CREDIT AGREEMENT
DATED AS OF NOVEMBER 19, 1996
AMONG
ROSE HILLS COMPANY,
AS BORROWER,
ROSE HILLS HOLDINGS CORP.,
AS GUARANTOR,
THE LENDERS FROM TIME TO TIME PARTIES HERETO,
AS LENDERS,
XXXXXXX, XXXXX & CO.,
AS SYNDICATION AGENT
AND ARRANGING AGENT,
AND
THE BANK OF NOVA SCOTIA,
AS ADMINISTRATIVE AGENT
ROSE HILLS CORPORATION
CREDIT AGREEMENT
TABLE OF CONTENTS
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SECTION 1.
DEFINITIONS......................................................... 3
1.1 Certain Defined Terms.............................................................. 3
1.2 Accounting Terms; Utilization of GAAP for Purposes of
Calculations Under Agreement....................................................... 39
1.3 Other Definitional Provisions and Rules of Construction............................ 40
SECTION 2.
AMOUNTS AND TERMS OF COMMITMENTS AND LOANS............................ 40
2.1 Commitments; Making of Loans; the Register; Notes.................................. 40
2.2 Interest on the Loans.............................................................. 48
2.3 Fees............................................................................... 52
2.4 Repayments, Prepayments and Reductions in Revolving Loan
Commitments; General Provisions Regarding Payments;
Application of Proceeds of Collateral and Payments Under Guaranties................ 53
2.5 Use of Proceeds.................................................................... 63
2.6 Special Provisions Governing Eurodollar Rate Loans................................. 64
2.7 Increased Costs; Taxes; Capital Adequacy........................................... 66
2.8 Obligation of Lenders and Issuing Lender to Mitigate............................... 72
SECTION 3.
LETTERS OF CREDIT....................................... 73
3.1 Issuance of Letters of Credit and Lenders' Purchase of Participations Therein...... 73
3.2 Letter of Credit Fees.............................................................. 75
3.3 Drawings and Reimbursement of Amounts Paid Under Letters of
Credit............................................................................. 76
3.4 Obligations Absolute............................................................... 79
3.5 Indemnification; Nature of Issuing Lender's Duties................................. 80
3.6 Increased Costs and Taxes Relating to Letters of Credit............................ 81
(i)
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SECTION 4.
CONDITIONS TO LOANS AND LETTERS OF CREDIT............................ 83
4.1 Conditions to AXELs and Initial Revolving Loans and Swing Line Loans............... 83
4.2 Conditions to All Loans............................................................ 90
4.3 Conditions to Letters of Credit.................................................... 92
SECTION 5.
REPRESENTATIONS AND WARRANTIES.................................. 92
5.1 Organization, Powers, Qualification, Good Standing, Business
and Subsidiaries................................................................... 92
5.2 Authorization of Borrowing, etc.................................................... 93
5.3 Financial Condition................................................................ 95
5.4 No Material Adverse Change; No Restricted Junior Payments.......................... 96
5.5 Title to Properties; Liens......................................................... 96
5.6 Litigation; Adverse Facts.......................................................... 96
5.7 Payment of Taxes................................................................... 97
5.8 Performance of Agreements; Materially Adverse Agreements; Material Contracts....... 97
5.9 Governmental Regulation............................................................ 97
5.10 Securities Activities.............................................................. 98
5.11 Employee Benefit Plans............................................................. 98
5.12 Certain Fees....................................................................... 99
5.13 Environmental Protection........................................................... 99
5.14 Employee Matters...................................................................100
5.15 Solvency...........................................................................100
5.16 Matters Relating to Collateral.....................................................100
5.17 Representations and Warranties in Acquisition Agreement............................101
5.18 Disclosure.........................................................................102
SECTION 6.
AFFIRMATIVE COVENANTS......................................102
6.1 Financial Statements and Other Reports.............................................102
6.2 Corporate Existence, etc...........................................................108
6.3 Payment of Taxes and Claims; Tax Consolidation.....................................108
6.4 Maintenance of Properties; Insurance; Application of Net
Insurance/Condemnation Proceeds....................................................109
6.5 Inspection Rights..................................................................111
6.6 Compliance with Laws, etc..........................................................111
(ii)
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6.7 Environmental Review and Investigation, Disclosure, Etc.; Borrower's Actions
Regarding Hazardous Materials Activities, Environmental Claims and Violations
of Environmental Laws..............................................................111
6.8 Execution of Subsidiary Guaranty and Personal Property Collateral Documents
by Certain Subsidiaries and Future Subsidiaries....................................115
6.9 Interest Rate Protection...........................................................116
6.10 Future Capital Contributions.......................................................116
...................................................................................116
SECTION 7.
NEGATIVE COVENANTS........................................116
7.1 Indebtedness.......................................................................117
7.2 Liens and Related Matters..........................................................119
7.3 Investments; Joint Ventures........................................................121
7.4 Contingent Obligations.............................................................122
7.5 Restricted Junior Payments.........................................................123
7.6 Financial Covenants................................................................123
7.7 Restriction on Fundamental Changes; Asset Sales and Acquisitions...................128
7.8 Consolidated Adjusted Capital Expenditures.........................................130
7.9 Sales and Lease-Backs..............................................................130
7.10 Transactions with Shareholders and Affiliates......................................131
7.11 Disposal of Subsidiary Stock.......................................................131
7.12 Conduct of Business................................................................132
7.13 Amendments or Waivers of Certain Related Agreements; Designation of
"Senior Indebtedness ".............................................................132
7.14 Fiscal Year........................................................................133
SECTION 8.
EVENTS OF DEFAULT........................................133
8.1 Failure to Make Payments When Due..................................................133
8.2 Default in Other Agreements........................................................133
8.3 Breach of Certain Covenants........................................................134
8.4 Breach of Warranty.................................................................134
8.5 Other Defaults Under Loan Documents................................................134
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc...............................134
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc.................................135
8.8 Judgments and Attachments..........................................................135
8.9 Dissolution........................................................................135
8.10 Employee Benefit Plans.............................................................136
8.11 Change in Control.................................................................136
(iii)
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8.12 Invalidity of Guaranties; Failure of Security; Repudiation of Obligations.........136
8.13 Subordinated Indebtedness.........................................................137
SECTION 9.
AGENTS..............................................138
9.1 Appointment........................................................................138
9.2 Powers and Duties; General Immunity................................................139
9.3 Representations and Warranties; No Responsibility For Appraisal
of Creditworthiness................................................................141
9.4 Right to Indemnity.................................................................142
9.5 Successor Administrative Agent and Swing Line Lender...............................142
9.6 Collateral Documents and Guaranties................................................143
SECTION 10.
