of operations and the financial condition and cash flows of the
Borrower and its consolidated Subsidiaries for such periods and at such dates.
Such balance sheets (including the notes and schedules thereto) disclose all
material liabilities, direct or contingent, at the dates thereof. Such
financial statements were prepared in accordance with GAAP applied on a
consistent basis.
36
SECTION 3.06. No Material Adverse Change. There has been no material
adverse change in the business, assets, operations, prospects, condition,
financial or otherwise, or material agreements of the Borrower and the
Subsidiaries, taken as a whole, since December 31, 1996.
SECTION 3.07. Title to Properties; Possession Under Leases. (a) The
Borrower and each of the Subsidiaries has good and marketable title to, or valid
leasehold interests in, all its material properties and assets, except (i) for
minor defects in title that do not interfere with its ability to conduct its
business as currently conducted or to utilize such properties and assets for
their intended purposes and (ii) as set forth on Schedule 3.07. All material
properties and assets of the Borrower and the Subsidiaries are free and clear of
Liens, other than Permitted Liens.
(b) The Borrower and each of the Subsidiaries has complied with all
obligations under all material leases to which it is a party and all such leases
are in full force and effect, except as set forth on Schedule 3.07. The
Borrower and each of the Subsidiaries enjoys peaceful and undisturbed possession
under all such material leases.
SECTION 3.08. Subsidiaries. Schedule 3.08 sets forth as of the Restatement
Closing Date a list of all Subsidiaries and the percentage ownership interest of
the Borrower therein. The shares of capital stock or other ownership interests
so indicated on Schedule 3.08 are fully paid and non-assessable and are owned by
the Borrower, directly or indirectly, free and clear of all Liens (other than
Liens created under the Loan Documents). As of the Restatement Closing Date,
the Borrower has no direct or indirect Foreign Subsidiaries.
SECTION 3.09. Litigation; Compliance with Laws. (a) Except as set forth on
Schedule 3.09, there are no actions, suits or proceedings at law or in equity or
by or before any Governmental Authority now pending or, to the knowledge of the
Borrower, threatened against or affecting the Borrower or any Subsidiary or any
business, property or rights of any such person (i) that involve any Loan
Document or the Restatement Transactions or (ii) as to which there is a
reasonable possibility of an adverse determination and that, if adversely
determined, could reasonably be expected, individually or in the aggregate, to
result in a Material Adverse Effect.
(b) Neither the Borrower nor any of the Subsidiaries or any of their
respective material properties or assets is in violation of, nor will the
continued operation of their material properties and assets as currently
conducted violate, any law, rule or regulation, or is in default with respect to
any judgment, writ, injunction, decree or order of any Governmental Authority,
where such violation or default could reasonably be expected to result in a
Material Adverse Effect.
SECTION 3.10. Agreements. (a) Neither the Borrower nor any of the
Subsidiaries is a party to any agreement or instrument or subject to any
corporate restriction that has resulted or could reasonably be expected to
result in a Material Adverse Effect.
(b) Neither the Borrower nor any of the Subsidiaries is in default in any
manner under any provision of any indenture or other agreement or instrument
evidencing Indebtedness, or any other material agreement or instrument to which
it is a party or by which it or any of its properties or assets are or may be
bound, where such default could reasonably be expected to result in a Material
Adverse Effect.
37
SECTION 3.11. Federal Reserve Regulations. (a) Neither the Borrower nor
any of the Subsidiaries is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of buying or
carrying Margin Stock.
(b) No part of the proceeds of any Loan will be used, whether directly or
indirectly, and whether immediately, incidentally or ultimately, for any purpose
that entails a violation of, or that is inconsistent with, the provisions of the
Regulations of the Board, including Regulation G, U or X.
SECTION 3.12. Investment Company Act; Public Utility Holding Company Act.
Neither the Borrower nor any Subsidiary is (a) an "investment company" as
defined in, or subject to regulation under, the Investment Company Act of 1940
or (b) a "holding company" as defined in, or subject to regulation under, the
Public Utility Holding Company Act of 1935.
SECTION 3.13. Use of Proceeds. The Borrower will use the proceeds of the
Loans only for the purposes specified in the preamble to this Agreement.
SECTION 3.14. Tax Returns. Each of the Borrower and the Subsidiaries has
filed or caused to be filed all Federal, state, local and foreign tax returns or
materials required to have been filed by it and has paid or caused to be paid
all taxes due and payable by it and all assessments received by it, except taxes
that are being contested in good faith by appropriate proceedings and for which
the Borrower or such Subsidiary, as applicable, shall have set aside on its
books adequate reserves.
SECTION 3.15. No Material Misstatements. None of the Confidential
Information Memorandum nor any other information, report, financial statement,
exhibit or schedule furnished in writing by or on behalf of the Borrower to the
Administrative Agent, the Collateral Agent or any Lender in connection with the
negotiation of any Loan Document or included therein or delivered pursuant
thereto (collectively, "information") contained, contains or will contain any
material mis statement of fact or omitted, omits or will omit to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were, are or will be made, not misleading,
provided that (a) the statements therein describing documents and agreements are
summaries only and as such are qualified in their entirety by reference to such
documents and agreements, (b) as to information therein that is specified as
having been supplied by persons other than the Borrower or an Affiliate of the
Borrower, the foregoing representation is limited to the knowledge of the
Borrower, (c) to the extent any such information was based upon or constitutes a
forecast or projection, the Borrower represents only that it acted in good faith
and utilized reasonable assumptions and due care in the preparation of such
information and (d) to the extent any such information was subsequently
replaced, prior to the Restatement Closing Date, by other information expressly
correcting such earlier information (and either the Administrative Agent or the
Collateral Agent was expressly informed by or on behalf of the Borrower that
such other information was correcting such earlier information), the foregoing
representation does not apply to such earlier information.
SECTION 3.16. Employee Benefit Plans. Each of the Borrower and its ERISA
Affiliates is in compliance in all material respects with the applicable
provisions of ERISA, the Code and the regulations and published interpretations
thereunder with respect to Plans and Multiemployer Plans.
38
Neither the Borrower nor any of its ERISA Affiliates maintains or contributes to
or is or has within the past five years been required to maintain or contribute
to a Plan or a Multiemployer Plan.
SECTION 3.17. Environmental Matters. Except as set forth in Schedule 3.17:
(a) The properties owned or operated by the Borrower and the Subsidiaries
(the "Properties") do not contain any Hazardous Materials in amounts or
concentrations which (i) constitute or constituted a violation of, (ii) require
Remedial Action under, or (iii) could give rise to liability under,
Environmental Laws, which violations, Remedial Actions and liabilities, in the
aggregate, could reasonably be expected to result in a Material Adverse Effect;
(b) The Properties and all operations of the Borrower and the Subsidiaries
are in compliance, and in the last five years have been in compliance, with all
Environmental Laws and all necessary Environmental Permits have been obtained
and are in effect, except to the extent that such non-compliance or failure to
obtain any necessary permits, in the aggregate, could not reasonably be expected
to result in a Material Adverse Effect;
(c) There have been no Releases or threatened Releases at or from the
Properties or otherwise in connection with the operations of the Borrower or the
Subsidiaries, which Releases or threatened Releases, in the aggregate, could
reasonably be expected to result in a Material Adverse Effect;
(d) Neither the Borrower nor any of the Subsidiaries has received any
notice of an Environmental Claim in connection with the Properties or the
operations of the Borrower or the Subsidiaries or with regard to any person
whose liabilities for environmental matters the Borrower or the Subsidiaries has
retained or assumed, in whole or in part, contractually, by operation of law or
otherwise, which, in the aggregate, could reasonably be expected to result in a
Material Adverse Effect, nor do the Borrower or the Subsidiaries have reason to
believe that any such notice will be received or is being threatened; and
(e) Hazardous Materials have not been transported from the Properties in
connection with the operations of the Borrower or the Subsidiaries or in
connection with the operations of any person for which the Borrower or the
Subsidiaries retained or assumed any liability, contractually, by operation of
law or otherwise, nor have Hazardous Materials been generated, treated, stored
or disposed of at, on or under any of the Properties in a manner that could give
rise to liability under any Environmental Law, nor have the Borrower or the
Subsidiaries retained or assumed any liability, contractually, by operation of
law or otherwise, with respect to the generation, treatment, storage or disposal
of Hazardous Materials, which transportation, generation, treatment, storage or
disposal, or retained or assumed liabilities, in the aggregate, could reasonably
be expected to result in a Material Adverse Effect.
SECTION 3.18. Insurance. Schedule 3.18 sets forth a true, complete and
correct description of all insurance maintained by or for the Borrower or any
Subsidiary as of the Restatement Closing Date. As of such date, such insurance
is in full force and effect and all premiums due and payable on the Restatement
Closing Date have been duly paid. The Borrower and the Subsidiaries have
insurance in such amounts and covering such risks and liabilities as are in
accordance with normal industry practice.
39
SECTION 3.19. Security Documents. (a) The Pledge Agreement is effective to
create in favor of the Collateral Agent, for the ratable benefit of the Secured
Parties, a legal, valid and enforceable security interest in the Collateral (as
defined in the Pledge Agreement) and, assuming the Collateral has been delivered
to the Collateral Agent, the Pledge Agreement constitutes a fully perfected
first priority Lien on, and security interest in, all right, title and interest
of the pledgors thereunder in such Collateral, in each case prior and superior
in right to any other person.
(b) The Security Agreement is effective to create in favor of the
Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid
and enforceable security interest in the Collateral (as defined in the Security
Agreement) and, assuming financing statements in appropriate form have been
filed in the offices specified on Schedule 6 to the Perfection Certificate, the
Security Agreement shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of the grantors thereunder in such
Collateral (other than the Intellectual Property, as defined in the Security
Agreement), in each case prior and superior in right to any other person, other
than with respect to any Permitted Liens.
(c) Assuming the Security Agreement has been filed in the United States
Patent and Trademark Office and the United States Copyright Office, the Security
Agreement shall constitute a fully perfected Lien on, and security interest in,
all right, title and interest of the grantors thereunder in the Intellectual
Property (as defined in the Security Agreement), in each case prior and superior
in right to any other person (it being understood that subsequent recordings in
the United States Patent and Trademark Office and the United States Copyright
Office may be necessary to perfect a lien on registered trademarks, trademark
applications and copyrights acquired by the grantors after the Restatement
Closing Date).
SECTION 3.20. Location of Leased Premises; No Real Property. Schedule 3.20
lists completely and correctly as of the Restatement Closing Date all real
property leased by the Borrower or any of the Subsidiaries and the addresses
thereof. Neither the Borrower nor any of the Subsidiaries owns any real
property as of the Restatement Closing Date.
