1
EXHIBIT 10.50
================================================================================
CREDIT AGREEMENT
DATED AS OF DECEMBER 7, 1998
AMONG
PROFITSOURCE CORPORATION
AND
ENTERPRISE PROFIT SOLUTIONS CORPORATION,
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
AS ADMINISTRATIVE AGENT,
ANTARES CAPITAL CORPORATION
AS DOCUMENTATION AGENT,
ING (U.S.) CAPITAL CORPORATION,
AS MANAGING AGENT,
AND
THE OTHER LENDERS PARTY HERETO
----------------------------------------------
NATIONSBANC XXXXXXXXXX SECURITIES LLC,
LEAD ARRANGER
ANTARES CAPITAL CORPORATION,
CO-ARRANGER
================================================================================
2
TABLE OF CONTENTS
SECTION PAGE
ARTICLE I DEFINITIONS........................................................................1
1.01 Certain Defined Terms......................................................1
1.02 Other Interpretive Provisions.............................................23
1.03 Accounting Principles.....................................................24
ARTICLE II THE CREDITS......................................................................24
2.01 Amounts and Terms of Commitments..........................................24
(a) The Term Credit...................................................24
(b) The Revolving Credit..............................................25
2.02 Loan Accounts.............................................................25
2.03 Procedure for Borrowing...................................................25
2.04 Conversion and Continuation Elections.....................................27
2.05 Voluntary Termination or Reduction of Commitments.........................28
2.06 Optional Prepayments......................................................28
2.07 Mandatory Prepayments of Loans; Mandatory Commitment Reductions...........28
(a) Asset Dispositions................................................28
(b) Equity or Debt Issuance...........................................29
(c) General...........................................................29
2.08 Repayment.................................................................29
(a) The Term Credit...................................................30
(b) The Revolving Credit..............................................30
2.09 Interest..................................................................30
2.10 Fees......................................................................31
(a) Agency and Other Fees.............................................31
(b) Commitment Fees...................................................31
2.11 Computation of Fees and Interest..........................................32
2.12 Payments by the Company...................................................32
2.13 Payments by the Lenders to the Agent......................................33
2.14 Sharing of Payments, Etc..................................................33
2.15 Security and Guaranty.....................................................34
ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY..........................................34
3.01 Taxes.....................................................................34
3.02 Illegality................................................................36
3.03 Increased Costs and Reduction of Return...................................37
3.04 Funding Losses............................................................38
3.05 Inability to Determine Rates..............................................39
3.06 Certificates of Lenders...................................................39
i.
3
3.07 Substitution of Lenders...................................................39
3.08 Survival..................................................................39
ARTICLE IV CONDITIONS PRECEDENT.............................................................40
4.01 Conditions of Initial Loans...............................................40
(a) Credit Agreement and Notes........................................40
(b) Resolutions; Incumbency...........................................40
(c) Organization Documents; Good Standing.............................40
(d) Legal Opinions....................................................41
(e) Payment of Fees...................................................41
(f) Collateral Documents..............................................41
(g) Insurance Policies................................................42
(h) Perfection Certificate............................................42
(i) Certificate.......................................................42
(j) Issuance of Holdings Subordinated Notes, Etc......................42
(k) Solvency..........................................................42
(l) Financial Information.............................................43
(m) Acquisition Documents, Etc........................................43
(n) Pro Forma Compliance with Financial Covenants.....................44
(o) Other Documents...................................................44
4.02 Conditions to All Borrowings..............................................44
(a) Notice of Borrowing...............................................44
(b) Continuation of Representations and Warranties....................44
(c) No Existing Default...............................................44
(d) No Material Adverse Effect........................................44
ARTICLE V REPRESENTATIONS AND WARRANTIES....................................................45
5.01 Corporate Existence and Power.............................................45
5.02 Corporate Authorization; No Contravention.................................45
5.03 Governmental Authorization................................................45
5.04 Binding Effect............................................................46
5.05 Litigation................................................................46
5.06 No Default................................................................46
5.07 ERISA Compliance..........................................................46
5.08 Use of Proceeds; Margin Regulations.......................................47
5.09 Title to Properties; Liens................................................47
5.10 Taxes.....................................................................47
5.11 Financial Condition.......................................................48
5.12 Environmental Matters.....................................................49
5.13 Collateral Documents......................................................49
5.14 Regulated Entities........................................................50
5.15 No Burdensome Restrictions................................................50
5.16 Copyrights, Patents, Trademarks and Licenses, Etc.........................50
ii.
4
5.17 Subsidiaries..............................................................51
5.18 Insurance.................................................................51
5.19 Solvency..................................................................51
5.20 Swap Obligations..........................................................51
5.21 Full Disclosure...........................................................51
5.22 Year 2000.................................................................52
5.23 Representations and Warranties Contained in the Acquisition
Agreements................................................................52
5.24 Deloitte & Touche Subordinated Debt.......................................52
ARTICLE VI AFFIRMATIVE COVENANTS............................................................53
6.01 Financial Statements......................................................53
6.02 Certificates; Other Information...........................................54
6.03 Notices...................................................................55
6.04 Preservation of Corporate Existence, Etc..................................57
6.05 Maintenance of Property...................................................57
6.06 Insurance.................................................................57
6.07 Payment of Obligations....................................................58
6.08 Compliance with Laws......................................................58
6.09 Compliance with ERISA.....................................................58
6.10 Inspection of Property and Books and Records..............................58
6.11 Environmental Laws........................................................59
6.12 Use of Proceeds...........................................................59
6.13 Year 2000.................................................................59
6.14 Additional Guarantors.....................................................60
6.15 Further Assurances........................................................61
6.16 Wholly-Owned Subsidiaries.................................................61
ARTICLE VII NEGATIVE COVENANTS..............................................................62
7.01 Limitation on Liens.......................................................62
7.02 Disposition of Assets.....................................................64
7.03 Consolidations and Mergers................................................65
7.04 Loans and Investments.....................................................65
7.05 Limitation on Indebtedness................................................66
7.06 Transactions with Affiliates..............................................67
7.07 Use of Proceeds...........................................................68
7.08 Contingent Obligations....................................................68
7.09 Lease Obligations.........................................................69
7.10 Restricted Payments.......................................................69
7.11 ERISA.....................................................................70
7.12 Change in Business........................................................70
7.13 Accounting Changes........................................................70
iii.
5
7.14 Capital Expenditures......................................................71
7.15 Holdings Subordinated Debt................................................71
7.16 Amendments to Acquisition Agreements......................................72
7.17 Tax Sharing Agreement.....................................................72
7.18 Financial Covenants.......................................................72
ARTICLE VIII EVENTS OF DEFAULT..............................................................74
8.01 Event of Default..........................................................74
(a) Non-Payment.......................................................74
(b) Representation or Warranty........................................74
(c) Specific Defaults.................................................74
(d) Other Defaults....................................................74
(e) Cross-Default.....................................................75
(f) Insolvency; Voluntary Proceedings.................................75
(g) Involuntary Proceedings...........................................75
(h) ERISA.............................................................76
(i) Monetary Judgments................................................76
(j) Non-Monetary Judgments............................................76
(k) Change of Control.................................................76
(l) Loss of Licenses..................................................76
(m) Adverse Change....................................................76
(n) Guarantor Defaults................................................77
(o) Invalidity of Subordination Provisions............................77
(p) Collateral........................................................77
(q) Acquisition Agreements............................................77
8.02 Remedies..................................................................77
8.03 Specified Swap Contract Remedies..........................................78
8.04 Rights Not Exclusive......................................................78
ARTICLE IX THE AGENT........................................................................78
9.01 Appointment and Authorization; "Agent"....................................78
9.02 Delegation of Duties......................................................79
9.03 Liability of Agent........................................................79
9.04 Reliance by Agent.........................................................79
9.05 Notice of Default.........................................................80
9.06 Credit Decision...........................................................80
9.07 Indemnification of Agent..................................................81
9.08 Agent in Individual Capacity..............................................81
9.09 Successor Agent...........................................................81
9.10 Withholding Tax...........................................................82
9.11 Collateral Matters........................................................83
9.12 Lead Arranger, Co-Arranger, Managing Agent, Documentation Agent...........84
iv.
6
ARTICLE X MISCELLANEOUS.....................................................................85
10.01 Amendments and Waivers....................................................85
10.02 Notices...................................................................85
10.03 No Waiver; Cumulative Remedies............................................86
10.04 Costs and Expenses........................................................86
10.05 Indemnification...........................................................87
10.06 Marshalling; Payments Set Aside...........................................88
10.07 Successors and Assigns....................................................89
10.08 Assignments, Participations, Etc..........................................89
10.09 Confidentiality...........................................................91
10.10 Set-off...................................................................92
10.11 Automatic Debits of Fees..................................................92
10.12 Guaranty..................................................................92
(a) Guaranty..........................................................92
(b) Separate Obligation...............................................93
(c) Limitation of Guaranty............................................94
(d) Liability of Guarantor............................................94
(e) Consents of Guarantor.............................................95
(f) Guarantor's Waivers...............................................96
(g) Financial Condition of the Company................................96
(h) Subrogation.......................................................97
(i) Continuing Guaranty...............................................97
(j) Reinstatement.....................................................97
(k) Substantial Benefits..............................................98
(l) Knowing and Explicit Waivers......................................98
10.13 Release of Subsidiary Guarantors..........................................98
10.14 Notification of Addresses, Lending Offices, Etc...........................99
10.15 Counterparts..............................................................99
10.16 Severability..............................................................99
10.17 No Third Parties Benefited................................................99
10.18 Governing Law and Jurisdiction............................................99
10.19 Waiver of Jury Trial.....................................................100
10.20 Entire Agreement.........................................................100
10.21 Antares..................................................................100
v.
7
ANNEXES
Annex I Subsidiary Guarantors
Annex II Pricing Grid
SCHEDULES
Schedule 1.01 Founding Companies
Schedule 2.01 Commitments and Pro Rata Shares
Schedule 5.05 Litigation
Schedule 5.07 ERISA
Schedule 5.11 Permitted Liabilities
Schedule 5.12 Environmental Matters
Schedule 5.17 Subsidiaries and Minority Interests
Schedule 5.18 Insurance Matters
Schedule 7.01 Permitted Liens
Schedule 7.05 Permitted Indebtedness
Schedule 7.08 Contingent Obligations
Schedule 7.09 Leases
Schedule 10.02 Payment Offices; Addresses for Notices; Lending Offices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D Form of Legal Opinion of Holdings' and Company's Counsel
Exhibit E Form of Assignment and Acceptance
Exhibit F-1 Form of Revolving Note
Exhibit F-2 Form of Term Note
Exhibit G Form of Security Agreement
Exhibit H Form of Update Certificate
Exhibit I Form of Additional Guarantor Assumption Agreement
Exhibit J Form of Legal Opinion of Additional Guarantor's Counsel
vi.
8
CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of December 7, 1998, among
Enterprise Profit Solutions Corporation, a Delaware corporation (the "Company"),
ProfitSource Corporation, a Delaware corporation, certain other affiliates of
the Company parties hereto as guarantors, the several lending institutions from
time to time party to this Agreement (individually, each a "Lender" and,
collectively, the "Lenders"), Bank of America National Trust and Savings
Association, as administrative agent for itself and the other Lenders (in such
capacity, the "Agent"), Antares Capital Corporation, as documentation agent (in
such capacity, the "Documentation Agent"), and ING (U.S.) Capital Corporation,
as managing agent (in such capacity, the "Managing Agent").
WHEREAS, the Lenders have agreed to make available to the Company a
secured term loan and revolving credit facility upon the terms and conditions
set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS
Certain Defined Terms. The following terms have the following meanings
(including in the Recitals hereof):
"Acquisition" means any transaction or series of related
transactions for the purpose of or resulting, directly or indirectly, in
(a) the acquisition of all or substantially all of the assets of a
Person, or of any business or division of a Person, (b) the acquisition
of in excess of 50% of the capital stock, partnership interests,
membership interests or equity of any Person, or otherwise causing any
Person to become a Subsidiary, or (c) a merger or consolidation or any
other combination with another Person (other than a Person that is a
Subsidiary), provided that the Company or the Subsidiary is the
surviving entity.
"Acquisition Agreements" has the meaning specified in subsection
4.01(m).
"Additional Guarantor Accession Date has the meaning specified in
subsection 6.14(a).
"Additional Guarantor Assumption Agreement" has the meaning
specified in subsection 6.14(a).
"Affiliate" means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. A Person shall be deemed to control
another Person if the controlling Person possesses, directly or
1.
9
indirectly, the power to direct or cause the direction of the management
and policies of the other Person, whether through the ownership of
voting securities, membership interests, by contract, or otherwise.
"Agent" means BofA in its capacity as agent for the Lenders
hereunder, and any successor agent arising under Section 9.09.
"Agent-Related Persons" means BofA and any successor agent
arising under Section 9.09, together with their respective Affiliates
(including, in the case of BofA, the Lead Arranger), and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.
"Agent's Payment Office" means the address for payments set forth
on Schedule 10.02 or such other address as the Agent may from time to
time specify.
"Aggregate Commitment" means the combined Commitments of the
Lenders.
"Aggregate Specified Swap Amount" means, at any time, the sum of
all Specified Swap Amounts owing to all Swap Providers.
"Agreement" means this Credit Agreement.
"Annualization Quotient" means, in respect of any Compliance
Period, the quotient obtained by dividing (a) the number of days elapsed
from the first day of the Compliance Period through the Closing Date, by
(b) 365.
"Antares" means Antares Capital Corporation, a Delaware
corporation.
"Applicable Fee Amount" means with respect to the commitment fee
payable hereunder on and after the first anniversary of the Closing
Date, the amount set forth opposite the indicated Level below the
heading "Commitment Fee" in the pricing grid set forth on Annex II in
accordance with the parameters for calculations of such amount also set
forth on Annex II.
"Applicable Margin" means
(a) at all times prior to the first anniversary of the Closing
Date,
(i) with respect to Base Rate Loans, 2.25%; and
(ii) with respect to Offshore Rate Loans, 3.50%; and
(b) at all times on and after the first anniversary of the
Closing Date, with respect to Base Rate Loans and Offshore Rate Loans,
the amount set forth opposite the indicated Level below the heading
"Base Rate Spread" or "Offshore Rate Spread" in the
2.
10
pricing grid set forth on Annex II in accordance with the parameters for
calculations of such amounts also set forth on Annex II.
"Assignee" has the meaning specified in subsection 10.08(a).
"Attorney Costs" means and includes all fees and disbursements of
any law firm or other external counsel, the allocated cost of internal
legal services and all disbursements of internal counsel.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978
(11 U.S.C. Section 101, et seq.).
"Base Rate" means, for any day, the higher of: (a) 0.50% per
annum above the latest Federal Funds Rate; and (b) the rate of interest
in effect for such day as publicly announced from time to time by BofA
in San Francisco, California, as its "reference rate." (The "reference
rate" is a rate set by BofA based upon various factors including BofA's
costs and desired return, general economic conditions and other factors,
and is used as a reference point for pricing some loans, which may be
priced at, above, or below such announced rate.) Any change in the
reference rate announced by BofA shall take effect at the opening of
business on the day specified in the public announcement of such change.
"Base Rate Loan" means a Loan that bears interest based on the
Base Rate.
"BofA" means Bank of America National Trust and Savings
Association, a national banking association.
"Borrowing" means a borrowing hereunder consisting of Loans of
the same Type made to the Company on the same day by the Lenders under
Article II, and, other than in the case of Base Rate Loans, having the
same Interest Period.
"Borrowing Date" means any date on which a Borrowing occurs under
Section 2.03.
"Business Day" means any day other than a Saturday, Sunday, Good
Friday or other day on which commercial banks in New York City or San
Francisco are authorized or required by law to close and, if the
applicable Business Day relates to any Offshore Rate Loan, means such a
day on which dealings are carried on in the London offshore Dollar
interbank market.
"Capital Adequacy Regulation" means any guideline, request or
directive of any central bank or other Governmental Authority, or any
other law, rule or regulation, whether or not having the force of law,
in each case, regarding capital adequacy of any bank or of any
corporation controlling a bank.
"CERCLA" has the meaning specified in the definition of
"Environmental Laws."
3.
11
"Change of Control" means the occurrence of any of the following:
(a) any "person" or "group" (as such terms are used in subsections 13(d)
and 14(d) of the Exchange Act and the regulations thereunder) other than
the Transaction Shareholders or any group which includes any Transaction
Shareholder is or becomes on or after the Closing Date the "beneficial
owner" (as such term is used in Rules 13d-3 and 13d-5 under the Exchange
Act, except that a person shall be deemed to have "beneficial ownership"
of all securities that such person has the right to acquire, whether
such right is exercisable immediately or only after the passage of
time), directly or indirectly, of securities of Holdings representing
25% or more of the combined voting power of Holdings' then-outstanding
voting securities; (b) the Continuing Directors shall cease to
constitute at least a majority of the directors constituting the board
of directors of Holdings; or (c) Holdings shall cease to own and control
directly, of record and beneficially, 100% of each class of outstanding
capital stock of the Company free and clear of all Liens (other than any
Liens under the Collateral Documents).
"Closing Date" means the date occurring on or before December 18,
1998 on which all conditions precedent set forth in Section 4.01 are
satisfied or waived by all Lenders (or, in the case of subsection
4.01(e), waived by the Person entitled to receive such payment).
"Closing Date Transaction" has the meaning specified in the
definition of Transaction.
"Co-Agents" means Antares, in its capacity as documentation
agent, and ING, in its capacity as managing agent.
"Code" means the Internal Revenue Code of 1986
"Collateral" means all property and interests in property and
proceeds thereof now owned or hereafter acquired by Holdings, the
Company, any Guarantor or other Subsidiary in or upon which a Lien now
or hereafter exists in favor of the Lenders, or the Agent on behalf of
the Lenders, the Lead Arranger or any Swap Provider whether under this
Agreement or under any Collateral Documents.
"Collateral Documents" means, collectively, (i) the Security
Agreement, the Mortgage(s) and all other security agreements, mortgages,
deeds of trust, patent and trademark assignments, lease assignments,
guarantees and other similar agreements between Holdings, the Company,
any Guarantor or any other Subsidiary and the Lenders, or the Agent for
the benefit of the Lenders, the Lead Arranger or any Swap Provider, now
or hereafter delivered to the Lenders or the Agent, pursuant to or in
connection with the transactions contemplated hereby, and all financing
statements (or comparable documents now or hereafter filed in accordance
with the Uniform Commercial Code or comparable law) against Holdings,
the Company, any Guarantor or any other Subsidiary as debtor in favor of
the Lenders, or the Agent for the benefit of the Lenders, the Lead
Arranger or any Swap Provider as secured party, and (ii) any amendments,
supplements,
4.
12
modifications, renewals, replacements, consolidations, substitutions and
extensions of any of the foregoing.
"Commitment" means, for each Lender, the sum of its Revolving
Commitment and Term Commitment.
"Company Leverage Ratio" means, as of any date of determination,
the ratio of (a) Funded Debt on such date to (b) EBITDA for the period
of 12 months (or four fiscal quarters, as the case may be) ended on such
date, of the Company and its Subsidiaries on a consolidated basis, as
determined in accordance with GAAP.
"Compliance Certificate" means a certificate substantially in the
form of Exhibit C.
"Compliance Period" means any period of four consecutive fiscal
quarters for which any covenant set forth in Section 7.18 is measured.
"Consolidated Net Worth" means, as of any date of determination,
total assets on such date minus total liabilities on such date, of the
Company and its Subsidiaries on a consolidated basis, as determined in
accordance with GAAP.
"Contingent Obligation" means, as to any Person, any direct or
indirect liability of that Person, whether or not contingent, with or
without recourse, (a) with respect to any Indebtedness, lease, dividend,
letter of credit or other obligation (the "primary obligations") of
another Person (the "primary obligor"), including any obligation of that
Person (i) to purchase, repurchase or otherwise acquire such primary
obligations or any security therefor, (ii) to advance or provide funds
for the payment or discharge of any such primary obligation, or to
maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency or any balance sheet
item, level of income or financial condition of the primary obligor,
(iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary
obligation, (iv) in connection with any synthetic lease or other similar
off balance sheet lease transaction, or (v) otherwise to assure or hold
harmless the holder of any such primary obligation against loss in
respect thereof (each, a "Guaranty Obligation"); (b) with respect to any
Surety Instrument issued for the account of that Person or as to which
that Person is otherwise liable for reimbursement of drawings or
payments; (c) to purchase any materials, supplies or other property
from, or to obtain the services of, another Person if the relevant
contract or other related document or obligation requires that payment
for such materials, supplies or other property, or for such services,
shall be made regardless of whether delivery of such materials, supplies
or other property is ever made or tendered, or such services are ever
performed or tendered; (d) all Earn-Out Obligations; or (e) in respect
of any Swap Contract. The amount of any Contingent Obligation shall, in
the case of Guaranty Obligations, be deemed equal to the stated or
determinable amount of the primary obligation in respect of which such
Guaranty Obligation is made or, if not stated or if indeterminable, the
maximum reasonably
5.
13
anticipated liability in respect thereof, and in the case of other
Contingent Obligations other than in respect of Swap Contracts, shall be
equal to the maximum reasonably anticipated liability in respect thereof
and, in the case of Contingent Obligations in respect of Swap Contracts,
shall be equal to the Swap Termination Value.
"Continuing Director" means, as of any date of determination, any
member of the board of directors of Holdings who (i) was a member of
such board of directors on the Closing Date or (ii) was nominated or
elected to such board of directors with the approval of a majority of
the directors constituting Continuing Directors who were members of such
board of directors at the time of such nomination or election.
"Contractual Obligation" means, as to any Person, any provision
of any security issued by such Person or of any agreement, undertaking,
contract, indenture, mortgage, deed of trust or other instrument,
document or agreement to which such Person is a party or by which it or
any of its property is bound.
"Conversion/Continuation Date" means any date on which, under
Section 2.04, the Company (a) converts Loans of one Type to another
Type, or (b) continues as Loans of the same Type, but with a new
Interest Period, Loans having Interest Periods expiring on such date.
"D&T Subordinated Note" means, collectively, the Holdings
Subordinated Notes issued to Deloitte & Touche LLP.
"Default" means any event or circumstance which, with the giving
of notice, the lapse of time, or both, would (if not cured or otherwise
remedied during such time) constitute an Event of Default.
"Disposition" means the sale, lease, conveyance or other
disposition of property, other than sales or other dispositions
expressly permitted under subsections 7.02(a) through 7.02(f).
"Dollars," "dollars" and "$" each mean lawful money of the United
States.
"Earn-Out Obligations" means any obligations, whether contingent
or matured, to pay additional consideration in connection with any
Acquisition by the Company or any Subsidiary (including any non-compete,
consulting and similar obligations not constituting reasonable
compensation for actual services rendered).
"EBITDA" of any Person means, for any period, net income plus
interest expense plus income tax expense plus depreciation expense,
amortization expense and other non-cash expenses plus extraordinary
losses minus extraordinary gains, in each case, which were deducted (or,
in the case of any extraordinary gains, added) in determining net
income, of such Person, as determined in accordance with GAAP. For
purposes of determining the consolidated EBITDA of the Company and its
Subsidiaries or Holdings and its Subsidiaries (except for purposes of
determining the Company's compliance with subsection 7.18(e), which
compliance shall be measured on the basis of the actual
6.
14
consolidated EBITDA of the Company and its Subsidiaries for each of the
first four full fiscal quarters ending after the Closing Date), EBITDA
shall be calculated on the basis of the combined financial statements of
the Company and its Subsidiaries for the 12 months ended September 30,
1998, delivered to the Agent and the Lenders pursuant to subsection
4.01(l)(iv), as supplemented from time to time by the financial
statements delivered after the Closing Date pursuant to subsections
6.01(a), 6.01(b) and 6.01(c), until such time as the first day of any
rolling twelve month or four quarter period, as the case may be, for
which the Company's or Holding's consolidated EBITDA is calculated
hereunder falls on or after the Closing Date. For purposes of
determining the consolidated EBITDA of the Company and its Subsidiaries
or Holdings and its Subsidiaries in connection with the calculation of
the Company Leverage Ratio or the Holdings Leverage Ratio, and only to
the extent that (i) supporting financial information satisfactory to the
Majority Lenders shall have been received by the Agent and the Lenders
and (ii) the Majority Lenders shall have approved of the following
adjustments, Holdings' and the Company's consolidated EBITDA shall be
adjusted upon the Permitted Acquisition of any acquired Person (the
"Acquiree") (A) to include the historical financial results of such
Acquiree for each rolling twelve month or four quarter period, as the
case may be, for which Holdings' or the Company's consolidated EBITDA is
calculated hereunder, until such time as the first day of any such
rolling twelve month or four quarter period, as the case may be, falls
on or after the date on which the Acquisition of such Acquiree is
consummated; and (B) to exclude any specific, identifiable expense items
which are eliminated as a result of the Permitted Acquisition of such
Acquiree at the closing thereof. Notwithstanding clauses (i) and (ii) of
the immediately preceding sentence, if audited financial statements
accompanied by an unqualified opinion of an Independent Auditor are
delivered to the Agent and the Lenders in respect of an Acquiree for the
then most recent fiscal year of such Acquiree, then the approval of the
Majority Lenders shall not be required for pro forma additions to the
consolidated EBITDA of the Company or Holdings in respect of the
historical financial results of such Acquiree resulting from the
Permitted Acquisition of such Acquiree that comply in all respects with
the SEC Pro Forma Rules, provided that (i) the Company or Holdings, as
the case may be, shall have delivered a certificate of a Responsible
Officer clearly setting forth such pro forma additions to consolidated
EBITDA resulting from the Permitted Acquisition of such Acquiree and
certifying that such pro forma additions comply in all respects with the
SEC Pro Forma Rules, and (ii) no such pro forma additions to the
consolidated EBITDA of Holdings and its Subsidiaries or the Company and
its Subsidiaries, as the case may be, in respect of any Acquiree shall
exceed $5,000,000.
"Eligible Assignee" means (a) a commercial bank organized under
the laws of the United States, or any state thereof, and having a
combined capital and surplus of at least $100,000,000; (b) a commercial
bank organized under the laws of any other country which is a member of
the Organization for Economic Cooperation and Development (the "OECD"),
or a political subdivision of any such country, and having a combined
capital and surplus of at least $100,000,000, provided that such bank is
acting through a branch or agency located in the United States; (c) a
Person that is primarily engaged in the business of commercial banking
and that is (i) a Subsidiary of a Lender, (ii) a Subsidiary of a Person
of which a Lender is a Subsidiary, or (iii) a Person of which a Lender
is a
7.
15
Subsidiary and (d) any other entity which is an "accredited investor"
(as defined in Regulation D under the Exchange Act) which extends credit
or buys loans as one of its businesses, including insurance companies,
mutual funds and lease financing companies; provided that no Loan Party
or any Affiliate of any Loan Party shall be an Eligible Assignee.
"Environmental Claims" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release or
injury to the environment or threat to public health, personal injury
(including sickness, disease or death), property damage, natural
resources damage, or otherwise alleging liability or responsibility for
damages (punitive or otherwise), cleanup, removal, remedial or response
costs, restitution, civil or criminal penalties, injunctive relief, or
other type of relief, resulting from or based upon the presence,
placement, discharge, emission or release (including intentional and
unintentional, negligent and non-negligent, sudden or non-sudden,
accidental or non-accidental, placement, spills, leaks, discharges,
emissions or releases) of any Hazardous Material at, in, or from
Property, whether or not owned by any Loan Party (or Subsidiary
thereof).
"Environmental Laws" means all federal, state or local laws,
statutes, common law duties, rules, regulations, ordinances and codes,
together with all administrative orders, directed duties, requests,
licenses, authorizations and permits of, and agreements with, any
Governmental Authorities, in each case relating to environmental,
health, safety and land use matters; including the Comprehensive
Environmental Response, Compensation and Liability Act of 1980
("CERCLA"), the Clean Air Act, the Federal Water Pollution Control Act
of 1972, the Solid Waste Disposal Act, the Federal Resource Conservation
and Recovery Act, the Toxic Substances Control Act, the Emergency
Planning and Community Right-to-Know Act, the California Hazardous Waste
Control Law, the California Solid Waste Management, Resource, Recovery
and Recycling Act, the California Water Code and the California Health
and Safety Code.
"ERISA" means the Employee Retirement Income Security Act of
1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Company within the meaning
of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the
Code for purposes of provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a
Pension Plan; (b) a withdrawal by the Company or any ERISA Affiliate
from a Pension Plan subject to Section 4063 of ERISA during a plan year
in which it was a substantial employer (as defined in Section 4001(a)(2)
of ERISA) or a cessation of operations which is treated as such a
withdrawal under Section 4062(e) of ERISA; (c) a complete or partial
withdrawal by the Company or any ERISA Affiliate from a Multiemployer
Plan or notification that a Multiemployer Plan is in reorganization; (d)
the filing of a notice of intent to terminate, the treatment of a Plan
amendment as a termination under Section 4041 or 4041A of
8.
16
ERISA, or the commencement of proceedings by the PBGC to terminate a
Pension Plan or Multiemployer Plan; (e) an event or condition which
might reasonably be expected to constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the
Company or any ERISA Affiliate; in each case which could reasonably be
expected to result in liability to the Company in excess of $5,000,000.
"Estimated Remediation Costs" means all costs associated with
performing work to remediate contamination of real property or
groundwater, including engineering and other professional fees and
expenses, costs to remove, transport and dispose of contaminated soil,
costs to "cap" or otherwise contain contaminated soil, and costs to pump
and treat water and monitor water quality.
"Eurodollar Reserve Percentage" has the meaning specified in the
definition of "Offshore Rate."
"Event of Default" means any of the events or circumstances
specified in Section 8.01.
"Event of Loss" means, with respect to any property, any of the
following: (a) any loss, destruction or damage of such property; (b) any
pending or threatened institution of any proceedings for the
condemnation or seizure of such property or for the exercise of any
right of eminent domain; or (c) any actual condemnation, seizure or
taking, by exercise of the power of eminent domain or otherwise, of such
property, or confiscation of such property or the requisition of the use
of such property.