MISCELLANEOUS..........................................144
10.1 Assignments and Participations in Loans and Letters of Credit......................144
10.2 Expenses...........................................................................147
10.3 Indemnity..........................................................................148
10.4 Set-Off; Security Interest in Deposit Accounts.....................................149
10.5 Ratable Sharing....................................................................150
10.6 Amendments and Waivers.............................................................151
10.7 Independence of Covenants..........................................................153
10.8 Notices............................................................................154
10.9 Survival of Representations, Warranties and Agreements.............................154
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative..............................154
10.11 Marshalling; Payments Set Aside....................................................155
10.12 Severability.......................................................................155
10.13 Obligations Several; Independent Nature of Lenders' Rights.........................155
10.14 Headings...........................................................................156
10.15 Applicable Law.....................................................................156
10.16 Successors and Assigns.............................................................156
10.17 Consent to Jurisdiction and Service of Process.....................................156
10.18 Waiver of Jury Trial...............................................................157
10.19 Confidentiality....................................................................158
10.20 Maximum Amount.....................................................................158
10.21 Counterparts; Effectiveness........................................................159
(iv)
EXHIBITS
I FORM OF NOTICE OF BORROWING
II FORM OF NOTICE OF CONVERSION/CONTINUATION
III FORM OF NOTICE OF ISSUANCE OF LETTER OF CREDIT
IV FORM OF AXEL NOTE
V FORM OF REVOLVING NOTE
VI FORM OF SWING LINE NOTE
VII FORM OF COMPLIANCE CERTIFICATE
VIII-A FORM OF OPINION OF XXXXXXX XXXXXXX & XXXXXXXX
VIII-B FORM OF OPINION OF XXX, CASTLE & XXXXXXXXX, LLP
IX FORM OF OPINION OF WHITE & CASE
X FORM OF ASSIGNMENT AGREEMENT
XI FORM OF CERTIFICATE RE NON-BANK STATUS
XII FORM OF COLLATERAL ACCOUNT AGREEMENT
XIII FORM OF BORROWER PLEDGE AGREEMENT
XIV FORM OF BORROWER SECURITY AGREEMENT
XV FORM OF SUBSIDIARY GUARANTY
XVI FORM OF SUBSIDIARY PLEDGE AGREEMENT
XVII FORM OF SUBSIDIARY SECURITY AGREEMENT
XVIII FORM OF HOLDINGS GUARANTY
XIX FORM OF HOLDINGS PLEDGE AGREEMENT
XX FORM OF INTERCOMPANY NOTE
XXI FORM OF MORTGAGE
XXII FORM OF ENVIRONMENTAL INDEMNITY AGREEMENT
XXIII FORM OF ACKNOWLEDGEMENT OF ADDITIONAL TERM LOANS
(v)
SCHEDULES
1.1A EXISTING INDEBTEDNESS
1.1B PRO FORMA EBITDA ADJUSTMENT
2.1 LENDERS' COMMITMENTS AND PRO RATA SHARES
4.1G GOVERNMENTAL AUTHORIZATIONS AND CONSENTS
5.1 SUBSIDIARIES OF HOLDINGS
5.3 CONTINGENT OBLIGATIONS
5.6 CERTAIN LITIGATION
5.8 MATERIAL CONTRACTS
5.11 CERTAIN EMPLOYEE BENEFIT PLANS
5.13 ENVIRONMENTAL MATTERS
5.14 EMPLOYEE MATTERS
7.1 CERTAIN EXISTING INDEBTEDNESS
7.2A CERTAIN EXISTING LIENS
7.2D PERMITTED RESTRICTIONS ON SUBSIDIARIES
7.3 CERTAIN EXISTING INVESTMENTS
7.4 CERTAIN EXISTING CONTINGENT OBLIGATIONS
(vi)
ROSE HILLS CORPORATION
CREDIT AGREEMENT
This CREDIT AGREEMENT is dated as of November 19, 1996 and entered into
by and among ROSE HILLS HOLDINGS CORP., a Delaware corporation (formerly known
as Tudor Holding Company) ("Holdings"), ROSE HILLS COMPANY, a Delaware
corporation (formerly known as Tudor Acquisition Corp.) ("Borrower"), XXXXXXX,
XXXXX & CO., as syndication agent and arranging agent (in such capacities,
"Syndication Agent" and "Arranging Agent", respectively), THE FINANCIAL
INSTITUTIONS FROM TIME TO TIME PARTIES HERETO (each individually referred to
herein as a "Lender" and collectively as "Lenders"), and THE BANK OF NOVA SCOTIA
("Scotiabank"), as administrative agent for Lenders (in such capacity,
"Administrative Agent").
R E C I T A L S
WHEREAS, Holdings, a corporation newly formed by the Investors (this
and other capitalized terms used in these recitals without definition being used
as defined in subsection 1.1), was formed to own all of the capital stock of
Borrower;
WHEREAS, Borrower has entered into the Acquisition Agreement with
Association, pursuant to which Borrower has agreed to acquire the assets and
liabilities relating to the ownership and operation of the Cemetery;
WHEREAS, on or before the Closing Date, Borrower will assign to Rose
Hills, Inc., a newly formed Wholly Owned Subsidiary of Borrower ("RH Cemetery"),
all of Borrower's rights and obligations under the Acquisition Agreement;
WHEREAS, Borrower has entered into the Merger Agreement with Roses,
Inc., a California corporation ("Rose Hills") and the stockholders of Rose
Hills;
WHEREAS, on or before the Closing Date, Borrower will assign to RH
Mortuary Corp., a newly formed Wholly-Owned Subsidiary of Borrower ("RH
Mortuary"), all of Borrower's rights and obligations under the Merger Agreement,
pursuant to which RH Mortuary will merge with and into Rose Hills with Rose
Hills (which will renamed RH Mortuary Corporation) being the surviving
corporation of such Merger.
WHEREAS, on the Closing Date, (i) Xxxxxx and the Blackstone Investors
will purchase $130,000,000 in the aggregate of Holdings Preferred Stock and
Holdings Common Stock, of which $107,000,000 will consist of Cash proceeds and
$23,000,000 will consist of the value of the Satellite Properties, (ii) Holdings
will contribute all of the cash and the Satellite Properties received from the
Investors to Borrower, and after giving effect to the foregoing transactions,
Holdings shall have no material assets or liabilities other than the capital
stock of Borrower, and (iii) Borrower will contribute (x) to RH Properties
Corp., a newly formed Wholly Owned Subsidiary of Borrower ("RH Properties"), all
of the Satellite Properties other than two combination funeral home cemeteries
and (y) to RH Cemetery Cash in an amount necessary for RH Cemetery to effect the
acquisition of the Cemetery pursuant to the Acquisition Agreement and two
combination funeral home cemeteries included in the Satellite Properties and (z)
to RH Mortuary Cash in an amount necessary for RH Mortuary to effect the Merger
(all of the foregoing herein referred to collectively as the "Contribution");
WHEREAS, on or before the Closing Date, Borrower will issue and sell
the Senior Subordinated Notes for gross proceeds of not less than $80,000,000;
WHEREAS, Lenders have agreed to extend certain credit facilities to
Borrower, the proceeds of which will be used, together with the proceeds of the
issuance and sale of the Senior Subordinated Notes and the Cash proceeds
received from the Contribution, (i) to fund the purchase price under the
Acquisition Agreement and under the Merger Agreement, (ii) to prepay the
Existing Indebtedness, (iii) to prefund certain capital expenditures and
severance costs in an aggregate amount not to exceed $2,000,000, (iv) to pay
fees and expenses in connection with the Transaction in an aggregate amount not
to exceed $20,000,000 and (v) to provide financing for working capital and other
general corporate purposes of Borrower and its Subsidiaries;
WHEREAS, Borrower desires to secure all of the Obligations hereunder
and under the other Loan Documents by granting to Administrative Agent, on
behalf of Lenders, a First Priority Lien on substantially all of its personal
property including a pledge of all of the capital stock of each of its domestic
Subsidiaries, 65% of the capital stock of each direct foreign Subsidiary and a
pledge of all Intercompany Notes; and
WHEREAS, Holdings and all of the domestic Subsidiaries of Borrower have
agreed to guarantee the Obligations hereunder and under the other Loan Documents
and to secure their guaranties by granting to Administrative Agent, on behalf of
Lenders, a First Priority Lien on the real property constituting the Cemetery,
and on substantially all
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of their respective personal property, including a pledge of all of the capital
stock of each of their respective domestic Subsidiaries and 65% of the capital
stock of each direct foreign Subsidiary owned by such Loan Parties and a
pledge of all Intercompany Notes:
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, Holdings, Borrower, Lenders and
Agents agree as follows:
SECTION 1.
DEFINITIONS
1.1 Certain Defined Terms.
The following terms used in this Agreement shall have the following
meanings:
"Acknowledgement of Additional Term Loans" means an
Acknowledgement in the form of Exhibit XXIII annexed hereto
(appropriately completed) and executed by Borrower, Administrative
Agent and Lender or Lenders making the Additional Term Loans.
"Acquired Business" has the meaning assigned to that term in
the definition of "Business Acquisition".
"Acquisition" means the transactions contemplated by the
Acquisition Agreement.
"Acquisition Agreement" means that certain Asset Purchase
Agreement by and between the Association and Borrower (whose rights and
obligations thereunder have been assigned to RH Cemetery), dated as of
September 19, 1996, in the form delivered to Arranging Agent prior to
the execution of this Agreement and as such agreement may be amended
from time to time thereafter to the extent permitted under subsection
7.13A.
"Additional Term Loans" has the meaning assigned to that term
in subsection 10.6C.
"Additional Term Loan Exposure" means with respect to any
Lender at any date of determination, the outstanding principal amount
the Additional Term Loans of that Lender.
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"Additional Term Notes" means promissory notes evidencing the
Additional Term Loans in substantially the form of the AXEL Notes with
such modifications thereto as are appropriate to reflect the specific
terms of the Additional Term Loans.