SECTION 3.21. Labor Matters. As of the Restatement Closing Date, there are
no strikes, lockouts or slowdowns against the Borrower or any Subsidiary pending
or, to the knowledge of the Borrower, threatened. The hours worked by and
payments made to employees of the Borrower and the Subsidiaries have not been in
violation of the Fair Labor Standards Act or any other applicable Federal,
state, local or foreign law dealing with such matters. All payments due from
the Borrower or any Subsidiary, or for which any claim may be made against the
Borrower or any Subsidiary, on account of wages and employee health and welfare
insurance and other benefits, have been paid or accrued as a liability on the
books of the Borrower or such Subsidiary. The consummation of the Restatement
Transactions will not give rise to any right of termination or right of
renegotiation on the part of any union under any collective bargaining agreement
to which the Borrower or any Subsidiary is bound.
SECTION 3.22. Solvency. As of the Restatement Closing Date, (i) the fair
value of the assets of each Loan Party, at a fair valuation, will exceed its
debts and liabilities, subordinated, contingent or otherwise; (ii) the present
fair saleable value of the property of each Loan Party will be greater than the
amount that will be required to pay the probable liability of its debts and
other liabilities, subordinated, contingent or otherwise, as such debts and
other liabilities become absolute and matured; (iii) each Loan Party will be
able to pay its debts and liabilities, subordinated, contingent or otherwise, as
such debts and liabilities become absolute and matured; and (iv) each
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Loan Party will not have unreasonably small capital with which to conduct the
business in which it is engaged as such business is now conducted and is
proposed to be conducted following the Restatement Closing Date.
SECTION 3.23. Lease. The Lease has been duly executed and delivered by
each of the Borrower and Leasco and constitutes a legal, valid and binding
obligation of each such party enforceable against each such party in accordance
with its terms.
ARTICLE IV
Conditions of Lending
The obligations of the Lenders to make Loans hereunder are subject to the
satisfaction of the following conditions:
SECTION 4.01. All Borrowings. On the date of each Borrowing:
(a) The Administrative Agent shall have received a notice of such
Borrowing as required by Section 2.03.
(b) Except in the case of a Borrowing that does not increase the aggregate
principal amount of Loans outstanding of any Lender, the representations and
warranties set forth in Article III hereof shall be true and correct in all
material respects on and as of the date of such Borrowing with the same effect
as though made on and as of such date, except to the extent such representations
and warranties expressly relate to an earlier date.
(c) The Borrower and each other Loan Party shall be in compliance with all
the terms and provisions set forth herein and in each other Loan Document on its
part to be observed or performed, and at the time of and immediately after such
Borrowing, no Event of Default or Default shall have occurred and be continuing.
Each Borrowing shall be deemed to constitute a representation and warranty
by the Borrower on the date of such Borrowing as to the matters specified in
paragraphs (b) (except as aforesaid) and (c) of this Section 4.01.
SECTION 4.02. Effectiveness. The effectiveness of the amendment and
restatement of this Agreement and the obligations of the Lenders to make Loans
hereunder are subject to the satisfaction on a single date on or prior to
September 17, 1997, of the conditions set forth in Section 7 of the Amendment
Agreement.
ARTICLE V
Affirmative Covenants
The Borrower covenants and agrees with each Lender that so long as
this Agreement shall remain in effect and until the Commitments have been
terminated and the principal of and interest
41
on each Loan, all Fees and all other expenses or amounts payable under any Loan
Document shall have been paid in full, unless the Required Lenders shall
otherwise consent in writing, the Borrower will, and will cause each of the
Subsidiaries to:
SECTION 5.01. Existence; Businesses and Properties. (a) Do or cause
to be done all things necessary to preserve, renew and keep in full force and
effect its legal existence, except as otherwise expressly permitted under
Section 6.05.
(b) Do or cause to be done all things necessary to obtain, preserve,
renew, extend and keep in full force and effect the rights, licenses, permits,
franchises, authorizations, patents, copyrights, trademarks and trade names
material to the conduct of its business; maintain and operate such business in
substantially the manner in which it is presently conducted and operated (or in
any manner reasonably incidental thereto); comply in all material respects with
all applicable laws, rules, regula tions and decrees and orders of any
Governmental Authority, whether now in effect or hereafter enacted; and at all
times maintain and preserve all property material to the conduct of such
business and keep such property in good repair, working order and condition and
from time to time make, or cause to be made, all needful and proper repairs,
renewals, additions, improvements and replacements thereto necessary in order
that the business carried on in connection therewith may be properly conducted
at all times.
SECTION 5.02. Insurance. Except with respect to Vehicles leased by
the Borrower from Leasco with respect to which the Borrower shall comply with
Section 22.4 of the Lease:
(a) Keep its insurable properties adequately insured at all times by
financially sound and reputable insurers; maintain such other insurance, to such
extent and against such risks, including fire and other risks insured against by
extended coverage, as is customary with companies in the same or similar
businesses operating in the same or similar locations, including public
liability insurance against claims for personal injury or death or property
damage occurring upon, in, about or in connection with the use of any properties
owned, occupied or controlled by it; and maintain such other insurance as may be
required by law; provided, however, that notwithstanding anything to the
contrary contained herein, the Borrower may (i) continue its current practices
of self-insurance and (ii) create one or more Subsidiaries to act as captive
insurance companies.
(b) Cause all such policies of the Borrower and the Loan Parties to
be endorsed or otherwise amended to include a "standard" or "New York" lender's
loss payable endorsement, in form and substance satisfactory to the
Administrative Agent and the Collateral Agent, which endorsement shall provide
that, from and after the Restatement Closing Date, if the insurance carrier
shall have received written notice from the Administrative Agent or the
Collateral Agent of the occurrence of an Event of Default, the insurance carrier
shall pay all proceeds otherwise payable to the Borrower or the other Loan
Parties under such policies directly to the Collateral Agent; cause all such
policies to provide that none of the Borrower, the Administrative Agent, the
Collateral Agent or any other party shall be a coinsurer thereunder and to
contain a "Replacement Cost Endorsement", without any deduction for
depreciation, and such other provisions as the Administrative Agent or the
Collateral Agent may reasonably require from time to time to protect their
interests; deliver original or certified copies of all such certificates of
insurance to the Collateral Agent; cause each such policy to provide that it
shall not be canceled, modified or not renewed (i) by reason of nonpayment of
premium upon not less than 10 days' prior written notice thereof by the insurer
to the Administrative Agent and the Collateral Agent (giving the
42
Administrative Agent and the Collateral Agent the right to cure defaults in the
payment of premiums) or (ii) for any other reason upon not less than 30 days'
prior written notice thereof by the insurer to the Administrative Agent and the
Collateral Agent; deliver to the Administrative Agent and the Collateral Agent,
prior to the cancelation, modification or nonrenewal of any such policy of
insurance, a copy of a renewal or replacement policy (or other evidence of
renewal of a policy previously delivered to the Administrative Agent and the
Collateral Agent) together with evidence satisfactory to the Administrative
Agent and the Collateral Agent of payment of the premium therefor.
(c) Notify the Administrative Agent and the Collateral Agent immediately
whenever any separate insurance concurrent in form or contributing in the event
of loss with that required to be maintained under this Section 5.02 is taken out
by the Borrower; and promptly deliver to the Administrative Agent and the
Collateral Agent a duplicate original copy of such policy or policies.
(d) In connection with the covenants set forth in this Section 5.02, it is
understood and agreed that:
(i) none of the Administrative Agent, the Collateral Agent, the
Lenders or their respective agents or employees shall be liable for any
loss or damage insured by the insurance policies required to be maintained
under this Section 5.02, it being understood that (A) the Borrower and the
other Loan Parties shall look solely to their insurance companies or any
other parties other than the aforesaid parties for the recovery of such
loss or damage and (B) such insurance companies shall have no rights of
subrogation against the Administrative Agent, the Collateral Agent, the
Lenders or their agents or employees. If, however, the insurance policies
do not provide waiver of subrogation rights against such parties, as
required above, then the Borrower hereby agrees, to the extent permitted by
law, to waive its, and to cause each of the Subsidiaries to waive its,
right of recovery, if any, against the Administrative Agent, the Collateral
Agent, the Lenders and their agents and employees; and
(ii) the designation of any form, type or amount of insurance
coverage by the Administrative Agent, the Collateral Agent or the Required
Lenders under this Section 5.02 shall in no event be deemed a
representation, warranty or advice by the Administrative Agent, the
Collateral Agent or the Lenders that such insurance is adequate for the
purposes of the business of the Borrower and the Subsidiaries or the
protection of their properties and the Administrative Agent, the Collateral
Agent and the Required Lenders shall have the right from time to time to
require the Borrower and the other Loan Parties to keep other insurance in
such form and amount as the Administrative Agent, the Collateral Agent or
the Required Lenders may reasonably request, provided that such insurance
shall be obtainable on commercially reasonable terms.
SECTION 5.03. Obligations and Taxes. Pay its Indebtedness and other
obligations promptly and in accordance with their terms and pay and discharge
promptly when due all taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or in respect of its property,
before the same shall become delinquent or in default, as well as all lawful
claims for labor, materials and supplies or otherwise that, if unpaid, might
give rise to a Lien upon such properties or any part thereof; provided, however,
that such payment and discharge shall not be required with respect to any such
tax, assessment, charge, levy or claim so long as the
43
validity or amount thereof shall be contested in good faith by appropriate
proceedings and the Borrower shall have set aside on its books adequate reserves
with respect thereto in accordance with GAAP and such contest operates to
suspend collection of the contested obligation, tax, assessment or charge and
enforcement of a Lien.