"Exchange Act" means the Securities Exchange Act of 1934.
"FDIC" means the Federal Deposit Insurance Corporation, and any
Governmental Authority succeeding to any of its principal functions.
"Federal Funds Rate" means, for any day, the rate set forth in
the weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York with
respect to the preceding Business Day opposite the caption "Federal
Funds (Effective)," or, if for any relevant day such rate is not so
published with respect to any such preceding Business Day, the rate for
such day will be the arithmetic mean as determined by the Agent of the
rates for the last transaction in overnight Federal funds arranged prior
to 9:00 a.m. (New York City time) on that day by each of three leading
brokers of Federal funds transactions in New York City selected by the
Agent.
"Fee Letter" means that certain letter agreement dated as of
November 25, 1998, among the Company, the Agent and the Lenders.
"Fixed Charge Coverage Ratio" has the meaning specified in
subsection 7.18(f).
9.
17
"Founding Companies" means the Persons listed on Schedule 1.01,
which Persons will be acquired by the Company on the Closing Date, in
the case of part A thereof, and within 60 days thereafter, in the case
of part B thereof, pursuant to the Transaction.
"FRB" means the Board of Governors of the Federal Reserve System,
and any Governmental Authority succeeding to any of its principal
functions.
"Funded Debt" of any Person means, without duplication, (a) all
interest-bearing Indebtedness of such Person (whether on- or off-balance
sheet), (b) all non-contingent obligations of such Person in respect of
any Surety Instrument, (c) all obligations of such Person with respect
to leases which are or should be capitalized on the balance sheet of
such Person in accordance with GAAP and (d) all Contingent Obligations
of such Person in respect of the Funded Debt of any other Person.
"Further Taxes" means any and all present or future taxes,
levies, assessments, imposts, duties, deductions, fees, withholdings or
similar charges (including net income taxes and franchise taxes), and
all liabilities with respect thereto, imposed by any jurisdiction on
account of amounts payable or paid pursuant to Section 3.01.
"GAAP" means generally accepted accounting principles as in
effect in the United States from time to time.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or
similar monetary or regulatory authority) thereof, any entity exercising
executive, legislative, judicial, regulatory or administrative functions
of or pertaining to government, and any corporation or other entity
owned or controlled, through stock or capital ownership or otherwise, by
any of the foregoing.
"Guarantor" means Holdings and each Subsidiary of the Company
party to a Guaranty in its capacity as a guarantor hereunder.
"Guaranty" means the guaranty of each Guarantor made pursuant to
Section 10.12 and any other guaranty under any separate agreement
executed by any Guarantor pursuant to which it guarantees the
Obligations.
"Guaranty Obligation" has the meaning specified in the definition
of "Contingent Obligation."
"Hazardous Materials" means all those substances that are
regulated by, or which may form the basis of liability under, any
Environmental Law, including any substance identified under any
Environmental Law as a pollutant, contaminant, hazardous waste,
hazardous constituent, special waste, hazardous substance, hazardous
material, or toxic substance, or petroleum or petroleum derived
substance or waste.
"Holdings" means ProfitSource Corporation, a Delaware
corporation.
10.
18
"Holdings Leverage Ratio" means, as of any date of determination,
the ratio of (a) Funded Debt on such date to (b) EBITDA for the period
of 12 months (or four fiscal quarters, as the case may be) ended on such
date, of Holdings and its Subsidiaries on a consolidated basis, as
determined in accordance with GAAP.
"Holdings Note" means that certain Promissory Note dated the
Closing Date made by Holdings in favor of the Company.
"Holdings Subordinated Notes" means those certain Subordinated
Promissory Notes issued by Holdings pursuant to the Acquisition
Agreements.
"Indebtedness" of any Person means, without duplication, (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken
or assumed as the deferred purchase price of property or services (other
than trade payables entered into in the ordinary course of business on
ordinary terms); (c) all non-contingent reimbursement or payment
obligations with respect to Surety Instruments; (d) all obligations
evidenced by notes, bonds, debentures or similar instruments, including
obligations so evidenced incurred in connection with the acquisition of
property, assets or businesses; (e) all indebtedness created or arising
under any conditional sale or other title retention agreement, or
incurred as financing, in either case with respect to property acquired
by the Person (even though the rights and remedies of the seller or bank
under such agreement in the event of default are limited to repossession
or sale of such property); (f) all obligations with respect to capital
leases; (g) all non-contingent Earn-Out Obligations; (h) all
indebtedness referred to in clauses (a) through (g) above secured by (or
for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien upon or in property
(including accounts and contracts rights) owned by such Person, even
though such Person has not assumed or become liable for the payment of
such Indebtedness; and (i) all Guaranty Obligations in respect of
indebtedness or obligations of others of the kinds referred to in
clauses (a) through (h) above. For all purposes of this Agreement, the
Indebtedness of any Person shall include all recourse Indebtedness of
any partnership or joint venture or limited liability company in which
such Person is a general partner or a joint venturer or a member.
"Indemnified Liabilities" has the meaning specified in Section
10.05.
"Indemnified Person" has the meaning specified in Section 10.05.
"Independent Auditor" has the meaning specified in subsection
6.01(a).
"ING" means ING (U.S.) Capital Corporation, a Delaware
corporation.
"Insolvency Proceeding" means, with respect to any Person, (a)
any case, action or proceeding with respect to such Person before any
court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership, dissolution,
winding-up or relief of debtors, or (b) any general assignment for the
benefit
11.
19
of creditors, composition, marshalling of assets for creditors, or
other, similar arrangement in respect of its creditors generally or any
substantial portion of its creditors, in either case undertaken under
U.S. Federal, state or foreign law, including the Bankruptcy Code.
"Interest Payment Date" means, as to any Loan other than a Base
Rate Loan, the last day of each Interest Period applicable to such Loan
and, as to any Base Rate Loan, the last Business Day of each calendar
quarter and the Revolving Termination Date, in the case of Revolving
Loans, or the Term Loan Maturity Date, in the case of Term Loans,
provided, however, that if any Interest Period for an Offshore Rate Loan
exceeds three months, the date that falls three months after the
beginning of such Interest Period and after each Interest Payment Date
thereafter is also an Interest Payment Date.
"Interest Period" means, as to any Offshore Rate Loan, the period
commencing on the Borrowing Date of such Loan or on the Conversion /
Continuation Date on which the Loan is converted into or continued as an
Offshore Rate Loan, and ending on the date one, two, three or six months
thereafter as selected by the Company in its Notice of Borrowing or
Notice of Conversion/Continuation;
provided that:
(i) if any Interest Period would otherwise end on a day that
is not a Business Day, that Interest Period shall be extended to
the following Business Day unless the result of such extension
would be to carry such Interest Period into another calendar
month, in which event such Interest Period shall end on the
preceding Business Day;
(ii) any Interest Period pertaining to an Offshore Rate Loan
that begins on the last Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on
the last Business Day of the calendar month at the end of such
Interest Period;
(iii) no Interest Period for any Term Loan shall extend
beyond the Term Loan Maturity Date and no Interest Period for any
Revolving Loan shall extend beyond the Revolving Termination
Date; and
(iv) no Interest Period applicable to a Term Loan or portion
thereof shall extend beyond any date upon which is due any
scheduled principal payment in respect of the Term Loans unless
the aggregate principal amount of Term Loans represented by Base
Rate Loans, or by Offshore Rate Loans having Interest Periods
that will expire on or before such date, equals or exceeds the
amount of such principal payment.
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
12.
20
"Joint Venture" means a partnership, limited liability company,
joint venture or other similar legal arrangement (whether created by
contract or conducted through a separate legal entity) now or hereafter
formed by the Company or any of its Subsidiaries with another Person in
order to conduct a common venture or enterprise with such Person.
"Lead Arranger" means NationsBanc Xxxxxxxxxx Securities LLC, a
Delaware limited liability company.
"Lender" means the institutions specified in the introductory
clause hereto. Unless the context otherwise clearly requires, "Lender"
includes any such institution in its capacity as Swap Provider pursuant
to a Specified Swap Contract. Unless the context otherwise clearly
requires, references to any such institution as a "Lender" shall also
include any of such institution's Affiliates that may at any time of
determination be Swap Providers pursuant to Specified Swap Contracts.
"Lending Office" means, as to any Lender, the office or offices
of such Lender specified as its "Lending Office" or "Domestic Lending
Office" or "Offshore Lending Office," as the case may be, on Schedule
10.02, or such other office or offices as the Lender may from time to
time notify the Company and the Agent.
"Lien" means any security interest, mortgage, deed of trust,
pledge, hypothecation, assignment, charge or deposit arrangement,
encumbrance, lien (statutory or other) or preferential arrangement of
any kind or nature whatsoever in respect of any property (including
those created by, arising under or evidenced by any conditional sale or
other title retention agreement, the interest of a lessor under a
capital lease, any financing lease having substantially the same
economic effect as any of the foregoing, or the filing of any financing
statement naming the owner of the asset to which such lien relates as
debtor, under the Uniform Commercial Code or any comparable law) and any
contingent or other agreement to provide any of the foregoing, but not
including the interest of a lessor under an operating lease.
"Loan" means an extension of credit by a Lender to the Company
under Article II, and may be a Base Rate Loan or an Offshore Rate Loan
(each, a "Type" of Loan), and includes any Revolving Loan or Term Loan.
"Loan Documents" means this Agreement, any Notes, the Collateral
Documents, the Fee Letter, any documents evidencing or relating to
Specified Swap Contracts, and all other documents delivered to the Agent
or any Lender in connection with the transactions contemplated by this
Agreement.
"Loan Party" means the Company, Holdings and each Subsidiary
party hereto as a Guarantor.
"Majority Lenders" means at any time Lenders then holding in
excess of 50% of the sum of (a) the combined Revolving Commitments, or
if the Revolving Commitments
13.
21
have been terminated, the then aggregate unpaid principal amount of the
Revolving Loans, plus (b) the combined Term Commitments, or if the Term
Commitments have been terminated, the then aggregate unpaid principal
amount of the Term Loans, or, if the Revolving Commitments and Term
Commitments have been terminated and no Loans are then outstanding,
Lenders then owed a Specified Swap Amount in excess of 50% of the
Aggregate Specified Swap Amount.
"Margin Stock" means "margin stock" as such term is defined in
Regulation T, U or X of the FRB.
"Material Adverse Effect" means (a) a material adverse change in,
or a material adverse effect upon, the operations, business, properties,
liabilities (whether actual or contingent), assets, condition (financial
or otherwise) or prospects of (i) the Company and its Subsidiaries taken
as a whole or (ii) as to Holdings and its Subsidiaries taken as a whole
or (iii) as to the Founding Companies; (b) a material impairment of the
ability of any Loan Party to perform under any Loan Document to which it
is a party and to avoid any Event of Default; or (c) a material adverse
effect upon (i) the legality, validity, binding effect or enforceability
against any Loan Party of any Loan Document to which it is a party, or
(ii) the perfection or priority of any Lien granted under any of the
Collateral Documents.
"Minimum Amount" means (i) in respect of any Borrowing,
conversion or continuation of Loans, (A) in the case of Base Rate Loans,
an aggregate minimum amount of $5,000,000 or any integral multiple of
$1,000,000 in excess thereof, and (B) in the case of Offshore Rate
Loans, an aggregate minimum amount of $5,000,000 or any integral
multiple of $1,000,000 in excess thereof, (ii) in the case of any
reduction of the Commitments under Section 2.05, an aggregate minimum
amount of $5,000,000 or any integral multiple of $1,000,000 in excess
thereof, and (iii) in the case of any optional prepayment of Loans under
Section 2.06, an aggregate minimum amount of $1,000,000 or any multiple
of $1,000,000 in excess thereof.
"Mortgage" means any deed of trust, mortgage, leasehold mortgage,
assignment of rents or other document creating a Lien on real property
or any interest in real property.
"Mortgaged Property" means all property subject to a Lien
pursuant to a Mortgage.
"Multiemployer Plan" means a "multiemployer plan," within the
meaning of Section 4001(a)(3) of ERISA, to which the Company or any
ERISA Affiliate makes, is making, or is obligated to make contributions
or, during the preceding three calendar years, has made, or been
obligated to make, contributions.
"Net Issuance Proceeds" means, as to any issuance of debt or
equity by any Person, cash proceeds received or receivable by such
Person in connection therewith, net
14.
22
of reasonable out-of-pocket costs and expenses paid or incurred in
connection therewith in favor of any Person not an Affiliate of such
Person.
"Net Proceeds" means, (a) as to any Disposition by a Person,
proceeds in cash, checks or other cash equivalent financial instruments
as and when received by such Person, net of: (i) the direct costs
relating to such Disposition excluding amounts payable to such Person or
any Affiliate of such Person, (ii) sale, use or other transaction taxes
and capital gains taxes paid or payable by such Person as a direct
result thereof, and (iii) amounts required to be applied to repay
principal, interest and prepayment premiums and penalties on
Indebtedness secured by a purchase money security interest on the asset
which is the subject of such Disposition; and (b) proceeds paid on
account of any Event of Loss, net of (i) all money actually and
reasonably promptly applied to repair or reconstruct the damaged
property or property affected by the condemnation or taking, (ii) all of
the costs and expenses reasonably incurred in connection with the
collection of such proceeds, award or other payments, and (iii) any
amounts retained by or paid to parties having superior rights to such
proceeds, awards or other payments. For purposes of determining the
amount of Net Proceeds in respect of any Disposition or Event of Loss,
however, the amount of proceeds calculated as provided above shall be
reduced by the amount of such proceeds that such Person has used (or
intends to use within six months of the date of receipt of such
proceeds) to repair, rebuild or replace all or any part of the assets in
respect of which such proceeds were received, it being understood that
any portion of such proceeds that has not been so used within such six
month period shall be deemed to be Net Proceeds received on the last day
of such six month period.
"Note" means a promissory note executed by the Company in favor
of a Lender pursuant to subsection 2.02(b), in substantially the form of
Exhibit F-1, in the case of Revolving Loans, and in the form of Exhibit
F-2, in the case of Term Loans.
"Notice of Borrowing" means a notice in substantially the form of
Exhibit A.
"Notice of Conversion / Continuation" means a notice in
substantially the form of Exhibit B.
"Obligations" means all advances, debts, liabilities,
obligations, covenants and duties arising under any Loan Document owing
by the Company to any Lender, the Agent, or any Indemnified Person,
whether direct or indirect (including those acquired by assignment),
absolute or contingent, due or to become due, now existing or hereafter
arising.
"Offshore Rate" means, for any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate of
interest per annum (rounded upward to the next 1/100th of 1%) determined
by the Agent as follows:
Offshore Rate = LIBOR
------------------------------------
1.00 - Eurodollar Reserve Percentage
15.
23
Where:
"Eurodollar Reserve Percentage" means for any day for any
Interest Period the maximum reserve percentage (expressed as a
decimal, rounded upward to the next 1/100th of 1%) in effect on
such day (whether or not applicable to any Lender) under
regulations issued from time to time by the FRB for determining
the maximum reserve requirement (including any emergency,
supplemental or other marginal reserve requirement) with respect
to Eurocurrency funding (currently referred to as "Eurocurrency
liabilities"); and
"LIBOR" means the rate of interest per annum determined by
the Agent to be the arithmetic mean (rounded upward to the next
1/16th of 1%) of the rates of interest per annum notified to the
Agent as the rate of interest at which Dollar deposits in the
approximate amount of the amount of the Loan to be made or
continued as, or converted into, an Offshore Rate Loan and having
a maturity comparable to such Interest Period would be offered by
BofA to major banks in the London interbank market at their
request at approximately 11:00 a.m. (London time) two Business
Days prior to the commencement of such Interest Period.
The Offshore Rate shall be adjusted automatically as to all
Offshore Rate Loans then outstanding as of the effective date of
any change in the Eurodollar Reserve Percentage.
"Offshore Rate Loan" means a Loan that bears interest based on
the Offshore Rate.
"Organization Documents" means, for any Person, the certificate
or articles of incorporation, the bylaws, the partnership agreement, the
limited liability company agreement or operating agreement, any
certificate of determination or instrument relating to the rights of
preferred shareholders of such Person, any shareholder rights agreement,
any other applicable organizational or constitutional documents and all
applicable resolutions of the board of directors (or any committee
thereof) of such Person.
"Other Taxes" means any present or future stamp, court or
documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or from the
execution, delivery, performance, enforcement or registration of, or
otherwise with respect to, this Agreement or any other Loan Documents.
"Participant" has the meaning specified in subsection 10.08(d).
"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions
under ERISA.
"Perfection Certificate" means a certificate, in form and
substance satisfactory to the Agent, providing certain information
relating to the Loan Parties and the Collateral.
16.
24
"Pension Plan" means a pension plan (as defined in Section 3(2)
of ERISA) subject to Title IV of ERISA which the Company sponsors,
maintains, or to which it makes, is making, or is obligated to make
contributions, or in the case of a multiple employer plan (as described
in Section 4064(a) of ERISA) has made contributions at any time during
the immediately preceding five (5) plan years.
"Permitted Acquisition" means any Acquisition (other than any
Acquisition included in the Closing Date Transaction) that conforms to
the following requirements: (a) the assets, Person, division or line of
business to be acquired is in a substantially similar or related line of
business as the Company, (b) the Agent and the Lenders shall have
received, no less than 10 Business Days prior to the consummation of
such Acquisition, reasonably adequate financial information regarding
the assets, Person or business to be acquired, including the most recent
audited financial statements, if available, but in any case the most
recently prepared balance sheet, statement of income and statement of
cash flows for the assets, Person or business to be acquired and pro
forma projected financial statements showing the effect of the
Acquisition of the assets, Person or business on the Company, including
a balance sheet for the Company and its Subsidiaries as of the time of
the Acquisition and projected statements of income and cash flows for
the Company and its Subsidiaries through at least the Revolving
Termination Date, (c) all transactions related to such Acquisition shall
be consummated in accordance with applicable Requirements of Law, (d)
such Acquisition shall be non-hostile in nature and not involve any
transaction subject to Section 13(d) or 14(d) of the Exchange Act, (e)
the prior, effective written consent or approval to such Acquisition of
the board of directors or equivalent governing body of the acquiree is
obtained, (f) immediately after giving effect to such Acquisition: (i)
no Default or Event of Default shall have occurred and be continuing or
would result therefrom, (ii) 100% of the capital stock of any acquired
or newly formed corporation, partnership, limited liability company or
other business entity is owned directly by the Company or a U.S.
Wholly-Owned Subsidiary of the Company, and all actions required to be
taken, if any, with respect to such acquired or newly formed Subsidiary
under Section 6.14 or as otherwise required under Section 6.15 shall
have been taken, (iii) there shall be at least $5,000,000 of
availability under the Revolving Commitments for Borrowings of Revolving
Loans, and (iv) (A) the Company shall be in compliance, on a pro forma
basis after giving effect to such Acquisition, with the covenants
contained in Section 7.18 recomputed as of the last day of the most
recently ended fiscal quarter of the Company as if such Acquisition had
occurred on the first day of each relevant period for testing such
compliance, and the Company shall have delivered to the Agent a
certificate of a Responsible Officer of the Company to such effect,
together with all relevant financial computations evidencing such
compliance, (B) if all or any part of the consideration for such
Acquisition shall be financed directly or indirectly by one or more
Borrowings hereunder, then the Company Leverage Ratio, measured as of
the end of the most recent fiscal quarter on a pro forma basis after
giving effect to such Acquisition, shall not be more than 2.00 to 1.00,
and the Holdings Leverage Ratio, measured as of the end of the most
recent fiscal quarter on a pro forma basis after giving effect to such
Acquisition, shall not be more than 3.50 to 1.00; provided, however,
that the preceding clause (iv) shall not apply to
17.
25
any Secondary Acquisition, and (C) any acquired or newly formed
Subsidiary shall not be liable for any Indebtedness other than
Indebtedness permitted under Section 7.05, (g) the assets, Person or
business to be acquired shall have had an EBITDA equal to or greater
than zero for the then most recent period of 12 fiscal months ended
prior to the consummation of such Acquisition, and (h) in the case of
any Significant Acquisition (other than any Secondary Acquisition), (i)
any Earn-Out Obligations constituting all or a portion of the
consideration for such Acquisition shall be on terms satisfactory to the
Majority Lenders, and (ii) the Majority Lenders, shall have otherwise
consented in writing to the consummation of such Acquisition.
"Permitted Liens" has the meaning specified in Section 7.01.
"Permitted New Subordinated Debt" has the meaning specified in
Section 7.05(g).
"Permitted Swap Obligations" means all obligations (contingent or
otherwise) of the Company or any Subsidiary existing or arising under
Swap Contracts, provided that each of the following criteria is
satisfied: (a) such obligations are (or were) entered into by such
Person in the ordinary course of business for the purpose of directly
mitigating risks associated with liabilities, commitments or assets held
by such Person, or changes in the value of securities issued by such
Person in conjunction with a securities repurchase program not otherwise
prohibited hereunder, and not for purposes of speculation or taking a
"market view;" (b) such Swap Contracts do not contain (i) any provision
("walk-away" provision) exonerating the non-defaulting party from its
obligation to make payments on outstanding transactions to the
defaulting party, or (ii) with respect to any Swap Contract that is not
a Specified Swap Contract, any provision creating or permitting the
declaration of an event of default, termination event or similar event
upon the occurrence of an Event of Default hereunder (other than an
Event of Default under subsection 8.01(a)) and (c) a perfected security
interest in such Person's rights and interests to and in such Swap
Contracts has been granted, and exists, in favor of the Agent, for the
benefit of the Lenders, as collateral for the Obligations.
"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture, Governmental Authority, or
any other entity of whatever nature.
"Plan" means an employee benefit plan (as defined in Section 3(3)
of ERISA) which the Company sponsors or maintains or to which the
Company makes, is making, or is obligated to make contributions and
includes any Pension Plan.
"Pledged Shares" has the meaning specified in the Security
Agreement.
"Principal Installment" means such amount of principal of the
Term Loans that is due and payable on any Principal Payment Date.
"Principal Payment Date" has the meaning specified in subsection
2.08(a).
18.
26
"Pro Rata Share" means, as to any Lender at any time, the
percentage equivalent (expressed as a decimal, rounded to the ninth
decimal place) at such time of (a) in the case of the Revolving
Commitments or the Revolving Loans, such Lender's Revolving Commitment
divided by the combined Revolving Commitments of all Lenders (or, if all
Revolving Commitments have been terminated, the aggregate principal
amount of such Lender's Revolving Loans divided by the aggregate
principal amount of the Revolving Loans then held by all Lenders), and
(b) in the case of the Term Commitments or the Term Loans, such Lender's
Term Commitment divided by the combined Term Commitments of all Lenders
(or, if all Term Commitments have been terminated, the aggregate
principal amount of such Lender's Term Loans divided by the aggregate
principal amount of Term Loans then held by all Lenders). The initial
Pro Rata Share of each Lender is set forth opposite such Lender's name
in Schedule 2.1 under the heading "Pro Rata Share."
"Related Person" means, with respect to any natural person, (i)
such person's spouse, parents and descendants (whether by blood or
adoption and including stepchildren) and the spouses of any such natural
persons and (ii) any corporation, partnership, trust or other Person in
which no one has any interest (directly or indirectly) except for any of
such natural person, such spouse, parents and descendants and the
spouses of any such natural persons.
"Replacement Lender" has the meaning specified in Section 3.07.
"Reportable Event" means, any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder, other than any such
event for which the 30-day notice requirement under ERISA has been
waived in regulations issued by the PBGC.
"Requirement of Law" means, as to any Person, any law (statutory
or common), treaty, rule or regulation or determination of an arbitrator
or of a Governmental Authority, in each case applicable to or binding
upon the Person or any of its property or to which the Person or any of
its property is subject.
"Responsible Officer" means, as to any Person, the chief
executive officer or the president of such Person, or any other officer
having substantially the same authority and responsibility; or, with
respect to compliance with financial covenants, the chief financial
officer or the treasurer of such Person, or any other officer having
substantially the same authority and responsibility.
"Revolving Commitment," as to each Lender, has the meaning
specified in subsection 2.01(b).
"Revolving Loan" has the meaning specified in Section 2.01.
"Revolving Termination Date" means the earlier to occur of:
(a) June 14, 2001; and
19.
27
(b) the date on which the Commitments terminate in accordance
with the provisions of this Agreement.
"SEC" means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.
"SEC Pro Forma Rules" means the SEC's requirements, as set forth
in Regulation S-X promulgated by the SEC, for the preparation of pro
forma financial statements and the making of pro forma adjustments in
connection therewith.
"Secondary Acquisition" means any Acquisition by the Company or
any Subsidiary of the Company of any Person identified on part B of
Schedule 1.01; provided that any such Acquisition shall be a Secondary
Acquisition only if such Acquisition is consummated not later than 60
days after the Closing Date.
"Security Agreement" means a security agreement in substantially
the form of Exhibit G.
"Significant Acquisition" means (a) any Acquisition by the
Company or any Subsidiary in respect of which cash or cash equivalents
and/or assumption and/or incurrence of Indebtedness exceeding
$10,000,000 in the aggregate constitutes all or a portion of the
consideration therefor, and (b) any Acquisition by the Company or any
Subsidiary at any time that cash or cash equivalents and/or assumption
and/or incurrence of Indebtedness exceeding $20,000,000 in the aggregate
has constituted (or, immediately after giving effect to such
Acquisition, shall have constituted) all or a portion of the
consideration for all Acquisitions by the Company and its Subsidiaries
consummated in the then current fiscal year.
"Solvent" means, as to any Person at any time, that (a) the fair
value of the property of such Person is greater than the amount of such
Person's liabilities (including disputed, contingent and unliquidated
liabilities) as such value is established and liabilities evaluated for
purposes of Section 101(31) of the Bankruptcy Code and, in the
alternative, for purposes of the California Uniform Fraudulent Transfer
Act; (b) the present fair saleable value of the property of such Person
is not less than the amount that will be required to pay the probable
liability of such Person on its debts as they become absolute and
matured; (c) such Person is able to realize upon its property and pay
its debts and other liabilities (including disputed, contingent and
unliquidated liabilities) as they mature in the normal course of
business; (d) such Person does not intend to, and does not believe that
it will, incur debts or liabilities beyond such Person's ability to pay
as such debts and liabilities mature; and (e) such Person is not engaged
in business or a transaction, and is not about to engage in business or
a transaction, for which such Person's property would constitute
unreasonably small capital.
"Specified Swap Amount" means, at any time, in respect of
Specified Swap Contracts to which any Swap Provider is party, the Swap
Termination Value relating
20.
28
thereto; provided that for purposes of this definition, any Swap
Termination Value that is negative as to (i.e., owing by) any Swap
Provider shall be deemed equal to zero (0).
"Specified Swap Contract" means any Swap Contract made or entered
into at any time, or in effect at any time (whether heretofore or
hereafter), whether directly or indirectly, and whether as a result of
assignment or transfer or otherwise, between the Company and any Swap
Provider which Swap Contract is or was intended by the Company to have
been entered into, in part or entirely, for purposes of mitigating
interest rate or currency exchange risk relating to any Loan (which
intent shall conclusively be deemed to exist if the Company so
represents to the Swap Provider in writing), and as to which the final
scheduled payment by the Company is not later than the Revolving
Termination Date.
"Subordinated Debt" means the Holdings Subordinated Notes and any
Permitted New Subordinated Debt.
"Subsidiary" of a Person means any corporation, association,
partnership, limited liability company, joint venture or other business
entity of which more than 50% of the voting stock, membership interests
or other equity interests (in the case of Persons other than
corporations), is owned or controlled directly or indirectly by the
Person, or one or more of the Subsidiaries of the Person, or a
combination thereof. Unless the context otherwise clearly requires,
references herein to a "Subsidiary" refer to a Subsidiary of the
Company.
"Surety Instruments" means all letters of credit (including
standby and commercial), bankers acceptances, bank guaranties, shipside
bonds, surety bonds and similar instruments.
"Swap Contract" means any agreement, whether or not in writing,
relating to any transaction that is a rate swap, basis swap, forward
rate transaction, commodity swap, commodity option, equity or equity
index swap or option, bond, note or xxxx option, interest rate option,
forward foreign exchange transaction, cap, collar or floor transaction,
currency swap, cross-currency rate swap, swaption, currency option or
any other, similar transaction (including any option to enter into any
of the foregoing) or any combination of the foregoing, and, unless the
context otherwise clearly requires, any master agreement relating to or
governing any or all of the foregoing.
"Swap Provider" means any Lender, or any Affiliate of any Lender,
that is at the time of determination party to a Specified Swap Contract
with the Company or any Subsidiary.
"Swap Termination Value" means, in respect of any one or more
Swap Contracts, after taking into account the effect of any legally
enforceable netting agreement relating to such Swap Contracts, (a) for
any date on or after the date such Swap Contracts have been closed out
and termination value(s) determined in accordance therewith, such
termination value(s), and (b) for any date prior to the date referenced
in clause (a) the
21.
29
amount(s) determined as the xxxx-to-market value(s) for such Swap
Contracts, as determined by the Company based upon one or more
mid-market or other readily available quotations provided by any
recognized dealer in such Swap Contracts (which may include any Lender.)
"Tax Sharing Agreement" means that certain Tax Sharing Agreement
dated as of December 11, 1998, by and among Holdings and its
Subsidiaries.
"Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the
case of each Lender and the Agent, respectively, taxes imposed on or
measured by its net income by the jurisdiction (or any political
subdivision thereof) under the laws of which such Lender or the Agent,
as the case may be, is organized or maintains a Lending Office.
"Term Commitment," as to each Lender, has the meaning specified
in subsection 2.01(a).
"Term Loan" has the meaning specified in Section 2.01.
"Term Loan Maturity Date" means June 14, 2001.
"Transaction" means (a) the following events occurring
simultaneously on the Closing Date: (i) the Acquisition by the Company
of the Founding Companies identified on part A of Schedule 1.01, (ii)
the issuance of the Holdings Subordinated Notes and shares of Holdings'
common stock to owners, officers, directors and employees of such
Founding Companies (such events, the "Closing Date Transaction"); and
(b) the following events occurring not later than 60 days after the
Closing Date: (i) the Acquisition by the Company of the Founding
Companies identified on Part B of Schedule 1.01, and (ii) the issuance
of the Holdings Subordinated Notes and shares of Holdings' common stock
to owners, officers, directors and employees of such Founding Companies.