"Adjusted Eurodollar Rate" means, for any Interest Rate
Determination Date with respect to an Interest Period for a Eurodollar
Rate Loan, the rate per annum obtained by dividing (i) (a) the per
annum rate for deposits in Dollars for a period corresponding to the
duration of the relevant Interest Period which appears on Telerate Page
3750 at approximately 11:00 a.m. (London time) on such Interest Rate
Determination Date or (b) if such rate does not appear on Telerate Page
3750 on such Interest Rate Determination Date, the per annum rate
(rounded upward to the nearest 1/16 of one percent) at which deposits
in Dollars are offered by Administrative Agent to first-class banks in
the London interbank market, in the approximate amount of
Administrative Agent's relevant Eurodollar Loan and having a maturity
approximately equal to such Interest Period, at approximately 11:00
a.m. (London time) on such Interest Rate Determination Date by (ii) one
minus the Reserve Requirement (expressed as a decimal) applicable on
such Interest Rate Determination Date. The reference to Telerate Page
3750 in this definition shall be construed to be a reference to the
relevant page or any other page that may replace such page on the
Telerate service or any other service that may be nominated by the
British Bankers' Association as the information vendor for the purpose
of displaying British Bankers' Association Interest Settlement Rates
for deposits in Dollars.
"Administrative Agent" has the meaning assigned to that term
in the introduction to this Agreement and also means and includes any
successor Administrative Agent appointed pursuant to subsection 9.5A.
"Administrative Agreement" means the Administrative Services
Agreement dated as of November 19, 1996, by and between Borrower and
Xxxxxx, as such agreement may be amended from time to time to the
extent permitted under subsection 7.13A.
"Affected Lender" has the meaning assigned to that term in
subsection 2.6C.
"Affiliate", as applied to any Person, means any other Person
directly or indirectly controlling, controlled by, or under common
control with, that Person. For the purposes of this definition,
"control" (including, with correlative meanings, the terms
"controlling", "controlled by" and "under common control with"), as
applied to any Person, means the possession, directly or indirectly, of
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the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting
securities or by contract or otherwise.
"Agent" means, individually, each of Arranging Agent,
Syndication Agent and Administrative Agent and "Agents" means Arranging
Agent, Syndication Agent and Administrative Agent, collectively.
"Agreement" means this Credit Agreement dated as of November
19, 1996, as it may be amended, supplemented or otherwise modified from
time to time.
"Applicable Margin" means, (i) for each AXEL and Revolving
Loan, as of any date of determination, a percentage per annum as set
forth below plus the Pricing Premium, if any, less the Pricing
Reduction, if any:
==================================================================================================================
AXELs Revolving Loans
==================================================================================================================
Base Rate Eurodollar Base Eurodollar
Rate Loans Rate Loans Rate Loans Rate Loans
==================================================================================================================
2.00% 3.00% 1.75% 2.75%
==================================================================================================================
; and (ii) for each Additional Term Loan, as of any date of
determination, a percentage per annum as has been agreed to by Borrower
and Lender or Lenders extending such Additional Term Loans as set forth
in the respective Acknowledgement of Additional Term Loans plus any
pricing premium, if any applicable thereto, less any pricing reduction,
if any applicable thereto.
"Arranging Agent" has the meaning assigned to that term in the
introduction to this Agreement.
"Asset Sale" means the sale by Holdings or any of its
Subsidiaries to any Person other than Holdings or any of its Wholly
Owned Subsidiaries of (i) any of the stock of any of Holdings'
Subsidiaries, (ii) substantially all of the assets of any division or
line of business of Holdings or any of its Subsidiaries, or (iii) any
other assets (whether tangible or intangible) of Holdings or any of its
Subsidiaries (other than (a) inventory (including group sales of land
plots and grave sites and sales of undeveloped inventory property) sold
in the ordinary course of business and (b) any such other assets to the
extent that the aggregate value of such assets sold in any single
transaction or related series of transactions is equal to or less
than $500,000).
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"Assignment Agreement" means an Assignment Agreement in
substantially the form of Exhibit X annexed hereto.
"Association" means Rose Hills Memorial Park Association, a
California nonprofit mutual benefit corporation.
"Available Excess Consolidated Capital Expenditure Amount"
means, as of any date of determination, the Excess Consolidated Capital
Expenditure Amount as of the date of determination minus the aggregate
portion of the Excess Consolidated Capital Expenditure Amount used to
make Consolidated Adjusted Capital Expenditures pursuant to subsection
7.8 as of the date of determination. For purposes of calculating the
Available Excess Consolidated Capital Expenditure Amount, Consolidated
Adjusted Capital Expenditures for each Fiscal Year shall be deemed to
have been made first from any carry forward of the Maximum Consolidated
Capital Expenditures Amount from the previous Fiscal Year permitted
pursuant to subsection 7.8, second from the Maximum Consolidated
Capital Expenditures Amount for such Fiscal Year, and third from the
Available Excess Consolidated Capital Expenditure Amount.
"AXEL" means a Loan made by a Lender to Borrower as an
amortization extended loan pursuant to subsection 2.1A(i), and "AXELs"
means any such Loan or Loans, collectively.
"AXEL Commitment" means the commitment of a Lender to make an
AXEL to Borrower pursuant to subsection 2.1A(i), and "AXEL Commitments"
means such commitments of all Lenders in the aggregate.
"AXEL Exposure" means, with respect to any Lender as of any
date of determination (i) prior to the funding of the AXELs, that
Lender's AXEL Commitment and (ii) after the funding of the AXELs, the
outstanding principal amount of the AXEL of that Lender.
"AXEL Notes" means (i) the promissory notes of Borrower issued
pursuant to subsection 2.1E(i)(a) on the Closing Date and (ii) any
promissory notes issued by Borrower pursuant to the last sentence of
subsection 10.1B(i) in connection with assignments of the AXEL
Commitments or AXELs of any Lenders, in each case substantially in the
form of Exhibit IV annexed hereto, as they may be amended, supplemented
or otherwise modified from time to time.
"Bankruptcy Code" means Title 11 of the United States Code
entitled "Bankruptcy", as now and hereafter in effect, or any successor
statute.
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"Base Rate" means, at any time, the higher of (i) the Prime
Rate or (ii) the rate which is 1/2 of 1% in excess of the Federal Funds
Effective Rate.
"Base Rate Loans" means Loans bearing interest at rates
determined by reference to the Base Rate as provided in subsection
2.2A.
"Blackstone Investors" means Blackstone Capital Partners II
Merchant Banking Fund L.P. and its Affiliates.
"Borrower" has the meaning assigned to that term in the
introduction to this Agreement.
"Borrower Pledge Agreement" means the Borrower Pledge
Agreement executed and delivered by Borrower and Administrative Agent
on the Closing Date, substantially in the form of Exhibit XIII annexed
hereto, as such Borrower Pledge Agreement may thereafter be amended,
supplemented or otherwise modified from time to time.
"Borrower Security Agreement" means the Borrower Security
Agreement executed and delivered by Borrower and Administrative Agent
on the Closing Date, substantially in the form of Exhibit XIV annexed
hereto, as such Borrower Security Agreement may thereafter be amended,
supplemented or otherwise modified from time to time.
"Business Acquisition" means any acquisition by Borrower or
any of its Subsidiaries (whether by purchase of assets or stock or by
merger, consolidation or otherwise) of any funeral home and/or cemetery
(including any peripheral business relating to the death care industry
such as monument companies, flower shops or vault companies) (each, an
"Acquired Business") in a single transaction or series of related
transactions.
"Business Day" means (i) for all purposes other than as
covered by clause (ii) below, any day excluding Saturday, Sunday and
any day which is a legal holiday under the laws of the State of New
York or is a day on which banking institutions located in such state
are authorized or required by law or other governmental action to
close, and (ii) with respect to all notices, determinations, fundings
and payments in connection with the Adjusted Eurodollar Rate or any
Eurodollar Rate Loans, any day that is a Business Day described in
clause (i) above and that is also a day for trading by and between
banks in Dollar deposits in the interbank Eurodollar market.
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"Capital Lease", as applied to any Person, means any lease of
any property (whether real, personal or mixed) by that Person as lessee
that, in conformity with GAAP, is accounted for as a capital lease on
the balance sheet of that Person.