SECTION 5.04. Financial Statements, Reports, etc. Furnish to the Agents:
(a) within 90 days after the end of each fiscal year, the consolidated
and combined balance sheet and related statements of income, stockholders'
equity and cash flows showing the financial condition of the Borrower and
its consolidated Subsidiaries as of the close of such fiscal year and the
results of its operations and the operations of such Subsidiaries during
such year, all audited by Coopers & Xxxxxxx LLP or other independent public
accountants of recognized national standing acceptable to the Required
Lenders and accompanied by an opinion of such accountants (which shall not
be qualified in any material respect) to the effect that such consolidated
financial statements fairly present the financial condition and results of
operations of the Borrower and its consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied; provided,
however, that such financial statements will contain footnotes or other
information to the effect that: (i) Leasco's business consists of the
purchase and lease of vehicles; (ii) Xxxxx'x business consists of the
issuance of commercial paper notes and of the making of loans to Leasco;
and (iii) each of Leasco and Xxxxx is a separate corporate entity with its
own separate creditors which, upon the liquidation of Leasco or Xxxxx, as
the case may be, will be entitled to be satisfied out of Leasco's or
Xxxxx'x assets, as applicable, prior to any value in Leasco or Xxxxx
becoming available to Leasco's or Xxxxx'x equity holders, as applicable;
(b) within 45 days after the end of each of the first three fiscal
quarters of each fiscal year, the consolidated and combined balance sheet
and related statements of income, stockholders' equity and cash flows
showing the financial condition of the Borrower and its consolidated
Subsidiaries as of the close of such fiscal quarter and the results of its
operations and the operations of such Subsidiaries during such fiscal
quarter and the then elapsed portion of the fiscal year, all certified by
one of its Financial Officers as fairly presenting the financial condition
and results of operations of the Borrower and its consolidated Subsidiaries
on a consolidated basis in accordance with GAAP consistently applied,
subject to normal year-end audit adjustments;
(c) within 30 days after the end of each of the first two months of
each fiscal quarter, the consolidated and combined balance sheet and
related statements of income, stockholders' equity and cash flows showing
the financial condition of the Borrower and its consolidated Subsidiaries
as of the close of such month and the results of its operations and the
operations of such Subsidiaries during such month and the then elapsed
portion of the fiscal year, all certified by one of its Financial Officers
as fairly presenting the financial condition and results of operations of
the Borrower and its consolidated Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied, subject to normal year-end audit
adjustments;
(d) concurrently with any delivery of financial statements under sub-
paragraph (a), (b) or (c) above, a certificate of the accounting firm or
Financial Officer opining on or
44
certifying such statements (which certificate, when furnished by an
accounting firm, may be limited to accounting matters and disclaim
responsibility for legal interpretations) (i) certifying that no Event of
Default or Default has occurred or, if such an Event of Default or Default
has occurred, specifying the nature and extent thereof and any corrective
action taken or proposed to be taken with respect thereto and (ii) with
respect to the financial statements delivered under sub-paragraph (a) or
(b) above, setting forth computations in reasonable detail satisfactory to
the Administrative Agent demonstrating whether or not there has been
compliance with the covenants contained in Sections 6.11 through 6.13;
(e) within 12 days after the end of each calendar month (i) a
certificate (a "Borrowing Base Certificate") showing the Borrowing Base as
of the close of business on the last day of such calendar month, each such
Certificate to be certified as complete and correct on behalf of the
Borrower by a Financial Officer of the Borrower, and (ii) such supporting
documentation and additional reports with respect to the Borrowing Base as
the Collateral Agent shall reasonably request;
(f) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by
the Borrower or any Subsidiary with the Securities and Exchange Commission,
or any Governmental Authority succeeding to any or all of the functions of
said Commission, or with any national securities exchange, or distributed
to its shareholders, as the case may be;
(g) Intentionally Omitted; and
(h) promptly, from time to time, such other information regarding the
operations, business affairs and financial condition of the Borrower or
any Subsidiary, or compliance with the terms of any Loan Document, any
Securitization Document or the Lease, as the Administrative Agent, the
Collateral Agent or any Lender may reasonably request.
SECTION 5.05. Litigation and Other Notices. Furnish to the Administrative
Agent, the Collateral Agent and each Lender prompt written notice of the
following:
(a) any Event of Default or Default, specifying the nature and extent
thereof and the corrective action (if any) taken or proposed to be taken
with respect thereto;
(b) the filing or commencement of, or any threat or notice of
intention of any person to file or commence, any action, suit or
proceeding, whether at law or in equity or by or before any Governmental
Authority, against the Borrower or any of its Affiliates that could
reasonably be expected to result in a Material Adverse Effect; and
(c) any development that has resulted in, or could reasonably be
expected to result in, a Material Adverse Effect (such notice to be
provided promptly upon any Responsible Officer of the Borrower becoming
aware of any such development).
SECTION 5.06. Employee Benefits. (a) Comply in all material respects with
the applicable provisions of ERISA, the Code and the regulations and published
interpretations thereunder with respect to Plans and Multiemployer Plans and (b)
furnish to the Administrative Agent (i) as soon
45
as possible after, and in any event within 10 days after any Responsible Officer
of the Borrower or any of its ERISA Affiliates knows or has reason to know that,
any ERISA Event has occurred that, alone or together with any other ERISA Event
could reasonably be expected to result in a Material Adverse Effect, a statement
of a Financial Officer of the Borrower setting forth details as to such ERISA
Event and the action, if any, that the Borrower proposes to take with respect
thereto.
SECTION 5.07. Maintaining Records; Access to Properties and Inspections.
Keep proper books of record and account in which full, true and correct entries
in conformity with GAAP and all requirements of law are made of all dealings and
transactions in relation to its business and activities. Each Loan Party and
Leasco will, and will cause each of its Subsidiaries to, permit any
representatives designated by the Administrative Agent, the Collateral Agent or
any Lender to visit and inspect the financial records and the properties of the
Borrower or any Subsidiary (including such records and properties as relate to
the Borrowing Base and the assets included therein) at reasonable times, upon
reasonable notice and as often as reasonably requested and at the Borrower's
expense if a Default or Event of Default shall have occurred and be continuing
and to make extracts from and copies of such financial records, and permit any
representatives designated by the Administrative Agent, the Collateral Agent or
any Lender to discuss the affairs, finances and condition of the Borrower or any
Subsidiary (including as such matters relate to the Borrowing Base and the
assets included therein) with the officers thereof and independent accountants
therefor, provided that the business of the Borrower and the Subsidiaries shall
not be unreasonably disrupted by any such visit and inspection.
SECTION 5.08. Use of Proceeds. Use the proceeds of the Loans only for the
purposes set forth in the preamble to this Agreement.
SECTION 5.09. Compliance with Environmental Laws. Comply, and cause, to the
best of its ability, all lessees and other persons occupying its Properties to
comply, in all material respects with all Environmental Laws and Environmental
Permits applicable to its operations and Properties; obtain and renew all
material Environmental Permits necessary for its operations and Properties; and
conduct any Remedial Action in accordance with Environmental Laws; provided,
however, that neither the Borrower nor any of the Subsidiaries shall be required
to undertake any Remedial Action to the extent that its obligation to do so is
being contested in good faith and by proper proceedings and appropriate reserves
are being maintained with respect to such circumstances.
SECTION 5.10. Preparation of Environmental Reports. If a Default caused by
reason of a breach of Section 3.17 or 5.09 shall have occurred and be
continuing, at the request of the Required Lenders through the Administrative
Agent, provide to the Lenders within 45 days after such request, at the expense
of the Borrower, an environmental site assessment report for the Properties
which are the subject of such default prepared by an environmental consulting
firm acceptable to the Administrative Agent and indicating the presence or
absence of Hazardous Materials and the estimated cost of any compliance or
Remedial Action in connection with such Properties.
SECTION 5.11. Audits. (a) From time to time upon reasonable notice from
the Collateral Agent or the Required Lenders, permit the Collateral Agent or the
Lenders or professionals (including investment bankers, consultants,
accountants, lawyers and appraisers) retained by the Collateral Agent or the
Lenders to conduct evaluations and appraisals of (i) the Borrower's practices in
the computation of the Borrowing Base, (ii) the assets included in the Borrowing
Base and
46
(iii) the monitoring systems (computer and otherwise) and financial records
relating to the Borrowing Base and such assets, and pay the reasonable fees and
expenses of such professionals, provided that (A) so long as no Default or Event
of Default shall have occurred and be continuing, there shall be no more than
one such evaluation and appraisal by any of the Collateral Agent or such Lenders
or professionals in any fiscal quarter of the Borrower and (B) the business of
the Borrower and the Subsidiaries shall not be unreasonably disrupted by any
such evaluation and appraisal.
(b) In connection with any evaluation and appraisal relating to the
computation of the Borrowing Base, agree to maintain such additional reserves
(for purposes of computing the Borrowing Base) in respect of the assets
specified in clauses (a) through (d) of the definition of the term "Borrowing
Base" and make such other adjustments to its parameters for including such
assets in the calculation of the Borrowing Base as the Collateral Agent or the
Required Lenders shall in good faith and in the exercise of its or their
reasonable judgment require based upon the results of such evaluation and
appraisal and after taking into account any other changes previously made with
respect to the calculation of the Borrowing Base.
SECTION 5.12. Interest Rate Protection. Enter into with one or more
persons that are at the time Lenders (or Affiliates of Lenders), and for a
period of two and one-half years after the October 17, 1996, maintain at all
times in full force and effect, Interest Rate Protection Agreements or fixed
rate securities or loans at rates, on terms and in form reasonably satisfactory
to the Agents to set at fixed rates the interest cost to the Borrower with
respect to its floating rate debt.
SECTION 5.13. Consents of Lessors. Use its reasonable efforts to obtain
within 60 days following the Restatement Closing Date estoppel certificates or
similar agreements reasonably satisfactory to the Collateral Agent executed by
the lessors of all Properties.
SECTION 5.14. Intentionally Omitted.
SECTION 5.15. Vehicle Fleet. (a) Leasco Distribution. Use its best
efforts to cause Leasco to dividend (or, in the event such dividends cannot
lawfully be made in accordance with applicable law, to lend or otherwise advance
(to the extent lawful to so lend or advance), subject to Section 6.04(b)) to the
Borrower all monies and other funds held by Leasco that do not need to be
retained by Leasco with respect to the ownership or acquisition of Vehicles,
debt service owed under the Securitization or the satisfaction of any other
obligations of Leasco reasonably relating thereto.
(b) Leasco Affairs. Cause Leasco to conduct its affairs strictly in
accordance with, and to otherwise comply with, its certificate of incorporation
and by-laws.
SECTION 5.16. Further Assurances. Execute any and all further documents,
financing statements, agreements and instruments, and take all further action
(including filing Uniform Commercial Code and other financing statements) that
may be required under applicable law, or that the Required Lenders, the
Administrative Agent or the Collateral Agent may reasonably request, in order to
effectuate the transactions contemplated by the Loan Documents and in order to
grant, preserve, protect and perfect the validity and first priority of the
security interests created or intended to be created by the Security Documents.
The Borrower will cause any subsequently acquired or organized Domestic
Subsidiary (or, to the extent no adverse tax consequences to the
47
Borrower or any Subsidiary would result, Foreign Subsidiary) to execute the
Guarantee Agreement, the Indemnity Subrogation and Contribution Agreement and
each applicable Security Document in favor of the Collateral Agent. In addition,
from time to time, the Borrower will, at its cost and expense, promptly secure
the Obligations by pledging or creating, or causing to be pledged or created,
perfected security interests with respect to such of its assets and properties
(other than the Vehicles owned by Leasco) as the Administrative Agent, the
Collateral Agent or the Required Lenders shall designate (it being understood
that it is the intent of the parties that the Obligations shall be secured by,
among other things, substantially all the assets of the Borrower and the
Subsidiaries (including properties acquired subsequent to the Restatement
Closing Date), other than such Vehicles). Such security interests and Liens will
be created under the Security Documents and other security agreements and other
instruments and documents in form and substance satisfactory to the Collateral
Agent, and the Borrower shall deliver or cause to be delivered to the Lenders
all such instruments and documents (including legal opinions, title insurance
policies and lien searches) as the Collateral Agent shall reasonably request to
evidence compliance with this Section. The Borrower agrees to provide such
evidence as the Collateral Agent shall reasonably request as to the perfection
and priority status of each such security interest and Lien. Nothwithstanding
any of the foregoing provisions of this Section 5.16, it is understood and
agreed that neither Xxxxx nor Leasco will be required to execute or become
parties to the Guarantee Agreement, the Indemnity, Subrogation and Contribution
Agreement or any other Security Document, pursuant to this Agreement.