"Transaction Documents" means (i) the documents and instruments
evidencing any Subordinated Debt and the issuance of the shares of
common stock of Holdings in connection with the Transaction and all
related stockholder agreements and (ii) the Acquisition Agreements.
"Transaction Shareholders" means those Persons obtaining shares
of Holdings' common stock on the Closing Date or pursuant to a Secondary
Acquisition and all Related Persons of such Persons.
"Type" has the meaning specified in the definition of "Loan."
"UCC" means the Uniform Commercial Code as in effect in the State
of California.
22.
30
"Unfunded Pension Liability" means the excess of a Pension Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the current
value of that Pension Plan's assets, determined in accordance with the
assumptions used for funding the Pension Plan pursuant to Section 412 of
the Code for the applicable plan year.
"United States" and "U.S." each means the United States of
America.
"U.S. Subsidiary" and "U.S. Wholly-Owned Subsidiary" means a
Subsidiary or Wholly-Owned Subsidiary, as the case may be, that is
located in and a resident of the United States.
"Wholly-Owned Subsidiary" means any corporation in which (other
than directors' qualifying shares required by law) 100% of the capital
stock of each class having ordinary voting power, 100% of the capital
stock of every other class and all warrants, options or other rights to
acquire capital stock of any class, in each case, at the time as of
which any determination is being made, is owned, beneficially and of
record, by the Company, or by one or more of the other Wholly-Owned
Subsidiaries, or both.
1.02 Other Interpretive Provisions.
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) The words "hereof," "herein," "hereunder" and similar words
refer to this Agreement as a whole and not to any particular provision of this
Agreement; and subsection, Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other writings,
however evidenced.
(ii) The term "including" is not limiting and means "including
without limitation."
(iii) In the computation of periods of time from a specified date
to a later specified date, the word "from" means "from and including";
the words "to" and "until" each mean "to but excluding," and the word
"through" means "to and including."
(iv) The term "property" includes any kind of property or asset,
real, personal or mixed, tangible or intangible.
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, but
only to the extent such amendments and other modifications are not prohibited by
the terms of any Loan Document, and (ii) references to any statute or regulation
are to be construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the statute or
regulation.
23.
31
(e) The captions and headings of this Agreement are for convenience
of reference only and shall not affect the interpretation of this Agreement.
(f) This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and shall
each be performed in accordance with their terms. Unless otherwise expressly
provided, any reference to any action of the Agent or the Lenders by way of
consent, approval or waiver shall be deemed modified by the phrase "in its/their
sole discretion."
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agent, the Company
and the other parties, and are the products of all parties. Accordingly, they
shall not be construed against the Lenders or the Agent merely because of the
Agent's or Lenders' involvement in their preparation.
1.03 Accounting Principles.
(a) Unless the context otherwise clearly requires, all accounting
terms not expressly defined herein shall be construed, and all financial
computations required under this Agreement shall be made, in accordance with
GAAP, consistently applied; provided, however, that, if GAAP shall have been
modified after the Closing Date and the application of such modified GAAP shall
have a material effect on such financial computations (including the
computations required for the purpose of determining compliance with the
financial covenants set forth herein), then such computations shall be made and
such financial statements, certificates and reports shall be prepared, and all
accounting terms not otherwise defined herein shall be construed, in accordance
with GAAP as in effect prior to such modification, unless and until the Majority
Lenders and the Company shall have agreed upon the terms of the application of
such modified GAAP.
(b) References herein to "fiscal year" and "fiscal quarter" refer to
such fiscal periods of the Company.
ARTICLE II
THE CREDITS
2.01 Amounts and Terms of Commitments
(a) The Term Credit. Each Lender severally agrees, on the terms and
conditions set forth herein, to make a single loan to the Company (each such
loan, a "Term Loan") on the Closing Date in an amount not to exceed the amount
set forth opposite such Lender's name on Schedule 2.01 under the heading "Term
Commitment" (such amount, such Lender's "Term Commitment") . Amounts borrowed as
Term Loans which are repaid or prepaid by the Company may not be reborrowed.
24.
32
(b) The Revolving Credit. Each Lender severally agrees, on the terms
and conditions set forth herein, to make loans to the Company (each such loan, a
"Revolving Loan") from time to time on any Business Day during the period from
the Closing Date to the Revolving Termination Date, in an aggregate amount not
to exceed at any time outstanding the amount set forth opposite such Lender's
name on Schedule 2.01 under the heading "Revolving Commitment" (such amount as
the same may be reduced under Section 2.05 or reduced or increased as a result
of one or more assignments under Section 10.08, such Lender's "Revolving
Commitment"); provided, however, that, after giving effect to any Borrowing of
Revolving Loans, the aggregate principal amount of all outstanding Revolving
Loans, together with the aggregate principal amount of all Term Loans
outstanding at such time, shall not at any time exceed the Aggregate Commitment.
Within the limits of each Lender's Revolving Commitment, and subject to the
other terms and conditions hereof, the Company may borrow under this subsection
2.01(b), prepay under Section 2.06 and reborrow under this subsection 2.01(b).
2.02 Loan Accounts.
(a) The Loans made by each Lender shall be evidenced by one or more
loan accounts or records maintained by such Lender in the ordinary course of
business. The loan accounts or records maintained by the Agent and each Lender
shall be conclusive absent manifest error/rebuttable presumptive evidence of the
amount of the Loans made by the Lenders to the Company and the interest and
payments thereon. Any failure so to record or any error in doing so shall not,
however, limit or otherwise affect the obligation of the Company hereunder to
pay any amount owing with respect to the Loans.
(b) Upon the request of any Lender made through the Agent, the Loans
made by such Lender may be evidenced by one or more Notes, instead of or in
addition to loan accounts. Each such Lender shall endorse on the schedules
annexed to its Note(s) the date, amount and maturity of each Loan made by it and
the amount of each payment of principal made by the Company with respect
thereto. Each such Lender is irrevocably authorized by the Company to endorse
its Note(s) and each Lender's record shall be conclusive absent manifest error;
provided, however, that the failure of a Lender to make, or an error in making,
a notation thereon with respect to any Loan shall not limit or otherwise affect
the obligations of the Company hereunder or under any such Note to such Lender.
2.03 Procedure for Borrowing.
(a) Each Borrowing shall be made upon the Company's irrevocable
written notice delivered to the Agent in the form of a Notice of Borrowing
(which notice must be received by the Agent prior to 9:00 a.m. (San Francisco
time) (i) at least three Business Days prior to the requested Borrowing Date, in
the case of Offshore Rate Loans; and (ii) on the requested Borrowing Date, in
the case of Base Rate Loans, specifying:
(i) the amount of the Borrowing, which shall be in a Minimum
Amount;
(ii) the requested Borrowing Date, which shall be a Business Day;
25.
33
(iii) the Type of Loans comprising the Borrowing and whether
Revolving Loans or Term Loans are requested; and
(iv) the duration of the Interest Period applicable to such Loans
included in such notice (subject to the provisions of the definition of
"Interest Period" herein). If the Notice of Borrowing fails to specify
the duration of the Interest Period for any Borrowing comprised of
Offshore Rate Loans, such Interest Period shall be three months;
provided, however, that with respect to the Borrowing to be made on the Closing
Date, the Notice of Borrowing shall be delivered to the Agent not later than
11:00 a.m. (San Francisco time) one Business Day prior to the Closing Date and
such Borrowing will consist of Base Rate Loans only; and further provided that
if so requested by the Agent, all Borrowings during the first three months
following the Closing Date shall have the same Interest Period and shall be Base
Rate Loans or Offshore Rate Loans for Interest Periods no longer than one month.
(b) The Agent will promptly notify each Lender of its receipt of any
Notice of Borrowing and of the amount of such Lender's Pro Rata Share of that
Borrowing.
(c) Each Lender will make the amount of its Pro Rata Share of each
Borrowing available to the Agent for the account of the Company at the Agent's
Payment Office by 11:00 a.m. (San Francisco time) on the Borrowing Date
requested by the Company in funds immediately available to the Agent. The
proceeds of all such Borrowings will then be made available to the Company by
the Agent at such office by crediting the account of the Company on the books of
BofA with the aggregate of the amounts made available to the Agent by the
Lenders and in like funds as received by the Agent, or if requested by the
Company, by wire transfer in accordance with written instructions provided to
the Agent by the Company of such funds as received by the Agent, unless on the
date of the Borrowing all or any portion of the proceeds thereof shall then be
required to be applied to the repayment of any outstanding Loans, in which case
such proceeds or portion thereof shall be applied to the payment of such Loans.
(d) After giving effect to any Borrowing, unless the Agent shall
otherwise consent, there may not be more than eight different Interest Periods
in effect.
2.04 Conversion and Continuation Elections.
(a) The Company may, upon irrevocable written notice to the Agent in
accordance with subsection 2.04(b):
(i) elect, as of any Business Day, in the case of Base Rate
Loans, or as of the last day of the applicable Interest Period, in the
case of any other Type of Loans, to convert any such Loans (or any part
thereof in a Minimum Amount) into Loans of any other Type; or
(ii) elect, as of the last day of the applicable Interest Period,
to continue any Loans having Interest Periods expiring on such day (or
any part thereof in a Minimum Amount);
26.
34
provided, that if at any time the aggregate amount of Offshore Rate Loans in
respect of any Borrowing is reduced, by payment, prepayment, or conversion of
part thereof to be less than $5,000,000, such Offshore Rate Loans shall
automatically convert into Base Rate Loans, and on and after such date the right
of the Company to continue such Loans as, and convert such Loans into, Offshore
Rate Loans shall terminate.
(b) The Company shall deliver a Notice of Conversion / Continuation
to be received by the Agent not later than 9:00 a.m. (San Francisco time) (i) at
least three Business Days in advance of the Conversion / Continuation Date, if
the Loans are to be converted into or continued as Offshore Rate Loans; and (ii)
on the Conversion / Continuation Date, if the Loans are to be converted into
Base Rate Loans, specifying:
(i) the proposed Conversion / Continuation Date;
(ii) the aggregate amount of Loans to be converted or continued;
(iii) the Type of Loans resulting from the proposed conversion or
continuation; and
(iv) other than in the case of conversions into Base Rate Loans,
the duration of the requested Interest Period (subject to the provisions
of the definition of "Interest Period" herein).
(c) If upon the expiration of any Interest Period applicable to
Offshore Rate Loans, the Company has failed to select timely a new Interest
Period to be applicable to such Offshore Rate Loans, or if any Default or Event
of Default then exists, the Company shall be deemed to have elected to convert
such Offshore Rate Loans into Base Rate Loans effective as of the expiration
date of such Interest Period.
(d) The Agent will promptly notify each Lender of its receipt of a
Notice of Conversion / Continuation, or, if no timely notice is provided by the
Company, the Agent will promptly notify each Lender of the details of any
automatic conversion. All conversions and continuations shall be made ratably
according to the respective outstanding principal amounts of the Loans with
respect to which the notice was given held by each Lender.
(e) Unless the Majority Lenders otherwise consent, during the
existence of a Default or Event of Default, the Company may not elect to have a
Loan converted into or continued as an Offshore Rate Loan.
(f) After giving effect to any conversion or continuation of Loans,
unless the Agent shall otherwise consent, there may not be more than eight
different Interest Periods in effect.
2.05 Voluntary Termination or Reduction of Commitments. The Company may,
upon not less than five Business Days' prior notice to the Agent, terminate the
Revolving Commitments, or permanently reduce the Revolving Commitments, provided
that the aggregate amount of any partial reduction is in a Minimum Amount;
unless, after giving effect thereto and
27.
35
to any prepayments of Loans made on the effective date thereof, the
then-outstanding principal amount of the Revolving Loans would exceed the amount
of the combined Revolving Commitments then in effect. Once reduced in accordance
with this Section, the Revolving Commitments may not be increased. Any reduction
of the Revolving Commitments shall be applied to each Lender according to its
Pro Rata Share. All accrued commitment fees to, but not including the effective
date of any reduction or termination of Revolving Commitments, shall be paid on
the effective date of such reduction or termination.
2.06 Optional Prepayments. Subject to Section 3.04, the Company may, at
any time or from time to time, upon irrevocable notice to the Agent, by no later
than 9:00 a.m. (San Francisco Time) (a) three Business Days prior to the date of
such prepayment in the case of prepayment of Offshore Rate Loans, and (b) on the
date of such prepayment in the case of prepayment of Base Rate Loans, ratably
prepay Loans in whole or in part, in Minimum Amounts. Such notice of prepayment
shall specify the date and amount of such prepayment and the Type(s) of Loans to
be prepaid and whether such prepayment is of Revolving Loans or Term Loans (or a
combination thereof). The Agent will promptly notify each Lender of its receipt
of any such notice, and of such Lender's Pro Rata Share of such prepayment. If
such notice is given by the Company, the Company shall make such prepayment and
the payment amount specified in such notice shall be due and payable on the date
specified therein, together with accrued interest to each such date on the
amount of Offshore Rate Loans prepaid and any amounts required pursuant to
Section 3.04. Optional prepayments of the Term Loans shall be applied pro rata
to the Principal Installments.
2.07 Mandatory Prepayments of Loans; Mandatory Commitment Reductions.
(a) Asset Dispositions. If the Company or any Subsidiary shall at
any time or from time to time make or agree to make a Disposition, or shall
suffer an Event of Loss, then (i) the Company shall promptly notify the Agent in
advance of such Disposition or promptly upon the occurrence of such Event of
Loss (including the amount of the estimated Net Proceeds to be received by the
Company or such Subsidiary in respect thereof) and (ii) if, after giving effect
to such Disposition or Event of Loss, the Net Proceeds of all Dispositions and
Events of Loss which have occurred in such fiscal year are greater than
$5,000,000 in the aggregate, then promptly upon, and in no event later than one
day after, receipt by the Company or the Subsidiary of the Net Proceeds of such
Disposition or Event of Loss, the Company shall prepay Term Loans in an
aggregate amount equal to the amount of all Net Proceeds received by the Company
or any Subsidiary on account of all Dispositions and Events of Loss which have
occurred in such fiscal year less the amount, if any, of Net Proceeds already so
applied in such fiscal year. Such prepayments shall be applied pro rata to the
Principal Installments.
(b) Equity or Debt Issuance. If Holdings shall issue new equity or
issue any debt securities or otherwise incur any additional Indebtedness for
borrowed money, in each case for cash consideration in excess of $1,000,000,
Holdings shall promptly notify the Agent of the estimated Net Issuance Proceeds
of such issuance or the amount of the proceeds of such additional Indebtedness,
as the case may be, to be received by Holdings in respect thereof. Promptly
upon, and in no event later than one day after, receipt by Holdings of Net
Issuance Proceeds of such issuance of new equity or debt securities or the
proceeds of such additional
28.
36
Indebtedness, as the case may be, Holdings shall pay to the Company in the form
of a capital contribution the lesser of (i) 100% of the amount of such Net
Issuance Proceeds or the proceeds of such additional Indebtedness, as the case
may be, and (ii) the then outstanding aggregate principal balance of the Term
Loans, and the Company shall on the same day prepay the Term Loans in an
aggregate amount equal to the amount of such Net Issuance Proceeds or proceeds
of such additional Indebtedness so contributed to the Company by Holdings, to be
applied pro rata to the Principal Installments.
(c) General. Any prepayments pursuant to this Section 2.07 shall be
subject to Section 3.04 and applied first to any Base Rate Loans then
outstanding and then to Offshore Rate Loans with the shortest Interest Periods
remaining; provided, however, that if the amount of Base Rate Loans then
outstanding is not sufficient to satisfy the entire prepayment requirement, the
Company may, at its option, place any amounts which it would otherwise be
required to use to prepay Offshore Rate Loans on a day other than the last day
of the Interest Period therefor in an interest-bearing account pledged to the
Agent for the benefit of the Lenders until the end of such Interest Period at
which time such pledged amounts will be applied to prepay such Offshore Rate
Loans. The Company shall pay, together with each prepayment under this Section
2.07, accrued interest on the amount of any Offshore Rate Loans prepaid and any
amounts required pursuant to Section 3.04.
2.08 Repayment.
(a) The Term Credit. The Company shall repay to the Agent for the
account of the Lenders the aggregate principal amount of the Term Loans on each
date and in such amounts as follows (each such payment date a "Principal Payment
Date") : (i) on the last Business Day of each calendar quarter, commencing on
March 31, 1999, a quarterly principal installment of $1,500,000, and (ii) on the
Term Loan Maturity Date, the aggregate principal amount of Term Loans
outstanding on such date.
(b) The Revolving Credit. The Company shall repay to the Agent for
the account of the Lenders on the Revolving Termination Date the aggregate
principal amount of Revolving Loans outstanding on such date.
2.09 Interest.
(a) Each Loan shall bear interest on the outstanding principal
amount thereof from the applicable Borrowing Date at a rate per annum equal to
the Offshore Rate or the Base Rate, as the case may be (and subject to the
Company's right to convert to other Types of Loans under Section 2.04) , plus
the Applicable Margin.
(b) Interest on each Loan shall be paid in arrears on each Interest
Payment Date. Interest shall also be paid on the date of any prepayment of
Offshore Rate Loans under Section 2.06 or 2.07 for the portion of the Offshore
Rate Loans so prepaid and upon payment (including prepayment) in full thereof
and, during the existence of any Event of Default, interest shall be paid on
demand of the Agent at the request or with the consent of the Majority Lenders.
29.
37
(c) Notwithstanding subsection (a) of this Section, while any Event
of Default exists or after acceleration, the Company shall pay interest (after
as well as before entry of judgment thereon to the extent permitted by law) on
the principal amount of all outstanding Obligations, at a rate per annum which
is determined by adding 2% per annum to the Applicable Margin then in effect for
such Loans and, in the case of Obligations not subject to an Applicable Margin,
at a rate per annum equal to the Base Rate plus the Applicable Margin then in
effect for Base Rate Loans plus 2% per annum; provided, however, that, on and
after the expiration of any Interest Period applicable to any Offshore Rate Loan
outstanding on the date of occurrence of such Event of Default or acceleration,
the principal amount of such Loan shall, during the continuation of such Event
of Default or after acceleration, bear interest at a rate per annum equal to the
Base Rate plus the Applicable Margin then in effect for Base Rate Loans plus 2%
per annum.
(d) Anything herein to the contrary notwithstanding, the obligations
of the Company to any Lender hereunder shall be subject to the limitation that
payments of interest shall not be required for any period for which interest is
computed hereunder, to the extent (but only to the extent) that contracting for
or receiving such payment by such Lender would be contrary to the provisions of
any law applicable to such Lender limiting the highest rate of interest that may
be lawfully contracted for, charged or received by such Lender, and in such
event the Company shall pay such Lender interest at the highest rate permitted
by applicable law.
2.10 Fees.
(a) Agency and Other Fees. The Company shall pay an agency fee and
such other fees to the Agent, the Lead Arranger and the Documentation Agent for
their own account, as required by Fee Letter.
(b) Commitment Fees. The Company shall pay to the Agent for the
account of each Lender a commitment fee on the actual daily unused portion of
such Lender's Revolving Commitment, computed on a quarterly basis in arrears on
the last Business Day of each calendar quarter based upon the daily utilization
for that quarter as calculated by the Agent, equal to (i) 0.50% per annum for
the period from and including the Closing Date through the first anniversary
thereof, and (ii) a rate per annum equal to the Applicable Fee Amount
thereafter. Such commitment fee shall accrue from the Closing Date to the
Revolving Termination Date and shall be due and payable quarterly in arrears on
the last Business Day of each calendar quarter commencing on December 31, 1998
through the Revolving Termination Date, with the final payment to be made on the
Revolving Termination Date; provided that, in connection with any termination of
Commitments under Section 2.05, the accrued commitment fee calculated for the
period ending on such date shall also be paid on the date of such termination,
with the following quarterly payment being calculated on the basis of the period
from such termination date to such quarterly payment date. The commitment fees
provided in this subsection shall accrue at all times after the above-mentioned
commencement date, including at any time during which one or more conditions in
Article IV are not met.
30.
38
2.11 Computation of Fees and Interest.
(a) All computations of interest for Base Rate Loans when the Base
Rate is determined by BofA's "reference rate" shall be made on the basis of a
year of 365 or 366 days, as the case may be, and actual days elapsed. All other
computations of fees and interest shall be made on the basis of a 360-day year
and actual days elapsed (which results in more interest being paid than if
computed on the basis of a 365-day year) . Interest and fees shall accrue during
each period during which interest or such fees are computed from the first day
thereof to the last day thereof.
(b) Each determination of an interest rate by the Agent shall be
conclusive and binding on the Company and the Lenders in the absence of manifest
error. The Agent will, at the request of the Company or any Lender, deliver to
the Company or such Lender, as the case may be, a statement showing the
quotations used by the Agent in determining any interest rate and the resulting
interest rate.
2.12 Payments by the Company.
(a) All payments to be made by the Company shall be made without
set-off, recoupment or counterclaim. Except as otherwise expressly provided
herein, all payments by the Company shall be made to the Agent for the account
of the Lenders at the Agent's Payment Office, and shall be made in Dollars and
in immediately available funds, no later than 11:00 a.m. (San Francisco time) on
the date specified herein. The Agent will promptly distribute to each Lender its
Pro Rata Share (or other applicable share as expressly provided herein) of such
payment in like funds as received. Any payment received by the Agent later than
11:00 a.m. (San Francisco time) shall be deemed to have been received on the
following Business Day and any applicable interest or fee shall continue to
accrue.
(b) Subject to the provisions set forth in the definition of
"Interest Period" herein, whenever any payment is due on a day other than a
Business Day, such payment shall be made on the following Business Day, and such
extension of time shall in such case be included in the computation of interest
or fees, as the case may be.
(c) Unless the Agent receives notice from the Company prior to the
date on which any payment is due to the Lenders that the Company will not make
such payment in full as and when required, the Agent may assume that the Company
has made such payment in full to the Agent on such date in immediately available
funds and the Agent may (but shall not be so required) , in reliance upon such
assumption, distribute to each Lender on such due date an amount equal to the
amount then due such Lender. If and to the extent the Company has not made such
payment in full to the Agent, each Lender shall repay to the Agent on demand
such amount distributed to such Lender, together with interest thereon at the
Federal Funds Rate for each day from the date such amount is distributed to such
Lender until the date repaid.
31.
39
2.13 Payments by the Lenders to the Agent.
(a) Unless the Agent receives notice from a Lender on or prior to
the Closing Date or, with respect to any Borrowing after the Closing Date, at
least one Business Day prior to the date of such Borrowing, that such Lender
will not make available as and when required hereunder to the Agent for the
account of the Company the amount of that Lender's Pro Rata Share of the
Borrowing, the Agent may assume that each Lender has made such amount available
to the Agent in immediately available funds on the Borrowing Date and the Agent
may (but shall not be so required) , in reliance upon such assumption, make
available to the Company on such date a corresponding amount. If and to the
extent any Lender shall not have made its full amount available to the Agent in
immediately available funds and the Agent in such circumstances has made
available to the Company such amount, that Lender shall on the Business Day
following such Borrowing Date make such amount available to the Agent, together
with interest at the Federal Funds Rate for each day during such period. A
notice of the Agent submitted to any Lender with respect to amounts owing under
this subsection (a) shall be conclusive, absent manifest error. If such amount
is so made available, such payment to the Agent shall constitute such Lender's
Loan on the date of Borrowing for all purposes of this Agreement. If such amount
is not made available to the Agent on the Business Day following the Borrowing
Date, the Agent will notify the Company of such failure to fund and, upon demand
by the Agent, the Company shall pay such amount to the Agent for the Agent's
account, together with interest thereon for each day elapsed since the date of
such Borrowing, at a rate per annum equal to the interest rate applicable at the
time to the Loans comprising such Borrowing.
(b) The failure of any Lender to make any Loan on any Borrowing Date
shall not relieve any other Lender of any obligation hereunder to make a Loan on
such Borrowing Date, but no Lender shall be responsible for the failure of any
other Lender to make the Loan to be made by such other Lender on any Borrowing
Date.
2.14 Sharing of Payments, Etc. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Loans made by it any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) in excess of its ratable share (or other share
contemplated hereunder) , such Lender shall immediately (a) notify the Agent of
such fact, and (b) purchase from the other Lenders such participations in the
Loans made by them as shall be necessary to cause such purchasing Lender to
share the excess payment pro rata with each of them; provided, however, that if
all or any portion of such excess payment is thereafter recovered from the
purchasing Lender, such purchase shall to that extent be rescinded and each
other Lender shall repay to the purchasing Lender the purchase price paid
therefor, together with an amount equal to such paying Lender's ratable share
(according to the proportion of (i) the amount of such paying Lender's required
repayment to (ii) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. the Company agrees that any Lender so
purchasing a participation from another Lender may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off, but subject to Section 10.10) with respect to such participation as
fully as if such Lender were the direct creditor of the Company in the amount of
such participation. The Agent will keep records (which shall be
32.
40
conclusive and binding in the absence of manifest error) of participations
purchased under this Section and will in each case notify the Lenders following
any such purchases or repayments.
2.15 Security and Guaranty.
(a) All obligations of the Company and each other Loan Party under
this Agreement and all other Loan Documents to which it is a party shall be
secured in accordance with the Collateral Documents.
(b) All obligations of the Company under this Agreement, each of the
Notes and all other Loan Documents to which it is a party shall be
unconditionally guaranteed by each Guarantor pursuant to its Guaranty.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 Taxes.
(a) Any and all payments by the Company to each Lender or the Agent
under this Agreement and any other Loan Document shall be made free and clear
of, and without deduction or withholding for, any Taxes, except as provided in
subsections 3.01(b) and (g) below. In addition, the Company shall pay all Other
Taxes.
(b) If the Company shall be required by law to deduct or withhold
any Taxes, Other Taxes or Further Taxes from or in respect of any sum payable
hereunder to any Lender or the Agent, then (except as provided in subsection
3.01(g) below):
(i) the sum payable shall be increased as necessary so that,
after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable under
this Section), such Lender or the Agent, as the case may be, receives
and retains an amount equal to the sum it would have received and
retained had no such deductions or withholdings been made;
(ii) the Company shall make such deductions and withholdings;
(iii) the Company shall pay the full amount deducted or withheld
to the relevant taxing authority or other authority in accordance with
applicable law; and
(iv) the Company shall also pay to each Lender or the Agent for
the account of such Lender, at the time interest is paid, Further Taxes
in the amount that the respective Lender specifies as necessary to
preserve the after-tax yield such Lender would have received if such
Taxes, Other Taxes or Further Taxes had not been imposed.
33.
41
(c) The Company agrees to indemnify and hold harmless each Lender
and the Agent for the full amount of (i) Taxes, (ii) Other Taxes, and (iii)
Further Taxes in the amount that the respective Lender specifies as necessary to
preserve the after-tax yield such Lender would have received if such Taxes,
Other Taxes or Further Taxes had not been imposed, and any liability (including
penalties, interest, additions to tax and expenses) arising therefrom or with
respect thereto, whether or not such Taxes, Other Taxes or Further Taxes were
correctly or legally asserted (except for Taxes and Further Taxes for which the
Company is not responsible under subsection 3.01(g) below). Payment under this
indemnification shall be made within 30 days after the date such Lender or the
Agent makes written demand therefor.
(d) Within 30 days after the date of any payment by the Company of
Taxes, Other Taxes or Further Taxes, the Company shall furnish to each Lender or
the Agent the original or a certified copy of a receipt evidencing payment
thereof, or other evidence of payment satisfactory to such Lender or the Agent.
(e) If the Company is required to pay any amount to any Lender or
the Agent pursuant to subsection (b) or (c) of this Section, then such Lender
shall use reasonable efforts (consistent with legal and regulatory restrictions)
to change the jurisdiction of its Lending Office so as to eliminate any such
additional payment by the Company which may thereafter accrue, if such change in
the sole judgment of such Lender is not otherwise disadvantageous to such
Lender.
(f) Nothing contained in this Section 3.01 shall override any term
or provision of any Specified Swap Contract regarding withholding taxes relating
to Swap Contracts.
(g) For any period with respect to which a Lender has failed to
provide the Company or the Agent with the appropriate form as required by
Section 9.10(a) (whether or not such Lender is lawfully able to do so, unless
such failure is due to a change in treaty, law or regulation occurring
subsequent to the date on which such form originally was required to be
provided), such Lender shall not be entitled to indemnification under this
Section 3.01 with respect to Taxes imposed on such Lender; provided that if a
Lender, which is otherwise exempt from withholding tax, becomes subject to Taxes
because of its failure to deliver a form required hereunder, the Loan Parties
shall take such steps as such Lender shall reasonably request, at the Lender's
expense, to assist such Lender to recover such Taxes.
(h) Each Lender represents and warrants to the Agent and the Company
as of the date hereof that under applicable law and treaties no tax will be
required to be withheld by the Company or the Agent with respect to any payments
to be made to such Lender hereunder.
3.02 Illegality.
(a) If any Lender determines that the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or that any central Lender or other Governmental Authority has
asserted that it is unlawful, for any Lender or its applicable Lending Office to
make Offshore Rate Loans, then, on notice thereof by such Lender to the Company
through the
34.
42
Agent, any obligation of that Lender to make Offshore Rate Loans shall be
suspended until such Lender notifies the Agent and the Company that the
circumstances giving rise to such determination no longer exist.
(b) If a Lender determines that it is unlawful to maintain any
Offshore Rate Loan, the Company shall, upon its receipt of notice of such fact
and demand from such Lender (with a copy to the Agent), prepay in full such
Offshore Rate Loans of that Lender then outstanding, together with interest
accrued thereon and amounts required under Section 3.04, either on the last day
of the Interest Period thereof, if such Lender may lawfully continue to maintain
such Offshore Rate Loans to such day, or immediately, if such Lender may not
lawfully continue to maintain such Offshore Rate Loan. If the Company is
required to so prepay any Offshore Rate Loan, then concurrently with such
prepayment, the Company shall borrow from the affected Lender, in the amount of
such repayment, a Base Rate Loan.