"Cash" means money, currency or a credit balance in a Deposit
Account.
"Cash Equivalents" means, as at any date of determination, (i)
marketable securities (a) issued or directly and unconditionally
guaranteed as to interest and principal by the United States Government
or (b) issued by any agency of the United States the obligations of
which are backed by the full faith and credit of the United States, in
each case maturing within one year after such date; (ii) marketable
direct obligations issued by any state of the United States of America
or any political subdivision of any such state or any public
instrumentality thereof, in each case maturing within one year after
such date and having, at the time of the acquisition thereof, the
highest rating obtainable from either Standard & Poor's Ratings Group
("S&P") or Xxxxx'x Investors Service, Inc. ("Moody's"); (iii)
commercial paper maturing no more than one year from the date of
creation thereof and having, at the time of the acquisition thereof, a
rating of at least A-1 from S&P or at least P-1 from Moody's; (iv)
certificates of deposit or bankers' acceptances maturing within one
year after such date and issued or accepted by any Lender or by any
commercial bank organized under the laws of the United States of
America or any state thereof or the District of Columbia that (a) is at
least "adequately capitalized" (as defined in the regulations of its
primary Federal banking regulator) and (b) has Tier 1 capital (as
defined in such regulations) of not less than $100,000,000; and (v)
shares of any money market mutual fund that (a) has at least 95% of its
assets invested continuously in the types of investments referred to in
clauses (i) and (ii) above, (b) has net assets of not less than
$500,000,000, and (c) has the highest rating obtainable from either S&P
or Moody's.
"Cemetery" means Rose Hills Memorial Park in Whittier,
California comprised of all the real property and the other assets
purchased by RH Cemetery pursuant to the Acquisition Agreement.
"Certificate re Non-Bank Status" means a certificate
substantially in the form of Exhibit XI annexed hereto delivered by a
Lender to Administrative Agent pursuant to subsection 2.7B(iii).
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"Class" means, as applied to Lenders, each of the following
classes of Lenders: (i) Lenders having AXEL Exposure and Additional
Term Loan Exposure and (ii) Lenders having Revolving Loan Exposure.
"Clean-Down Period" means a period of thirty consecutive days
during which no more than $15,000,000 in aggregate principal amount of
the sum of Revolving Loans, Swing Line Loans and Letter of Credit Usage
is outstanding at any time during such period. A Clean-Down Period
shall be deemed to have occurred on the last day of any such period.
"Closing Date" means the date on or before February 28, 1997,
on which the initial Loans are made.
"Collateral" means, collectively, all of the real and personal
property (including capital stock) in which Liens are purported to be
granted pursuant to the Collateral Documents as security for the
Obligations.
"Collateral Account" has the meaning assigned to that term
in the Collateral Account Agreement.
"Collateral Account Agreement" means the Collateral Account
Agreement executed and delivered by Borrower and Administrative Agent
on the Closing Date, substantially in the form of Exhibit XII annexed
hereto, as such Collateral Account Agreement may hereafter be amended,
supplemented or otherwise modified from time to time.
"Collateral Documents" means the Holdings Pledge Agreement,
the Borrower Pledge Agreement, the Borrower Security Agreement, the
Collateral Account Agreement, the Subsidiary Pledge Agreement, the
Subsidiary Security Agreement, the Mortgage, and all other instruments
or documents delivered by any Loan Party pursuant to this Agreement or
any of the other Loan Documents in order to grant to Administrative
Agent, on behalf of Lenders, a Lien on any real or personal property of
that Loan Party as security for the Obligations.
"Commercial Letter of Credit" means any letter of credit or
similar instrument issued for the purpose of providing the primary
payment mechanism in connection with the purchase of any materials,
goods or services by Borrower or any of its Subsidiaries.
"Commitments" means the commitments of Lenders to make Loans
as set forth in subsection 2.1A.
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"Compliance Certificate" means a certificate substantially in
the form of Exhibit VII annexed hereto delivered to Administrative
Agent and Lenders by Borrower pursuant to subsection 6.1(iv).
"Confidential Information Memorandum" means that certain
Confidential Information Memorandum prepared by Borrower relating to
the AXELs and Revolving Loans dated October 1996, together with any
supplements thereto.
"Consolidated Adjusted Capital Expenditures" means, for any
period, Consolidated Capital Expenditures made pursuant to subsection
7.8 for that period minus any portion of such Consolidated Capital
Expenditures financed with insurance or condemnation proceeds.
"Consolidated Adjusted EBITDA" means, for any period, the sum
(without duplication) for such period of (i) Consolidated Net Income,
(ii) Consolidated Interest Expense, (iii) provisions for taxes, (iv)
total depreciation expense, (v) total amortization expense (including,
to the extent not already included therein, amortization of grave sites
included in cost of sales), (vi) Management Fees, (vii) (a) other
non-cash items reducing Consolidated Net Income less (b) non-cash items
(other than non-cash items included as installment revenues) increasing
Consolidated Net Income, (viii) any draw of the reserve of any
endowment care fund and (ix) (a) non-recurring items reducing
Consolidated Net Income less (b) non-recurring items (other than
non-recurring items attributable to revenue from any endowment care
fund) increasing Consolidated Net Income, all of the foregoing as
determined on a consolidated basis for Holdings and its Subsidiaries in
conformity with GAAP.
"Consolidated Capital Expenditures" means, for any period, the
aggregate of all expenditures (whether paid in Cash or other
consideration or accrued as a liability and including that portion of
Capital Leases which is capitalized on the consolidated balance sheet
of Holdings and its Subsidiaries) by Holdings and its Subsidiaries
during that period that, in conformity with GAAP, (i) are included in
"additions to property, plant or equipment" or comparable items
reflected in the consolidated statement of cash flows of Holdings and
its Subsidiaries or (ii) were incurred in developing cemetery land,
niches, mausolea and other property which is reflected in "long-term
inventory" or "cemetery properties" on the consolidated balance sheet
of Holdings and its Subsidiaries.
"Consolidated Cash Interest Expense" means, for any period,
Consolidated Interest Expense, but excluding, interest expense
(including
-10-
amortization of financing fees) not payable in Cash plus, without
duplication, the amount of any capitalized interest that is paid in
Cash during such period.
"Consolidated Current Assets" means, as at any date of
determination, the total assets of Holdings and its Subsidiaries on a
consolidated basis which may properly be classified as current assets
in conformity with GAAP, excluding Cash and Cash Equivalents.
"Consolidated Current Liabilities" means, as at any date of
determination, the total liabilities of Holdings and its Subsidiaries
on a consolidated basis which may properly be classified as current
liabilities in conformity with GAAP.
"Consolidated Excess Cash Flow" means, for any period, an
amount (if positive) equal to (i) the sum, without duplication, of the
amounts for such period of (a) Consolidated Adjusted EBITDA, (b) the
Consolidated Working Capital Adjustment and (c) the Deferred
Merchandising Adjustment minus (ii) the sum, without duplication, of
the amounts for such period of (a) voluntary and scheduled repayments
of Consolidated Total Debt (excluding repayments of Revolving Loans
except to the extent the Revolving Loan Commitments are permanently
reduced in connection with such repayments), (b) Consolidated Adjusted
Capital Expenditures minus any portion of Consolidated Adjusted Capital
Expenditures financed during such period with the proceeds of
Indebtedness permitted under subsection 7.1(vi), (c) Consolidated Cash
Interest Expense, (d) the provision for current taxes of Holdings and
its Subsidiaries payable in cash with respect to such period, (e) to
the extent not included in Consolidated Interest Expense, Cash payments
in respect of Covenants not to Compete, and (f) to the extent not
included in the determination of Consolidated Adjusted EBITDA, (1)
non-recurring Cash charges, (2) Management Fees and (3) Cash costs of
purchasing Hedge Agreements during such period.
"Consolidated Fixed Charges" means, for any period, the sum
(without duplication) of the amounts for such period of (i)
Consolidated Cash Interest Expense, (ii) scheduled repayments of
Indebtedness included in Consolidated Total Debt and (iii) taxes based
on income actually paid by Holdings and its Subsidiaries during such
period, all of the foregoing as determined on a consolidated basis for
Holdings and its Subsidiaries.