ARTICLE VI
Negative Covenants
The Borrower covenants and agrees with each Lender that, so long as this
Agreement shall remain in effect and until the Commitments have been terminated
and the principal of and interest on each Loan, all Fees and all other expenses
or amounts payable under any Loan Document have been paid in full, unless the
Required Lenders shall otherwise consent in writing, the Borrower will not, and
will not cause or permit any of the Subsidiaries to:
SECTION 6.01. Indebtedness. Incur, create, assume or permit to exist any
Indebtedness, except:
(a) in the case of the Borrower, Indebtedness for borrowed money
existing on the Restatement Closing Date and set forth in Schedule 6.01;
(b) Indebtedness of the Borrower the net proceeds of which are used
substantially concurrently to refinance Indebtedness described in clause
(a) so long as (i) such refinancing Indebtedness is in an aggregate
principal amount not greater than the aggregate principal amount of the
Indebtedness being refinanced plus the amount of any premiums required to
be paid thereon and fees and expenses associated therewith, (ii) such
Indebtedness has a later or equal final maturity and a longer or equal
weighted average life than the Indebtedness being refinanced, (iii) the
interest rate applicable to such Indebtedness shall be a market interest
rate (as determined in good faith by the Board of Directors of the
Borrower) as of the time of the incurrence thereof and (iv) each of the
covenants, events of default and other provisions thereof (including any
Guarantees thereof and, if the
48
Indebtedness being refinanced is subordinated, the subordination provisions
thereof) shall be no less favorable to the Lenders than those contained in
the Indebtedness being refinanced unless each of such provisions is
approved in writing by the Required Lenders;
(c) Indebtedness created hereunder and under the other Loan Documents;
(d) in the case of Leasco and Xxxxx, Indebtedness created and
permitted to be outstanding under the Securitization Documents (including,
without limitation, the Subordinated Demand Note), as amended,
supplemented, replaced, refinanced or otherwise modified from time to time;
(e) in the case of the Borrower and the Subsidiaries, intercompany
loans and advances permitted by Section 6.04(b);
(f) in the case of the Borrower and the Subsidiaries (other than
Leasco and Xxxxx), Indebtedness consisting of purchase money Indebtedness
or Capital Lease Obligations incurred in the ordinary course of business
after the Restatement Closing Date to finance Capital Expenditures,
provided that (i) a description of the assets financed thereby shall have
been furnished to the Administrative Agent for any assets for which the
purchase price is greater than $500,000, (ii) the Indebtedness incurred
shall not exceed 85% of the purchase price of the assets financed thereby
and (iii) the aggregate principal amount of any Indebtedness or Capital
Lease Obligations incurred pursuant to this paragraph (f) outstanding at
any time shall not exceed $10,000,000;
(g) in the case of the Borrower, Indebtedness pursuant to Interest
Rate Protection Agreements, in form, on terms and with parties reasonably
satisfactory to the Administrative Agent;
(h) in the case of the Borrower and the Subsidiaries (other than
Leasco and Xxxxx), Indebtedness in respect of performance bonds, bid bonds,
appeal bonds, surety bonds and similar obligations and trade letters of
credit, in each case provided in the ordinary course of business, including
those incurred to secure health, safety and environmental obligations in
the ordinary course of business, provided that the issuance or existence of
any such trade letter of credit shall not extend or otherwise improve the
payment terms of the underlying obligations to which such letter of credit
relates beyond the terms that would have otherwise been granted had such
letter of credit not been issued or existed;
(i) in the case of the Borrower, cash collateralized letters of
credit in an aggregate outstanding face amount not to exceed $50,000,000 at
any time; and
(j) in the case of the Borrower and the Subsidiaries (other than
Leasco and Xxxxx), unsecured Indebtedness in addition to that permitted by
clauses (a) through (i) above in an aggregate principal amount not to
exceed $5,000,000 at any time outstanding, so long as such Indebtedness is
created under agreements or instruments imposing covenants on the Borrower
and the Subsidiaries no less favorable to them than the covenants imposed
under this Agreement.
49
SECTION 6.02. Liens. Create, incur, assume or permit to exist any Lien on
any property or assets (including stock or other securities of any person,
including any Subsidiary) now owned or hereafter acquired by it or on any income
or revenues or rights in respect of any thereof, except (each of the following,
a "Permitted Lien"):
(a) Liens on property or assets of the Borrower and the Subsidiaries
existing on the Restatement Closing Date and set forth in Schedule 6.02,
provided that such Liens shall secure only those obligations which they
secure on the Restatement Closing Date;
(b) any Lien created under the Loan Documents;
(c) any Lien created under the Securitization on the property and
assets of Leasco and Xxxxx;
(d) any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Subsidiary, provided that (i)
such Lien is not created in contemplation of or in connection with such
acquisition and (ii) such Lien does not apply to any other property or
assets of the Borrower or any Subsidiary;
(e) Liens for taxes, assessments or governmental charges not yet due
and payable or which are being contested in compliance with Section 5.03;
(f) carriers', warehousemen's, mechanics', materialmen's, repairmen's
or other like Liens arising in the ordinary course of business and securing
obligations that are not due yet and payable or which are being contested
in compliance with Section 5.03;
(g) pledges and deposits made in the ordinary course of business in
compliance with workmen's compensation, unemployment insurance and other
social security laws or regulations;
(h) pledges and deposits to secure the performance of bids, trade
contracts (other than for Indebtedness), leases (other than Capital Lease
Obligations), statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature incurred in the ordinary
course of business;
(i) zoning restrictions, easements, rights-of-way, restrictions on use
of real property and other similar encumbrances incurred in the ordinary
course of business which, in the aggregate, are not substantial in amount
and do not materially impair the current use or value of the property
subject thereto;
(j) purchase money security interests in real property, improvements
thereto or equipment (including Vehicles) hereafter acquired (or, in the
case of improvements, constructed) by the Borrower or any Subsidiary (other
than Leasco and Xxxxx), provided that (i) such security interests secure
Indebtedness permitted by Section 6.01(f), (ii) such security interests are
incurred, and the Indebtedness secured thereby is created, within 90 days
after such acquisition (or construction), (iii) the Indebtedness secured
thereby does not exceed 85% of the lesser of the cost and the fair market
value of such real property, improvements or equipment at the time of such
acquisition (or construction) and (iv) such
50
security interests do not apply to any other property or assets of the
Borrower or any Subsidiary;
(k) Liens arising out of judgments or awards (other than any judgment
that is described in clause (i) of Article VII and constitutes an Event of
Default thereunder) in respect of which the Borrower shall in good faith be
prosecuting an appeal or proceedings for review and in respect of which it
shall have secured a subsisting stay of execution pending such appeal or
proceedings for review, provided that the Borrower shall have set aside on
its books adequate reserves, in accordance with GAAP, with respect to such
judgment or award;
(l) Liens to secure Capital Lease Obligations permitted by Section
6.01(f), provided that such Liens (i) do not extend to any other property
or assets of the Borrower or any Subsidiary and (ii) do not interfere with
the business of the Borrower and the Subsidiaries in any material respect;
and
(m) pledges and deposits of cash to secure the letters of credit
issued pursuant to the Letter of Credit Agreement.
SECTION 6.03. Sale and Lease-Back Transactions. Enter into any arrangement,
directly or indirectly, with any person whereby it shall sell or transfer any
property, real or personal, used or useful in its business, whether now owned or
hereafter acquired, and thereafter rent or lease such property or other property
which it intends to use for substantially the same purpose or purposes as the
property being sold or transferred, provided that the Borrower and the
Subsidiaries may enter into any such transaction to the extent the Capital Lease
Obligation and Liens associated therewith would be permitted by Sections 6.01(f)
and 6.02(l), respectively.
SECTION 6.04. Investments, Loans and Advances. Purchase, hold or acquire
any capital stock, evidences of indebtedness or other securities of, make or
permit to exist any loans or advances to, or make or permit to exist any
investment or any other interest in, any other person, except:
(a) investments existing on the Restatement Closing Date by the
Borrower in the capital stock of the Subsidiaries and additional
investments by the Borrower in Leasco and Xxxxx to the extent necessary to
fund the Required Enhancement Percentage;
(b) investments, loans or advances made by the Borrower or any of its
wholly owned Subsidiaries in or to the Borrower or any other such wholly
owned Subsidiary, provided in each case that (i) any such loans or advances
that, individually or in the aggregate, are in excess of $100,000, shall be
evidenced by a promissory note pledged to the Collateral Agent for the
benefit of the Secured Parties pursuant to the Pledge Agreement (other than
any such loans or advances made by Leasco to the Borrower (A) pursuant to
the Borrower's obligations under Section 5.15(a), (B) existing on the
Restatement Closing Date or (C) pursuant to the Subordinated Demand Note)
and (ii) any such loans or advances shall be subordinated to the prior
payment in full of the Obligations on terms reasonably satisfactory to the
Administrative Agent;
(c) Permitted Investments;
51
(d) loans or advances to employees and officers of the Borrower or any
Subsidiary in the ordinary course of business in an aggregate amount to any
single employee or officer not in excess of $100,000 (or, if and to the
extent such loans or advances shall be used by such employee or officer for
relocation expenses, $250,000) and in an aggregate amount for all employees
and officers of the Borrower and the Subsidiaries not in excess of
$1,250,000 at any one time outstanding, provided, however, that this clause
(d) shall not apply to the Borrower's and the Subsidiaries' contemplated
change of the location of their chief executive offices from Miami, Florida
to Denver, Colorado;
(e) the capital stock of (or partnership interest in) any subsidiary
formed after the Restatement Closing Date by the Borrower, provided that
(i) such capital stock (or partnership interest) is pledged to the
Collateral Agent for the benefit of the Secured Parties pursuant to the
Pledge Agreement and (ii) the Borrower and such subsidiary comply with the
provisions of Section 5.16;
(f) the acquisition by the Borrower of capital stock of the Borrower
owned by Management Investors or directors of the Borrower or any
Subsidiary upon the termination, death, disability or retirement of any
such Management Investor or director and in accordance with the terms of
any Option Plan under which such capital stock was issued, in aggregate
amounts not exceeding (i) $500,000 in any fiscal year or (ii) $2,500,000 in
the aggregate during the term of this Agreement, provided that, in each
case, no Default or Event of Default shall have occurred and be continuing
or would result therefrom; and
(g) investments arising from transactions by the Borrower or any of
the Subsidiaries with customers or suppliers in the ordinary course of
business, including endorsements of negotiable instruments, debt
obligations and other investments received in connection with the
bankruptcy or reorganization of customers and suppliers and in settlement
of delinquent obligations of, and other disputes with, customers or
suppliers, arising in the ordinary course of business and in the exercise
of the reasonable business judgment of the Borrower or such Subsidiary.
SECTION 6.05. Mergers, Consolidations, Sales of Assets and Acquisitions.