(c) If the obligation of any Lender to make or maintain Offshore
Rate Loans has been so terminated or suspended, the Company may elect, by giving
notice to such Lender through the Agent that all Loans which would otherwise be
made by such Lender as Offshore Rate Loans shall be instead Base Rate Loans.
(d) Before giving any notice to the Agent under this Section, the
affected Lender shall designate a different Lending Office with respect to its
Offshore Rate Loans if such designation will avoid the need for giving such
notice or making such demand and will not, in the judgment of such Lender, be
illegal or otherwise disadvantageous to such Lender.
3.03 Increased Costs and Reduction of Return.
(a) If any Lender determines that, due to either (i) the
introduction of or any change (other than any change by way of imposition of or
increase in reserve requirements included in the calculation of the Offshore
Rate) in or in the interpretation of any law or regulation or (ii) the
compliance by that bank with any guideline or request from any central bank or
other Governmental Authority (whether or not having the force of law), there
shall be any increase in the cost to such Lender of agreeing to make or making,
funding or maintaining any Offshore Rate Loans, then the Company shall be liable
for, and shall from time to time, within 10 days after demand (with a copy of
such demand to be sent to the Agent), pay to the Agent for the account of such
Lender, additional amounts as are sufficient to compensate such Lender for such
increased costs.
(b) If any Lender shall have determined that (i) the introduction of
any Capital Adequacy Regulation, (ii) any change in any Capital Adequacy
Regulation, (iii) any change in the interpretation or administration of any
Capital Adequacy Regulation by any central bank or other Governmental Authority
charged with the interpretation or administration thereof, or (iv) compliance by
such Lender (or its Lending Office) or any corporation controlling such Lender
with any Capital Adequacy Regulation, affects or would affect the amount of
capital required or expected to be maintained by such Lender or any corporation
controlling such Lender and (taking into consideration such Lender's or such
corporation's policies with respect to capital adequacy and such Lender's
desired return on capital) determines that the amount of such
35.
43
capital is increased as a consequence of its Commitments, loans, credits or
obligations under this Agreement, then, within 10 days after demand of such
Lender to the Company through the Agent, the Company shall pay to such Lender,
from time to time as specified by such Lender, additional amounts sufficient to
compensate such Lender for such increase.
(c) Before giving any notice to the Agent under this Section, the
affected Lender shall designate a different Lending Office with respect to its
Offshore Rate Loans if such designation will avoid the need for giving such
notice or making such demand and will not, in the judgment of such Lender, be
illegal or otherwise disadvantageous to such Lender.
3.04 Funding Losses. the Company shall reimburse each Lender and hold
each Lender harmless from any loss or expense which such Lender may sustain or
incur as a consequence of:
(a) the failure of the Company to make on a timely basis any payment
of principal of any Offshore Rate Loan;
(b) the failure of the Company to borrow, continue or convert a Loan
after the Company has given (or is deemed to have given) a Notice of Borrowing
or a Notice of Conversion / Continuation;
(c) the failure of the Company to make any prepayment in accordance
with any notice delivered under Section 2.06;
(d) the prepayment (including pursuant to Section 2.06 or 2.07 or in
connection with a substitution of any Lender pursuant to Section 3.07 or the
syndication of the Loans after the Closing Date) or other payment (including
after acceleration thereof) of an Offshore Rate Loan on a day that is not the
last day of the relevant Interest Period; or
(e) the conversion under Section 2.04 of any Offshore Rate Loan to a
Base Rate Loan on a day that is not the last day of the relevant Interest
Period;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Offshore Rate Loans or from fees payable
to terminate the deposits from which such funds were obtained (but excluding
loss of margin) . For purposes of calculating amounts payable by the Company to
the Lenders under this Section and under subsection 3.03(a) , each Offshore Rate
Loan made by a Lender (and each related reserve, special deposit or similar
requirement) shall be conclusively deemed to have been funded at the LIBOR used
in determining the Offshore Rate for such Offshore Rate Loan by a matching
deposit or other borrowing in the interbank eurodollar market for a comparable
amount and for a comparable period, whether or not such Offshore Rate Loan is in
fact so funded.
3.05 Inability to Determine Rates. If the Agent or the Majority Lenders
determine that for any reason adequate and reasonable means do not exist for
determining the Offshore Rate for any requested Interest Period with respect to
a proposed Offshore Rate Loan, or that the Offshore Rate applicable pursuant to
subsection 2.09(a) for any requested Interest Period with respect to a proposed
Offshore Rate Loan does not adequately and fairly reflect the cost to the
Lenders of funding such Loan, the Agent will promptly so notify the Company and
each Lender.
36.
44
Thereafter, the obligation of the Lenders to make or maintain Offshore Rate
Loans hereunder shall be suspended until the Agent upon the instruction of the
Majority Lenders revokes such notice in writing. Upon receipt of such notice,
the Company may revoke any Notice of Borrowing or Notice of Conversion /
Continuation then submitted by it. If the Company does not revoke such Notice,
the Lenders shall make, convert or continue the Loans, as proposed by the
Company, in the amount specified in the applicable notice submitted by the
Company, but such Loans shall be made, converted or continued as Base Rate Loans
instead of Offshore Rate Loans.
3.06 Certificates of Lenders. Any Lender claiming reimbursement or
compensation under this Article III shall deliver to the Company (with a copy to
the Agent) a certificate setting forth in reasonable detail the amount payable
to such Lender hereunder and such certificate shall be conclusive and binding on
the Company in the absence of manifest error.
3.07 Substitution of Lenders. Upon the receipt by the Company from any
Lender (an "Affected Lender") of a claim for compensation under Section 3.01 or
Section 3.03, the Company may: (i) request one or more of the other Lenders to
acquire and assume all or part of such Affected Lender's Loans and Commitment;
or (ii) designate a replacement commercial bank (which shall be an Eligible
Assignee) satisfactory to the Company to acquire and assume all or a ratable
part of such Affected Lender's Loans and Commitment (a "Replacement Lender");
provided, however, that the Company shall be liable for the payment upon demand
of all costs and other amounts arising under Section 3.04 that result from the
acquisition of any Affected Lender's Loan and/or Commitment (or any portion
thereof) by a Lender or Replacement Lender, as the case may be, on a date other
than the last day of the applicable Interest Period with respect to any Offshore
Rate Loan then outstanding. Any such designation of a Replacement Lender under
clause (ii) shall be effected in accordance with, and subject to the terms and
conditions of, the assignment provisions contained in Section 10.08, and shall
in any event be subject to the prior written consent of the Agent (which consent
shall not be unreasonably withheld).
3.08 Survival. The agreements and obligations of the Company in this
Article III shall survive the payment of all other Obligations.
ARTICLE IV
CONDITIONS PRECEDENT
4.01 Conditions of Initial Loans. The obligation of each Lender to make
its initial Loan hereunder is subject to the condition that the Agent shall have
received on or before the Closing Date all of the following, in form and
substance satisfactory to the Agent and each Lender, and in sufficient copies
for each Lender:
(a) Credit Agreement and Notes. This Agreement executed by each
party thereto and Notes executed by the Company for the Lenders requesting
Notes;
37.
45
(b) Resolutions; Incumbency.
(i) Copies of the resolutions of the board of directors or
equivalent governing body of each Loan Party authorizing the
transactions contemplated hereby and by each other Loan Document to
which such Loan Party is a party, certified as of the Closing Date by
the Secretary or an Assistant Secretary (or other appropriate officer or
official) of such Person; and
(ii) A certificate of the Secretary or Assistant Secretary of
each Loan Party, dated the Closing Date, certifying the names, titles
and true signatures of the officers of such Loan Party authorized to
execute, deliver and perform, as applicable, this Agreement, and all
other Loan Documents to be delivered by it hereunder;
(c) Organization Documents; Good Standing. Each of the following
documents:
(i) the articles or certificate of incorporation and the bylaws
(or other equivalent Organization Documents) of Holdings and the Company
as in effect on the Closing Date, certified by the Secretary or
Assistant Secretary of such Person as of the Closing Date; and
(ii) a good standing and tax good standing certificate for each
Loan Party from the Secretary of State (or similar, applicable
Governmental Authority) of its state of incorporation and each state
where such Person is qualified to do business as a foreign corporation
as of a recent date;
(d) Legal Opinions.
(i) an opinion of Xxxxxx, Xxxx & Xxxxxxxx, counsel to Holdings
and the Company and addressed to the Agent and the Lenders, dated the
Closing Date, substantially in the form of Exhibit D; and
(ii) copies of the closing legal opinions delivered to Holdings
pursuant to the Acquisition Agreements, together with reliance letters
permitting the Agent and the Lenders to rely on such opinions as though
they were the addressees thereof, in form and substance satisfactory to
the Agent and the Lenders.
(e) Payment of Fees. Evidence of payment by the Company of all
accrued and unpaid fees, costs and expenses to the extent then due and payable
on the Closing Date, including any fees referenced in Section 2.10 and all costs
and expenses payable under Section 10.04 to the extent such costs and expenses
are invoiced prior to or on the Closing Date, plus such additional amounts of
costs and expenses as shall constitute a reasonable estimate of costs and
expenses payable under Section 10.04 incurred or to be incurred through the
closing proceedings (provided that such estimate shall not thereafter preclude
final settling of accounts between the Company and any Persons entitled to
payment or reimbursement under Section 10.04);
38.
46
(f) Collateral Documents. The Collateral Documents, executed by the
each Loan Party required to be a party thereto, in appropriate form for
recording, where necessary, together with:
(i) acknowledgment copies of all UCC-l financing statements
filed, registered or recorded to perfect the security interests of the
Agent for the benefit of the Lenders, or other evidence satisfactory to
the Agent that there has been filed, registered or recorded (or
arrangements made with a reputable filing service to file, register or
record) all financing statements and other filings, registrations and
recordings necessary and advisable to perfect the Liens of the Agent for
the benefit of the Lenders in accordance with applicable law;
(ii) written advice relating to such Lien and judgment searches
as the Agent shall have requested, and such termination statements or
other documents as may be necessary to confirm that the Collateral is
subject to no other Liens in favor of any Persons (other than Permitted
Liens);
(iii) all certificates and instruments representing the Pledged
Shares, together with stock transfer powers executed in blank as the
Agent or the Lenders may specify; and
(iv) evidence that all other actions necessary or, in the opinion
of the Agent or the Lenders, desirable to perfect and protect the first
priority Lien created by the Collateral Documents, and to enhance the
Agent's ability to preserve and protect its interests in and access to
the Collateral, have been taken;
(g) Insurance Policies. Evidence that the Agent has been named as
loss payee under all policies of casualty insurance under a Form 438FBFU or
other standard lender's loss payable endorsement, and as additional insured
under all policies of liability insurance, required in accordance with Section
6.06 and the Collateral Documents, together with a certificate of insurance as
to all insurance coverage on the properties of the Loan Parties;
(h) Perfection Certificate. A Perfection Certificate from the
Company (as to each Loan Party);
(i) Certificate. A certificate signed by a Responsible Officer of
each Loan Party, dated as of the Closing Date, stating that:
(i) the representations and warranties contained in Article V are
true and correct on and as of such date, as though made on and as of
such date;
(ii) no Default or Event of Default exists or would result from
the initial Borrowing; and
(iii) there has occurred since September 30, 1998, no event or
circumstance that has resulted or could reasonably be expected to result
in a Material Adverse Effect;
47
(j) Issuance of Holdings Subordinated Notes, Etc. (i) A certificate
of a Responsible Officer of Holdings certifying as to the issuance of the
Holdings Subordinated Notes and shares of Holdings' common stock for aggregate
consideration of not less than $60,000,000; and (ii) copies of all documentation
relating to the Holdings Subordinated Notes, including all subordination
agreements relating thereto, all of which shall be in form and substance
satisfactory to the Agent and the Lenders;
(k) Solvency. After giving effect to the Transaction, Holdings and
its Subsidiaries, on a consolidated basis, and the Company and its Subsidiaries,
on a consolidated basis, shall be Solvent, and the Agent and the Lenders shall
have received a certificate to that effect from a Responsible Officer of
Holdings and the Company;
(l) Financial Information. The Agent and each Lender shall have
received and reviewed to their satisfaction (i) all available historical
financial results for the Founding Companies, which results shall have been
prepared in accordance with GAAP and include but not be limited to audited
financial statements for the fiscal year ended December 31, 1997, for such
Founding Companies making up at least 60% of pro forma EBITDA of the Company and
its Subsidiaries after giving effect to the Acquisitions of all of the Founding
Companies; (ii) a pro forma balance sheet for the Company and its Subsidiaries
as of the Closing Date, after giving effect to the Acquisitions of the Founding
Companies, prepared in accordance with GAAP by independent public accountants
acceptable to the Agent and the Lenders; (iii) interim summary combined balance
sheet and statement of income of the Company and its Subsidiaries for the nine
months ended September 30, 1998, together with the report of Ernst & Young
relating thereto; (iv) summary combined income statements of the Company and its
Subsidiaries for the twelve months ended September 30 ,1998, but without giving
effect to any Secondary Acquisition, which shall be in form and substance
satisfactory to the Agent and the Lenders and accompanied by a certificate of a
Responsible Officer of the Company certifying that such combined income
statements were prepared in accordance with GAAP (except as otherwise specified
in such combined income statements), are complete and accurate in all material
respects and fairly present the financial performance of the Company and its
Subsidiaries for such 12-month period; (v) detailed financial projections
through at least the Revolving Termination Date, including but not limited to
balance sheets, income and cash flow statements, prepared in accordance with
GAAP, reflecting management's assumptions regarding future financial and
operating performance of the Company and its Subsidiaries; and (vi) such other
financial information relating to Holdings, the Company or any of its
Subsidiaries as the Agent, any Lender or the Lead Arranger may reasonably
require, including, in such form and detail as shall be satisfactory to the
Agent, the Lead Arranger and each Lender, a schedule or schedules showing all
adjustments made to the historical financial results of the Founding Companies
for purposes of preparing the pro forma financial statements of the Company and
its Subsidiaries delivered to the Agent, the Lead Arranger and each Lender
pursuant to this subsection 4.01(l);
(m) Acquisition Documents, Etc. The Agent and the Lenders shall have
received a certificate of a Responsible Officer of Holdings and the Company
certifying that (i) all conditions precedent to the consummation of the Closing
Date Transaction have been satisfied other than the payment of cash
consideration to the sellers of the Founding Companies
40.
48
included in the Closing Date Transaction, (ii) the merger agreements,
acquisition agreements and/or asset purchase agreements (the "Acquisition
Agreements") evidencing the Acquisition by the Company of the Founding Companies
shall not have been amended, supplemented or otherwise modified except as
disclosed to the Agent and the Lenders, and (iii) the Acquisition of the
Founding Companies (other than any Secondary Acquisition) by the Company shall
have been consummated, or shall be consummated simultaneously with the initial
Borrowing hereunder, in accordance with all Requirements of Law and in
accordance with the terms of the Acquisition Agreements referenced in the
preceding clause (ii).
(n) Pro Forma Compliance with Financial Covenants. The Agent and the
Lenders shall have received a certificate of a Responsible Officer of the
Company certifying that the Company shall be in pro forma compliance with
Section 7.18, and its other Indebtedness and financial obligations, immediately
after giving effect to the Closing Date Transaction and the initial Borrowing
hereunder; and
(o) Other Documents. Such other approvals, opinions, documents or
materials as the Agent or any Lender may reasonably request.
4.02 Conditions to All Borrowings. The obligation of each Lender to make
any Loan to be made by it (including its initial Loan) is subject to the
satisfaction of the following conditions precedent on the relevant Borrowing
Date:
(a) Notice of Borrowing. The Agent shall have received a Notice of
Borrowing;
(b) Continuation of Representations and Warranties. The
representations and warranties in Article V shall be true and correct on and as
of such Borrowing Date with the same effect as if made on and as of such
Borrowing Date (except to the extent such representations and warranties
expressly refer to an earlier date, in which case they shall be true and correct
as of such earlier date), taking into account any amendments to the Schedules
and other disclosures made in writing by the Company to the Agent and the
Lenders after the Closing Date and approved by the Agent and the Majority
Lenders.
(c) No Existing Default. No Default or Event of Default shall exist
or shall result from such Borrowing; and
(d) No Material Adverse Effect There has occurred since September
30, 1998, no event or circumstance that has resulted or could reasonably be
expected to result in a Material Adverse Effect.
Each Notice of Borrowing submitted by the Company hereunder shall constitute a
representation and warranty by the Company hereunder, as of the date of each
such notice and as of each Borrowing Date, that the conditions in this Section
4.02 are satisfied.
41.
49
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Each Loan Party represents and warrants to the Agent and each Lender
that:
5.01 Corporate Existence and Power Such Loan Party and each of its
Subsidiaries:
(a) is a corporation, limited liability company or partnership duly
organized or formed, as the case may be, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or formation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals (i) to own its assets and carry on its
business and (ii) to execute, deliver, and perform its obligations under the
Loan Documents and Transaction Documents to which it is a party;
(c) is duly qualified, licensed and in good standing under the laws
of each jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification, license or good standing;
and
(d) is in compliance with all Requirements of Law; except, in each
case referred to in clause (b)(i), clause (c) or clause (d) of this Section, to
the extent that the failure to do so could not reasonably be expected to have a
Material Adverse Effect.
5.02 Corporate Authorization; No Contravention. The execution, delivery
and performance by such Loan Party of this Agreement and each other Loan
Document or Transaction Document to which such Loan Party is party, have been
duly authorized by all necessary corporate action, and do not and will not:
(a) contravene the terms of any of such Loan Party's Organization
Documents;
(b) conflict with or result in any breach or contravention of, or
the creation of any Lien under, any document evidencing any Contractual
Obligation to which such Loan Party or any of its Subsidiaries is a party or any
order, injunction, writ or decree of any Governmental Authority to which such
Person or its property is subject; or
(c) violate any Requirement of Law.
5.03 Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority (except for recordings or filings in connection with the
Liens granted to the Agent under the Collateral Documents) is necessary or
required in connection with the execution, delivery or performance by, or
enforcement against, such Loan Party of this Agreement or any other Loan
Document or Transaction Document to which it is a party.
42.
50
5.04 Binding Effect. This Agreement and each other Loan Document to
which such Loan Party or any of its Subsidiaries is a party constitute the
legal, valid and binding obligations of such Loan Party and any of its
Subsidiaries to the extent it is a party thereto, enforceable against such
Person in accordance with their respective terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, or similar laws affecting the
enforcement of creditors' rights generally or by equitable principles relating
to enforceability.
5.05 Litigation. Except as specifically disclosed in Schedule 5.05,
there are no actions, suits, proceedings, claims or disputes pending, or to the
best knowledge of such Loan Party, threatened or contemplated, at law, in
equity, in arbitration or before any Governmental Authority, against such Loan
Party, or its Subsidiaries or any of their respective properties which:
(a) purport to affect or pertain to this Agreement or any other Loan
Document or Transaction Document, or any of the transactions contemplated hereby
or thereby; or
(b) if determined adversely to such Loan Party or its Subsidiaries,
would reasonably be expected to have a Material Adverse Effect. No injunction,
writ, temporary restraining order or any order of any nature has been issued by
any court or other Governmental Authority purporting to enjoin or restrain the
execution, delivery or performance of this Agreement or any other Loan Document,
or directing that the transactions provided for herein or therein not be
consummated as herein or therein provided.
5.06 No Default. No Default or Event of Default exists or would result
from the incurring, directly or indirectly of any Obligations by such Loan
Party, whether as borrower or guarantor thereof, or from the grant or perfection
of the Liens of the Agent and the Lenders on the Collateral. Neither such Loan
Party, whether as borrower or guarantor thereof, nor any Subsidiary of such Loan
Party is in default under or with respect to any Contractual Obligation in any
respect which, individually or together with all such defaults, could reasonably
be expected to have a Material Adverse Effect, or that would create an Event of
Default under subsection 8.01(e).
5.07 ERISA Compliance. Except as specifically disclosed in Schedule
5.07:
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law. Each
Plan which is intended to qualify under Section 401(a) of the Code has received
a favorable determination letter from the IRS, or has applied for such
determination within the applicable remedial amendment period under Section
401(b) of the Code, and to the best knowledge of such Loan Party, nothing has
occurred which would cause the loss of such qualification. Such Loan Party and
each ERISA Affiliate has made all required contributions to any Plan subject to
Section 412 of the Code, and no application for a funding waiver or an extension
of any amortization period pursuant to Section 412 of the Code has been made
with respect to any Plan.
43.
51
(b) There are no pending or, to the best knowledge of such Loan
Party, threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan which has resulted or could reasonably be
expected to result in a Material Adverse Effect. There has been no prohibited
transaction or violation of the fiduciary responsibility rules with respect to
any Plan which has resulted or could reasonably be expected to result in a
Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to
occur; (ii) no Pension Plan has any Unfunded Pension Liability in excess of
$5,000,000; (iii) neither such Loan Party nor any ERISA Affiliate has incurred,
or reasonably expects to incur, any liability under Title IV of ERISA with
respect to any Pension Plan (other than premiums due and not delinquent under
Section 4007 of ERISA); (iv) neither such Loan Party nor any ERISA Affiliate
has incurred, or reasonably expects to incur, any liability (and no event has
occurred which, with the giving of notice under Section 4219 of ERISA, would
result in such liability) under Section 4201 or 4243 of ERISA with respect to a
Multiemployer Plan; and (v) neither the Company nor any ERISA Affiliate has
engaged in a transaction that could be subject to Section 4069 or 4212(c) of
ERISA.
5.08 Use of Proceeds; Margin Regulations. The proceeds of the Loans are
to be used solely for the purposes set forth in and permitted by Section 6.12
and Section 7.07. No Loan Party is generally engaged in the business of
purchasing or selling Margin Stock or extending credit for the purpose of
purchasing or carrying Margin Stock.
5.09 Title to Properties; Liens. Such Loan Party and each of its
Subsidiaries have good record and marketable title in fee simple to, or valid
leasehold interests in, all real property necessary or used in the ordinary
conduct of their respective businesses, except for such defects in title as
could not, individually or in the aggregate, have a Material Adverse Effect. The
property of such Loan Party and its Subsidiaries is subject to no Liens, other
than Permitted Liens.
5.10 Taxes. Such Loan Party and its Subsidiaries have filed all Federal
and other material tax returns and reports required to be filed, and have paid
all Federal and other material taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets
otherwise due and payable, except those which are being contested in good faith
by appropriate proceedings and for which adequate reserves have been provided in
accordance with GAAP. There is no proposed tax assessment against such Loan
Party or any of its Subsidiaries that would, if made, have a Material Adverse
Effect.
5.11 Financial Condition. (a) The audited and unaudited consolidated
balance sheets of Holdings and its Subsidiaries delivered to the Lenders
hereunder as of the end of each fiscal year, fiscal quarter or fiscal month, as
the case may be, and in each case the related consolidated statements of income
or operations for the fiscal period ended on that date:
44.
52
(i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein, subject to ordinary, good faith year end audit adjustments in the case
of quarterly and monthly financial statements; and
(ii) are complete and accurate in all material respects and
fairly present the financial condition of Holdings and its Subsidiaries as of
the date thereof and results of operations and cash flows for the period covered
thereby;
(b) The audited or reviewed financial statements of certain Founding
Companies dated December 31, 1997, and identified on Schedule 5.11(b), and the
related statements of income or operations for the fiscal year ended on that
date, the interim summary combined balance sheet and statement of income of the
Company and its Subsidiaries for the nine months ended September 30, 1998, and
the summary combined income statements of the Company and its Subsidiaries for
the 12 months ended September 30, 1998:
(i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein, subject to ordinary, good faith year end audit adjustments in the case
of quarterly financial statements;
(ii) are complete and accurate in all material respects and
fairly present the financial condition of the Founding Companies as of the date
thereof and results of operations and cash flows for the period covered thereby;
and
(iii) except as specifically disclosed in Schedule 5.11, show
all material Indebtedness and other liabilities, direct or contingent, of the
Founding Companies as of the date thereof, including liabilities for taxes,
material commitments and Contingent Obligations.
(c) The pro forma financial statements of the Company and its
Subsidiaries referred to in subsection 4.01(1) were prepared in accordance with
GAAP, are complete and accurate in all material respects and fairly present the
pro forma financial condition of the Company and its Subsidiaries as of the date
thereof, and the financial projections also referred to in subsection 4.01(1)
represent the Company's best estimates and assumptions as to future performance,
which the Company believes to be fair and reasonable as of the time made in the
light of current and reasonably foreseeable business conditions.
(d) Since September 30, 1998, there has not been, nor is it
reasonably likely that there will be, any Material Adverse Effect.
5.12 Environmental Matters.
(a) Except as specifically disclosed in Schedule 5.12, the ongoing
operations of such Loan Party and each of its Subsidiaries comply in all
respects with all Environmental Laws, except such non-compliance which would not
(if enforced in accordance with applicable law) result in liability in excess of
$1,000,000 in the aggregate.
45.
53
(b) Except as specifically disclosed in Schedule 5.12, such Loan
Party and each of its Subsidiaries have obtained all licenses, permits,
authorizations and registrations required under any Environmental Law
("Environmental Permits") and necessary for their respective ordinary course
operations, all such Environmental Permits are in good standing, and such Loan
Party and each of its Subsidiaries are in compliance with all material terms and
conditions of such Environmental Permits.
(c) Except as specifically disclosed in Schedule 5.12 or pursuant to
Section 6.03, neither such Loan Party nor any of its Subsidiaries or any of
their respective present property or operations, is subject to any outstanding
written order from or agreement with any Governmental Authority (except for
routine agreements in the ordinary course of business) , nor subject to any
judicial or docketed administrative proceeding, respecting any Environmental
Law, Environmental Claim or Hazardous Material.
(d) Except as specifically disclosed in Schedule 5.12, there are no
Hazardous Materials or other conditions or circumstances existing with respect
to any property of such Loan Party or any of its Subsidiaries, or arising from
operations prior to the Closing Date, of such Loan Party or any of its
Subsidiaries that would reasonably be expected to give rise to Environmental
Claims with a potential liability of such Loan Party and its Subsidiaries in
excess of $1,000,000 in the aggregate for any such condition, circumstance or
property. In addition, (i) neither such Loan Party nor any of its Subsidiaries
has any underground storage tanks (x) that are not properly registered or
permitted under applicable Environmental Laws, or (y) that are leaking or
disposing of Hazardous Materials off-site, and (ii) such Loan Party and its
Subsidiaries have notified all of their employees of the existence, if any, of
any health hazard arising from the conditions of their employment and have met
all notification requirements under Title III of CERCLA and all other
Environmental Laws.
5.13 Collateral Documents. (a) The provisions of each of the Collateral
Documents are effective to create in favor of the Agent for the benefit of the
Lenders, a legal, valid and enforceable first priority security interest in all
right, title and interest of such Loan Party in the Collateral described therein
subject only to Permitted Liens; and financing statements have been filed in the
offices in all of the jurisdictions listed in the schedule to the Security
Agreement.
(b) Each Mortgage (if any) when delivered under Section 6.15 will be
effective to grant to the Agent for the benefit of the Lenders a legal, valid
and enforceable mortgage lien on all the right, title and interest of the
mortgagor under such Mortgage in the mortgaged property described therein. When
each such Mortgage is duly recorded in the offices listed on the schedule to
such Mortgage and the mortgage recording fees and taxes in respect thereof are
paid and compliance is otherwise had with the formal requirements of state law
applicable to the recording of real estate mortgages generally, each such
mortgaged property, subject to the encumbrances and exceptions to title set
forth therein and except as noted in the title policies delivered to the Agent
pursuant to Section 6.15, will be subject to a legal, valid, enforceable and
perfected first priority deed of trust; and when financing statements have been
filed in the offices specified in such Mortgage, such Mortgage also will create
a legal, valid, enforceable and perfected first lien on, and security interest
in, all right, title and interest of the Company or such Subsidiary (as the case
may be) under such Mortgage in all personal property and fixtures which
46.
54
is covered by such Mortgage, subject to no other Liens, except the encumbrances
and exceptions to title set forth therein and except as noted in the title
policies delivered to the Agent pursuant to Section 6.15, and Permitted Liens.
(c) All representations and warranties of such Loan Party and any of
its Subsidiaries party thereto contained in the Collateral Documents are true
and correct.
5.14 Regulated Entities. None of Holdings, the Company, any Person
controlling the Company, or any Subsidiary, is an "Investment Company" within
the meaning of the Investment Company Act of 1940. No Loan Party is not subject
to regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act, any state public utilities code, or any
other Federal or state statute or regulation limiting its ability to incur
Indebtedness.
5.15 No Burdensome Restrictions. Neither such Loan Party nor any of its
Subsidiaries is a party to or bound by any Contractual Obligation, or subject to
any restriction in any Organization Document, or any Requirement of Law, which
could reasonably be expected to have a Material Adverse Effect.
5.16 Copyrights, Patents, Trademarks and Licenses, Etc. Such Loan Party
or its Subsidiaries own or are licensed or otherwise have the right to use all
of the patents, trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other rights that are reasonably necessary for
the operation of their respective businesses, without conflict with the rights
of any other Person that could be expected to have a Material Adverse Effect. To
the best knowledge of such Loan Party, no slogan or other advertising device,
product, process, method, substance, part or other material now employed, or now
contemplated to be employed, by such Loan Party or any of its Subsidiaries
infringes upon any rights held by any other Person. Except as specifically
disclosed in Schedule 5.05, no claim or litigation regarding any of the
foregoing is pending or, to the best knowledge of such Loan Party, threatened,
which, in either case, could reasonably be expected to have a Material Adverse
Effect.
5.17 Subsidiaries. As of the Closing Date, Holdings and the Company have
no Subsidiaries other than those specifically disclosed in part (a) of Schedule
5.17 and has no equity investments in any other Person other than those
specifically disclosed in part (b) of Schedule 5.17. The Company is a
Wholly-Owned Subsidiary of Holdings and each of the Company's Subsidiaries is a
Wholly-Owned Subsidiary, except as disclosed on Schedule 5.17.