"Consolidated Interest Expense" means, for any period, total
interest expense (including that portion attributable to Capital Leases
and Covenants not to Compete in accordance with GAAP) of Holdings and
its Subsidiaries on a consolidated basis with respect to all
outstanding Indebtedness of Holdings and
-11-
its Subsidiaries, including all commissions, discounts and other fees
and charges owed with respect to letters of credit and bankers'
acceptance financing and net costs under Interest Rate Agreements, but
excluding, however, any amounts referred to in subsection 2.3 payable
to Agents and Lenders on or before the Closing Date.
"Consolidated Net Income" means, for any period, the net
income (or loss) of Holdings and its Subsidiaries on a consolidated
basis for such period taken as a single accounting period determined in
conformity with GAAP; provided that there shall be excluded (i) the
income (or loss) of any Person (other than a Subsidiary of Holdings) in
which any other Person (other than Holdings or any of its Subsidiaries)
has a joint interest, except to the extent of the amount of dividends
or other distributions actually paid to Holdings or any of its
Subsidiaries by such Person during such period, (ii) the income (or
loss) of any Person accrued prior to the date it becomes a Subsidiary
of Holdings or is merged into or consolidated with Holdings or any of
its Subsidiaries or that Person's assets are acquired by Holdings or
any of its Subsidiaries, (iii) the income of any Subsidiary of Holdings
to the extent that the declaration or payment of dividends or similar
distributions by that Subsidiary of that income is not at the time
permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Subsidiary, (iv) any after-tax gains or
losses attributable to Asset Sales or returned surplus assets of any
Pension Plan, and (v) (to the extent not included in clauses (i)
through (iv) above) any net extra-ordinary gains or net non-cash
extraordinary losses.
"Consolidated Total Debt" means, as at any date of
determination, the aggregate stated balance sheet amount of all
Indebtedness and Contingent Obligations of Holdings and its
Subsidiaries in respect of Indebtedness determined on a consolidated
basis in accordance with GAAP, in each case other than Indebtedness in
respect of Covenants not to Compete and the Existing Sellers Notes.
"Consolidated Working Capital" means, as at any date of
determination, the excess of Consolidated Current Assets over
Consolidated Current Liabilities.
"Consolidated Working Capital Adjustment" means, for any
period on a consolidated basis, the amount (which may be a negative
number) by which Consolidated Working Capital as of the beginning of
such period exceeds (or is less than) Consolidated Working Capital as
of the end of such period.
-12-
"Contingent Obligation", as applied to any Person, means any
direct or indirect liability, contingent or otherwise, of that Person
(i) with respect to any Indebtedness, lease, dividend or other
obligation of another if the primary purpose or intent thereof by the
Person incurring the Contingent Obligation is to provide assurance to
the obligee of such obligation of another that such obligation of
another will be paid or discharged, or that any agreements relating
thereto will be complied with, or that the holders of such obligation
will be protected (in whole or in part) against loss in respect
thereof, (ii) with respect to any letter of credit issued for the
account of that Person or as to which that Person is otherwise liable
for reimbursement of drawings, or (iii) under Hedge Agreements.
Contingent Obligations shall include (a) the direct or indirect
guaranty, endorsement (otherwise than for collection or deposit in the
ordinary course of business), co-making, discounting with recourse or
sale with recourse by such Person of the obligation of another, (b) the
obligation to make take-or-pay or similar payments if required
regardless of non-performance by any other party or parties to an
agreement, and (c) any liability of such Person for the obligation of
another through any agreement (contingent or otherwise) (1) to
purchase, repurchase or otherwise acquire such obligation or any
security therefor, or to provide funds for the payment or discharge of
such obligation (whether in the form of loans, advances, stock
purchases, capital contributions or otherwise) or (2) to maintain the
solvency or any balance sheet item, level of income or financial
condition of another if, in the case of any agreement described under
subclauses (1) or (2) of this sentence, the primary purpose or intent
thereof is as described in the preceding sentence. The amount of any
Contingent Obligation shall be equal to the amount of the obligation so
guaranteed or otherwise supported or, if less, the amount to which such
Contingent Obligation is specifically limited.
"Contractual Obligation", as applied to any Person, means any
provision of any Security issued by that Person or of any material
indenture, mortgage, deed of trust, contract, undertaking, agreement or
other instrument to which that Person is a party or by which it or any
of its properties is bound or to which it or any of its properties is
subject.
"Contribution" has the meaning assigned to that term in the
Recitals.
"Covenants not to Compete" means any covenants not to compete,
consulting agreements, former owner agreements (including employment
agreements) or other similar arrangements pursuant to which Holdings or
any of its Subsidiaries agree to make periodic payments to certain
Persons in connection with the acquisition of funeral homes and
cemeteries.
-13-
"Cumulative Consolidated Adjusted EBITDA" means, at any date
of determination, Consolidated Adjusted EBITDA for the period from
January 1, 1997 through such date.
"Cure Amount" means the amount of Cash received by Holdings
and contributed to Borrower from the issuance of Permitted Cure
Securities by Holdings or from other contributions to the capital of
Holdings pursuant to the exercise by Holdings of any Cure Right.
"Cure Right" has the meaning assigned to that term in
subsection 7.6G.
"Currency Agreement" means any foreign exchange contract,
currency swap agreement, futures contract, option contract, synthetic
cap or other similar agreement or arrangement to which Holdings or any
of its Subsidiaries is a party.
"Deferred Merchandising Adjustment" means, for any period, the
increase (or decrease) in the net deferred merchandise liability during
such period, in each case determined pursuant to the calculations set
forth in the form of the Compliance Certificate.
"Deposit Account" means a demand, time, savings, passbook or
like account with a bank, savings and loan association, credit union or
like organization, other than an account evidenced by a negotiable
certificate of deposit.
"Dollars" and the sign "$" mean the lawful money of the
United States of America.
"Eligible Assignee" means (i)(a) a commercial bank organized
under the laws of the United States or any state thereof; (b) a savings
and loan association or savings bank organized under the laws of the
United States or any state thereof; (c) a commercial bank organized
under the laws of any other country or a political subdivision thereof;
provided that (1) such bank is acting through a branch or agency
located in the United States or (2) such bank is organized under the
laws of, and acting through a branch or agency located in, a country
that is a member of the Organization for Economic Cooperation and
Development or a political subdivision of such country; and (d) any
finance company, insurance company, or other financial institution or
fund (whether a corporation, partnership, trust or other entity) that
is engaged in making, purchasing or otherwise investing in commercial
loans in the ordinary course of its business and having a combined
capital and surplus or net assets of at least $100,000,000; and (ii)
any Lender and any Affiliate of any Lender; provided that no
Affiliate of Borrower shall be an Eligible Assignee.
-14-
"Employee Benefit Plan" means any "employee benefit plan" as
defined in Section 3(3) of ERISA which is or was maintained or
contributed to by Holdings, any of its Subsidiaries or any of their
respective ERISA Affiliates.
"Environmental Claim" means any investigation, written notice,
written notice of violation, claim, action, suit, proceeding, written
demand, written abatement order or other written order or directive
(conditional or otherwise), by any governmental authority or any other
Person, arising (i) pursuant to or in connection with any actual or
alleged violation of any Environmental Law, (ii) in connection with any
Hazardous Materials or any actual or alleged Hazardous Materials
Activity, or (iii) in connection with any actual or alleged damage,
injury, threat or harm to health, safety, natural resources or the
environment.
"Environmental Indemnity Agreement" means the Environmental
Indemnity Agreement executed and delivered by the Loan Parties
signatory thereto on the Closing Date, substantially in the form of
Exhibit XXII annexed hereto, as such Environmental Indemnity Agreement
may thereafter be amended, supplemented or otherwise modified from time
to time.
"Environmental Laws" means any and all applicable statutes,
ordinances, orders, rules, regulations, judgments, Governmental
Authorizations, or any other binding requirements of governmental
authorities relating to (i) environmental matters, including those
relating to any Hazardous Materials Activity, (ii) the generation,
use, storage, transportation or disposal of Hazardous Materials, or
(iii) occupational safety and health, industrial hygiene, land use or
the protection of human, plant or animal health or welfare as relating
to the environment, in any manner applicable to Holdings or any of its
Subsidiaries or any Facility, including the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C. ss.