Merge into or consolidate with any other person, or permit any other person to
merge into or consolidate with it, or sell, transfer, lease or otherwise dispose
of (in one transaction or in a series of transactions) all or any substantial
part of its assets (whether now owned or hereafter acquired) or any capital
stock of any Subsidiary, or purchase, lease or otherwise acquire (in one
transaction or a series of transactions) all or any substantial part of the
assets of any other person, except that (a) the Borrower and any Subsidiary may
sell Permitted Investments for cash at fair market value, (b) the Borrower and
any Subsidiary may purchase and sell inventory and Vehicles in the ordinary
course of business, (c) if at the time thereof and immediately after giving
effect thereto no Default or Event of Default shall have occurred and be
continuing or would result therefrom, (i) any wholly owned Subsidiary of the
Borrower may merge into or consolidate with the Borrower in a transaction in
which the Borrower is the surviving corporation and (ii) any wholly owned
Subsidiary of the Borrower may merge into or consolidate with any other wholly
owned Subsidiary of the Borrower that is a Domestic Subsidiary in a transaction
in which the surviving entity is a wholly owned Subsidiary of the Borrower that
is a Domestic Subsidiary and no person other than the Borrower or a wholly owned
Subsidiary of the Borrower that is a Domestic Subsidiary receives any
consideration and (d) Leasco may lease Vehicles to the Borrower.
52
SECTION 6.06. Dividends and Distributions; Restrictions on Ability of
Subsidiaries to Pay Dividends. (a) Declare or pay, directly or indirectly, any
dividend or make any other distribution (by reduction of capital or otherwise),
whether in cash, property, securities or a combination thereof, with respect to
any shares of its capital stock or directly or indirectly redeem, purchase,
retire or otherwise acquire for value (or permit any Subsidiary to purchase or
acquire) any shares of any class of its capital stock or set aside any amount
for any such purpose; provided, however, that (i) any Subsidiary may declare and
pay dividends or make other distributions to the Borrower, (ii) the Borrower may
declare and pay dividends solely in shares of common stock of the Borrower and
(iii) the Borrower may redeem, purchase, retire or otherwise acquire its capital
stock to the extent permitted by Section 6.04(f) (with, for purposes of the
dollar limitations in Section 6.04(f), transactions pursuant to this clause
(iii) being aggregated with transactions pursuant to Section 6.04(f)).
(b) Permit its subsidiaries to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any encumbrance or
restriction on the ability of any such subsidiary to (i) pay any dividends or
make any other distributions on its capital stock or any other interest or (ii)
make or repay any loans or advances to the Borrower or the parent of such
subsidiary, other than, (x) in the case of Leasco, (A) as set forth on the
Restatement Closing Date in paragraph (b) of Article Fourth and paragraph
(b)(vii) of Article Tenth of its certificate of incorporation or (B) as required
under the Securitization Documents and (y) in the case of Xxxxx, (A) as set
forth on the Restatement Closing Date in paragraph (b) of Article Fourth and
paragraph (b)(vii) of Article Tenth of its certificate of incorporation or (B)
as required under the Securitization Documents.
SECTION 6.07. Transactions with Affiliates. Sell or transfer any property
or assets to, or purchase or acquire any property or assets from, or otherwise
engage in any other transactions with, any of its Affiliates, except that the
Borrower or any Subsidiary may engage in any of the foregoing transactions in
the ordinary course of business at prices and on terms and conditions no less
favorable to the Borrower or such Subsidiary than could be obtained on an arm's-
length basis from unrelated third parties; provided, however, that (a)
management fees may be paid to Questor Management in accordance with the terms
of the Management Agreement in an aggregate amount of up to $212,500 in any
quarter of any fiscal year, unless (x) a Default or Event of Default shall have
occurred and be continuing or would result therefrom, in which event no more
than 50% of such aggregate amount may be paid to Questor Management in any such
period, or (y) a Change of Control shall have occurred, in which event no such
amount may be paid to Questor Management (unless, in the case of this clause
(y), otherwise permitted by this Section 6.07), and (b) fees may be paid to Xxx
Xxxx & Associates, Inc. in accordance with the terms of the Letter Agreement.
SECTION 6.08. Business of Borrower and Subsidiaries. In the case of each
of the Borrower and the Subsidiaries, engage at any time in any business or
business activity other than the business currently conducted by it (after
giving effect to the consummation of the Transactions) and business activities
reasonably incidental thereto.
SECTION 6.09. Other Indebtedness and Agreements. (a)(i) Make any
distribution, whether in cash, property, securities or a combination thereof,
other than scheduled payments of principal and interest as and when due (to the
extent not prohibited by applicable subordination provisions), in respect of, or
pay, or offer or commit to pay, or directly or indirectly redeem, repurchase,
retire or otherwise acquire for consideration, or set apart any sum for the
aforesaid purposes, any of the Subordinated Notes or any other Indebtedness for
borrowed money of the
53
Borrower or any Loan Party, (ii) make any payment or prepayment of any such
Indebtedness that would violate the terms of this Agreement or of such
Indebtedness, any agreement, indenture, instrument or other document evidencing,
relating to or securing the payment or performance of such Indebtedness or any
subordination agreement or provision applicable to such Indebtedness or (iii)
pay in cash any amount in respect of such Indebtedness that may at the
Borrower's or such Subsidiary's option be paid in kind thereunder, other than
(A) Indebtedness under this Agreement and (B) any refinancing of Indebtedness to
the extent permitted by Section 6.01(b).
(b) Permit any waiver, supplement, modification, amendment, termination or
release of any agreement, indenture, instrument or other document pursuant to
which any Indebtedness or preferred stock of the Borrower or any Subsidiary is
outstanding in an aggregate principal amount in excess of $500,000, to the
extent that any such waiver, supplement, modification, amendment, termination or
release would be adverse to the Lenders in any material respect.
(c) Permit any waiver, supplement, modification, amendment, termination or
release of (i) the certificate of incorporation or by-laws of the Borrower or
any Subsidiary or (ii) the Purchase Agreement, any other Acquisition Agreement,
the Management Agreement, the Letter Agreement or the Lease, in each case to the
extent that any such waiver, supplement, modification, amendment, termination or
release would be adverse to the Lenders in any material respect.
SECTION 6.10. Capital Stock. Issue any shares of any class of capital
stock or any additional partnership interests, except (a) in the case of any
Domestic Subsidiary, capital stock or partnership interests that are issued to
the Borrower or any wholly owned Subsidiary of the Borrower that is a Domestic
Subsidiary and that are pledged to the Collateral Agent for the benefit of the
Secured Parties under the Pledge Agreement and (b) in the case of the Borrower,
the issuance of capital stock in a manner that does not result in a Change of
Control.
SECTION 6.11. Total Debt Ratio. Permit the Total Debt Ratio on the last
day of any fiscal quarter of the Borrower to be greater than 4.00 to 1.00.
SECTION 6.12. Fixed Charge Coverage Ratio. Permit the Fixed Charge
Coverage Ratio for any period of four consecutive fiscal quarters ending on any
date set forth below (each such period of four consecutive fiscal quarters, a
"Measurement Period"), to be less than the ratio set forth below opposite such
date:
Date Ratio
-------------------- ------------
December 31, 1997 1.00 to 1.00
March 31, 1998 1.00 to 1.00
June 30, 1998 1.00 to 1.00
September 30, 1998 1.00 to 1.00
December 31, 1998 1.00 to 1.00
March 31, 1999 1.10 to 1.00
June 30, 1999 1.10 to 1.00
September 30, 1999 1.10 to 1.00
December 31, 1999 1.10 to 1.00
March 31, 2000 1.20 to 1.00
June 30, 2000 1.20 to 1.00
----------------------------------
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September 30, 2000 1.20 to 1.00
December 31, 2000 1.20 to 1.00
March 31, 2001 1.30 to 1.00
June 30, 2001 1.30 to 1.00
September 30, 2001 1.30 to 1.00
December 31, 2001 1.30 to 1.00
March 31, 2002 1.30 to 1.00
June 30, 2002 1.30 to 1.00
provided that the Borrower may permit the Fixed Charge Coverage Ratio to be less
than the amount set forth above opposite such date (the "Threshold Amount") for
any such Measurement Period if (a) the Fixed Charge Coverage Ratio for such
Measurement Period shall be at least equal to 90% of the Threshold Amount and
(b) the Fixed Charge Coverage Ratio for at least three of the four immediately
preceding Measurement Periods (or, if there have not yet been three such
Measurement Periods under this Section 6.12, then for all such Measurement
Periods that there have been at such time) shall have been not less than the
then applicable Threshold Amount.
SECTION 6.13. Non-Vehicle Consolidated Capital Expenditures. Incur Non-
Vehicle Consolidated Capital Expenditures in excess of (i) for each fiscal year
ending on December 31, 1997 and December 31, 1998, $25,000,000, and (ii) for any
subsequent fiscal year, $20,000,000; provided, however, that the amount of Non-
Vehicle Consolidated Capital Expenditures permitted in any fiscal year ending
after December 31, 1997 pursuant to this Section 6.13 shall be increased by the
total amount of unused Non-Vehicle Consolidated Capital Expenditures for the
immediately preceding year (less an amount equal to any unused Non-Vehicle
Consolidated Capital Expenditures carried forward to such preceding year
pursuant to this Section 6.13), provided that any amount carried forward
pursuant to this proviso shall not exceed (i) $10,000,000 for the fiscal year
ended December 31, 1998 and (ii) $7,500,000 for the fiscal year ended December
31, 1999.
SECTION 6.14. Bank Accounts. Establish or maintain any bank account or
similar account with any financial institution that is not a Lender, other than
(a) the accounts specified in Section 2 of the Perfection Certificates, (b) the
Collection Deposit Accounts (as defined in the Security Agreement), (c) any
deposit account used exclusively for the payment of payroll of any Loan Party or
any Subsidiary or (d) any account or accounts, the aggregate balance of each
such account does not exceed $100,000 at any time.
SECTION 6.15. Fiscal Year. Change the end of its fiscal year from
December 31 to any other date.