5.18 Insurance. Except as specifically disclosed in Schedule 5.18, the
properties of such Loan Party and its Subsidiaries are insured with financially
sound and reputable insurance companies not Affiliates of such Loan Party, in
such amounts, with such deductibles and covering such risks as are customarily
carried by companies engaged in similar businesses and owning similar properties
in localities where such Loan Party or such Subsidiary operates.
47.
55
5.19 Solvency. Such Loan Party is Solvent.
5.20 Swap Obligations. Neither such Loan Party nor any of its
Subsidiaries has incurred any outstanding obligations under any Swap Contracts,
other than Permitted Swap Obligations. Such Loan Party has undertaken its own
independent assessment of its consolidated assets, liabilities and commitments
and has considered appropriate means of mitigating and managing risks associated
with such matters and has not relied on any Swap Provider or any Affiliate of
any Swap Provider in determining whether to enter into any Swap Contract.
5.21 Full Disclosure. None of the representations or warranties made by
such Loan Party or any of its Subsidiaries in the Loan Documents or Transaction
Documents as of the date such representations and warranties are made or deemed
made, and none of the statements contained in any exhibit, report, statement or
certificate furnished or made available by or on behalf of such Loan Party or
any of its Subsidiaries in connection with the Loan Documents or Transaction
Documents (including the offering and disclosure materials delivered by or on
behalf of such Loan Party to the Lenders prior to the Closing Date), contains
any untrue statement of a material fact or, when considered as a whole, omits
any material fact required to be stated therein or necessary to make the
statements made therein, in light of the circumstances under which they are
made, not misleading as of the time when made or delivered; provided that to the
extent any such information, report, financial statement, exhibit or schedule
was based upon or constitutes a forecast or projection, such Loan Party
represents only that it acted in good faith and utilized reasonable assumptions
and due care in the preparation of such information, report, financial
statement, exhibit or schedule (it being understood that forecasts and
projections by their nature involve approximations and uncertainties).
5.22 Year 2000. On the basis of representations and warranties set forth
in the Acquisition Agreements and due diligence inquiries in connection
therewith, such Loan Party reasonably believes the "Year 2000 problem" (that is,
the inability of computers, as well as embedded microchips in non-computing
devices, to perform properly date-sensitive functions with respect to certain
dates prior to and after December 31, 1999), including costs of remediation,
will not result in a Material Adverse Effect. Such Loan Party and its
Subsidiaries are in the process of developing feasible contingency plans
intended to ensure uninterrupted and unimpaired business operation in the event
of a material failure of their own or a third party's systems or equipment due
to the Year 2000 problem, including those of vendors, customers, and suppliers,
as well as a general failure of or interruption in its communications and
delivery infrastructure.
5.23 Representations and Warranties Contained in the Acquisition
Agreements. The Acquisition Agreements are in full force and effect, no term or
condition thereof has been amended, waived or modified, except as may have been
consented to in writing by the Majority Lenders or as permitted hereunder, the
parties thereto have performed all material obligations required to be performed
thereunder and no notice of termination or intent to terminate shall have been
given by any party thereto. All representations and warranties of Holdings and
the Company set forth therein are true and correct in all material respects. The
Agent and the Lenders shall be entitled to rely on all of such representations
and warranties of
48.
56
Holdings and the Company set forth therein with the same force and effect as
though they were incorporated in this Agreement and made by Holdings and the
Company for the Agent and the Lenders herein.
5.24 Deloitte & Touche Subordinated Debt. No event or circumstance has
occurred or exists which has resulted in, or would permit (whether with the
passage of time, the giving of notice or otherwise), the acceleration or
required principal repayment prior to December 14, 2001, of any of the
Subordinated Debt held by Deloitte & Touche LLP, except as permitted under
subsection 7.15(c).
ARTICLE VI
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan
or other Obligation shall remain unpaid or unsatisfied, unless the Majority
Lenders waive compliance in writing:
6.01 Financial Statements. The Company shall deliver to the Agent and
each Lender in form and detail satisfactory to the Agent and the Majority
Lenders:
(a) as soon as available, but not later than 105 days after the end
of each fiscal year, a copy of the audited consolidated balance sheet of
Holdings and its Subsidiaries, and of the Company and its Subsidiaries, each as
at the end of such year and the related consolidated statements of income or
operations, shareholders' equity and cash flows for such year, setting forth in
each case in comparative form the figures for the previous fiscal year, and each
accompanied by the unqualified opinion of Ernst & Young or another
nationally-recognized independent public accounting firm ("Independent Auditor")
which report shall state that such consolidated financial statements present
fairly the financial position for the periods indicated in conformity with GAAP
applied on a basis consistent with prior years. Any such opinion shall not be
qualified as to (i) going concern, (ii) any limitation in the scope of the
audit, or (iii) possible errors generated by financial reporting and related
systems due to the Year 2000 problem;
(b) as soon as available, but not later than 45 days after the end
of each of the first three fiscal quarters of each fiscal year, a copy of the
unaudited consolidated balance sheet of Holdings and its Subsidiaries, and of
the Company and its Subsidiaries, each as of the end of such quarter and the
related consolidated statements of income, shareholders' equity and cash flows
for the period commencing on the first day and ending on the last day of such
quarter, and certified by a Responsible Officer of Holdings as being complete
and accurate in all material respects and fairly presenting, in accordance with
GAAP (subject to ordinary, good faith adjustments and the absence of footnotes),
the financial position and the results of operations and cash flows of
Holdings and its Subsidiaries, and of the Company and its Subsidiaries;
49.
57
(c) as soon as available, but not later than 45 days after the end
of each fiscal month of each fiscal year, a copy of the unaudited consolidated
balance sheet of Holdings and its Subsidiaries, and of the Company and its
Subsidiaries, each as of the end of such fiscal month and the related
consolidated statements of income, shareholders' equity and cash flows for the
period commencing on the first day and ending on the last day of such fiscal
period, certified by a Responsible Officer of Holdings as being complete and
accurate in all material respects and fairly presenting, in accordance with GAAP
(subject to ordinary, good faith year-end audit adjustments), the financial
position and the results of operations and cash flows of Holdings and its
Subsidiaries, and of the Company and its Subsidiaries;
(d) as soon as available, but not later than 105 days after the end
of each fiscal year, copies of unaudited consolidating balance sheets of
Holdings and its Subsidiaries as at the end of such year and the related
consolidating statements of income, shareholders' equity and cash flows for such
year, certified by a Responsible Officer of Holdings as having been developed
and used in connection with the preparation of the financial statements referred
to in subsection 6.01(a); and
(e) as soon as available, but not later than 45 days after the end
of each of the first three fiscal quarters of each fiscal year, copies of the
unaudited consolidating balance sheets of Holdings and its Subsidiaries, and the
related consolidating statements of income, shareholders' equity and cash flows
for such quarter, all certified by a Responsible Officer as having been
developed and used in connection with the preparation of the financial
statements referred to in subsection 6.01(b).
6.02 Certificates; Other Information. The Company shall furnish to the
Agent and each Lender:
(a) concurrently with the delivery of the financial statements
referred to in subsection 6.01(a), a certificate of the Independent Auditor
stating that in making the examination necessary therefor no knowledge was
obtained of any Default or Event of Default, except as specified in such
certificate;
(b) concurrently with the delivery of the financial statements
referred to in subsections 6.01(a) and (b), a Compliance Certificate executed
by a Responsible Officer of Holdings and the Company;
(c) promptly upon sending or receipt, copies of any and all
management letters and correspondence relating to management letters, sent or
received by Holdings, the Company or any of its Subsidiaries to or from the
Independent Auditor;
(d) upon the request of the Agent or any Lender, a copy of the
Company's and its Subsidiaries' plan, timetable and budget to address the Year
2000 problem, together with periodic updates thereof and expenses incurred to
date, any third party assessment of the Company's and its Subsidiaries' Year
2000 remediation efforts, and any Year 2000 contingency plans, and any estimates
of the Company's and its Subsidiaries' potential litigation exposure (if any) to
the Year 2000 problem;
50.
58
(e) promptly, copies of all financial statements and reports that
the Company sends to its shareholders, and copies of all financial statements
and regular, periodical or special reports (including Forms 10K, 10Q and 8K)
that Holdings or the Company or any Subsidiary may make to, or file with, the
SEC;
(f) not more than 45 days after the end of each calendar quarter, an
Update Certificate, in substantially the form of Exhibit H, executed by a
Responsible Officer of the Company;
(g) at the same time it is provided to the holders of any
Subordinated Debt, the information provided to such holders pursuant to the
reporting and notices provisions of the documents evidencing such Subordinated
Debt;
(h) promptly after receipt thereof, all schedules, exhibits or other
documents evidencing any calculations supporting any material adjustments to the
purchase price under the Acquisition Agreements;
(i) concurrently with the delivery of the financial statements
referred to in subsection 6.01(a) , a consolidated financial forecast for
Holdings and its Subsidiaries for the then current and the next succeeding two
fiscal years, including forecasted consolidated balance sheets, consolidated
statements of income, shareholders' equity and cash flows of Holdings and its
Subsidiaries, and the related consolidating statements of income, shareholders'
equity and cash flows, which forecast shall (A) state the assumptions used in
the preparation thereof, a(B) be in form reasonably satisfactory to the Majority
Lenders;
(j) not less than 10 Business Days prior to the consummation of any
Secondary Acquisition, amended Schedules reflecting changes to the disclosures
contained in the Schedules delivered on the Closing Date resulting from such
Secondary Acquisition, in form and substance satisfactory to the Agent and the
Majority Lenders; and
(k) promptly, such additional information regarding the business,
financial or corporate affairs of Holdings, the Company or any Subsidiary as the
Agent, at the request of any Lender, may from time to time reasonably request.
6.03 Notices. The Company shall promptly notify the Agent and each
Lender:
(a) of the occurrence of any Default or Event of Default, and of the
occurrence or existence of any event or circumstance that foreseeably will
become a Default or Event of Default;
(b) of (i) any breach or non-performance of, or any default under,
any Contractual Obligation of Holdings, the Company or any of its Subsidiaries
which could result in a Material Adverse Effect; and (ii) any dispute,
litigation, investigation, proceeding or suspension which may exist at any time
between Holdings, the Company or any of its Subsidiaries and any Governmental
Authority which could result in a Material Adverse Effect;
51.
59
(c) of the commencement of, or any material development in, any
litigation or proceeding affecting Holdings, the Company or any Subsidiary (i)
in which the amount of damages claimed is $1,000,000 (or its equivalent in
another currency or currencies) or more, (ii) in which injunctive or similar
relief is sought and which, if adversely determined, would reasonably be
expected to have a Material Adverse Effect, or (iii) in which the relief sought
is an injunction or other stay of the performance of this Agreement or any Loan
Document;
(d) upon, but in no event later than 10 days after, becoming aware
of (i) any and all enforcement, cleanup, removal or other governmental or
regulatory actions instituted, completed or threatened against the Company or
any Subsidiary or any of their respective properties pursuant to any applicable
Environmental Laws, (ii) all other Environmental Claims, and (iii) any
environmental or similar condition on any real property adjoining or in the
vicinity of the property of Holdings, the Company or any Subsidiary that could
reasonably be anticipated to cause such property or any part thereof to be
subject to any restrictions on the ownership, occupancy, transferability or use
of such property under any Environmental Laws;
(e) of any other litigation or proceeding affecting Holdings, the
Company or any of its Subsidiaries which Holdings or the Company would be
required to report to the SEC pursuant to the Exchange Act, within four days
after reporting the same to the SEC;
(f) of the occurrence of any of the following events affecting
Holdings, the Company or any ERISA Affiliate (but in no event more than 10 days
after such event), and deliver to the Agent and each Lender a copy of any
notice with respect to such event that is filed with a Governmental Authority
and any notice delivered by a Governmental Authority to Holdings, the Company or
any ERISA Affiliate with respect to such event:
(i) an ERISA Event;
(ii) a material increase in the Unfunded Pension Liability of any
Pension Plan;
(iii) the adoption of, or the commencement of contributions to,
any Plan subject to Section 412 of the Code by Holdings, the Company or
any ERISA Affiliate; or
(iv) the adoption of any amendment to a Plan subject to Section
412 of the Code, if such amendment results in a material increase in
contributions or Unfunded Pension Liability.
(g) of any material change in accounting policies or financial
reporting practices by Holdings, the Company or any of its consolidated
Subsidiaries;
(h) of the entry by the Company or any of its Subsidiaries into any
Specified Swap Contract, together with the details thereof;
(i) of the occurrence of any default, event of default, termination
event or other event under any Specified Swap Contract that after the giving of
notice, passage of time or both,
52.
60
would permit either counterparty to such Specified Swap Contract to terminate
early any or all trades relating to such contract;
(j) upon the request from time to time of the Agent, the Swap
Termination Values, together with a description of the method by which such
amounts were determined, relating to any then-outstanding Swap Contracts to
which the Company or any of its Subsidiaries is party; and
(k) the occurrence of any Event of Loss exceeding $1,000,000.
Each notice under this Section shall be accompanied by a written
statement by a Responsible Officer of the Company setting forth details of the
occurrence referred to therein, and stating what action Holdings, the Company or
any affected Subsidiary proposes to take with respect thereto and at what time.
Each notice under subsection 6.03(a) shall describe with particularity any and
all clauses or provisions of this Agreement or other Loan Document that have
been (or foreseeably will be) breached or violated.
6.04 Preservation of Corporate Existence, Etc. Each Loan Party
shall, and shall cause each of its Subsidiaries to, except in connection with
transactions permitted by Section 7.03 and sales of assets permitted by Section
7.02:
(a) preserve and maintain in full force and effect its (i) legal
existence and (ii) good standing under the laws of its state or jurisdiction of
incorporation or formation;
(b) preserve and maintain in full force and effect all material
governmental rights, privileges, qualifications, permits, licenses and
franchises necessary or desirable in the normal conduct of its business except
in connection with transactions permitted by Section 7.03 and sales of assets
permitted by Section 7.02;
(c) use reasonable efforts, in the ordinary course of business, to
preserve its business organization and goodwill; and
(d) preserve or renew all of its registered patents, trademarks,
trade names and service marks, the non-preservation of which could reasonably be
expected to have a Material Adverse Effect.
6.05 Maintenance of Property. Each Loan Party shall, and shall cause
each of its Subsidiaries to, maintain and preserve all its property which is
used or useful in its business in good working order and condition, ordinary
wear and tear excepted, except as permitted by Section 7.02.
6.06 Insurance. In addition to insurance requirements set forth in the
Collateral Documents, each Loan Party shall maintain, and shall cause each of
its Subsidiaries to maintain, with financially sound and reputable independent
insurers, insurance with respect to its properties and business against loss or
damage of the kinds customarily insured against by Persons engaged in the same
or similar business, of such types and in such amounts as are customarily
carried under similar circumstances by such other Persons; including workers'
53.
61
compensation insurance, public liability and property and casualty insurance
which amount shall not be reduced by the Company in the absence of 30 days'
prior notice to the Agent. All such insurance shall name the Agent as loss
payee/mortgagee and as additional insured, for the benefit of the Lenders, as
their interests may appear. The Company shall furnish the Agent, with sufficient
copies for each Lender, at reasonable intervals (but not less than once per
calendar year) a certificate of a Responsible Officer of the Company (and, if
requested by any Lender, any insurance broker of the Company) setting forth the
nature and extent of all insurance maintained by Holdings, the Company and its
Subsidiaries in accordance with this Section or any Collateral Documents (and
which, in the case of a certificate of a broker, were placed through such
broker).
6.07 Payment of Obligations. Each Loan Party shall, and shall cause each
of its Subsidiaries to, pay and discharge as the same shall become due and
payable, all their respective obligations and liabilities, including:
(a) all tax liabilities, assessments and governmental charges or
levies upon it or its properties or assets, unless the same are being contested
in good faith by appropriate proceedings and adequate reserves in accordance
with GAAP are being maintained by such Loan Party or such Subsidiary;
(b) all lawful claims which, if unpaid, would by law become a Lien
upon its property not constituting a Permitted Lien; and
(c) all Indebtedness, as and when due and payable, but subject to
any subordination provisions contained in any instrument or agreement evidencing
such Indebtedness;
except where failure to do so would not otherwise constitute a Default or Event
of Default hereunder.
6.08 Compliance with Laws. Each Loan Party shall comply, and shall cause
each of its Subsidiaries to comply, in all material respects with all
Requirements of Law of any Governmental Authority having jurisdiction over it or
its business (including the Federal Fair Labor Standards Act), except such as
may be contested in good faith or as to which a bona fide dispute may exist.
6.09 Compliance with ERISA. Each Loan Party shall, and shall cause each
of its ERISA Affiliates to: (a) maintain each Plan in compliance in all material
respects with the applicable provisions of ERISA, the Code and other federal or
state law; (b) cause each Plan which is qualified under Section 401(a) of the
Code to maintain such qualification; and (c) make all required contributions to
any Plan subject to Section 412 of the Code.
6.10 Inspection of Property and Books and Records. Each Loan Party
shall, and shall cause each of its Subsidiaries to, maintain proper books of
record and account, in which full, true and correct entries in conformity with
GAAP consistently applied shall be made of all financial transactions and
matters involving the assets and business of such Loan Party and such
Subsidiary. Each Loan Party shall permit, and shall cause each of its
Subsidiaries to permit,
54.
62
(a) representatives and independent contractors of the Agent or any Lender to
visit and inspect any of their respective properties, to examine their
respective corporate, financial, operating and other records, and make copies
thereof or abstracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective directors, officers, and independent
public accountants, at their own expense at such reasonable times during normal
business hours and as often as may be reasonably desired, upon reasonable
advance notice to such Loan Party (b) representatives and independent
contractors of the Agent to do any of the foregoing at the expense of the
Company at such reasonable times during normal business hours, but no more
frequently than twice in any calendar year, upon reasonable advance notice to
such Loan Party;
provided, however, when an Event of Default exists the Agent or any Lender may
do any of the foregoing at the expense of the Company at any time during normal
business hours and without advance notice.
6.11 Environmental Laws.
(a) Each Loan Party shall, and shall cause each of its Subsidiaries
to, conduct its operations and keep and maintain its property in compliance in
all material respects with all Environmental Laws.
(b) Upon the written request of the Agent or any Lender, the Company
shall submit and cause each of its Subsidiaries to submit, to the Agent with
sufficient copies for each Lender, at the Company's sole cost and expense, at
reasonable intervals, a report providing an update of the status of any
environmental, health or safety compliance, hazard or liability issue identified
in any notice or report required pursuant to subsection 6.03(d), that could,
individually or in the aggregate, result in liability in excess of $1,000,000.
6.12 Use of Proceeds. The Company shall use the proceeds of the Loans in
connection with the consummation of the Closing Date Transaction, for Permitted
Acquisitions, working capital and other general corporate purposes not in
contravention of any Requirement of Law or of any Loan Document.
6.13 Year 2000. The Company shall, and shall cause each of its
Subsidiaries to, complete or accomplish the following:
(a) By June 30, 1999, renovate all systems and equipment affected by
the Year 2000 problem to cause them to perform correctly date-sensitive
functions for relevant date data from before and after December 31, 1999 ("Year
2000 Compliance") or replace them with technology not so affected, and commence
testing; and
(b) By June 30, 1999, complete testing and installation of all
material systems and equipment to ensure timely Year 2000 Compliance.
6.14 Additional Guarantors. (a) If the Company, or any Subsidiary of the
Company, shall incorporate, create or acquire any U.S. Subsidiary, the Company
shall cause such Subsidiary to furnish promptly, but in no event more than 30
days after its incorporation,
55.
63
creation or acquisition, as the case may be, each of the following to the Agent,
in sufficient quantities for each Lender:
(i) a duly executed notice and agreement in substantially the
form of Exhibit I (an "Additional Guarantor Assumption Agreement");
(ii) (A) (1) copies of the resolutions of the board of directors
of such Subsidiary approving and authorizing the execution, delivery and
performance by such Subsidiary of its Additional Guarantor Assumption
Agreement, this Agreement and the Security Agreement, certified as of
the date of such Additional Guarantor Assumption Agreement (the
"Additional Guarantor Accession Date") by the Secretary or an Assistant
Secretary of such Subsidiary; and (2) a certificate of the Secretary or
Assistant Secretary of such Subsidiary certifying the names and true
signatures of the officers of such Subsidiary authorized to execute and
deliver and perform, as applicable, its Additional Guarantor Assumption
Agreement, this Agreement and all other Loan Documents to be delivered
hereunder; (B) the articles or certificate of incorporation of such
Subsidiary as in effect on the Additional Guarantor Accession Date,
certified by the Secretary or Assistant Secretary of such Subsidiary as
of the Additional Guarantor Accession Date, and the bylaws of such
Subsidiary as in effect on the Additional Guarantor Accession Date,
certified by the Secretary or Assistant Secretary or such Subsidiary as
of the Additional Guarantor Accession Date; and (C) if such Subsidiary
has EBITDA exceeding $1,000,000 for the immediately preceding 12-month
period, an opinion of counsel to such Subsidiary and addressed to the
Agent and the Lenders, substantially in the form of Exhibit J; and
(iii) (A) such amendments to the Schedules to the Security
Agreement as shall be required in connection with the accession of such
Subsidiary thereto; (B) executed UCC-1 financing statements furnished by
the Agent in each jurisdiction in which such filing is necessary to
perfect the security interest of the Agent on behalf of the Lenders in
the Collateral of such Subsidiary and in which the Agent requests that
such filing be made, and (C) if requested by the Agent, such Mortgages
and other documents as may be required to create and perfect a lien in
the interests of such Subsidiary in any real property and such title
insurance policies and other documents as the Agent or the Majority
Lenders may reasonably request in connection therewith.
(b) The Company shall, not later than the expiration of the 30-day
period referenced in subsection (a) above, pledge (or cause to be pledged) the
capital stock of such Subsidiary to the Agent pursuant to the Security
Agreement, and execute and deliver, or cause such Subsidiary to execute and
deliver, to the Agent (in sufficient quantities for each Lender) such other
items as reasonably requested by the Agent in connection with the matters set
forth in this Section 6.14.
(c) Additionally, the Company and such Subsidiary shall have
executed and delivered to the Agent (in sufficient quantities for each Lender)
such other items as reasonably requested by the Agent in connection with the
foregoing, including officers' certificates, search reports and other
certificates and documents.
56.
64
6.15 Further Assurances.
(a) The Company shall ensure that all written information, exhibits
and reports furnished to the Agent or the Lenders by and on behalf of any Loan
Party do not and will not contain any untrue statement of a material fact and do
not and will not, when considered as a whole, omit to state any material fact or
any fact necessary to make the statements contained therein not misleading in
light of the circumstances in which made, and will promptly disclose to the
Agent and the Lenders and correct any defect or error that may be discovered
therein or in any Loan Document or in the execution, acknowledgement or
recordation thereof.
(b) If at any time Holdings, the Company or any Subsidiary shall
become the owner of any real property that is located in the United States that
has an aggregate fair market value equal to at least $5,000,000, promptly, and
in any event within thirty 30 days following acquisition of such real property,
Holdings and the Company shall (and shall cause any of their Subsidiaries to)
enter into and deliver to the Agent a Mortgage in respect to such property, in
form and substance reasonably satisfactory to the Agent, together with such
title insurance polices, insurance endorsements, surveys, appraisals, consents,
estoppels, subordination agreements and other documents and other instruments as
the Agent or the Majority Lenders shall reasonably request.
(c) Promptly upon request by the Agent or the Majority Lenders,
Holdings and the Company shall (and shall cause any of their Subsidiaries to)
do, execute, acknowledge, deliver, record, re-record, file, re-file, register
and re-register, any and all such further acts, deeds, conveyances, security
agreements, mortgages, assignments, estoppel certificates, financing statements
and continuations thereof, termination statements, notices of assignment,
transfers, certificates, assurances and other instruments the Agent or such
Lenders, as the case may be, may reasonably require from time to time in order
(i) to carry out more effectively the purposes of this Agreement or any other
Loan Document, (ii) to subject to the Liens created by any of the Collateral
Documents any of the properties, rights or interests covered by any of the
Collateral Documents, (iii) to perfect and maintain the validity, effectiveness
and priority of any of the Collateral Documents and the Liens intended to be
created thereby, and (iv) to better assure, convey, grant, assign, transfer,
preserve, protect and confirm to the Agent and Lenders the rights granted or now
or hereafter intended to be granted to the Lenders under any Loan Document or
under any other document executed in connection therewith.
6.16 Wholly-Owned Subsidiaries. Not later than 30 days (or, in the case
of the warrants to purchase the common stock of TSL Services, Inc., issued to
BVS Invesco, one year) following the Closing Date, (i) the Company shall have
caused all Founding Companies acquired by the Company pursuant to the
Transaction which are not already Wholly-Owned Subsidiaries of the Company to
become Wholly-Owned Subsidiaries or (ii) the Company shall have demonstrated to
the satisfaction of the Agent and the Majority Lenders that such
non-Wholly-Owned Subsidiaries can pay cash dividends to a Wholly-Owned
Subsidiary or to the Company without making any payment to any other shareholder
of such non-Wholly-Owned Subsidiary and that the other shareholders, and all
Persons having any rights to acquire or otherwise receive capital stock, of such
non-Wholly-Owned Subsidiary shall have consented to
57.
65
the execution, delivery and performance by such non-Wholly-Owned Subsidiary of
the Loan Documents to which it is a party.
ARTICLE VII
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan
or other Obligation shall remain unpaid or unsatisfied, unless the Majority
Lenders waive compliance in writing:
7.01 Limitation on Liens. Holdings and the Company shall not, and shall
not suffer or permit any Subsidiary to, directly or indirectly, make, create,
incur, assume or suffer to exist any Lien upon or with respect to any part of
its property, whether now owned or hereafter acquired, other than the following
("Permitted Liens"):
(a) any Lien existing on the Closing Date and set forth in Schedule
7.01 securing Indebtedness outstanding on such date;
(b) any Lien created under any Loan Document;
(c) Liens for taxes, fees, assessments or other governmental charges
which are not delinquent or remain payable without penalty, or to the extent
that non-payment thereof is permitted by Section 6.07, provided that no notice
of lien has been filed or recorded under the Code;
(d) carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's or other similar Liens arising in the ordinary course
of business which are not delinquent or remain payable without penalty or which
are being contested in good faith and by appropriate proceedings, which
proceedings have the effect of preventing the forfeiture or sale of the property
subject thereto;
(e) Liens (other than any Lien imposed by ERISA and other than on
the Collateral) consisting of pledges or deposits required in the ordinary
course of business in connection with workers' compensation, unemployment
insurance and other social security legislation;
(f) Liens securing (i) the non-delinquent performance of bids, trade
contracts (other than for borrowed money), leases (other than capital leases) ,
and statutory obligations, (ii) contingent obligations on surety and appeal
bonds, and (iii) other non-delinquent obligations of a like nature; in each
case, incurred in the ordinary course of business, provided all such Liens in
the aggregate would not (even if enforced) cause a Material Adverse Effect;
(g) Liens consisting of judgment or judicial attachment liens,
provided that the enforcement of such Liens is effectively stayed and all such
liens in the aggregate at any time outstanding for Holdings, the Company and its
Subsidiaries do not exceed $1,000,000;
58.
66
(h) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount, and which do not in any case
materially detract from the value of the property subject thereto or interfere
with the ordinary conduct of the businesses of Holdings, the Company and its
Subsidiaries;
(i) purchase money security interests on any property acquired or
held by the Company or its Subsidiaries in the ordinary course of business,
securing Indebtedness incurred or assumed for the purpose of financing all or
any part of the cost of acquiring such property; provided that (i) any such Lien
attaches to such property concurrently with or within 20 days after the
acquisition thereof, (ii) such Lien attaches solely to the property so acquired
in such transaction, (iii) the principal amount of the Indebtedness secured
thereby does not exceed 100% of the cost of such property, and (iv) the
principal amount of the Indebtedness secured by any and all such purchase money
security interests shall not at any time exceed, together with Indebtedness
permitted under subsection 7.04(d), $10,000,000;
(j) Liens securing obligations in respect of capital leases on
assets subject to such leases, provided that such capital leases are otherwise
permitted hereunder;
(k) Liens arising solely by virtue of any statutory or common law
provision relating to bankers liens, rights of set-off or similar rights and
remedies as to deposit accounts or other funds maintained with a creditor
depository institution; provided that (i) such deposit account is not a
dedicated cash collateral account and is not subject to restrictions against
access by Holdings or the Company in excess of those set forth by regulations
promulgated by the FRB, and (ii) such deposit account is not intended by
Holdings, the Company or any Subsidiary to provide collateral to the depository
institution;
(l) Liens consisting of pledges of cash collateral or government
securities not constituting Collateral to secure on a xxxx-to-market basis
Permitted Swap Obligations only, provided that (i) the counterparty to any Swap
Contract relating to any such Permitted Swap Obligation is under a similar
requirement to deliver similar collateral from time to time to the Company or
the Subsidiary party thereto on a xxxx-to-market basis; and (ii) the aggregate
value of such collateral so pledged by the Company and the Subsidiaries together
in favor of any counterparty does not at any time exceed $5,000,000; and
(m) Liens on specific tangible assets of Persons which become
Subsidiaries after the date of this Agreement, provided, however, that (a) such
Liens existed at the time the respective Persons became Subsidiaries and were
not created in anticipation thereof, (b) any such Lien does not by its terms
cover any assets after the time such Person becomes a Subsidiary which were not
covered immediately prior thereto, (c) any such Lien does not by its terms
secure any Indebtedness other than Indebtedness existing immediately prior to
the time such Person becomes a Subsidiary, and (d) such Indebtedness is
permitted by Section 7.05(d).
59.
67
7.02 Disposition of Assets. Holdings and the Company shall not, and
shall not suffer or permit any Subsidiary to, directly or indirectly, sell,
assign, lease, convey, transfer or otherwise dispose of (whether in one or a
series of transactions) any property (including accounts and notes receivable,
with or without recourse) or enter into any agreement to do any of the
foregoing, except:
(a) dispositions of inventory, or used, worn-out or surplus
equipment, all in the ordinary course of business;
(b) the sale of equipment and other tangible assets to the extent
that such equipment or other tangible asset is exchanged for credit against the
purchase price of similar replacement equipment or other tangible assets, as the
case may be, or the proceeds of such sale are reasonably promptly (but in no
event later than six months after such sale) applied to the purchase price of
such replacement equipment or other tangible asset; and
(c) dispositions of tangible assets by the Company or any U.S.