9601 et seq.), the Hazardous Materials Transportation Act (49 U.S.C.
ss. 1801 et seq.), the Resource Conservation and Recovery Act (42
U.S.C. ss. 6901 et seq.), the Federal Water Pollution Control Act (33
U.S.C. ss. 1251 et seq.), the Clean Air Act (42 U.S.C. ss. 7401 et
seq.), the Toxic Substances Control Act (15 U.S.C. ss. 2601 et seq.),
the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C.
ss.136 et seq.), the Occupational Safety and Health Act (29 U.S.C. ss.
651 et seq.), the Oil Pollution Act (33 U.S.C. ss. 2701 et seq.) and
the Emergency Planning and Community Right-to-Know Act (42 U.S.C. ss.
11001 et seq.), each as amended or supplemented, any analogous state
or local statutes or laws, and any regulations promulgated pursuant
to any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor thereto.
-15-
"ERISA Affiliate" means, as applied to any Person, (i) any
corporation which is a member of a controlled group of corporations
within the meaning of Section 414(b) of the Internal Revenue Code of
which that Person is a member; (ii) any trade or business (whether or
not incorporated) which is a member of a group of trades or businesses
under common control within the meaning of Section 414(c) of the
Internal Revenue Code of which that Person is a member; and (iii) any
member of an affiliated service group within the meaning of Section
414(m) or (o) of the Internal Revenue Code of which that Person, any
corporation described in clause (i) above or any trade or business
described in clause (ii) above is a member. Any former ERISA Affiliate
of Holdings or any of its Subsidiaries shall continue to be considered
an ERISA Affiliate of Holdings or such Subsidiary within the meaning of
this definition with respect to the period such entity was an ERISA
Affiliate of Holdings or such Subsidiary and with respect to
liabilities arising after such period for which Holdings or such
Subsidiary could be liable under the Internal Revenue Code or ERISA.
"ERISA Event" means (i) a "reportable event" within the
meaning of Section 4043 of ERISA and the regulations issued thereunder
with respect to any Pension Plan (excluding those for which the
provision for 30-day notice to the PBGC has been waived by regulation);
(ii) the failure to meet the minimum funding standard of Section 412 of
the Internal Revenue Code with respect to any Pension Plan (whether or
not waived in accordance with Section 412(d) of the Internal Revenue
Code) or the failure to make by its due date a required installment
under Section 412(m) of the Internal Revenue Code with respect to any
Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (iii) the provision by the administrator of any
Pension Plan pursuant to Section 4041(a)(2) of ERISA of a notice of
intent to terminate such plan in a distress termination described in
Section 4041(c) of ERISA; (iv) the withdrawal by Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates from any
Pension Plan with two or more contributing sponsors or the termination
of any such Pension Plan resulting in liability pursuant to Section
4063 or 4064 of ERISA; (v) the institution by the PBGC of proceedings
to terminate any Pension Plan, or the occurrence of any event or
condition which could reasonably be expected to constitute grounds
under ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan; (vi) the imposition of material liability
on Holdings, any of its Subsidiaries or any of their respective ERISA
Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason
of the application of Section 4212(c) of ERISA; (vii) the withdrawal
of Holdings, any of its Subsidiaries or any of their respective ERISA
Affiliates in a complete or partial withdrawal (within the meaning of
Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there
could reasonably be expected to be any material liability therefor, or
the receipt by
-16-
Holdings, any of its Subsidiaries or any of their respective ERISA
Affiliates of notice from any Multiemployer Plan that it is in
reorganization or insolvency pursuant to Section 4241 or 4245 of
ERISA, or that it intends to terminate or has terminated under Section
4041A or 4042 of ERISA; (viii) the occurrence of an act or omission
which could give rise to the imposition on Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates of material
fines, material penalties, material taxes or material related charges
under Chapter 43 of the Internal Revenue Code or under Section 409,
Section 502(c), (i) or (l), or Section 4071 of ERISA in respect of any
Employee Benefit Plan; (ix) the assertion of a material claim (other
than routine claims for benefits) against any Employee Benefit Plan
other than a Multiemployer Plan or the assets thereof, or against
Holdings, any of its Subsidiaries or any of their respective ERISA
Affiliates in connection with any Employee Benefit Plan; (x) receipt
from the Internal Revenue Service of notice of the failure of any
Pension Plan (or any other Employee Benefit Plan intended to be
qualified under Section 401(a) of the Internal Revenue Code) to
qualify under Section 401(a) of the Internal Revenue Code, or the
failure of any trust forming part of any Pension Plan to qualify for
exemption from taxation under Section 501(a) of the Internal Revenue
Code; or (xi) the imposition of a material Lien pursuant to Section
401(a)(29) or 412(n) of the Internal Revenue Code or pursuant to ERISA
with respect to any Pension Plan.
"Eurodollar Rate Loans" means Loans bearing interest at rates
determined by reference to the Adjusted Eurodollar Rate as provided in
subsection 2.2A.
"Event of Default" means each of the events set forth in
Section 8.
"Excess Consolidated Capital Expenditure Amount" means, as of
any date of determination, the sum of the Yearly Excess Cash Flow
Amounts for each Fiscal Year ending after the Closing Date and on or
prior to the date of determination. As used in this definition, "Yearly
Excess Cash Flow Amount" means, for each Fiscal Year, the lesser of (i)
Consolidated Excess Cash Flow for such Fiscal Year and (ii) (x) in the
case of each of Fiscal Year 1997 and Fiscal Year 1998, the sum of
$10,000,000 and 50% of Consolidated Excess Cash Flow in excess of
$10,000,000 for each such Fiscal Year and (y) in the case of each
Fiscal Year thereafter, the sum of $7,500,000 and 50% of Consolidated
Excess Cash Flow in excess of $7,500,000 for each such Fiscal Year;
provided in no event shall the Yearly Excess Cash Flow Amount be less
than zero in any Fiscal Year, and provided further, that at any time
that the proviso to subsection 2.4B(iii)(d) is applicable, the
foregoing percentage of Consolidated Excess Cash Flow in clauses
(ii)(x) and (y) above in this definition shall instead be 75%.
-17-
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute.
"Existing Indebtedness" means the Indebtedness set forth on
Schedule 1.1A annexed hereto which shall be repaid in full on the
Closing Date provided, however, that the Existing Indebtedness shall
not include up to $3,000,000 of Covenants not to Compete assumed by the
Borrower as part of the Transaction and the Existing Sellers Notes.
"Existing Sellers Notes" means up to $2,000,000 of sellers
notes issued to certain former owners of the Satellite Properties.
"Facilities" means any and all real property (including all
buildings, fixtures or other improvements located thereon) now,
hereafter or heretofore owned, leased, operated or used by Holdings or
any of its Subsidiaries or any of their respective predecessors or
Affiliates.
"Federal Funds Effective Rate" means, for any period, a
fluctuating interest rate equal for each day during such period to the
weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day which is
a Business Day, the average of the quotations for such day on such
transactions received by Administrative Agent from three Federal funds
brokers of recognized standing selected by Administrative Agent.
"Financial Performance Covenants" means the covenants of
Holdings and Borrower set forth in subsections 7.6A, 7.6B, 7.6C, 7.6D
and 7.6E.
"Financial Plan" has the meaning assigned to that term in
subsection 6.1(xiii).
"First Priority" means, with respect to any Lien purported to
be created in any Collateral pursuant to any Collateral Document, that
(i) such Lien has priority over any other Lien on such Collateral
(other than Liens permitted pursuant to subsection 7.2A) and (ii) such
Lien is the only Lien (other than Permitted Encumbrances and Liens
permitted pursuant to subsection 7.2) to which such Collateral is
subject.
"Fiscal Quarter" means a fiscal quarter of any Fiscal Year.
-18-
"Fiscal Year" means the fiscal year of Holdings and its
Subsidiaries ending on December 31 of each calendar year.
"Funding and Payment Office" means (i) the office of
Administrative Agent and Swing Line Lender located at Xxx Xxxxxxx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 or (ii) such other office of
Administrative Agent and Swing Line Lender located in the United States
as may from time to time hereafter be designated as such in a written
notice delivered by Administrative Agent and Swing Line Lender to
Borrower and each Lender.
"Funding Date" means the date of the funding of a Loan.
"GAAP" means, subject to the limitations on the application
thereof set forth in subsection 1.2, generally accepted accounting
principles set forth in opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such other
entity as may be approved by a significant segment of the accounting
profession, in each case as the same are applicable to the
circumstances as of the date of determination.