ARTICLE VII
Events of Default
In case of the happening of any of the following events ("Events of
Default"):
(a) any representation or warranty made or deemed made in or in
connection with any Loan Document or the borrowings hereunder, or any
representation, warranty, statement or information contained in any report,
certificate, financial statement or other
55
instrument furnished in connection with or pursuant to any Loan Document,
shall prove to have been false or misleading in any material respect when
so made, deemed made or furnished;
(b) default shall be made in the payment of any principal of any Loan
when and as the same shall become due and payable, whether at the due date
thereof or at a date fixed for prepayment thereof or by acceleration
thereof or otherwise;
(c) default shall be made in the payment of any interest on any Loan
or any Fee or any other amount (other than an amount referred to in (b)
above) due under any Loan Document, when and as the same shall become due
and payable, and such default shall continue unremedied for a period of
three Business Days;
(d) default shall be made in the due observance or performance by the
Borrower or any Subsidiary of any covenant, condition or agreement
contained in Section 5.01(a), 5.05 or 5.08 or in Article VI;
(e) default shall be made in the due observance or performance by the
Borrower or any Subsidiary of any covenant, condition or agreement
contained in any Loan Document (other than those specified in (b), (c) or
(d) above) and such default shall continue unremedied for a period of 20
days after notice thereof from the Administrative Agent, the Collateral
Agent or any Lender to the Borrower;
(f) the Borrower or any Subsidiary shall (i) fail to pay any principal
or interest, regardless of amount, due in respect of any Indebtedness in a
principal amount in excess of $1,000,000, when and as the same shall become
due and payable, or (ii) fail to observe or perform any other term,
covenant, condition or agreement contained in any agreement or instrument
evidencing or governing any such Indebtedness (subject, unless such failure
is with respect to any payment or other monetary obligation or any
financial covenant or similar financial maintenance term, condition or
agreement thereunder, to the initial grace period applicable thereto) if
the effect of any failure referred to in this clause (ii) is to cause, or
to permit the holder or holders of such Indebtedness or a trustee on its or
their behalf (with or without the giving of notice, the lapse of time or
both) to cause, such Indebtedness to become due prior to its stated
maturity;
(g) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i)
relief in respect of the Borrower or any Subsidiary, or of a substantial
part of the property or assets of the Borrower or a Subsidiary, under Title
11 of the United States Code, as now constituted or hereafter amended, or
any other Federal, state or foreign bankruptcy, insolvency, receivership or
similar law, (ii) the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or any
Subsidiary or for a substantial part of the property or assets of the
Borrower or a Subsidiary or (iii) the winding-up or liquidation of the
Borrower or any Subsidiary; and such proceeding or petition shall continue
undismissed for 60 days or an order or decree approving or ordering any of
the foregoing shall be entered;
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(h) the Borrower or any Subsidiary shall (i) voluntarily commence any
proceeding or file any petition seeking relief under Title 11 of the United
States Code, as now constituted or hereafter amended, or any other Federal,
state or foreign bankruptcy, insolvency, receivership or similar law, (ii)
consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or the filing of any petition described
in (g) above, (iii) apply for or consent to the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for the
Borrower or any Subsidiary or for a substantial part of the property or
assets of the Borrower or any Subsidiary, (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding,
(v) make a general assignment for the benefit of creditors, (vi) become
unable, admit in writing its inability or fail generally to pay its debts
as they become due or (vii) take any action for the purpose of effecting
any of the foregoing;
(i) one or more judgments for the payment of money in an aggregate
amount in excess of $1,000,000 shall be rendered against the Borrower, any
Subsidiary or any combination thereof and the same shall remain
undischarged for a period of 30 consecutive days during which execution
shall not be effectively stayed, or any action shall be legally taken by a
judgment creditor to levy upon assets or properties of the Borrower or any
Subsidiary to enforce any such judgment;
(j) an ERISA Event shall have occurred that, in the opinion of the
Required Lenders, when taken together with all other such ERISA Events,
could reasonably be expected to result in liability of the Borrower and its
ERISA Affiliates in an aggregate amount exceeding $1,000,000 and the same
shall remain undischarged for a period of 30 days;
(k) any security interest purported to be created by any Security
Document shall cease to be, or shall be asserted by the Borrower or any
other Loan Party not to be, a valid, perfected, first priority (except as
otherwise expressly provided in this Agreement or such Security Document)
security interest in the securities, assets or properties covered thereby,
except to the extent that any such loss of perfection or priority results
from the failure of the Collateral Agent to maintain possession of
certificates representing securities pledged under the Pledge Agreement; or
(l) there shall have occurred a Change in Control;
then, and in every such event (other than an event with respect to the Borrower
described in paragraph (g) or (h) above), and at any time thereafter during the
continuance of such event, the Administrative Agent may, and at the request of
the Required Lenders shall, by notice to the Borrower, take either or both of
the following actions, at the same or different times: (i) terminate forthwith
the Commitments and (ii) declare the Loans then outstanding to be forthwith due
and payable in whole or in part, whereupon the principal of the Loans so
declared to be due and payable, together with accrued interest thereon and any
unpaid accrued Fees and all other liabilities of the Borrower accrued hereunder
and under any other Loan Document, shall become forthwith due and payable,
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived by the Borrower anything contained herein or
in any other Loan Document to the contrary notwithstanding; and in any event
with respect to the Borrower described in paragraph (g) or (h) above, the
Commitments shall automatically terminate and the principal of
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the Loans then outstanding, together with accrued interest thereon and any
unpaid accrued Fees and all other liabilities of the Borrower accrued hereunder
and under any other Loan Document, shall automatically become due and payable,
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived by the Borrower anything contained herein or
in any other Loan Document to the contrary notwithstanding.
ARTICLE VIII
The Administrative Agent and the Collateral Agent
In order to expedite the transactions contemplated by this Agreement,
Citibank, N.A. is hereby appointed to act as Administrative Agent, Citicorp USA,
Inc. is hereby appointed to act as Collateral Agent and The Chase Manhattan Bank
is hereby appointed to act as Documentation Agent, in each case on behalf of the
Lenders (for purposes of this Article VIII, the Administrative Agent, the
Collateral Agent and the Documentation Agent are referred to collectively as the
Agents). Each of the Lenders and each assignee of any such Lender hereby
irrevocably authorizes the Agents to take such actions on behalf of such Lender
or assignee and to exercise such powers as are specifically delegated to the
Agents by the terms and provisions hereof and of the other Loan Documents,
together with such actions and powers as are reasonably incidental thereto. The
Administrative Agent is hereby expressly authorized by the Lenders, without
hereby limiting any implied authority, (a) to receive on behalf of the Lenders
all payments of principal of and interest on the Loans and all other amounts due
to the Lenders hereunder, and promptly to distribute to each Lender its proper
share of each payment so received; (b) to give notice on behalf of each of the
Lenders to the Borrower of any Event of Default specified in this Agreement of
which the Administrative Agent has actual knowledge acquired in connection with
its agency hereunder; and (c) to distribute to each Lender copies of all
notices, financial statements and other materials delivered by the Borrower or
any other Loan Party pursuant to this Agreement or the other Loan Documents as
received by the Administrative Agent. Without limiting the generality of the
foregoing, the Agents are hereby expressly authorized to execute any and all
documents (including releases) with respect to the Collateral and the rights of
the Secured Parties with respect thereto, as contemplated by and in accordance
with the provisions of this Agreement and the Security Documents.
Neither the Agents nor any of their respective directors, officers,
employees or agents shall be liable as such for any action taken or omitted by
any of them except for its or his own gross negligence or wilful misconduct, or
be responsible for any statement, warranty or representation herein or the
contents of any document delivered in connection herewith, or be required to
ascertain or to make any inquiry concerning the performance or observance by the
Borrower or any other Loan Party of any of the terms, conditions, covenants or
agreements contained in any Loan Document. The Agents shall not be responsible
to the Lenders for the due execution, genuineness, validity, enforceability or
effectiveness of this Agreement or any other Loan Documents, instruments or
agreements. The Agents shall in all cases be fully protected in acting, or
refraining from acting, in accordance with written instructions signed by the
Required Lenders and, except as otherwise specifically provided herein, such
instructions and any action or inaction pursuant thereto shall be binding on all
the Lenders. Each Agent shall, in the absence of knowledge to the contrary, be
entitled to rely on any instrument or document believed by it in good faith to
be genuine and correct and to have been signed or sent by the proper person or
persons. Neither the
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Agents nor any of their respective directors, officers, employees or agents
shall have any responsibility to the Borrower or any other Loan Party on account
of the failure of or delay in performance or breach by any Lender of any of its
obligations hereunder or to any Lender on account of the failure of or delay in
performance or breach by any other Lender or the Borrower or any other Loan
Party of any of their respective obligations hereunder or under any other Loan
Document or in connection herewith or therewith. Each of the Agents may execute
any and all duties hereunder by or through agents or employees and shall be
entitled to rely upon the advice of legal counsel selected by it with respect to
all matters arising hereunder and shall not be liable for any action taken or
suffered in good faith by it in accordance with the advice of such counsel.
The Lenders hereby acknowledge that neither Agent shall be under any duty
to take any discretionary action permitted to be taken by it pursuant to the
provisions of this Agreement unless it shall be requested in writing to do so by
the Required Lenders.
Subject to the appointment and acceptance of a successor Agent as provided
below, either Agent may resign at any time by notifying the Lenders and the
Borrower. Upon any such resignation, the Required Lenders shall have the right
to appoint a successor. If no successor shall have been so appointed by the
Required Lenders and shall have accepted such appointment within 30 days after
the retiring Agent gives notice of its resignation, then the retiring Agent may,
on behalf of the Lenders, appoint a successor Agent which shall be a bank with
an office in New York, New York, having a combined capital and surplus of at
least $500,000,000 or an Affiliate of any such bank. Upon the acceptance of any
appointment as Agent hereunder by a successor bank, such successor shall 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 hereunder. After the Agent's resignation hereunder, the provisions
of this Article and Section 9.05 shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
Agent.
With respect to the Loans made by it hereunder, each Agent in its
individual capacity and not as Agent shall have the same rights and powers as
any other Lender and may exercise the same as though it were not an Agent, and
the Agents and their Affiliates may accept deposits from, lend money to and
generally engage in any kind of business with the Borrower or any Subsidiary or
other Affiliate thereof as if it were not an Agent.
Each Lender agrees (a) to reimburse the Agents, on demand, in the amount of
its pro rata share (based on its Commitments hereunder) of any expenses incurred
for the benefit of the Lenders by the Agents, including counsel fees and
compensation of agents and employees paid for services rendered on behalf of the
Lenders, that shall not have been reimbursed by the Borrower and (b) to
indemnify and hold harmless each Agent and any of its directors, officers,
employees or agents, on demand, in the amount of such pro rata share, from and
against any and all liabilities, taxes, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by or asserted against it in
its capacity as Agent or any of them in any way relating to or arising out of
this Agreement or any other Loan Document or any action taken or omitted by it
or any of them under this Agreement or any other Loan Document, to the extent
the same shall not have been reimbursed by the Borrower or any other Loan Party,
provided that no Lender shall be liable to an Agent or any such other
indemnified person for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
that are determined by a court of
59
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or wilful misconduct of such Agent or any of its directors,
officers, employees or agents.
Each Lender acknowledges that it has, independently and without reliance
upon the Agents or any other Lender and based on such documents and information
as it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement. Each Lender also acknowledges that it will, independently
and without reliance upon the Agents or any other Lender and based on such
documents and information as it shall from time to time deem appropriate,
continue to make its own decisions in taking or not taking action under or based
upon this Agreement or any other Loan Docu ment, any related agreement or any
document furnished hereunder or thereunder.