Subsidiary to the Company or any U.S. Subsidiary pursuant to reasonable business
requirements and in the ordinary course of business;
(d) the lease or sublease of real property by the Company or any
Subsidiary to other Persons in the ordinary course of business;
(e) licenses and sublicenses on a non-exclusive basis of
intellectual property in the ordinary course of business;
(f) (i) cancellation of Indebtedness evidenced by promissory notes
made by any officer or employee of any Loan Party as consideration for the
issuance to such officer or employee of capital stock of Holdings; and (ii) the
sale of cash equivalents and other short term money market investments in the
ordinary course of business pursuant to Holdings' and the Company's usual and
customary cash management policies and procedures;
(g) subject to Section 2.07, dispositions by the Company or any
Subsidiary not otherwise permitted hereunder which are made for fair market
value; provided, that (i) at the time of any disposition, no Event of Default
shall exist or shall result from such disposition, (ii) at least 75% of the
aggregate sales price from such disposition shall be paid in cash, (iii) the
aggregate book value of all assets so sold by the Company and its Subsidiaries,
together, shall not exceed in any fiscal year $3,000,000, and (iv) no
dispositions of accounts or notes receivable shall be permitted hereunder unless
in connection with the sale of all or substantially all of a business unit,
division or Subsidiary of the Company and such sale is otherwise permitted
hereunder; and
(h) transfers to the Company of stock of Persons acquired by
Holdings (or of Persons established by Holdings to acquire assets of Persons) in
Acquisitions permitted hereunder; provided that such Acquisitions are included
in the Closing Date Transaction or are Permitted Acquisitions and any such
transfer occurs immediately upon the consummation of any such Acquisition.
60.
68
7.03 Consolidations and Mergers. Holdings and the Company shall not, and
shall not suffer or permit any Subsidiary to, merge, consolidate with or into,
or convey, transfer, lease or otherwise dispose of (whether in one transaction
or in a series of transactions all or substantially all of its assets (whether
now owned or hereafter acquired) to or in favor of any Person, except:
(a) any of the Company's Subsidiaries may merge with, consolidate
into or transfer all or substantially all of its assets to any Subsidiary of the
Company (provided that the surviving or transferee entity is a U.S. Wholly-Owned
Subsidiary of the Company) or to the Company and in connection therewith such
Subsidiary may be liquidated or dissolved;
(b) Holdings, the Company or any of its Subsidiaries may sell or
dispose of assets in accordance with the provisions of Section 7.02;
(c) the Company or any of its Subsidiaries may make any Investment
permitted by Section 7.04; and
(d) the Company or any Subsidiary thereof may merge with or
consolidate into any other Person (other than Holdings), provided that (i) (in
the case of the Company) the Company is the surviving Person, (ii) such merger
or consolidation is in connection with a Permitted Acquisition, (iii) no such
merger or consolidation shall be made while there exists a Default or if a
Default would occur as a result thereof and (iv) all actions have been taken (to
the satisfaction of the Agent) under Sections 6.14 and 6.15 to protect and
continue perfected the Liens of the Agent under the Collateral Documents.
7.04 Loans and Investments. Holdings and the Company shall not purchase
or acquire, or suffer or permit any Subsidiary to purchase or acquire, any
capital stock, equity interest, or any obligations or other securities of, or
any interest in, any Person, or make any Acquisitions, or make any advance,
loan, extension of credit or capital contribution to or any other investment in,
any Person including any Affiliate of the Company together, ("Investments"),
except for:
(a) Investments held by Holdings and the Company or such Subsidiary
in the form of cash equivalents and short term money market investments in the
ordinary course of business pursuant to such Person's usual and customary cash
management policies and procedures;
(b) extensions of credit by the Company or any such Subsidiary in
the nature of accounts receivable or notes receivable arising from the sale or
lease of goods or services in the ordinary course of business;
(c) existing Investments disclosed in Schedule 5.17, and other
Investments in the capital stock of U.S. Wholly Owned Subsidiaries, and
extensions of credit by the Company to any of its U.S. Wholly Owned Subsidiaries
or by any of its Wholly-Owned Subsidiaries to the Company or to any other U.S.
Wholly-Owned Subsidiaries in the ordinary course of business;
(d) Investments by Holdings, the Company or any U.S. Wholly Owned
Subsidiary incurred in order to consummate Acquisitions otherwise permitted
herein, provided that such Acquisitions are included in the Closing Date
Transaction or are Permitted
61.
69
Acquisitions, and provided further that all proceeds of any such Investment by
the Company in Holdings are applied to consummate such Acquisitions and that all
stock of Persons acquired by Holdings (or of Persons established by Holdings to
acquire assets of Persons) are immediately transferred to the Company pursuant
to Section 7.02(h);
(e) Investments constituting Permitted Swap Obligations or payments
or advances under Swap Contracts relating to Permitted Swap Obligations;
(f) (i) management and employee loans and guarantees not exceeding
$1,000,000 in the aggregate in any fiscal year; (ii) a Loan to Xxxxx Xxxxxx not
exceeding $2,400,000 advanced in connection with the Closing Date Transaction;
and (iii) cashless loans to management and employees for the sole purpose of
financing the purchase of Holdings' capital stock;
(g) any promissory notes, securities or other instruments received
as consideration for any Disposition permitted under Section 7.02;
(h) equity investments held by Holdings obtained in consideration of
the issuance by Holdings of common stock, provided that (i) all such equity
investments are immediately transferred to the Company, and (ii) no such equity
investment would result in an Event of Default;
(i) the extension of credit by the Company to Holdings evidenced by
the Holdings Note; and
(j) other Investments, including Investments in joint ventures and
Investments received or otherwise acquired as part of a litigation settlement or
an Insolvency Proceeding of the issuing Person, which do not exceed $1,000,000
in the aggregate at any time outstanding.
7.05 Limitation on Indebtedness. Holdings and the Company shall not, and
shall not suffer or permit any Subsidiary to, create, incur, assume, suffer to
exist, or otherwise become or remain directly or indirectly liable with respect
to, any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement;
(b) Indebtedness consisting of Contingent Obligations permitted
pursuant to Section 7.08;
(c) Indebtedness existing on the Closing Date and set forth in
Schedule 7.05;
(d) Indebtedness of the Company or any Subsidiary secured by Liens
permitted by subsection 7.01(i), (j) and (m) in an aggregate amount outstanding
not to exceed $10,000,000;
(e) Indebtedness incurred in connection with leases permitted
pursuant to Section 7.09;
62.
70
(f) Indebtedness of U.S. Wholly Owned Subsidiaries of the Company to
the Company or to other U.S. Wholly Owned Subsidiaries of the Company;
(g) in the case of Holdings, (i) Indebtedness owing to the Company
evidenced by the Holdings Note, (ii) additional unsecured, subordinated
Indebtedness of Holdings incurred after the Closing Date, provided that the
proceeds of any such additional Indebtedness are applied to the extent required
to repay the Loans in accordance with subsection 2.07(b), and (iii) Indebtedness
in respect of the Holdings Subordinated Notes issued on or prior to the Closing
Date, and any extensions, renewals or replacements of such Indebtedness,
provided that (A) concurrently with the issuance of such Indebtedness, the
Holdings Subordinated Notes in a principal amount equal to the principal amount
of such Indebtedness shall have been repaid, at a price not in excess of 100% of
the principal amount thereof (plus interest accrued to the date of repayment and
not paid in cash); (B) no material terms applicable to such Indebtedness shall
be more favorable to the extending, renewing or replacement lenders than the
terms that are applicable to the holders of the Holdings Subordinated Notes
(other than the D&T Subordinated Note) as of the Closing Date; and provided
further, in the case of any such Indebtedness described in clause (ii) or (iii)
above, (1) the terms of such Indebtedness and the indenture or other agreement
evidencing such Indebtedness otherwise shall be satisfactory in all material
respects to the Majority Lenders (including terms and conditions relating to the
interest rate, fees, subordination, amortization, maturity, covenants, events of
default and remedies), (2) the interest rate applicable thereto shall be fixed,
non-increasing market interest rate per annum and shall be payable not more
often than quarterly; (3) after giving effect to the issuance thereof, no Event
of Default shall exist hereunder, and (4) such Indebtedness shall mature not
earlier than December 14, 2001 (any such Indebtedness under clause (i) or (ii)
issued in compliance with this subsection (g) hereinafter "Permitted New
Subordinated Debt"); and
(h) additional unsecured Indebtedness of the Company or any
Subsidiary not exceeding $5,000,000 in the aggregate at any time outstanding for
all such Indebtedness.
7.06 Transactions with Affiliates. Holdings and the Company shall not,
and shall not suffer or permit any Subsidiary to, enter into any transaction
with any Affiliate of the Company, except upon fair and reasonable terms no less
favorable to Holdings, the Company or such Subsidiary than would obtain in a
comparable arm's-length transaction with a Person not an Affiliate of the
Company except for the Holdings Note, employee compensation, director fees,
customary indemnities of management and employees, transfers of assets among the
Company and its U.S. Wholly-Owned Subsidiaries, employee loans and guarantees
permitted under Section 7.04(f) transactions between Holdings and the Company
that are permitted under Section 7.02(h) and Section 7.04(d), the Tax Sharing
Agreement and transfers to pay audit, SEC and other administrative expenses
incurred by Holdings.
7.07 Use of Proceeds.
(a) Holdings and the Company shall not, and shall not suffer or
permit any Subsidiary to, use any portion of the Loan proceeds, directly or
indirectly, (i) to purchase or carry Margin Stock, (ii) to repay or otherwise
refinance indebtedness of Holdings and the Company or others incurred to
purchase or carry Margin Stock, (iii) to extend credit for the
63.
71
purpose of purchasing or carrying any Margin Stock, or (iv) to acquire any
security in any transaction that is subject to Section 13 or 14 of the Exchange
Act or (v) to enter into or consummate any Acquisition that is not part of the
Closing Date Transaction or a Permitted Acquisition.
(b) Holdings and the Company shall not, directly or indirectly, use
any portion of the Loan proceeds to purchase during the underwriting period, or
for thirty days thereafter, Ineligible Securities underwritten by the Lead
Arranger. The Lead Arranger is a wholly-owned subsidiary of BankAmerica
Corporation and a registered broker-dealer which is permitted to underwrite and
deal in certain Ineligible Securities; and "Ineligible Securities" means
securities which may not be underwritten or dealt in by member banks of the
Federal Reserve System under Section 16 of the Banking Act of 1933 (12 U.S.C.
Section 24, Seventh), as amended.
7.08 Contingent Obligations. Holdings and the Company shall not, and
shall not suffer or permit any Subsidiary to, create, incur, assume or suffer to
exist any Contingent Obligations except:
(a) endorsements for collection or deposit in the ordinary course of
business;
(b) Permitted Swap Obligations;
(c) Contingent Obligations existing as of the Closing Date and
listed on Schedule 7.08;
(d) Contingent Obligations of Holdings and the Company in respect of
Indebtedness of any of its Wholly Owned Subsidiaries, or Contingent Obligations
of any of its Wholly Owned Subsidiaries in respect of Indebtedness which is the
subject of the Contingent Obligation of another of its Wholly Owned Subsidiaries
or of the Company, in each case to the extent such Indebtedness is permitted
hereunder;
(e) Contingent Obligations of the Company and its Subsidiaries with
respect to Surety Instruments incurred in the ordinary course of business and
not exceeding at any time $5,000,000 in the aggregate in respect of Holdings and
the Company and its Subsidiaries together; and
(f) additional unsecured Contingent Obligations of the Company or
any Subsidiary not exceeding $1,000,000 in the aggregate at any time outstanding
for all such Contingent Obligations.
7.09 Lease Obligations. Holdings and the Company shall not, and shall
not suffer or permit any Subsidiary to, create or suffer to exist any
obligations for the payment of rent for any property under lease or agreement to
lease, except for:
(a) leases of Holdings and the Company and of Subsidiaries in
existence on the Closing Date and listed in Schedule 7.09;
64.
72
(b) operating leases entered into by Holdings, the Company or any
Subsidiary after the Closing Date in the ordinary course of business;
(c) leases entered into by the Company or any Subsidiary after the
Closing Date pursuant to sale-leaseback transactions to the extent permitted
under subsection 7.02(g); and
(d) capital leases other than those permitted under clauses (a) and
(b) of this Section, entered into by the Company or any Subsidiary after the
Closing Date in the ordinary course of business to finance the acquisition of
equipment.
7.10 Restricted Payments. Holdings and the Company shall not, and shall
not suffer or permit any Subsidiary to, declare or make any dividend payment or
other distribution of assets, properties, cash, rights, obligations or
securities on account of any shares of any class of its capital stock, or
purchase, redeem or otherwise acquire for value any shares of its capital stock
or any warrants, rights or options to acquire such shares, now or hereafter
outstanding; except that:
(a) Holdings, the Company and any Wholly-Owned Subsidiary may
declare and make dividend payments or other distributions payable solely in its
common stock;
(b) Holdings, the Company and any Wholly-Owned Subsidiary may
purchase, redeem or otherwise acquire shares of its stock or warrants or options
to acquire any such shares with the proceeds received from the substantially
concurrent issue of new shares of its stock or by cancellation of Indebtedness
incurred by any Person to finance the acquisition such stock;
(c) any Subsidiary may declare and make dividends to a Wholly Owned
Subsidiary or the Company; and
(d) the Company may declare and pay cash dividends to Holdings (i)
from time to time in an amount not to exceed $5,000,000 in the aggregate in any
fiscal year on account of actual corporate overhead expenses of Holdings, (ii)
from time to time (A) in an amount not to exceed in the aggregate in any
calendar year Company's agreed share of tax obligations, calculated pursuant to
the Tax Sharing Agreement, and (B) as necessary to permit Holdings to pay
interest on the Holdings Note, provided that simultaneously therewith all such
interest is returned to the Company to make such interest payment and such
transaction is effected on a cashless basis; and (iii) so long as no Default or
Event of Default shall have occurred and be continuing or would result
therefrom, in an amount not to exceed in the aggregate in any calendar year the
interest due and payable in such calendar year (together with, in the case of
the D&T Subordinated Note, any deferred, accrued interest which was due and
payable in any prior calendar year to the extent such interest has not then
already been paid) on Subordinated Debt, which dividend (A) shall be paid by the
Company to Holdings on the Business Day immediately prior to the date on which
such interest payment in respect of the Subordinated Debt is actually paid by
Holdings to the holders thereof and (B) shall not exceed the amount of such
interest payment; provided that no such distribution by the Company to Holdings
shall be permitted under this clause (iii) if the Company Leverage Ratio,
measured as of the end of the most recent fiscal quarter on a pro forma basis
after giving effect to all Funded Debt outstanding on the date
65.
73
such dividend payment is to be made, is greater than 2.00 to 1.00. Prior to
paying any cash dividends which are subject to the preceding clause (iii), the
Company shall deliver to the Agent and the Lenders a certificate of a
Responsible Officer of the Company certifying the Company's compliance with the
preceding maximum Company Leverage Ratio.
7.11 ERISA. Holdings and the Company shall not, and shall not suffer or
permit any of its ERISA Affiliates to: (a) engage in a prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan which
has resulted or could reasonably expected to result in liability of such Person
in an aggregate amount in excess of $5,000,000; or (b) engage in a transaction
that could be subject to Section 4069 or 4212(c) of ERISA which has resulted or
could reasonably be expected to result in liability to such Person in an
aggregate amount in excess of $5,000,000.
7.12 Change in Business. Holdings and the Company shall not, and shall
not suffer or permit any Subsidiary to, engage in any material line of business
substantially different from those lines of business carried on by Holdings, the
Company and its Subsidiaries on the date hereof. Holdings shall not engage in
any business activity other than its ownership of the capital stock of the
Company and the performance of its obligations under the Transaction Documents
to which it is a party.
7.13 Accounting Changes. Holdings and the Company shall not, and shall
not suffer or permit any Subsidiary to, make any significant change in
accounting treatment or reporting practices, except as required by GAAP, or
change the fiscal year of Holdings, the Company or of any Subsidiary, except to
change the fiscal year of a Subsidiary acquired in connection with a Permitted
Acquisition to conform its fiscal year to Holdings' and the Company's.
7.14 Capital Expenditures. Holdings and the Company shall not, and shall
not suffer or permit any Subsidiary to, make any expenditures for fixed or
capital assets, including obligations under capital leases, in excess of (a)
$8,000,000 on a consolidated basis, in fiscal year 1999 and (b) $6,000,000, on a
consolidated basis, in fiscal year 2000 and in any fiscal year thereafter.
7.15 Holdings Subordinated Debt. (i) Holdings shall not amend,
supplement or otherwise modify the terms of the Holdings Note. (ii) Holdings
shall not (a), except in connection with the issuance of Permitted New
Subordinated Debt, amend, supplement or otherwise modify the terms of the
Holdings Subordinated Notes or, after issued, the Permitted New Subordinated
Debt, in a manner that imposes obligations on Holdings that are materially more
onerous or otherwise materially more burdensome to Holdings than its obligations
under the Holdings Subordinated Notes or the Permitted New Subordinated Debt, as
the case may be, on their respective dates of issuance; provided that no such
amendment, supplement or other modification of the Holdings Subordinated Notes
or the Permitted New Subordinated Debt, as the case may be, shall be permitted
hereunder if, after giving effect thereto, (i) the interest rate applicable to
such Indebtedness shall not be a fixed, non-increasing market interest rate per
annum payable no more often than quarterly, or (ii) such Indebtedness shall
mature on an earlier date than the maturity date of the Holdings Subordinated
Notes or Permitted New
66.
74
Subordinated Debt, as the case may be, prior to giving effect to such amendment,
supplement or other modification; or (b) (i) prepay, redeem or repurchase any of
the Subordinated Debt (except, if permitted by the respective subordination
agreements among the Agent, the Company and the holders of such Subordinated
Debt, in connection with the issuance of Permitted New Subordinated Debt or
equity) or the Permitted New Subordinated Debt if not permitted by the
respective subordination agreements among the Agent, the Company and the holders
of such Subordinated Debt; (ii) make any principal payments on any Holdings
Subordinated Notes or Permitted New Subordinated Debt not permitted by the
respective subordination agreements among the Agent, the Company and the holders
of such Subordinated Debt or (iii) make any interest payments on any Holdings
Subordinated Notes or Permitted New Subordinated Debt other than regularly
scheduled interest payments thereunder made by increasing the principal balance
thereof by the amount of such payment or, to the extent Holdings has or would
have sufficient cash on hand by means of payments by the Company to Holdings
permitted hereunder and/or has sufficient cash on hand by other means permitted
hereunder, and if permitted by the respective subordination agreements among the
Agent, the Company and the holders of such Subordinated Debt, scheduled interest
payments (together with, in the case of the D&T Subordinated Note, payment of
deferred, accrued interest to the extent such interest has not then already been
paid) paid in cash; or (c) take, or suffer or permit to occur, any action that
would cause any Subordinated Debt to become due and payable prior to the final
scheduled maturity date thereof, including any closing of any public or private
debt or equity offering by Holdings, the Company or any Subsidiary that would so
result in Subordinated Debt becoming so due and payable, except, in the case of
any initial public offering or private placement of Holdings' capital stock, if
the Term Loans and all such Subordinated Debt is repaid in full thereby.
7.16 Amendments to Acquisition Agreements. Neither Holdings nor the
Company shall (i) amend, supplement, waive or otherwise modify any provision of
the Acquisition Agreements in any material respect, or (ii) take or fail to take
any action under the Acquisition Agreements that would reasonably be expected to
have Material Adverse Effect.
7.17 Tax Sharing Agreement. Holdings and the Company shall not amend,
supplement or otherwise modify the terms of the Tax Sharing Agreement in a
manner that imposes obligations on the Company that are more onerous or
otherwise more burdensome to the Company than its obligations under the Tax
Sharing Agreement as in effect on the Closing Date.
7.18 Financial Covenants.
(a) Maximum Holdings Leverage Ratio. Holdings shall not permit the
Holdings Leverage Ratio as at the end of any fiscal quarter to be greater than
(i) 4.00 to 1.00 for any fiscal quarter ending in 1998 or 1999 and (ii) 3.50 to
1.00 for any fiscal quarter ending in 2000 and thereafter.
(b) Minimum Consolidated Net Worth. The Company shall not permit its
Consolidated Net Worth as at the end of any fiscal quarter to be less than (i)
90% of Consolidated Net Worth measured as of the Closing Date (after giving
effect to the Transaction),
67.
75
plus (ii) 50% of consolidated net income of the Company and its Subsidiaries
earned in each quarterly accounting period ending after the Closing Date (but
without any deduction for any consolidated net loss for any such quarterly
accounting period), plus (iii) 100% of the Net Issuance Proceeds of any new
equity issued by the Company after the Closing Date, minus (iv) any cash
distributions made by the Company to Holdings pursuant to subsection
7.10(d)(iii).
(c) Maximum Company Leverage Ratio. The Company shall not permit the
Company Leverage Ratio as at the end of any fiscal quarter to be greater than
(i) 2.50 to 1.00 for any fiscal quarter ending in 1998 or 1999 and (ii) 2.00 to
1.00 for any fiscal quarter ending in 2000 and thereafter.
(d) Minimum Interest Coverage Ratio. The Company shall not permit as
at the end of any fiscal quarter, measured on a consolidated basis for the
Company and its Subsidiaries for the period of four fiscal quarters ended on
such date in accordance with GAAP, the ratio (the "Interest Coverage Ratio") of
(i) EBITDA to (ii) (A) cash interest expense plus (B) cash distributions made by
the Company to Holdings pursuant to subsection 7.10(d)(iii) to be less than (1)
3.00 to 1.00 for any period of four fiscal quarters ending in 1998 or 1999, or
for each period of four fiscal quarters ending on March 31, 2000, and June 30,
2000, and (2) 3.50 to 1.00 for the period of four fiscal quarters ending
September 30, 2000 and each period of four fiscal quarters thereafter. For
purposes of calculating the Interest Coverage Ratio hereunder, until such time
as the first day of the rolling four-quarter period for which the Interest
Coverage Ratio is being calculated falls on or after the Closing Date, cash
interest expense for purposes of the preceding clause (ii)(A) shall be deemed to
be equal to (i) actual cash interest expense for the Company and its
Subsidiaries, measured on a consolidated basis for the period from the Closing
Date through the last day of the Compliance Period in accordance with GAAP, plus
(ii) (A) the lesser of (x) $89,041,057 and (y) the Indebtedness of the Company
and its Subsidiaries outstanding on the last day of the Compliance Period,
multiplied by (B) the average interest rate then in effect for outstanding
Loans, multiplied by (C) the Annualization Quotient.
(e) Minimum Quarterly EBITDA. The Company shall not permit (i)
EBITDA for each of the first four full fiscal quarters ending after the Closing
Date, measured on a consolidated basis for the Company and its Subsidiaries in
accordance with GAAP, to be less than $10,000,000 for each such quarter, and
(ii) EBITDA for each rolling period of four fiscal quarters ending on December
31, 1999, and thereafter, measured on a consolidated basis for the Company and
its Subsidiaries in accordance with GAAP, to be less than $43,000,000 for each
such rolling four-quarter period.
(f) Minimum Fixed Charge Coverage Ratio. The Company shall not
permit as at the end of any fiscal quarter, measured on a consolidated basis for
the Company and its Subsidiaries for the period of four fiscal quarters ended on
such date in accordance with GAAP, the ratio (the "Fixed Charge Coverage Ratio")
of (i)(A) EBITDA minus (B) capital expenditures minus (C) cash distributions
made by the Company to Holdings pursuant to subsection 7.10(d)(ii) (to the
extent that such cash distributions made by the Company to Holdings pursuant to
subsection 7.10(d)(ii) have not already reduced EBITDA for purposes of the
preceding clause (i)(A)) to (ii)(A) principal amortization of Funded Debt
plus (B) cash interest expense plus (C) cash distributions made by the Company
to Holdings pursuant to subsection 7.10(d)(i) or
68.
76
7.10(d)(iii) (to the extent that such cash distributions made by the Company to
Holdings pursuant to subsection 7.10(d)(i) or 7.10(d)(iii) have not already
reduced EBITDA for purposes of the preceding clause (i)(A)) to be less than
1.25 to 1.00. For purposes of calculating the Fixed Charge Coverage Ratio
hereunder, until such time as the first day of the rolling four-quarter period
for which the Fixed Charge Coverage Ratio is calculated falls on or after the
Closing Date, (1) capital expenditures for purposes of the preceding clause
(i)(B) shall be deemed to be equal to $7,300,000; (2) cash interest expense for
purposes of the preceding clause (ii)(B) shall be deemed to be equal to (x)
actual cash interest expense for the Company and its Subsidiaries, measured on a
consolidated basis for the period from the Closing Date through the last day of
the Compliance Period in accordance with GAAP, plus (y) (I) the lesser of (aa)
$89,041,057 and (bb) the Indebtedness of the Company and its Subsidiaries
outstanding on the last day of the Compliance Period, multiplied by (II) the
average interest rate then in effect for outstanding Loans, multiplied by (III)
the Annualization Quotient; (3) cash distributions made by the Company to
Holdings pursuant to subsection 7.10(d)(ii) shall be deemed to be equal to (x)
actual cash distributions made by the Company to Holdings pursuant to subsection
7.10(d)(ii) after the Closing Date through the last day of the Compliance Period
plus (y) $14,300,000 multiplied by the Annualization Quotient; and (4) actual
cash distributions made by the Company to Holdings pursuant to Subsection
7.10(d)(i) and 7.10(d)(iii) shall be annualized in a manner acceptable to the
Agent and the Majority Lenders.
ARTICLE VIII
EVENTS OF DEFAULT
8.01 Event of Default. Any of the following shall constitute an "Event
of Default":
(a) Non-Payment. The Company or any other Loan Party fails to make,
(i) when and as required to be made herein, payments of any amount of principal
of any Loan, or (ii) when and as required to be paid under any Specified Swap
Contract, any payment or transfer under such Specified Swap Contract, or (iii)
within three days after the same becomes due, payment of any interest, fee or
any other amount payable hereunder or under any other Loan Document (other than
a Specified Swap Contract); or
(b) Representation or Warranty. Any representation or warranty by
Holdings, the Company or any other Loan Party made or deemed made herein, in any
other Loan Document other than a Specified Swap Contract, or which is contained
in any certificate, document or financial or other statement by Holdings, the
Company or any other Loan Party, any Subsidiary, or any Responsible Officer,
furnished at any time under this Agreement, or in or under any other Loan
Document other than a Specified Swap Contract, is incorrect in any material
respect on or as of the date made or deemed made; or
(c) Specific Defaults. Holdings, the Company or any other Loan Party
fails to perform or observe any term, covenant or agreement contained in any of
Section 6.01, 6.02, 6.03, 6.04(a)(i), 6.12, 6.13, 6.14 or 6.15(a) or in Article
VII; or
69.
77
(d) Other Defaults. Holdings, the Company or any other Loan Party
shall fail to perform or observe any other term or covenant contained in this
Agreement or any other Loan Document other than a Specified Swap Contract, and
such default shall continue unremedied for a period of 20 days after the earlier
of (i) the date upon which a Responsible Officer knew of such failure or (ii)
the date upon which written notice thereof is given to the Company by the Agent
or any Lender; or
(e) Cross-Default. (i) Holdings, the Company or any Subsidiary (A)
shall fail to make any payment in respect of any Indebtedness or Contingent
Obligation (other than in respect of Swap Contracts) , having an aggregate
principal amount (including undrawn committed or available amounts and including
amounts owing to all creditors under any combined or syndicated credit
arrangement) of more than $5,000,000 when due (whether by scheduled maturity,
required prepayment, acceleration, demand, or otherwise) and such failure
continues after the applicable grace or notice period, if any, specified in the
relevant document on the date of such failure; or (B) shall fail to perform or
observe any other condition or covenant, or any other event shall occur or
condition exist, under any agreement or instrument relating to any such
Indebtedness or Contingent Obligation, and such failure continues after the
applicable grace or notice period, if any, specified in the relevant document on
the date of such failure if the effect of such failure, event or condition is to
cause, or to permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Indebtedness (or a trustee or agent on behalf of such
holder or holders or beneficiary or beneficiaries) to cause, such Indebtedness
to be declared to be due and payable, or require such Indebtedness to be repaid
in full prior to its final scheduled maturity date (other than as contemplated
in the exception set forth in subsection 7.15(c)), or such Contingent Obligation
to become payable or cash collateral in respect thereof to be demanded; or (ii)
there occurs under any Swap Contract an Early Termination Date (as defined in
such Swap Contract) resulting from (1) any event of default under such Swap
Contract as to which Holdings and the Company or any Subsidiary is the
Defaulting Party (as defined in such Swap Contract) or (2) any Termination Event
(as so defined) as to which Holdings and the Company or any Subsidiary is an
Affected Party (as so defined), and, in either event, the Swap Termination
Value owed by Holdings and the Company or such Subsidiary as a result thereof is
greater than $5,000,000;
(f) Insolvency; Voluntary Proceedings. Holdings, the Company or any
Subsidiary (i) ceases or fails to be solvent, or generally fails to pay, or
admits in writing its inability to pay, its debts as they become due, subject to
applicable grace periods, if any, whether at stated maturity or otherwise; (ii)
voluntarily ceases to conduct its business in the ordinary course; (iii)
commences any Insolvency Proceeding with respect to itself; or (iv) takes any
action to effectuate or authorize any of the foregoing; or
(g) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against Holdings, the Company or any
Subsidiary, or any writ, judgment, warrant of attachment, execution or similar
process, is issued or levied against a substantial part of Holdings', the
Company's or any Subsidiary's properties, and any such proceeding or petition
shall not be dismissed, or such writ, judgment, warrant of attachment, execution
or similar process shall not be released, vacated or fully bonded within 60 days
after commencement, filing or levy; (ii) Holdings, the Company or any Subsidiary
admits the material allegations of a
70.