"Governmental Authorization" means any permit, license,
authorization, plan, directive, consent order or consent decree of or
from any federal, state or local governmental authority, agency or
court.
"Guaranties" means the Holdings Guaranty and the Subsidiary
Guaranty.
"Hazardous Materials" means (i) any chemical, material or
substance at any time defined as or included in the definition of
"hazardous substances", "hazardous wastes", "hazardous materials",
"extremely hazardous waste", "acutely hazardous waste", "radioactive
waste", "biohazardous waste", "pollutant", "toxic pollutant",
"contaminant", "restricted hazardous waste", "infectious waste", "toxic
substances", or any other term or expression intended to define, list
or classify substances by reason of properties harmful to
health, safety or the indoor or outdoor environment (including harmful
properties such as ignitability, corrosivity, reactivity,
carcinogenicity, toxicity, reproductive toxicity, "TCLP toxicity" or
"EP toxicity" or words of similar import under any applicable
Environmental Laws); (ii) any oil, petroleum, petroleum fraction or
petroleum derived substance; (iii) any drilling fluids, produced
waters and other wastes associated with the exploration, development
or production of crude oil, natural gas or geothermal resources; (iv)
any explosives; (v) any radioactive
-19-
materials; (vi) any asbestos-containing materials; (vii) urea
formaldehyde foam insulation; (viii) electrical equipment which
contains any oil or dielectric fluid containing polychlorinated
biphenyls; (ix) pesticides; and (x) any other chemical, material or
substance, exposure to which is prohibited, limited or regulated by
any governmental authority or which may or could pose a hazard to the
health and safety of the owners, occupants or any Persons in the
vicinity of any Facility or to the indoor or outdoor environment.
"Hazardous Materials Activity" means any past, current,
proposed or threatened activity, event or occurrence involving any
Hazardous Materials, including the use, manufacture, possession,
storage, holding, presence, existence, location, Release, threatened
Release, discharge, placement, generation, transportation, processing,
construction, treatment, abatement, removal, remediation, disposal,
disposition or handling of any Hazardous Materials, and any corrective
action or response action with respect to any of the foregoing.
"Hedge Agreement" means an Interest Rate Agreement or a
Currency Agreement designed to hedge against fluctuations in interest
rates or currency values, respectively.
"Holdings" has the meaning assigned to that term in the
introduction to this Agreement.
"Holdings Certificate of Designations" means the provisions of
Holdings' Certificate of Incorporation relating to the Holdings
Preferred Stock, in the form delivered to Arranging Agent, prior to the
execution of this Agreement and as such provisions may be amended from
time to time thereafter to the extent permitted under subsection 7.13A.
"Holdings Common Stock" means the common stock of Holdings,
par value $.01 per share.
"Holdings Guaranty" means the Holdings Guaranty executed and
delivered by Holdings on the Closing Date, substantially in the form of
Exhibit XVIII annexed hereto, as such Holdings Guaranty may thereafter
be amended, supplemented or otherwise modified from time to time.
"Holdings Pledge Agreement" means the Holdings Pledge
Agreement executed and delivered by Holdings and Administrative Agent
on the Closing Date, substantially in the form of Exhibit XIX annexed
hereto, as such Holdings Pledge Agreement may thereafter be amended,
supplemented or otherwise modified from time to time.
-20-
"Holdings Preferred Stock" means the Preferred Stock of
Holdings, with a liquidation preference of $10.00 per share and with
the other terms set forth in the Holdings Certificate of Designations.
"Indebtedness", as applied to any Person, means (i) all
indebtedness for borrowed money, (ii) that portion of obligations with
respect to Capital Leases that is properly classified as a liability on
a balance sheet in conformity with GAAP, (iii) notes payable and drafts
accepted representing extensions of credit whether or not representing
obligations for borrowed money, (iv) any obligation owed for all or any
part of the deferred purchase price of property or services (including
those portions of obligations with respect to Covenants not to Compete
that are properly classified as liabilities on a balance sheet in
conformity with GAAP, but excluding any such obligations incurred under
ERISA), which purchase price is (a) due more than six months from the
date of incurrence of the obligation in respect thereof or (b)
evidenced by a note or similar written instrument, (v) all indebtedness
secured by any Lien on any property or asset owned or held by that
Person regardless of whether the indebtedness secured thereby shall
have been assumed by that Person or is nonrecourse to the credit of
that Person and (vi) any reimbursement obligations of that Person in
respect of letters of credit. Obligations under Interest Rate
Agreements and Currency Agreements constitute (1) in the case of Hedge
Agreements, Contingent Obligations, and (2) in all other cases,
Investments, and in neither case constitute Indebtedness.
"Indemnitee" has the meaning assigned to that term in
subsection 10.3.
"Intellectual Property" means all patents, trademarks,
tradenames, copyrights, technology, know-how and processes used in or
necessary for the conduct of the business of Borrower and its
Subsidiaries as currently conducted that are material to the condition
(financial or otherwise), business or operations of Borrower and its
Subsidiaries, taken as a whole.
"Intercompany Note" means a promissory note executed by a Loan
Party or any of its Subsidiaries evidencing intercompany Indebtedness
substantially in the form of Exhibit XX annexed hereto.
"Interest Payment Date" means (i) with respect to any Base
Rate Loan, each February 1, May 1, August 1 and November 1 of each
year, commencing on the first such date to occur after the Closing
Date, and (ii) with respect to any Eurodollar Rate Loan, the last day
of each Interest Period applicable to such Loan; provided that in the
case of each Interest Period of longer than three months "Interest
Payment Date" shall also include each date that is three
-21-
months, or an integral multiple thereof, after the commencement
of such Interest Period.
"Interest Period" has the meaning assigned to that term in
subsection 2.2B.
"Interest Rate Agreement" means any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement
or other similar agreement or arrangement to which Borrower or any of
its Subsidiaries is a party.
"Interest Rate Determination Date" means, with respect to any
Interest Period, the second Business Day prior to the first day of such
Interest Period.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended to the date hereof and from time to time hereafter,
and any successor statute.
"Inventory" means, with respect to any Person as of any date
of determination, all goods, merchandise and other personal property
which are then held by such Person for sale or lease, including raw
materials and work in process.
"Investment" means (i) any direct or indirect purchase or
other acquisition by Holdings or any of its Subsidiaries of, or of a
beneficial interest in, any Securities of any other Person (including
any Subsidiary of Holdings), (ii) any direct or indirect redemption,
retirement, purchase or other acquisition for value, by any Subsidiary
of Holdings from any Person other than Holdings or any of its
Subsidiaries, of any equity Securities of such Subsidiary, (iii) any
direct or indirect loan, advance (other than advances to employees for
moving, entertainment and travel expenses, drawing accounts and similar
expenditures in the ordinary course of business) or capital
contribution by Holdings or any of its Subsidiaries to any other Person
(other than a Wholly Owned Subsidiary of Holdings), including all
indebtedness and accounts receivable from that other Person that are
not current assets or did not arise from sales to that other Person in
the ordinary course of business, or (iv) Interest Rate Agreements or
Currency Agreements not constituting Hedge Agreements. The amount of
any Investment shall be (a) the original cost of such Investment plus
(b) the cost of all additions thereto, without any adjustments for
increases or decreases in value, or write- ups, write-downs or
write-offs with respect to such Investment minus (c) the lesser of (1)
the aggregate amount of any repayments, redemptions, dividends or
distributions thereon or proceeds from the sale thereof, in each case
to the extent of any Cash payments (including any Cash received by way
of deferred payment
-22-
pursuant to, or by monetization of, a note receivable or otherwise,
but only as and when so received) actually received by Borrower or any
of its Subsidiaries in connection therewith, and (2) the aggregate
amount described in the immediately preceding clauses (a) and (b).
"Investors" means collectively Xxxxxx and the Blackstone
Investors.
"Issuing Lender" means, Scotiabank, or any Person serving as
successor Administrative Agent hereunder, in its capacity as Issuing
Lender.
"Joint Venture" means a joint venture, partnership or other
similar arrangement, whether in corporate, partnership or other legal
form; provided that in no event shall any corporate Subsidiary of any
Person be considered to be a Joint Venture to which such Person is a
party.