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices. Notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopy, as follows:
(a) if to the Borrower, to Ryder TRS, Inc., One Civic Center, 0000
Xxxxxxxx, Xxxxx 0000, Xxxxxx, XX 00000, Attention of General Counsel
(Telecopy No. (000) 000-0000), with a copy to Questor Management Company,
0000 Xxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx 00000, Attention of
President (Telecopy No. (000) 000-0000);
(b) if to the Administrative Agent, to Citibank, N.A. 000 Xxxx Xxxxxx,
0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Shapleigh X. Xxxxx
(Telecopy No. (000) 000-0000), with a copy to Citicorp USA, Inc., 000 Xxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Xxxxxxx Xxxx
Soon (Telecopy No. (000) 000-0000);
(c) if to the Collateral Agent, to Citicorp USA, Inc., 000 Xxxx
Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Shapleigh X.
Xxxxx (Telecopy No. (000) 000-0000), with a copy to Citicorp USA, Inc., 000
Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Xxxxxxx
Xxxx Soon (Telecopy No. (000) 000-0000);
(d) if to the Documentation Agent, to The Chase Manhattan Bank, 000
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Xxxxxx Xxxxxxx
(Telecopy No. (000) 000-0000); and
(e) if to a Lender, to it at its address (or telecopy number) set
forth on Schedule 2.01 or in the Assignment and Acceptance pursuant to
which such Lender shall have become a party hereto.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy or on the date five Business Days after dispatch by certified or
registered mail if mailed, in each case delivered, sent or mailed (properly
addressed)
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to such party as provided in this Section 9.01 or in accordance with
the latest unrevoked direction from such party given in accordance with this
Section 9.01.
SECTION 9.02. Survival of Agreement. All covenants, agreements,
representations and warranties made by the Borrower herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and shall survive the making by the Lenders
of the Loans, regardless of any investigation made by the Lenders or on their
behalf, and shall continue in full force and effect as long as the principal of
or any accrued interest on any Loan or any Fee or any other amount payable under
this Agreement or any other Loan Document is outstanding and unpaid and so long
as the Commitments have not been terminated. The provisions of Sections 2.14,
2.16, 2.20 and 9.05 shall remain operative and in full force and effect
regardless of the expiration of the term of this Agreement, the consummation of
the transactions contemplated hereby, the repayment of any of the Loans, the
expiration of the Commitments, the invalidity or unenforceability of any term or
provision of this Agreement or any other Loan Document, or any investigation
made by or on behalf of the Administrative Agent, the Collateral Agent or any
Lender.
SECTION 9.03. Binding Effect. This Agreement shall become effective when it
shall have been executed by the Borrower, the Administrative Agent and the
Collateral Agent and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective permitted successors and
assigns.
SECTION 9.04. Successors and Assigns. (a) Whenever in this Agreement any
of the parties hereto is referred to, such reference shall be deemed to include
the permitted successors and assigns of such party; and all covenants, promises
and agreements by or on behalf of the Borrower, the Administrative Agent, the
Collateral Agent or the Lenders that are contained in this Agreement shall bind
and inure to the benefit of their respective successors and assigns.
(b) Each Lender may assign to one or more assignees all or a portion of
its interests, rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it); provided,
however, that (i) except in the case of an assignment to a Lender or an
Affiliate of such Lender, (x) the Borrower (unless a Default or Event of Default
shall have occurred and be continuing) and the Administrative Agent must give
their prior written consent to such assignment (which consent shall not be
unreasonably withheld) and (y) the amount of the Commitment of the assigning
Lender subject to each such assignment (determined as of the date the Assignment
and Acceptance with respect to such assignment is delivered to the
Administrative Agent) shall not, unless otherwise agreed to by the Borrower and
the Administrative Agent, be less than $5,000,000 (or, if less, the entire
remaining amount of such Lender's Commitment), (ii) the parties to each such
assignment shall execute and deliver to the Administrative Agent an Assignment
and Acceptance, together with a processing and recordation fee of $3,500, (iii)
the assignee, if it shall not be a Lender, shall deliver to the Administrative
Agent an Administrative Questionnaire and (iv) notwithstanding the foregoing, no
such assignment may be made to any of the persons identified on Schedule 9.04
hereto without the prior written consent of the Borrower. Upon acceptance and
recording pursuant to paragraph (e) of this Section 9.04, from and after the
effective date specified in each Assignment and Acceptance, which effective date
shall be at least five Business Days after the execution thereof, (A) the
assignee thereunder shall be a party hereto and,
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to the extent of the interest assigned by such Assignment and Acceptance, have
the rights and obligations of a Lender under this Agreement and (B) the
assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of an assigning Lender's rights and obligations under this
Agreement, such Lender shall cease to be a party hereto but shall continue to be
entitled to the benefits of Sections 2.14, 2.16, 2.20 and 9.05, as well as to
any Fees accrued for its account and not yet paid).
(c) By executing and delivering an Assignment and Acceptance, 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:
(i) 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 that
its Commitment, and the outstanding balances of its Loans, in each case without
giving effect to assignments thereof which have not become effective, are as set
forth in such Assignment and Acceptance; (ii) except as set forth in (i) above,
such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement,
any other Loan Document or any other instrument or document furnished pursuant
hereto, or the financial condition of the Borrower or any Subsidiary or the
performance or observance by the Borrower or any Subsidiary of any of its
obligations under this Agreement, any other Loan Document or any other
instrument or document furnished pursuant hereto; (iii) such assignee represents
and warrants that it is legally authorized to enter into such Assignment and
Acceptance; (iv) such assignee confirms that it has received a copy of this
Agreement, together with copies of the most recent financial statements referred
to in Section 3.05(a) or delivered pursuant to Section 5.04 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (v) such
assignee will independently and without reliance upon the Administrative Agent,
the Collateral Agent, 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 Agreement; (vi) such assignee appoints and authorizes the Administrative
Agent and the Collateral Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement as are delegated to the Administrative
Agent and the Collateral Agent, respectively, by the terms hereof, together with
such powers as are reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all the obligations which by
the terms of this Agreement are required to be performed by it as a Lender.
(d) The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices in The City of New York a copy of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the "Register"). The entries in the Register shall be
conclusive and the Borrower, the Administrative Agent, the Collateral Agent and
the Lenders may treat each person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower, the Collateral Agent and any Lender,
at any reasonable time and from time to time upon reasonable prior notice.
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(e) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, an Administrative Questionnaire
completed in respect of the assignee (unless the assignee shall already be a
Lender hereunder), the processing and recordation fee referred to in paragraph
(b) above and, if required, the written consent of the Borrower and the
Administrative Agent to such assignment, the Administrative Agent shall (i)
accept such Assignment and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof to the Lenders. No
assignment shall be effective unless it has been recorded in the Register as
provided in this paragraph (e).
(f) Each Lender may without the consent of the Borrower or the
Administrative Agent sell participations to one or more banks or other entities
in all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans owing to it);
provided, however, that (i) such Lender's obligations under this Agreement shall
remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, (iii) the participating
banks or other entities shall be entitled to the benefit of the cost protection
provisions contained in Sections 2.14, 2.16 and 2.20 to the same extent as if
they were Lenders (provided that such participating banks or other entities
shall have no greater rights than those of such Lender), (iv) except in the case
of a participation sold to a Lender or an Affiliate of such Lender or unless
otherwise agreed to by the Borrower and the Administrative Agent, the amount of
the Commitment of such Lender subject to each such participation (determined as
of the date such participation is sold) shall be not less than $5,000,000 (or,
if less, the entire remaining amount of such Lender's Commitment), (v) no such
participation may be sold to any of the persons identified on Schedule 9.04
without the prior written consent of the Borrower and (vi) the Borrower, the
Administrative Agent, the Collateral Agent and the Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement, and such Lender shall retain the
sole right to enforce the obligations of the Borrower relating to the Loans and
to approve any amendment, modification or waiver of any provision of this
Agreement (other than amendments, modifications or waivers decreasing any fees
payable hereunder or the amount of principal of or the rate at which interest is
payable on the Loans, extending any scheduled principal payment date or date
fixed for the payment of interest on the Loans, increasing or extending the
Commitments or releasing any Guarantor or all or any substantial part of the
Collateral (except for any such release expressly permitted by the Loan
Documents).
(g) Any Lender or participant may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
9.04, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender by
or on behalf of the Borrower; provided that each such assignee or participant or
proposed assignee or participant shall execute an agreement whereby such
assignee or participant shall agree (subject to customary exceptions) to
preserve the confidentiality of such confidential information on terms no less
restrictive than those applicable to the Lenders pursuant to Section 9.16.
(h) Any Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Agreement to secure obligations of such
Lender, including any such pledge or assignment to a Federal Reserve Bank, and
this Section shall not apply to any such pledge or assignment of a security
interest, provided that no such pledge or assignment of a security interest
63
shall release a Lender from any of its obligations hereunder or substitute any
such pledgee or assignee for such Lender as a party hereto.
(i) In order to facilitate any assignment, pledge or participation made
pursuant to this Section 9.04, the Borrower shall, at the request of the
assigning, pledging or participating Lender, duly execute and deliver to such
Lender a promissory note or notes evidencing the Loans made to the Borrower by
such Lender hereunder (subject to the requirements of Section 2.04(e)).
(j) The Borrower shall not assign or delegate any of its rights or duties
hereunder without the prior written consent of the Administrative Agent and each
Lender, and any attempted assignment without such consent shall be null and
void.
SECTION 9.05. Expenses; Indemnity. (a) The Borrower agrees to pay all
reasonable out-of-pocket expenses incurred by the Agents in connection with the
syndication of the credit facilities provided for herein and the preparation and
administration of this Agreement and the other Loan Documents or in connection
with any amendments, modifications or waivers of the provisions hereof or
thereof (whether or not the transactions hereby or thereby contemplated shall be
consummated) or incurred by the Agents or any Lender in connection with the
enforcement or protection of its rights in connection with this Agreement and
the other Loan Documents or in connection with the Loans made hereunder,
including the reasonable fees, charges and disbursements of Cravath, Swaine &
Xxxxx, counsel for the Agents, and, in connection with any such enforcement or
protection, the reasonable fees, charges and disbursements of any other counsel
for the Agents or any Lender.
(b) The Borrower agrees to indemnify each Agent, each Lender, each
Affiliate of any of the foregoing persons and each of their respective
directors, officers, employees and agents (each such person being called an
Indemnitee) against, and to hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and related expenses, including reasonable
counsel fees, charges and disbursements, incurred by or asserted against any
Indemnitee arising out of, in any way connected with, or as a result of (i) the
execution or delivery of this Agreement or any other Loan Document or any
agreement or instrument contemplated thereby, the performance by the parties
thereto of their respective obligations thereunder or the consummation of the
Restatement Transactions and the other transactions contemplated thereby, (ii)
the use of the proceeds of the Loans, (iii) any claim, litigation, investigation
or proceeding relating to any of the foregoing (Proceedings), whether or not
any Indemnitee is a party thereto, or (iv) any actual or alleged presence or
Release of Hazardous Materials on any property owned or operated by the Borrower
or any of the Subsidiaries, or any Environmental Claim related in any way to the
Borrower or the Subsidiaries; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted solely from
the gross negligence or wilful misconduct of such Indemnitee.