78
petition against it in any Insolvency Proceeding, or an order for relief (or
similar order under non-U.S. law) is ordered in any Insolvency Proceeding; or
(iii) Holdings, the Company or any Subsidiary acquiesces in the appointment of a
receiver, trustee, custodian, conservator, liquidator, mortgagee in possession
(or agent therefor), or other similar Person for itself or a substantial
portion of its property or business; or
(h) ERISA. (i) An ERISA Event shall occur with respect to a Pension
Plan or Multiemployer Plan which has resulted or could reasonably be expected to
result in liability of any Loan Party under Title IV of ERISA to the Pension
Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess of
$5,000,000; or (ii) the aggregate amount of Unfunded Pension Liability among all
Pension Plans at any time exceeds $5,000,000; or (iii) any Loan Party or any
ERISA Affiliate shall fail to pay when due, after the expiration of any
applicable grace period, any installment payment with respect to its withdrawal
liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate
amount in excess of $5,000,000; or
(i) Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against
Holdings, the Company or any Subsidiary involving in the aggregate a liability
(to the extent not covered by independent third-party insurance as to which the
insurer does not dispute coverage) as to any single or related or unrelated
series of transactions, incidents or conditions, of $1,000,000 or more, and the
same shall remain unsatisfied, unvacated and unstayed pending appeal for a
period of 10 days after the entry thereof; or
(j) Non-Monetary Judgments. Any non-monetary judgment, order or
decree is entered against Holdings, the Company or any Subsidiary which does or
would reasonably be expected to have a Material Adverse Effect, and there shall
be any period of 10 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect; or
(k) Change of Control. There occurs any Change of Control; or
(l) Loss of Licenses. Any Governmental Authority revokes or fails to
renew any material license, permit or franchise of Holdings, the Company or any
Subsidiary, or Holdings, the Company or any Material Subsidiary for any reason
loses any material license, permit or franchise, or Holdings, the Company or any
Subsidiary suffers the imposition of any restraining order, escrow, suspension
or impound of funds in connection with any proceeding (judicial or
administrative) with respect to any material license, permit or franchise if
such revocation, failure to renew, loss or imposition could be expected to have
a Material Adverse Effect; or
(m) Adverse Change. There occurs a Material Adverse Effect; or
(n) Guarantor Defaults. Any Guarantor fails in any material respect
to perform or observe any term, covenant or agreement in its Guaranty; or any
Guaranty is for any reason partially (including with respect to future advances)
or wholly revoked or invalidated, or otherwise ceases to be in full force and
effect, or the Guarantor or any other Person contests in
71.
79
any manner the validity or enforceability thereof or denies that it has any
further liability or obligation thereunder; or any event described in
subsections (f) or (g) of this Section occurs with respect to any Guarantor; or
(o) Invalidity of Subordination Provisions. The subordination
provisions applicable to any Subordinated Debt or any agreement or instrument
governing any or the foregoing is for any reason revoked or invalidated, or
otherwise cease to be in full force and effect, or the Indebtedness hereunder is
for any reason subordinated or does not have the priority contemplated by this
Agreement or such subordination provisions; or
(p) Collateral. (i) Any provision of any Collateral Document shall
for any reason cease to be valid and binding on or enforceable against Holdings,
the Company or any Subsidiary party thereto or Holdings, the Company or any
Subsidiary shall so state in writing or bring an action to limit its obligations
or liabilities thereunder; or (ii) any Collateral Document shall for any reason
(other than pursuant to the terms thereof) cease to create a valid security
interest in the Collateral purported to be covered thereby or such security
interest shall for any reason cease to be a perfected and first priority
security interest, subject only to Permitted Liens; or
(q) Acquisition Agreements. Any material breach or default occurs
under any of the Acquisition Agreements.
8.02 Remedies. If any Event of Default occurs, the Agent shall, at the
request of, or may, with the consent of, the Majority Lenders, do any or all of
the following:
(a) declare the obligation of each Lender to make Loans to be
terminated, whereupon such obligation and each Lender's Commitments shall be
terminated;
(b) declare the unpaid principal amount of all outstanding Loans,
all interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Company and each other Loan Party; and
(c) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
law;
provided, however, that upon the occurrence of any event specified in subsection
(f) or (g) of Section 8.01 (in the case of clause (i) of subsection (g) upon the
expiration of the 60-day period mentioned therein), the obligation of each
Lender to make Loans shall automatically terminate and the unpaid principal
amount of all outstanding Loans and all interest and other amounts as aforesaid
shall automatically become due and payable without further act of the Agent or
any Lender.
72.
80
8.03 Specified Swap Contract Remedies. Notwithstanding any other
provision of this Article VIII, each Swap Provider shall have the right, with
prior notice to the Agent, but without the approval or consent of the Agent or
the other Lenders, with respect to any Specified Swap Contract of such Swap
Provider, (a) to declare an event of default, termination event or other similar
event thereunder and to create an Early Termination Date, (b) to determine net
termination amounts in accordance with the terms of such Specified Swap
Contracts and to set-off amounts between Specified Swap Contracts, and (c) to
prosecute any legal action against Holdings and the Company or its Subsidiary to
enforce net amounts owing to such Swap Provider.
8.04 Rights Not Exclusive. The rights provided for in this Agreement and
the other Loan Documents are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.
ARTICLE IX
THE AGENT
9.01 Appointment and Authorization; "Agent". Each Lender hereby
irrevocably (subject to Section 9.09) appoints, designates and authorizes the
Agent to execute the Collateral Documents and all subordination agreements
relating to the Holdings Subordinated Notes and to take such action on its
behalf under the provisions of this Agreement and each other Loan Document and
to exercise such powers and perform such duties as are expressly delegated to it
by the terms of this Agreement or any other Loan Document, together with such
powers as are reasonably incidental thereto. Notwithstanding any provision to
the contrary contained elsewhere in this Agreement or in any other Loan
Document, the Agent shall not have any duties or responsibilities, except those
expressly set forth herein, nor shall the Agent have or be deemed to have any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the Agent.
Without limiting the generality of the foregoing sentence, the use of the term
"agent" in this Agreement with reference to the Agent is not intended to connote
any fiduciary or other implied (or express) obligations arising under agency
doctrine of any applicable law. Instead, such term is used merely as a matter of
market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties.
9.02 Delegation of Duties. The Agent may execute any of its duties under
this Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.
73.
81
9.03 Liability of Agent. None of the Agent-Related Persons shall (i) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (ii) be responsible in any manner to any of the Lenders for any recital,
statement, representation or warranty made by the Company or any Subsidiary or
Affiliate of the Company, or any officer thereof, contained in this Agreement or
in any other Loan Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by the Agent under or in
connection with, this Agreement or any other Loan Document, or for the value of
or title to any Collateral, or the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document, or
for any failure of the Company or any other party to any Loan Document to
perform its obligations hereunder or thereunder. No Agent-Related Person shall
be under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of Holdings, the Company or any of their Subsidiaries or
Affiliates.
9.04 Reliance by Agent.
(a) The Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to Holdings
and the Company), independent accountants and other experts selected by the
Agent. The Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Majority Lenders as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Loan Document in accordance with a
request or consent of the Majority Lenders and such request and any action taken
or failure to act pursuant thereto shall be binding upon all of the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 4.01, each Lender that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter (including any and all items referenced in subsections
4.01(j), (l) and (m)) either sent, or made available for inspection, by the
Agent to such Lender for consent, approval, acceptance or satisfaction, or
required thereunder to be consented to or approved by or acceptable or
satisfactory to such Lender.
9.05 Notice of Default. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Default or Event of Default, except with
respect to defaults in the payment of principal, interest and fees required to
be paid to the Agent for the account of the Lenders, unless the Agent shall have
received written notice from a Lender or the Company referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a
74.
82
"notice of default." The Agent will notify the Lenders of its receipt of any
such notice. The Agent shall take such action with respect to such Default or
Event of Default as may be requested by the Majority Lenders in accordance with
Article VIII; provided, however, that unless and until the Agent has received
any such request, the Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to such Default or
Event of Default as it shall deem advisable or in the best interest of the
Lenders.
9.06 Credit Decision. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Agent hereinafter taken, including any review of the affairs of
Holdings, the Company and their Subsidiaries or the Founding Companies, shall be
deemed to constitute any representation or warranty by any Agent-Related Person
to any Lender. Each Lender represents to the Agent that it has, independently
and without reliance upon any Agent-Related Person and based on such documents
and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of Holdings, the Company and their
Subsidiaries and the Founding Companies, the value of and title to any
Collateral, and all applicable Lender regulatory laws relating to the
transactions contemplated hereby, and made its own decision to enter into this
Agreement and to extend credit to the Company hereunder. Each Lender also
represents that it will, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of Holdings, the Company and their
Subsidiaries. Except for notices, reports and other documents expressly herein
required to be furnished to the Lenders by the Agent, the Agent shall not have
any duty or responsibility to provide any Lender with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of Holdings, the Company or any
Subsidiary which may come into the possession of any of the Agent-Related
Persons.
9.07 Indemnification of Agent. Whether or not the transactions
contemplated hereby are consummated, the Lenders shall indemnify upon demand the
Agent-Related Persons (to the extent not reimbursed by or on behalf of Holdings
and the Company and without limiting the obligation of Holdings and the Company
to do so), pro rata, from and against any and all Indemnified Liabilities;
provided, however, that no Lender shall be liable for the payment to the
Agent-Related Persons of any portion of such Indemnified Liabilities resulting
solely from such Person's gross negligence or willful misconduct. Without
limitation of the foregoing, each Lender shall reimburse the Agent upon demand
for its ratable share of any costs or out-of-pocket expenses (including Attorney
Costs) incurred by the Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the extent
that the Agent is not reimbursed for such expenses by or on behalf of Holdings
or the Company. The undertaking in this Section shall
75.
83
survive the payment of all Obligations hereunder and the resignation or
replacement of the Agent.
9.08 Agent in Individual Capacity. BofA and its Affiliates may make
loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with Holdings, the Company
and their Subsidiaries and Affiliates as though BofA were not the Agent
hereunder and without notice to or consent of the Lenders. The Lenders
acknowledge that, pursuant to such activities, BofA or its Affiliates may
receive information regarding each of Holdings, the Company or any of their
Subsidiaries or Affiliates (including information that may be subject to
confidentiality obligations in favor of Holdings, the Company or such Subsidiary
or Affiliate) and acknowledge that the Agent shall be under no obligation to
provide such information to them. With respect to its Loans, BofA shall have the
same rights and powers under this Agreement as any other Lender and may exercise
the same as though it were not the Agent, and the terms "Lender" and "Lenders"
include BofA in its individual capacity.
9.09 Successor Agent. The Agent may, and at the request of the Majority
Lenders shall, resign as Agent upon 30 days' notice to the Lenders. If the Agent
resigns under this Agreement, the Majority Lenders shall appoint from among the
Lenders a successor agent for the Lenders which successor agent shall be
approved by the Company (such approval not to be unreasonably withheld). If no
successor agent is appointed prior to the effective date of the resignation of
the Agent, the Agent may appoint, after consulting with the Lenders and the
Company, a successor agent from among the Lenders. Upon the acceptance of its
appointment as successor agent hereunder, such successor agent shall succeed to
all the rights, powers and duties of the retiring Agent and the term "Agent"
shall mean such successor agent and the retiring Agent's appointment, powers and
duties as Agent shall be terminated. After any retiring Agent's resignation
hereunder as Agent, the provisions of this Article IX and Sections 10.04 and
10.05 shall inure to its benefit as to any actions taken or omitted to be taken
by it while it was Agent under this Agreement. If no successor agent has
accepted appointment as Agent by the date which is 30 days following a retiring
Agent's notice of resignation, the retiring Agent's resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of the
duties of the Agent hereunder until such time, if any, as the Majority Lenders
appoint a successor agent as provided for above.
9.10 Withholding Tax.
(a) If any Lender is a "foreign corporation, partnership or trust"
within the meaning of the Code and such Lender claims exemption from, or a
reduction of, U.S. withholding tax under Sections 1441 or 1442 of the Code, or
if any Lender claims exemption from U.S. withholding tax under Sections 871(h)
or 881(c) of the Code with respect to payments of "portfolio interest," such
Lender agrees with and in favor of the Agent, to deliver to the Agent:
(i) if such Lender claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, two properly completed
and executed copies of IRS Form 1001 before the payment of any interest
or fees in the first calendar
76.
84
year and before the payment of any interest or fees in each third
succeeding calendar year during which interest or fees may be paid under
this Agreement;
(ii) if such Lender claims that interest or fees paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such
Lender, two properly completed and executed copies of IRS Form 4224
before the payment of any interest or fees is due in the first taxable
year of such Lender and in each succeeding taxable year of such Lender
during which interest or fees may be paid under this Agreement;
(iii) if such Lender claims exemption from, or a reduction of,
withholding tax under Sections 871(h) or 881(c) of the Code with respect
to payments of "portfolio interest," a Form W-8, or any subsequent
versions thereof or successors thereto (and if such Lender delivers a
Form W-8, a certificate representing that such 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 Company and is not a controlled foreign corporation related to
the Company (within the meaning of Section 864(d)(4) of the Code)) on
or before the date it becomes a party to this Agreement; and
(iv) such other form or forms as may be required under the Code
or other laws of the United States as a condition to exemption from, or
reduction of, United States withholding tax.
Such Lender agrees to promptly notify the Agent of any change in circumstances
which would modify or render invalid any claimed exemption or reduction.
(b) If any Lender claims exemption from, or reduction of,
withholding tax under a United States tax treaty by providing IRS Form 1001 and
such Lender sells, assigns, grants a participation in, or otherwise transfers
all or part of the Obligations of Holdings and the Company owing to such Lender,
such Lender agrees to notify the Agent of the percentage amount in which it is
no longer the beneficial owner of Obligations of the Company owing to such
Lender. To the extent of such percentage amount, the Agent will treat such
Lender's IRS Form 1001 as no longer valid.
(c) If any Lender claiming exemption from United States withholding
tax by filing IRS Form 4224 with the Agent sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations of the
Company owing to such Lender, such Lender agrees to undertake sole
responsibility for complying with the withholding tax requirements imposed by
Sections 1441 and 1442 of the Code.
(d) If any Lender is entitled to a reduction in the applicable
withholding tax, the Agent may withhold from any interest payment to such Lender
an amount equivalent to the applicable withholding tax after taking into account
such reduction. However, if the forms or other documentation required by
subsection (a) of this Section are not delivered to the Agent, then the Agent
may withhold from any interest payment to such Lender not providing such forms
77.
85
or other documentation an amount equivalent to the applicable withholding tax
imposed by Sections 1441 and 1442 of the Code, without reduction.
(e) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Agent did not properly
withhold tax from amounts paid to or for the account of any Lender (because the
appropriate form was not delivered or was not properly executed, or because such
Lender failed to notify the Agent of a change in circumstances which rendered
the exemption from, or reduction of, withholding tax ineffective, or for any
other reason) such Lender shall indemnify the Agent fully for all amounts paid,
directly or indirectly, by the Agent as tax or otherwise, including penalties
and interest, and including any taxes imposed by any jurisdiction on the amounts
payable to the Agent under this Section, together with all costs and expenses
(including Attorney Costs). The obligation of the Lenders under this subsection
shall survive the payment of all Obligations and the resignation or replacement
of the Agent.
9.11 Collateral Matters.
(a) The Agent is authorized on behalf of all the Lenders, without
the necessity of any notice to or further consent from the Lenders, from time to
time to take any action with respect to any Collateral or the Collateral
Documents which may be necessary to perfect and maintain perfected the security
interest in and Liens upon the Collateral granted pursuant to the Collateral
Documents.
(b) The Lenders irrevocably authorize the Agent, at its option and
in its discretion, to release any Lien granted to or held by the Agent upon any
Collateral (i) upon termination of the Commitments and payment in full of all
Loans and all other Obligations known to the Agent and payable under this
Agreement or any other Loan Document; (ii) constituting property sold or to be
sold or disposed of as part of or in connection with any Disposition permitted
hereunder; (iii) constituting property in which Holdings, the Company or any
Subsidiary owned no interest at the time the Lien was granted or at any time
thereafter; (iv) constituting property leased to Holdings, the Company or any
Subsidiary under a lease which has expired or been terminated in a transaction
permitted under this Agreement or is about to expire and which has not been, and
is not intended by the Company or such Subsidiary to be, renewed or extended;
(v) consisting of an instrument evidencing Indebtedness or other debt
instrument, if the indebtedness evidenced thereby has been paid in full; or (vi)
if approved, authorized or ratified in writing by the Majority Lenders or all
the Lenders, as the case may be, as provided in subsection 10.01(f). Upon
request by the Agent at any time, the Lenders will confirm in writing the
Agent's authority to release particular types or items of Collateral pursuant to
this subsection 9.11(b), provided that the absence of any such confirmation for
whatever reason shall not affect the Agent's rights under this Section 9.11.
(c) Each Lender agrees with and in favor of each other (which
agreement shall not be for the benefit of Holdings, the Company or any
Subsidiary) that each Loan Party's obligation to such Lender under this
Agreement and the other Loan Documents is not and shall not be secured by any
real property collateral now or hereafter acquired by such Lender other than the
real property described in the Mortgages.
78.
86
9.12 Lead Arranger, Co-Arranger, Managing Agent, Documentation Agent.
Neither the Lead Arranger, nor any of the Lenders identified on the facing page
or signature pages of this Agreement as a "Co-Arranger," "Managing Agent" or
"Documentation Agent", shall have any obligation, liability, responsibility or
duty under this Agreement other than those applicable to all Lenders as such.
Without limiting the foregoing, neither the Lead Arranger nor any of the Lenders
so identified as a "Co-Arranger," "Managing Agent" or "Documentation Agent",
shall have or be deemed to have any fiduciary relationship with any Lender. Each
Lender acknowledges that it has not relied, and will not rely, on the Lead
Arranger, or any of the Lenders so identified, in deciding to enter into this
Agreement or in taking or not taking action hereunder.
ARTICLE X
MISCELLANEOUS
10.01 Amendments and Waivers. No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent with respect to any
departure by Holdings, the Company or any other Loan Party therefrom, shall be
effective unless the same shall be in writing and signed by the Majority Lenders
(or by the Agent at the written request of the Majority Lenders) and each Loan
Party thereto and acknowledged by the Agent, and then any such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given; provided, however, that no such waiver, amendment, or consent
shall, unless in writing and signed by all the Lenders and acknowledged by the
Agent, do any of the following:
(a) increase or extend the Commitment of any Lender (or reinstate
any Commitment terminated pursuant to Section 8.02);
(b) postpone or delay any date fixed by this Agreement or any other
Loan Document for any payment of principal, interest, fees or other amounts due
to the Lenders (or any of them) hereunder or under any other Loan Document;
(c) reduce the principal of, or the rate of interest specified
herein on any Loan, or (subject to clause (ii) below) any fees or other amounts
payable hereunder or under any other Loan Document;
(d) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Loans which is required for the Lenders or any of
them to take any action hereunder;
(e) amend this Section 10.01, subsection 2.04(e), Section 2.14, the
definition of "Majority Lenders" herein, or any provision herein providing for
consent or other action by all Lenders or some specified amount of Lenders; or
79.
87
(f) discharge any Guarantor, or release all or substantially all of
the Collateral except as otherwise may be provided in Section 10.13 or the
Collateral Documents or except where the consent of the Majority Lenders only is
specifically provided for;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Agent in addition to the Majority Lenders or all the
Lenders, as the case may be, affect the rights or duties of the Agent under this
Agreement or any other Loan Document, and (ii) the Fee Letters and documents
evidencing Specified Swap Contracts may be amended, or rights or privileges
thereunder waived, in a writing executed by the parties thereto.
10.02 Notices.
(a) All notices, requests, consents, approvals, waivers and other
communications shall be in writing (including, unless the context expressly
otherwise provides, by facsimile transmission, provided that any matter
transmitted by any Loan Party by facsimile (i) shall be immediately confirmed by
a telephone call to the recipient at the number specified on Schedule 10.02, and
(ii) shall be followed promptly by delivery of a hard copy original thereof) and
mailed, faxed or delivered, to the address or facsimile number specified for
notices on Schedule 10.02; or, as directed to any Loan Party or the Agent, to
such other address as shall be designated by such party in a written notice to
the other parties, and as directed to any other party, at such other address as
shall be designated by such party in a written notice to the Loan Parties and
the Agent.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered for
overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or if mailed, upon the third Business Day after the date
deposited into the U.S. mail, or if delivered, upon delivery; except that
notices pursuant to Article II or IX to the Agent shall not be effective until
actually received by the Agent and any notice of any Default or Event of Default
to any Loan Party shall not be effective until actually received by such Loan
Party.
(c) Any agreement of the Agent and the Lenders herein to receive
certain notices by telephone or facsimile is solely for the convenience and at
the request of the Loan Parties. The Agent and the Lenders shall be entitled to
rely on the authority of any Person purporting to be a Person authorized by the
Loan Parties to give such notice and the Agent and the Lenders shall not have
any liability to the Loan Parties or other Person on account of any action taken
or not taken by the Agent or the Lenders in reliance upon such telephonic or
facsimile notice. The obligation of the Company to repay the Loans or the
obligations of any Loan Party under any Loan Document to which it is a party
shall not be affected in any way or to any extent by any failure by the Agent
and the Lenders to receive written confirmation of any telephonic or facsimile
notice or the receipt by the Agent and the Lenders of a confirmation which is at
variance with the terms understood by the Agent and the Lenders to be contained
in the telephonic or facsimile notice.
80.
88
10.03 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Agent or any Lender, any right, remedy,
power or privilege hereunder, shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege.
10.04 Costs and Expenses. The Company shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse BofA (including in its capacity as Agent) and
Antares (including in its capacity as Documentation Agent) within five Business
Days after demand (subject to subsection 4.01(e)) for all reasonable costs and
expenses incurred by BofA (including in its capacity as Agent) and Antares
(including in its capacity as Documentation Agent), in connection with (i) the
development, preparation, delivery, ongoing administration and execution of, and
the due diligence relating thereto, and any amendment, supplement, waiver or
modification to (in each case, whether or not consummated) , this Agreement, any
Loan Document and any other documents prepared in connection herewith or
therewith, and (ii) the consummation of the transactions contemplated hereby and
thereby, and (iii) the syndication and assignment following the Closing Date of
all or any part of BofA's or Antares' interest as a Lender hereunder, including
reasonable Attorney Costs incurred by BofA (including in its capacity as Agent)
and Antares (including in its capacity as Documentation Agent) with respect
thereto;
(b) pay or reimburse the Agent, the Lead Arranger and each Lender
within five Business Days after demand (subject to subsection 4.01(e)) for all
costs and expenses (including Attorney Costs) incurred by them in connection
with the enforcement, attempted enforcement, or preservation of any rights or
remedies under this Agreement or any other Loan Document during the existence of
an Event of Default or after acceleration of the Loans (including in connection
with any "workout" or restructuring regarding the Loans, and including in any
Insolvency Proceeding or appellate proceeding); and
(c) pay or reimburse BofA (including in its capacity as Agent)
within five Business Days after demand (subject to subsection 4.01(e)) for all
reasonable appraisal (including the allocated cost of internal appraisal
services) , audit, environmental inspection and review (including the allocated
cost of such internal services) , search and filing costs, fees and expenses,
incurred or sustained by BofA (including in its capacity as Agent) in connection
with the matters referred to under subsections (a) and (b) of this Section.
10.05 Indemnification.
(a) Whether or not the transactions contemplated hereby are
consummated, each of Holdings and the Company shall indemnify, defend and hold
the Agent-Related Persons, and each Lender and each of its respective officers,
directors, employees, counsel, agents and attorneys-in-fact (each, an
"Indemnified Person") harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses and disbursements (including reasonable Attorney Costs) of any
kind or nature whatsoever which may at any time (including at any time following
repayment of the Loans and
81.
89
termination of all Specified Swap Contracts and the termination, resignation or
replacement of the Agent or replacement of any Lender) be imposed on, incurred
by or asserted against any such Person in any way relating to or arising out of
this Agreement, the other Loan Documents, the Transaction Documents or any
document contemplated by or referred to therein, or the transactions
contemplated, thereby, or any action taken or omitted by any such Person under
or in connection with any of the foregoing, including with respect to any
investigation, litigation or proceeding (including any Insolvency Proceeding or
appellate proceeding) related to or arising out of this Agreement, the other
Loan Documents, the Transaction Documents or the Specified Swap Contracts or the
Loans or the use of the proceeds thereof, whether or not any Indemnified Person
is a party thereto (all the foregoing, collectively, the "Indemnified
Liabilities"); provided that neither Holdings nor the Company shall have any
obligation hereunder to any Indemnified Person with respect to Indemnified
Liabilities to the extent resulting from the gross negligence or willful
misconduct of such Indemnified Person. The agreements in this Section shall
survive payment of all other Obligations.
(b) (i) Each Loan Party shall indemnify, defend and hold harmless
each Indemnified Person, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, charges, expenses
or disbursements (including reasonable Attorney Costs and the allocated cost of
internal environmental audit or review services), which may be incurred by or
asserted against such Indemnified Person in connection with or arising out of
any pending or threatened investigation, litigation or proceeding, or any action
taken by any Person, with respect to any Environmental Claim arising out of or
related to any property subject to a Mortgage provided by such Loan Party in
favor of the Agent or any Lender. No action taken by legal counsel chosen by the
Agent or any Lender in defending against any such investigation, litigation or
proceeding or requested remedial, removal or response action shall vitiate or
any way impair the Company's obligation and duty hereunder to indemnify and hold
harmless the Agent and each Lender.
(ii) In no event shall any site visit, observation, or testing
by the Agent or any Lender (or any contractee of the Agent or any Lender) be
deemed a representation or warranty that Hazardous Materials are or are not
present in, on, or under, the site, or that there has been or shall be
compliance with any Environmental Law. Neither the Company nor any other Person
is entitled to rely on any site visit, observation, or testing by the Agent or
any Lender. Neither the Agent nor any Lender owes any duty of care to protect
the Company or any other Person against, or to inform the Company or any other
party of, any Hazardous Materials or any other adverse condition affecting any
site or property. Neither the Agent nor any Lender shall be obligated to
disclose to the Company or any other Person any report or findings made as a
result of, or in connection with, any site visit, observation, or testing by the
Agent or any Lender.
(c) Survival; Defense. The obligations in this Section shall survive
payment of all other Obligations. At the election of any Indemnified Person, the
Company shall defend such Indemnified Person using legal counsel satisfactory to
such Indemnified Person in such Person's sole discretion, at the sole cost and
expense of the Company. All amounts owing under this Section shall be paid
within 30 days after demand.
82.
90
10.06 Marshalling; Payments Set Aside. Neither the Agent nor the Lenders
shall be under any obligation to marshal any assets in favor of Holdings, the
Company or any other Person or against or in payment of any or all of the
Obligations. To the extent that the Company makes a payment to the Agent or the
Lenders, or the Agent or the Lenders exercise their right of set-off, and such
payment or the proceeds of such set-off or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Agent or such Lender
in its discretion) to be repaid to a trustee, receiver or any other party, in
connection with any Insolvency Proceeding or otherwise, then (a) to the extent
of such recovery the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such set-off had not occurred, and (b) each Lender
severally agrees to pay to the Agent upon demand its pro rata share of any
amount so recovered from or repaid by the Agent.
10.07 Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Company may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of the Agent and each Lender.
10.08 Assignments, Participations, Etc. Any Lender may, with the
written consent of the Company and the Agent (which in each case shall not be
unreasonably withheld), at any time assign and delegate to one or more Eligible
Assignees (each an "Assignee") all, or any ratable part of all, of the Loans,
the Commitment and the other rights and obligations of such Lender hereunder;
provided, however, that (i) no written consent of the Company shall be required
during the existence of a Default or an Event of Default; (ii) no written
consent of the Company or the Agent shall be required in connection with any
assignment and delegation by a Lender to an Eligible Assignee that is another
Lender or an Affiliate of such Lender; (iii) except in connection with an
assignment of all of a Lender's rights and obligations with respect to its
Commitment and Loans, any such assignment to an Eligible Assignee that is not a
Lender hereunder shall be equal to or greater than $5,000,000; and (iv) no such
partial assignment need be of a ratable part of the Revolving Loans, the Term
Loans, the Commitment and the other interests, rights and obligations hereunder
of such assigning Lender; and provided further, however, that the Company and
the Agent may continue to deal solely and directly with such Lender in
connection with the interest so assigned to an Assignee until (A) such Lender
and its Assignee shall have delivered to the Company and the Agent an Assignment
and Acceptance Agreement substantially in the form of Exhibit E (an "Assignment
and Acceptance"), together with any Note or Notes subject to such assignment;
(B) a written notice of such assignment, together with payment instructions,
addresses and related information with respect to the Assignee, in substantially
the form of the Notice of Assignment and Acceptance attached as Schedule 1 to
the Assignment and Acceptance, shall have been given to the Company and the
Agent by such Lender and the Assignee; (C) the assignor Lender or Assignee shall
have paid to the Agent a processing fee in the amount of $4,000; and (D) the
Agent and the Company each shall have provided any required consent to such
assignment in accordance with this Section.
(b) From and after the date that the Agent notifies the assignor
Lender that the Agent has received (and, if required, provided its consent with
respect thereto and, if necessary, received any other consents required under
this Section 10.8) an executed Assignment and
83.
91
Acceptance and payment of the above-referenced processing fee, (i) the Assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, shall have the rights and obligations of a Lender under the Loan
Documents, (ii) this Agreement shall be deemed to be amended to the extent, but
only to the extent, necessary to reflect the addition of the Assignee and the
resulting adjustment of the Commitments arising therefrom, and (iii) the
assignor Lender shall, to the extent that rights and obligations hereunder and
under the other Loan Documents have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Loan Documents; provided, however, that the assignor
Lender shall not relinquish its rights under Article III or under Sections 10.04
and 10.05 (and any equivalent provisions of the other Loan Documents) to the
extent such rights relate to the time prior to the effective date of the
Assignment and Acceptance. The Commitment allocated to each Assignee shall
reduce the Commitment of the assigning Lender pro tanto.
(c) Within five Business Days after its receipt of notice by the
Agent that it has received (and, if necessary, consented to) an executed
Assignment and Acceptance and payment of the processing fee (and provided that
the Company consents to such assignment in accordance with subsection 10.08(a)),
the Company shall execute and deliver to the Agent any new Notes requested by
such Assignee evidencing such Assignee's assigned Loans and Commitment and, if
the assignor Lender has retained a portion of its Loans and its Commitment,
replacement Notes as requested by the assignor Lender evidencing the Loans and
Commitment retained by the assignor Lender (such Notes to be in exchange for,
but not in payment of, the Notes held by such Lender, if any).
(d) Any Lender may at any time sell to one or more commercial banks
or other Persons not Affiliates of the Company (a "Participant") participating
interests in any Loans, the Commitment of that Lender and the other interests of
that Lender (the "originating Lender") hereunder and under the other Loan
Documents; provided, however, that (i) the originating Lender's obligations
under this Agreement shall remain unchanged, (ii) the originating Lender shall
remain solely responsible for the performance of such obligations, (iii) the
Loan Parties and the Agent shall continue to deal solely and directly with the
originating Lender in connection with the originating Lender's rights and
obligations under this Agreement and the other Loan Documents, and (iv) no
Lender shall transfer or grant any participating interest under which the
Participant has rights to approve any amendment to, or any consent or waiver
with respect to, this Agreement or any other Loan Document, except to the extent
such amendment, consent or waiver would require unanimous consent of the Lenders
as described in the first proviso to Section 10.01. In the case of any such
participation, the Participant shall be entitled to the benefit of Sections
3.01, 3.03 and 10.05 as though it were also a Lender hereunder (provided that in
the case of Section 3.01, the amounts, if any, payable by the Company shall not
be increased as a result of such participation), and if amounts outstanding
under this Agreement are due and unpaid, or shall have been declared or shall
have become due and payable upon the occurrence of an Event of Default, each
Participant shall be deemed to have the right of set-off in respect of its
participating interest in amounts owing under this Agreement to the same extent
as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement.
84.
92
(e) Notwithstanding any other provision in this Agreement, any
Lender may at any time create a security interest in, or pledge, all or any
portion of its rights under and interest in this Agreement and the Note held by
it in favor of any Federal Reserve Lender in accordance with Regulation A of the
FRB or U.S. Treasury Regulation 31 CFR Section 203.14, and such Federal Reserve
Lender may enforce such pledge or security interest in any manner permitted
under applicable law.
(f) So long as Deloitte & Touche LLP holds any Subordinated Debt, no
assignment or participation hereunder to any Assignee or Participant shall be
effective unless, prior to the making of such assignment or the sale of such
participation, a Responsible Officer of the Company shall certify to the Agent
and the Lenders that such assignment to such Assignee, or the sale of such
participation to such Participant, as the case may be, shall not result in any
violation of, or (if such Assignee or Participant is an attest client of
Deloitte & Touche LLP) impairment of Deloitte & Touche LLP's independence in
respect of such attest client under, any Requirement of Law or any rule,
regulation, interpretation, guidelines or request from any self-regulatory body
with authority with respect to auditing standards or auditing firms (whether or
not having the force of law) applicable to or binding upon Deloitte & Touche LLP
in its capacity as a holder of Subordinated Debt. In the event of any request
made to the Company for such certification, the Agent or the party seeking to
make such assignment or to sell such participation shall provide such
information as may be reasonably requested by the Company to evaluate such
request and the Company agrees to consult with Deloitte & Touche LLP and act in
good faith to provide, and not unreasonably withhold, such certification or to
advise the Agent in reasonable detail as to why such certification cannot be
provided.
10.09 Confidentiality. Each Lender agrees to take and to cause its
Affiliates to take normal and reasonable precautions and exercise due care to
maintain the confidentiality of all information identified as "confidential" or
"secret" by any Loan Party and provided to it by such Loan Party or any
Subsidiary, or by the Agent on such Loan Party's or such Subsidiary's behalf,
under this Agreement or any other Loan Document, and neither it nor any of its
Affiliates shall use any such information other than in connection with or in
enforcement of this Agreement and the other Loan Documents or in connection with
other business now or hereafter existing or contemplated with such Loan Party or
any Subsidiary, except to the extent such information (i) was or becomes
generally available to the public other than as a result of disclosure by the
Lender, or (ii) was or becomes available on a non-confidential basis from a
source other than a Loan Party, provided that such source is not bound by a
confidentiality agreement with such Loan Party known to such Lender; provided,
however, that any Lender may disclose such information (A) at the request or
pursuant to any requirement of any Governmental Authority to which such Lender
is subject or in connection with an examination of such Lender by any such
authority; (B) pursuant to subpoena or other court process; (C) when required to
do so in accordance with the provisions of any applicable Requirement of Law;
(D) to the extent reasonably required in connection with any litigation or
proceeding to which the Agent, any Lender or their respective Affiliates may be
party; (E) to the extent reasonably required in connection with the exercise of
any remedy hereunder or under any other Loan Document; (F) to such Lender's
independent auditors, legal counsel and other professional advisors; (G) to any
Participant or Assignee, actual or potential, provided that such Person agrees
in writing to keep such information confidential to the same extent required of
the Lenders hereunder; (H) as to any
85.
93
Lender or its Affiliate, as expressly permitted under the terms of any other
document or agreement regarding confidentiality to which the Company or any
Subsidiary is party or is deemed party with such Lender or such Affiliate; and
(I) to its Affiliates.
10.10 Set-off. In addition to any rights and remedies of the Lenders
provided by law, if an Event of Default exists or the Loans have been
accelerated, each Lender is authorized at any time and from time to time,
without prior notice to the Company or any other Loan Party, any such notice
being waived by the Company and each other Loan Party to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held by, and other
indebtedness at any time owing by, such Lender to or for the credit or the
account of the Company against any and all Obligations owing to such Lender, now
or hereafter existing, irrespective of whether or not the Agent or such Lender
shall have made demand under this Agreement or any Loan Document and although
such Obligations may be contingent or unmatured. Each Lender agrees promptly to
notify the Company and the Agent after any such set-off and application made by
such Lender; provided, however, that the failure to give such notice shall not
affect the validity of such set-off and application. NOTWITHSTANDING THE
FOREGOING, IF ANY MORTGAGE HAS BEEN PROVIDED BY A LOAN PARTY HEREUNDER, NO
LENDER SHALL EXERCISE, OR ATTEMPT TO EXERCISE, ANY RIGHT OF SET-OFF, BANKERS
LIEN, OR THE LIKE, AGAINST ANY DEPOSIT ACCOUNT OR PROPERTY OF HOLDINGS, THE
COMPANY OR ANY SUBSIDIARY OF THE COMPANY HELD OR MAINTAINED BY SUCH LENDER
WITHOUT THE PRIOR WRITTEN CONSENT OF THE AGENT.
10.11 Automatic Debits of Fees. With respect to any principal, interest,
fee, or any other cost or expense (including Attorney Costs) due and payable to
the Agent, BofA or the Lead Arranger under the Loan Documents, each of Holdings
and the Company hereby irrevocably authorizes BofA to debit any deposit account
of Holdings or the Company with BofA in an amount such that the aggregate amount
debited from all such deposit accounts does not exceed such principal, interest,
fee or other cost or expense. If there are insufficient funds in such deposit
accounts to cover the amount then due, such debits will be reversed (in whole or
in part, in BofA's sole discretion) and such amount not debited shall be deemed
to be unpaid. No such debit under this Section shall be deemed a set-off.
10.12 Guaranty
(a) Guaranty. Each of the Guarantors unconditionally and
irrevocably, jointly and severally guarantees to the Agent, the Lead Arranger,
the Swap Providers and the Lenders, and their respective successors, endorsers,
transferees and assigns (the "Guaranteed Persons"), the full and prompt payment
when due (whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise) and performance of all indebtedness,
liabilities and other obligations of the Company to any Guaranteed Person,
whether created under, arising out of or in connection with this Agreement, the
Notes or any of the other Loan Documents or otherwise, including all unpaid
principal of the Loans, all interest accrued thereon, all fees due under this
Agreement and all other amounts payable by the Company to any Guaranteed Person
thereunder or in connection therewith. The terms
86.
94
"indebtedness," "liabilities" and "obligations" are used herein in their most
comprehensive sense and include any and all advances, debts, obligations and
liabilities, now existing or hereafter arising, whether voluntary or involuntary
and whether due or not due, absolute or contingent, liquidated or unliquidated,
determined or undetermined, and whether recovery upon such indebtedness,
liabilities and obligations may be or hereafter become unenforceable or shall be
an allowed or disallowed claim under the Bankruptcy Code or other applicable
law. The foregoing indebtedness, liabilities and other obligations of the
Company shall hereinafter be collectively referred to as the "Guaranteed
Obligations." The Guaranteed Obligations include interest which, but for an
Insolvency Proceeding, would have accrued on such Guaranteed Obligations,
whether or not a claim is allowed against the Company for such interest in any
such Insolvency Proceeding.
(b) Separate Obligation. Each Guarantor acknowledges and agrees (i)
that the Guaranteed Obligations are separate and distinct from any indebtedness,
obligations or liabilities arising under or in connection with any other
agreement, instrument or guaranty, including under any provision of this
Agreement other than this Section 10.12, executed at any time by such Guarantor
in favor of any Guaranteed Person, and (ii) such Guarantor shall pay and perform
all of the Guaranteed Obligations as required under this Section 10.12, and each
Guaranteed Person may enforce any and all of its rights and remedies hereunder,
without regard to any other agreement, instrument or guaranty, including any
provision of this Agreement other than this Section 10.12, at any time executed
by such Guarantor in favor of any Guaranteed Person, regardless of whether or
not any such other agreement, instrument or guaranty, or any provision thereof
or hereof, shall for any reason become unenforceable or any of the indebtedness,
obligations or liabilities thereunder shall have been discharged, whether by
performance, avoidance or otherwise. Each Guarantor acknowledges that in
providing benefits to the Company and such Guarantor, the Guaranteed Persons are
relying upon the enforceability of this Section 10.12 and the Guaranteed
Obligations as separate and distinct indebtedness, obligations and liabilities
of such Guarantor, and each Guarantor agrees that each Guaranteed Person would
be denied the full benefit of their bargain if at any time this Section 10.12 or
the Guaranteed Obligations were treated any differently. The fact that the
Guaranty of each Guarantor is set forth in this Agreement rather than in a
separate guaranty document is for the convenience of the Company and the
Guarantors and shall in no way impair or adversely affect the rights or benefits
of any Guaranteed Person under this Section 10.12. Each Guarantor agrees to
execute and deliver a separate agreement, immediately upon request at any time
of any Guaranteed Person, evidencing such Guarantor's obligations under this
Section 10.12. Upon the occurrence of any Event of Default, a separate action or
actions may be brought against each Guarantor, whether or not the Company or any
other Guarantor or Person is joined therein or a separate action or actions are
brought against the Company or any other Guarantor or Person.
(c) Limitation of Guaranty. To the extent that any court of
competent jurisdiction shall impose by final judgment under applicable law
(including the California Uniform Fraudulent Transfer Act and Sections 544 and
548 of the Bankruptcy Code) any limitations on the amount of any Guarantor's
liability with respect to the Guaranteed Obligations which
87.
95
any Guaranteed Person can enforce under this Section 10.12, each Guaranteed
Person by its acceptance hereof accepts such limitation on the amount of such
Guarantor's liability hereunder to the extent needed to make this Section 10.12
fully enforceable and nonavoidable.
(d) Liability of Guarantor. The liability of each Guarantor under
this Section 10.12 shall be irrevocable, absolute, independent and
unconditional, and shall not be affected by any circumstance which might
constitute a discharge of a surety or guarantor other than the indefeasible
payment and performance in full of all Guaranteed Obligations. In furtherance of
the foregoing and without limiting the generality thereof, each Guarantor agrees
as follows:
(i) such Guarantor's liability hereunder shall be the immediate,
direct, and primary obligation of such Guarantor and shall not be
contingent upon any Guaranteed Person's exercise or enforcement of any
remedy it may have against the Company or any other Person, or against
any Collateral or other security for any Guaranteed Obligations;
(ii) this Guaranty is a guaranty of payment when due and not
merely of collectibility;
(iii) such Guarantor's payment of a portion, but not all, of the
Guaranteed Obligations shall in no way limit, affect, modify or abridge
such Guarantor's liability for any portion of the Guaranteed Obligations
remaining unsatisfied; and
(iv) such Guarantor's liability with respect to the Guaranteed
Obligations shall remain in full force and effect without regard to, and
shall not be impaired or affected by, nor shall such Guarantor be
exonerated or discharged by, any of the following events:
(A) any Insolvency Proceeding;
(B) any limitation, discharge, or cessation of the liability
of the Company or any other guarantor or Person for any Guaranteed Obligations
due to any statute, regulation or rule of law, or any invalidity or
unenforceability in whole or in part of any of the Guaranteed Obligations or the
Loan Documents;
(C) any merger, acquisition, consolidation or change in
structure of the Company or any other Guarantor or Person, or any sale, lease,
transfer or other disposition of any or all of the assets or shares of the
Company or any other Guarantor or other Person;
(D) any assignment or other transfer, in whole or in part, of
any Guaranteed Person's interests in and rights under this Guaranty or the other
Loan Documents;
88.
96
(E) any claim, defense, counterclaim or set-off, other than
that of prior performance, that the Company, such Guarantor, any other guarantor
or other Person may have or assert, including any defense of incapacity or lack
of corporate or other authority to execute any of the Loan Documents;
(F) any Guaranteed Person's amendment, modification, renewal,
extension, cancellation or surrender of any Loan Document or any Guaranteed
Obligations;
(G) any Guaranteed Person's exercise or nonexercise of any
power, right or remedy with respect to any Guaranteed Obligations or any
Collateral;
(H) any Guaranteed Person's vote, claim, distribution,
election, acceptance, action or inaction in any Insolvency Proceeding;
(I) any other guaranty, whether by any Guarantor or any other
Person, of all or any part of the Guaranteed Obligations or any other
indebtedness, obligations or liabilities of any Guaranteed Person.
(e) Consents of Guarantor. Each Guarantor hereby unconditionally
consents and agrees that, without notice to or further assent from such
Guarantor:
(i) the principal amount of the Guaranteed Obligations may be
increased or decreased and additional indebtedness or obligations of the
Company under the Loan Documents may be incurred and the time, manner,
place or terms of any payment under any Loan Document be extended or
changed, by one or more amendments, modifications, renewals or
extensions of any Loan Document or otherwise;
(ii) the time for the Company's (or any other Person's)
performance of or compliance with any term, covenant or agreement on its
part to be performed or observed under any Loan Document may be
extended, or such performance or compliance waived, or failure in or
departure from such performance or compliance consented to, all in such
manner and upon such terms as any Guaranteed Person (or the Majority
Lenders, as the case may be) may deem proper;
(iii) each Guaranteed Person may request and accept other
guarantees and may take and hold other security as collateral for the
Guaranteed Obligations, and may, from time to time, in whole or in part,
exchange, sell, surrender, release, subordinate, modify, waive, rescind,
compromise or extend such other guaranties or security and may permit or
consent to any such action or the result of any such action, and may
apply such security and direct the order or manner of sale thereof;
(iv) each Guaranteed Person may exercise, or waive or otherwise
refrain from exercising, any other right, remedy, power or privilege
even if the exercise thereof affects or eliminates any right of
subrogation or any other right of such Guarantor against the Company;
89.
97
(f) Guarantor's Waivers. Each Guarantor waives and agrees not to
assert:
(i) any right to require any Guaranteed Person to proceed against
the Company, any other guarantor or any other Person, or to pursue any
other right, remedy, power or privilege of such Guaranteed Person
whatsoever;
(ii) the defense of the statute of limitations in any action
hereunder or for the collection or performance of the Guaranteed
Obligations;
(iii) any defense arising by reason of any lack of corporate or
other authority or any other defense of the Company, such Guarantor or
any other Person;
(iv) any defense based upon any Guaranteed Person's errors or
omissions in the administration of the Guaranteed Obligations;
(v) any rights to set-offs and counterclaims;
(vi) without limiting the generality of the foregoing, to the
fullest extent permitted by law, any defenses or benefits that may be
derived from or afforded by applicable law limiting the liability of or
exonerating guarantors or sureties, or which may conflict with the terms
of this Section 10.12; and
(vii) any and all notice of the acceptance of this Guaranty, and
any and all notice of the creation, renewal, modification, extension or
accrual of the Guaranteed Obligations, or the reliance by any Guaranteed
Person upon this Guaranty, or the exercise of any right, power or
privilege hereunder. The Guaranteed Obligations shall conclusively be
deemed to have been created, contracted, incurred and permitted to exist
in reliance upon this Guaranty. Each Guarantor waives promptness,
diligence, presentment, protest, demand for payment, notice of default,
dishonor or nonpayment and all other notices to or upon the Company,
such Guarantor or any other Person with respect to the Guaranteed
Obligations.
(g) Financial Condition of the Company. No Guarantor shall have any
right to require any Guaranteed Person to obtain or disclose any information
with respect to: the financial condition or character of the Company or the
ability of the Company to pay and perform the Guaranteed Obligations; the
Guaranteed Obligations; any Collateral or other security for any or all of the
Guaranteed Obligations; the existence or nonexistence of any other guarantees of
all or any part of the Guaranteed Obligations; any action or inaction on the
part of any Guaranteed Person or any other Person; or any other matter, fact or
occurrence whatsoever. Each Guarantor hereby acknowledges that it has undertaken
its own independent investigation of the financial condition of the Company and
all other matters pertaining to this Guaranty and further acknowledges that it
is not relying in any manner upon any representation or statement of any
Guaranteed Person with respect thereto.
90.
98
(h) Subrogation. Until the Guaranteed Obligations shall be satisfied
in full and the Revolving Commitments shall be terminated, each Guarantor shall
not have, and shall not directly or indirectly exercise (i) any rights that it
may acquire by way of subrogation under this Section 10.12, by any payment
hereunder or otherwise, (ii) any rights of contribution, indemnification,
reimbursement or similar suretyship claims arising out of this Section 10.12 or
(iii) any other right which it might otherwise have or acquire (in any way
whatsoever) which could entitle it at any time to share or participate in any
right, remedy or security of any Guaranteed Person as against the Company or
other guarantors, whether in connection with this Section 10.12, any of the
other Loan Documents or otherwise. If any amount shall be paid to any Guarantor
on account of the foregoing rights at any time when all the Guaranteed
Obligations shall not have been paid in full, such amount shall be held in trust
for the benefit of each Guaranteed Person and shall forthwith be paid to the
Agent to be credited and applied to the Guaranteed Obligations, whether matured
or unmatured, in accordance with the terms of the Loan Documents.
(i) Continuing Guaranty. This Guaranty is a continuing guaranty and
agreement of subordination and shall continue in effect and be binding upon each
Guarantor until termination of the Commitments and payment and performance in
full of all Guaranteed Obligations, including Guaranteed Obligations which may
exist continuously or which may arise from time to time under successive
transactions, and each Guarantor expressly acknowledges that this Guaranty shall
remain in full force and effect notwithstanding that there may be periods in
which no Guaranteed Obligations exist.
(j) Reinstatement. This Guaranty shall continue to be effective or
shall be reinstated and revived, as the case may be, if, for any reason, any
payment of the Guaranteed Obligations by or on behalf of the Company (or receipt
of any proceeds of Collateral) shall be rescinded, invalidated, declared to be
fraudulent or preferential, set aside, voided or otherwise required to be repaid
to the Company, its estate, trustee, receiver or any other Person (including
under the Bankruptcy Code or other state or federal law) , or must otherwise be
restored by any Guaranteed Person, whether as a result of Insolvency Proceedings
or otherwise. All losses, damages, costs and expenses that any Guaranteed Person
may suffer or incur as a result of any voided or otherwise set aside payments
shall be specifically covered by the indemnity in favor of the Lenders and the
Agent contained in Section 10.5.
(k) Substantial Benefits. The funds that have been borrowed from the
Lenders by the Company have been and are to be contemporaneously used for the
direct or indirect benefit of the Company and each Guarantor. It is the
position, intent and expectation of the parties that the Company and each
Guarantor have derived and will derive significant and substantial direct or
indirect benefits from the accommodations that have been made by the Lenders
under the Loan Documents.
(l) Knowing and Explicit Waivers. EACH GUARANTOR ACKNOWLEDGES THAT
IT EITHER HAS OBTAINED THE ADVICE OF LEGAL COUNSEL OR HAS HAD THE OPPORTUNITY TO
OBTAIN SUCH ADVICE IN
91.
99
CONNECTION WITH THE TERMS AND PROVISIONS OF THIS SECTION 10.12. EACH GUARANTOR
ACKNOWLEDGES AND AGREES THAT EACH OF THE WAIVERS AND CONSENTS SET FORTH HEREIN
ARE MADE WITH FULL KNOWLEDGE OF THEIR SIGNIFICANCE AND CONSEQUENCES, AND THAT
ALL SUCH WAIVERS AND CONSENTS HEREIN ARE EXPLICIT AND KNOWING AND WHICH EACH
GUARANTOR EXPECTS TO BE FULLY ENFORCEABLE.
10.13 Release of Subsidiary Guarantors. The Company may at any time
deliver to the Agent a certificate from a Responsible Officer certifying as of
the date of the certificate that, after the consummation of the transaction or
series of transactions described in such certificate (which certification shall
also state that such transactions, individually or in the aggregate, will be in
compliance with the terms and conditions of this Agreement, including to the
extent applicable Sections 7.02 and 7.03, and that no Event of Default existed,
exists or will exist, as the case may be, immediately before, as a result of or
immediately after giving effect to such transaction or transactions and
termination), the Guarantor identified in such certification will no longer be
a Subsidiary of the Company. Effective upon the consummation of the transaction
or series of transactions described in such certificate, the Subsidiary
identified in such certification shall thereupon automatically cease to be a
Guarantor hereunder and shall cease to be a party hereto and shall thereupon
automatically be released from its obligations under Section 10.12. The Company
shall promptly notify the Agent of the consummation of any such transaction or
series of transactions. The Agent, on behalf of the Lenders, shall, at the
Company's expense, execute and deliver such instruments as the Company may
reasonably request to evidence such release, including such UCC termination
statements and other documents as may be necessary to release the Lien of the
Agent and the Lenders on the assets of such released Subsidiary.
10.14 Notification of Addresses, Lending Offices, Etc. Each Lender shall
notify the Agent in writing of any changes in the address to which notices to
the Lender should be directed, of addresses of any Lending Office, of payment
instructions in respect of all payments to be made to it hereunder and of such
other administrative information as the Agent shall reasonably request.
10.15 Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of said counterparts taken together shall be deemed to
constitute but one and the same instrument.
10.16 Severability. The illegality or unenforceability of any provision
of this Agreement or any instrument or agreement required hereunder shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required hereunder.
10.17 No Third Parties Benefited. This Agreement is made and entered
into for the sole protection and legal benefit of the Company, the other Loan
Parties, the Lenders, the Agent and the Agent-Related Persons, the Indemnified
Persons and their permitted successors and assigns, and no other Person shall be
a direct or indirect legal beneficiary of, or have any direct or
92.
100
indirect cause of action or claim in connection with, this Agreement or any of
the other Loan Documents.
10.18 Governing Law and Jurisdiction. THIS AGREEMENT AND THE NOTES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK; PROVIDED THAT THE AGENT AND THE LENDERS SHALL RETAIN ALL RIGHTS
ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR
OF THE UNITED STATES SITTING IN NEW YORK CITY, AND BY EXECUTION AND DELIVERY OF
THIS AGREEMENT, EACH OF THE COMPANY, EACH OTHER LOAN PARTY, THE AGENT AND THE
LENDERS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE COMPANY, EACH OTHER LOAN
PARTY, THE AGENT AND THE LENDERS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY
OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT
RELATED HERETO. THE COMPANY, EACH OTHER LOAN PARTY, THE AGENT AND THE LENDERS
EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH
MAY BE MADE BY ANY OTHER MEANS PERMITTED BY NEW YORK LAW.
(c) Nothing contained in this Section shall override any contrary
provision contained in any Specified Swap Contract.
10.19 Waiver of Jury Trial. THE COMPANY, EACH OTHER LOAN PARTY, THE
LENDERS AND THE AGENT EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS
AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY
ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON,
PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS,
OR OTHERWISE. THE COMPANY, EACH OTHER LOAN PARTY, THE LENDERS AND THE AGENT EACH
AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL
WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT
THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION
AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN
PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER
LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO
ANY
93.
101
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS.
10.20 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Company,
each other Loan Party, the Lenders and the Agent, and supersedes all prior or
contemporaneous agreements and understandings of such Persons, verbal or
written, relating to the subject matter hereof and thereof.
10.21 Antares. The parties agree and acknowledge that all references to
"Antares Leveraged Capital Corp." in any certificate, agreement or other Loan
Document delivered in connection herewith shall be deemed a reference to Antares
Capital Corporation (formerly known as Antares Leveraged Capital Corp.).
[Signature page follows.]
94.
102
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in San Francisco, California by their proper and
duly authorized officers as of the day and year first above written.
PROFITSOURCE CORPORATION
By:
---------------------------------------
Name:
Title:
By:
---------------------------------------
Name:
Title:
ENTERPRISE PROFIT SOLUTIONS CORPORATION
By:
---------------------------------------
Name:
Title:
THE SUBSIDIARIES LISTED ON ANNEX I
By:
---------------------------------------
Name:
Title:
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Agent and a Lender
By:
---------------------------------------
Name: Xxxxx X. Leader
Title: Vice President
ANTARES CAPITAL CORPORATION, as
Documentation Agent a Lender
By:
---------------------------------------
Name:
Title:
95.
103
ING (U.S.) CAPITAL CORPORATION, as
Managing Agent and a Lender
By:
---------------------------------------
Name:
Title:
96.
104
ANNEX II
PRICING GRID
The Applicable Margin and the Applicable Fee Amount, for any day on and
after the first anniversary of the Closing Date, shall be the amount per annum
set forth below based on the Company Leverage Ratio set forth in the Compliance
Certificate most recently delivered by the Company to the Agent pursuant to
Section 6.02(b) of the Credit Agreement; changes in the Applicable Margin and
the Applicable Fee Amount resulting from a change in the Company Leverage Ratio
shall become effective on the earlier of: (i) the date of delivery by the
Company to the Agent of a new Compliance Certificate and accompanying financial
statements pursuant to Section 6.02(b); and (ii) the date on which the Company
is required to deliver such new Compliance Certificate and accompanying
financial statements pursuant to Section 6.02(b). If the Company shall fail to
deliver a Compliance Certificate and accompanying financial statements within
the number of days after the end of any fiscal quarter or fiscal year as
required pursuant to Section 6.02(b), the parties agree that the Applicable
Margin and the Applicable Fee Amount shall be fixed at Level 3 until such time
as the Company delivers such new Compliance Certificate and accompanying
financial statements pursuant to Section 6.02(b).
==========================================================================================
LEVEL COMPANY OFFSHORE RATE BASE RATE COMMITMENT FEE
LEVERAGE RATIO SPREAD SPREAD
==========================================================================================
Level 1 less than or 2.75% 1.50% 0.50%
equal to 1.00
------------------------------------------------------------------------------------------
Level 2 greater than 3.25% 2.00% 0.50%
1.00 but less
than or equal
to 1.75
------------------------------------------------------------------------------------------
Level 3 greater than 3.50% 2.25% 0.50%
1.75
------------------------------------------------------------------------------------------
1.
105
SCHEDULE 2.01
COMMITMENTS
AND PRO RATA SHARES
Term Revolving
Lender Commitment Commitment Pro Rata Share
------ ----------- ----------- --------------
Bank of America National Trust
and Savings Association $18,750,000 $18,750,000 37.50000000%
Antares Capital Corporation $18,750,000 $18,750,000 37.50000000%
ING (U.S.) Capital Corporation $12,500,000 $12,500,000 25.00000000%
----------- ----------- -----------
TOTAL $50,000,000 $50,000,000 100%
1.
106
SCHEDULE 10.02
PAYMENT OFFICES;
ADDRESSES FOR NOTICES; LENDING OFFICES
PROFITSOURCE CORPORATION
Address: 000 Xxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000-0000
Attention: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
ENTERPRISE PROFIT SOLUTIONS CORPORATION
Address: 000 Xxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000-0000
Attention: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
OTHER LOAN PARTIES
Address c/o Enterprise Profit Solutions Corporation
000 Xxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000-0000
Attention: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
1.
000
XXXX XX XXXXXXX NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Agent
Notices for Borrowing, Conversions/ Continuations, Payments:
Address Bank of America National Trust and Savings
Association
Agency Administrative Services #5596
0000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000 or 7532
Other Notices:
Address Bank of America National Trust and Savings
Association
Credit Products #3838
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Leader
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Agent's Payment Office:
Address Bank of America National Trust and Savings
Association
0000 Xxxxxxx Xxxxxxxxx
Xxxxxxx, XX 00000
Attention: Agency Administrative Services #5596
Reference: ProfitSource
For Credit to Bancontrol Acct. No. 12330-16523
2.
108
ANTARES CAPITAL CORPORATION,
as a Lender
Domestic and Offshore Lending Office:
Address 000 X. Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Notices (other than Borrowing Notices and Notices of
Conversion/Continuation):
Address 000 X. Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
Reference: Profit Source
Facsimile: (000) 000-0000
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as a Lender
Domestic and Offshore Lending Office:
Address Bank of America National Trust and Savings
Association
0000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000 or 7532
3.
109
Notices (other than Borrowing Notices and Notices of
Conversion/Continuation):
Address Bank of America National Trust and Savings
Association
Credit Products #3838
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Leader
Reference: ProfitSource
Facsimile: (000) 000-0000
ING (U.S.) CAPITAL CORPORATION, as a Lender
Domestic and Offshore Lending Office:
Address ING (U.S.) Capital Corporation
Loan Operations - 6L
000 X. 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Notices (other than Borrowing Notices and Notices of
Conversion/Continuation):
Address ING (U.S.) Capital Corporation
000 X. Xxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxxxx
Reference: ProfitSource
Facsimile: (000) 000-0000
4.