(c) If for any reason the indemnification set forth in paragraph (b) above
is unavailable to any Indemnitee or insufficient to hold it harmless, then the
Borrower shall contribute to the amount paid or payable to such Indemnitee as a
result of such loss, claim, damage, liability or expense in such proportion as
is appropriate to reflect not only the relative benefits received by the
Borrower, on the one hand, and such Indemnitee, on the other hand, but also the
relative fault of the Borrower, on the one hand, and such Indemnitee, on the
other hand, as well as any relevant
64
equitable considerations. It is hereby agreed that the relative benefits to the
Borrower, on the one hand, and all Indemnities, on the other hand, shall be
deemed to be in the same proportion as (i) the total value received or proposed
to be received by the Borrower in connection with the Commitments (whether or
not any Loans are made) bears to (ii) the Fees. The indemnity, reimbursement and
contribution obligations of the Borrower under paragraph (b) above and under
this paragraph (c) shall be in addition to any liability which the Borrower may
otherwise have to an Indemnitee and shall be binding upon and inure to the
benefit of any successors, assigns, heirs and personal representatives of the
Borrower and any Indemnitee.
(d) Promptly after receipt by an Indemnitee of notice of the commencement
of any Proceedings, such Indemnitee will, if a claim in respect thereof is to be
made against the Borrower, notify the Borrower in writing of the commencement
thereof; provided that (i) the omission so to notify the Borrower will not
relieve it from any liability which it may have hereunder except to the extent
it has been materially prejudiced by such failure and (ii) the omission so to
notify the Borrower will not relieve it from any liability which it may have to
an Indemnitee otherwise than on account of the indemnity agreement provided for
hereunder. In case any such Proceedings are brought against any Indemnitee and
it notifies the Borrower of the commencement thereof, the Borrower will be
entitled to participate therein, and, to the extent that it may elect by written
notice delivered to such Indemnitee, to assume the defense thereof, with counsel
reasonably satisfactory to such Indemnitee, provided that, if the defendants in
any such Proceedings include both such Indemnitee and the Borrower and such
Indemnitee shall have concluded that there may be legal defenses available to it
which are different from or additional to those available to the Borrower, such
Indemnitee shall have the right to select separate counsel to assert such legal
defenses and to otherwise participate in the defense of such Proceedings on
behalf of such Indemnitee. Upon receipt of notice from the Borrower to such
Indemnitee of its election so to assume the defense of such Proceedings and
approval by such Indemnitee of counsel, the Borrower shall not be liable to such
Indemnitee for expenses incurred by such Indemnitee in connection with the
defense thereof (other than reasonable costs of investigation) unless (i) such
Indemnitee shall have employed separate counsel in connection with the assertion
of legal defenses in accordance with the proviso to the next preceding sentence
(it being understood, however, that the Borrower shall not be liable for the
reasonable expenses of more than one separate counsel (plus no more than one
separate local counsel in any jurisdiction), approved by the Agents,
representing the Indemnitees who are parties to such Proceedings), (ii) the
Borrower shall not have employed counsel reasonably satisfactory to such
Indemnitee to represent such Indemnitee within a reasonable time after notice of
commencement of the Proceedings, (iii) the Borrower shall have authorized in
writing the employment of counsel for such Indemnitee or (iv) the use of counsel
chosen by the Borrower to represent such Indemnitee would present such counsel
with a conflict of interest; and except that, if clause (i) or (iii) is
applicable, such liability shall be only in respect of the counsel referred to
in such clause (i) or (iii).
(e) The provisions of this Section 9.05 shall remain operative and in full
force and effect regardless of the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the repayment of any of
the Loans, the expiration of the Commitments, the invalidity or unenforceability
of any term or provision of this Agreement or any other Loan Document, or any
investigation made by or on behalf of any Agent or any Lender. All amounts due
under this Section 9.05 shall be payable on written demand therefor.
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SECTION 9.06. Right of Setoff. If an Event of Default shall have occurred
and be continuing, each Lender is hereby authorized at any time and from time to
time, except to the extent prohibited by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness or obligations at any time owing by such Lender to
or for the credit or the account of the Borrower against any of and all the
obligations of the Borrower now or hereafter existing under this Agreement and
other Loan Documents held by such Lender, irrespective of whether or not such
Lender shall have made any demand under this Agreement or such other Loan
Document and although such obligations may be unmatured. The rights of each
Lender under this Section 9.06 are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.
SECTION 9.07. Applicable Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
(OTHER THAN AS EXPRESSLY SET FORTH IN OTHER LOAN DOCUMENTS) SHALL BE CONSTRUED
IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
SECTION 9.08. Waivers; Amendment. (a) No failure or delay of the
Administrative Agent, the Collateral Agent or any Lender in exercising any power
or right hereunder or under any other Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of the Administrative Agent, the
Collateral Agent and the Lenders hereunder and under the other Loan Documents
are cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provision of this Agreement or any other Loan
Document or consent to any departure by the Borrower or any other Loan Party
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) below, and then such waiver or consent shall be effective only in
the specific instance and for the purpose for which given. No notice or demand
on the Borrower in any case shall entitle the Borrower to any other or further
notice or demand in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived, amended
or modified except pursuant to an agreement or agreements in writing entered
into by the Borrower and the Required Lenders; provided, however, that no such
agreement shall (i) decrease the principal amount of, or extend the maturity of
or any scheduled principal payment date or date for the payment of any interest
on any Loan, or waive or excuse any such payment or any part thereof, or
decrease the rate of interest on any Loan, without the prior written consent of
each Lender affected thereby, (ii) change or extend the Commitment or decrease
or extend the date for payment of the Commitment Fees of any Lender, without the
prior written consent of such Lender, or (iii) amend or modify the provisions of
Section 2.17 or 9.04(j), the provisions of this Section, the definition of the
term "Required Lenders" or the term "Supermajority Lenders" or release any
Guarantor or all or any substantial part of the Collateral (except for any such
release expressly permitted by the Loan Documents), without the prior written
consent of each Lender; provided further that no such agreement shall amend,
modify or otherwise affect the rights or duties of the Administrative Agent or
the Collateral Agent hereunder or under any other Loan Document without the
prior written consent of the Administrative Agent or the Collateral Agent.
SECTION 9.09. Interest Rate Limitation. Notwithstanding anything herein to
the contrary, if at any time the interest rate applicable to any Loan, together
with all fees, charges and other
66
amounts which are treated as interest on such Loan under applicable law
(collectively the Charges), shall exceed the maximum lawful rate (the Maximum
Rate) which may be contracted for, charged, taken, received or reserved by the
Lender holding such Loan or participation in accordance with applicable law, the
rate of interest payable in respect of such Loan or participation hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan or participation but were not payable as a
result of the operation of this Section 9.09 shall be cumulated and the interest
and Charges payable to such Lender in respect of other Loans or participations
or periods shall be increased (but not above the Maximum Rate therefor) until
such cumulated amount, together with interest thereon at the Federal Funds
Effective Rate to the date of repayment, shall have been received by such
Lender.
SECTION 9.10. Entire Agreement. This Agreement, the Fee Letter and the
other Loan Documents constitute the entire contract among the parties relative
to the subject matter hereof. Any other previous agreement among the parties
with respect to the subject matter hereof is superseded by this Agreement and
the other Loan Documents. Nothing in this Agreement or in the other Loan
Documents, expressed or implied, is intended to confer upon any party other than
the parties hereto and thereto any rights, remedies, obligations or liabilities
under or by reason of this Agreement or the other Loan Documents.
SECTION 9.11. Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF,
UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS.
EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.11.
SECTION 9.12. Severability. In the event any one or more of the provisions
contained in this Agreement or in any other Loan Document should be held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected or impaired thereby (it being understood that the
invalidity of a particular provision in a particular jurisdiction shall not in
and of itself affect the validity of such provision in any other jurisdiction).
The parties shall endeavor in good-faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.
SECTION 9.13. Counterparts. This Agreement may be executed in counterparts
(and by different parties hereto on different counterparts), each of which shall
constitute an original but all of which when taken together shall constitute a
single contract, and shall become effective as provided in Section 9.03.
Delivery of an executed signature page to this Agreement by facsimile
transmission shall be as effective as delivery of a manually signed counterpart
of this Agreement.
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SECTION 9.14. Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
SECTION 9.15. Jurisdiction; Consent to Service of Process. (a) The
Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or the other Loan Documents, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement shall affect any right that the
Administrative Agent, the Collateral Agent or any Lender may otherwise have to
bring any action or proceeding relating to this Agreement or the other Loan
Documents against the Borrower or its properties in the courts of any
jurisdiction.
(b) The Borrower hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or the other Loan Documents in any
New York State or Federal court. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
(c) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 9.16. Confidentiality. The Administrative Agent, the Collateral
Agent and each of the Lenders agrees to keep confidential (and to use its best
efforts to cause its respective agents and representatives to keep confidential)
the Information (as defined below) and all copies thereof, extracts therefrom
and analyses or other materials based thereon, except that the Administrative
Agent, the Collateral Agent or any Lender shall be permitted to disclose
Information (a) to such of its respective officers, directors, employees,
agents, affiliates and representatives or direct or indirect contractual
counterparties in swap agreements in each case who need to know such
Information, provided that any such contractual counterparty shall agree to keep
such Informational confidential, (b) to the extent requested by any regulatory
authority, (c) to the extent otherwise required by applicable laws and
regulations or by any subpoena or similar legal process, (d) in connection with
any suit, action or proceeding relating to the enforcement of its rights
hereunder or under the other Loan Documents or (e) to the extent such
Information (i) becomes publicly available other than as a result of a breach of
this Section 9.16 or (ii) becomes available to the Administrative Agent, any
Lender or the Collateral Agent on a nonconfidential basis from a source other
than the Borrower. For the purposes of this Section, "Information" shall mean
all financial statements, certificates, reports, agreements and information
(including all analyses, compilations and studies prepared by the Administrative
Agent, the Collateral Agent or any Lender based on any of the foregoing) that
are received from the Borrower and related to the Borrower, any shareholder of
the Borrower or any employee, customer or supplier of the Borrower, other than
any of the
68
foregoing that were available to the Administrative Agent, the Collateral Agent
or any Lender on a nonconfidential basis prior to its disclosure thereto by the
Borrower. The provisions of this Section 9.16 shall remain operative and in full
force and effect regardless of the expiration and term of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
RYDER TRS, INC.,
by /s/ Xxxxxx X. Xxxxxxx
--------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President and Treasurer
CITICORP USA, INC., individually, as
Administrative Agent and as Collateral Agent,
by /s/ Shapleigh X. Xxxxx
--------------------------
Name: Shapleigh X. Xxxxx
Title:
THE CHASE MANHATTAN BANK, individually and as
Documentation Agent,
by /s/ Xxxxxx X. Xxxxxxx
--------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
70
CORESTATES BANK, N.A.,
by /s/ Xxxx X. Xxxxx
--------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
71
SOCIETE GENERALE,
by /s/ Xxxxx Xxxxx
--------------------------
Name: Xxxxx Xxxxx
Title: Vice President and Manager