"Lender" and "Lenders" means the persons identified as
"Lenders" and listed on the signature pages of this Agreement and the
Persons making the Additional Term Loans, together with their
successors and permitted assigns pursuant to subsection 10.1, and the
term "Lenders" shall include Swing Line Lender unless the context
otherwise requires; provided that the term "Lenders", when used in the
context of a particular Commitment, shall mean Lenders having that
Commitment.
"Letter of Credit" or "Letters of Credit" means Commercial
Letters of Credit and Standby Letters of Credit issued or to be issued
by Issuing Lender for the account of Borrower pursuant to subsection
3.1.
"Letter of Credit Usage" means, as at any date of
determination, the sum of (i) the maximum aggregate amount which is or
at any time thereafter may become available for drawing under all
Letters of Credit then outstanding plus (ii) the aggregate amount of
all drawings under Letters of Credit honored by Issuing Lender and not
theretofore reimbursed by Borrower (including any such reimbursement
out of the proceeds of Revolving Loans pursuant to subsection 3.3B).
"Leverage Ratio" means the ratio of (i) Consolidated Total
Debt as of the last day of any Fiscal Quarter to (ii) Consolidated
Adjusted EBITDA for the four-Fiscal Quarter period then ended, in each
case as set forth in the most recent Compliance Certificate delivered
by Borrower to Administrative Agent and Lenders pursuant to clause
(iii) of subsection 6.1.
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"Lien" means any lien, mortgage, pledge, collateral
assignment, security interest, charge or encumbrance of any kind
(including any conditional sale or other title retention agreement, any
lease in the nature thereof, and any agreement to give any security
interest) and any option or trust having the practical effect of any of
the foregoing.
"Loan" or "Loans" means one or more of the AXELs, Revolving
Loans, Swing Line Loans or Additional Term Loans or any combination
thereof.
"Loan Documents" means this Agreement, the Notes, any
applications for, or reimbursement agreements or other documents or
certificates executed by Borrower in favor of Issuing Lender relating
to, the Letters of Credit, the Guaranties, the Collateral Documents,
the Environmental Indemnity Agreement, each Acknowledgement of
Additional Term Loans and any Hedge Agreements entered into with
Lenders or their Affiliates.
"Loan Party" means each of Holdings, Borrower and any of
Holdings' Subsidiaries from time to time executing a Loan Document, and
"Loan Parties" means all such Persons, collectively.
"Xxxxxx" means Xxxxxx Group International Inc., a Delaware
corporation and a Wholly Owned Subsidiary of Xxxxxx Group, and its
Affiliates.
"Xxxxxx Group" means The Xxxxxx Group, Inc., a corporation
organized under the laws of British Columbia.
"Management Fees" means fees payable to Affiliates of the
Blackstone Investors in an aggregate amount not to exceed $250,000 per
annum, as adjusted for inflation.
"Margin Stock" has the meaning assigned to that term in
Regulation U of the Board of Governors of the Federal Reserve System as
in effect from time to time.
"Material Adverse Effect" means (i) any material adverse
effect on or affecting the financial position, prospects or results of
operations of Holdings and its Subsidiaries, taken as a whole, or (ii)
the impairment of the ability of Holdings, Borrower or the Loan
Parties, taken as a whole, to perform, or of Administrative Agent or
Lenders to enforce, the Obligations.
"Material Contract" means any contract or other arrangement to
which Holdings or any of its Subsidiaries is a party (other than the
Loan Documents)
-24-
for which breach, nonperformance, cancellation or failure to renew
could have a Material Adverse Effect.
"Maximum Consolidated Capital Expenditures Amount" has the
meaning assigned to that term in subsection 7.8.
"Merger" means the merger of RH Mortuary with and into Rose
Hills pursuant to the terms and conditions of the Merger Agreement and
as a result of which Rose Hills shall be the surviving corporation and
a Wholly Owned Subsidiary of Holdings named RH Mortuary.
"Merger Agreement" means that certain Agreement and Plan of
Merger by and among Rose Hills, the existing stockholders of Rose
Hills, and the Borrower (whose rights and obligations thereunder have
been assigned to RH Mortuary), dated as of September 19, 1996, in the
form delivered to Arranging Agent prior to the execution of this
Agreement and as such agreement may be amended from time to time
thereafter to the extent permitted under subsection 7.13A.
"Mortgage" means the Mortgage executed and delivered by RH
Cemetery on the Closing Date, substantially in the form of Exhibit XXI
annexed hereto, as such Mortgage may thereafter be amended,
supplemented or otherwise modified from time to time.
"Multiemployer Plan" means any Employee Benefit Plan which is
a "multiemployer plan" as defined in Section 3(37) of ERISA.
"Net Asset Sale Proceeds" means, with respect to any Asset
Sale, Cash payments (including any Cash received by way of deferred
payment pursuant to, or by monetization of, a note receivable or
otherwise, but only as and when so received) received from such Asset
Sale, net of any bona fide direct costs incurred in connection with
such Asset Sale, including (i) taxes reasonably estimated to be
actually payable within two years of the date of such Asset Sale as a
result of any gain recognized in connection with such Asset Sale and
(ii) payment of the outstanding principal amount of, interest on, and
premium or penalty, if any, with respect to any Indebtedness (other
than the Loans) that is secured by a Lien on the stock or assets in
question and that is required to be repaid under the terms thereof as
a result of such Asset Sale.
"Net Insurance/Condemnation Proceeds" means any Cash payments
or proceeds received by Holdings or any of its Subsidiaries (i) under
any business interruption or casualty insurance policy in respect of a
covered loss thereunder
-25-
or (ii) as a result of the taking of any assets of Holdings or any of
its Subsidiaries by any Person pursuant to the power of eminent
domain, condemnation or otherwise, or pursuant to a sale of any such
assets to a purchaser with such power under threat of such a taking (a
"Condemnation"), in each case net of (a) any actual and reasonable
documented costs incurred by Holdings or any of its Subsidiaries in
connection with the adjustment or settlement of any claims of Holdings
or such Subsidiary in respect thereof and (b) any bona fide direct
costs incurred in connection with such Condemnation or casualty,
including (1) taxes reasonably estimated to be actually payable within
two years of the date of such Condemnation or casualty as a result of
any gain recognized in connection with such Condemnation or casualty
and (2) payment of the outstanding principal amount of, interest on,
and premium or penalty, if any, with respect to any Indebtedness
(other than the Loans) that is secured by a Lien on the assets in
question and that is required to be repaid under the terms thereof as
a result of such Condemnation or casualty.
"Notes" means one or more of the AXEL Notes, Revolving Notes,
Additional Term Notes or Swing Line Note or any combination thereof.
"Notice of Borrowing" means a notice substantially in the form
of Exhibit I annexed hereto delivered by Borrower to Administrative
Agent pursuant to subsection 2.1B with respect to a proposed borrowing,
or in the case of a proposed borrowing of Additional Term Loans, the
notice information set forth in the respective Acknowledgement of
Additional Term Loans for such proposed borrowing.
"Notice of Conversion/Continuation" means a notice
substantially in the form of Exhibit II annexed hereto delivered by
Borrower to Administrative Agent pursuant to subsection 2.2D with
respect to a proposed conversion or basis for determining the
interest rate with respect to the Loans specified therein.
"Notice of Issuance of Letter of Credit" means a notice
substantially in the form of Exhibit III annexed hereto delivered by
Borrower to Administrative Agent pursuant to subsection 3.1B(i) with
respect to the proposed issuance of a Letter of Credit.
"Obligations" means all obligations of every nature of each
Loan Party from time to time owed to Agents, Lenders or their
respective Affiliates or any of them under the Loan Documents, whether
for principal, interest, reimbursement of amounts drawn under Letters
of Credit, fees, expenses, indemnification or otherwise.
-26-
"Officers' Certificate" means, as applied to any corporation,
a certificate executed on behalf of such corporation by its chairman of
the board (if an officer) or its chief executive officer or its
president or one of its vice presidents and by its chief financial
officer or its treasurer; provided that any Officers' Certificate with
respect to compliance with a condition precedent to the making of the
initial Loans hereunder shall include (i) a statement that the officer
or officers making or giving such Officers' Certificate have read such
condition and any definitions or other provisions contained in this
Agreement relating thereto, (ii) a statement that, in the opinion of
the signers, they have made or have caused to be made such examination
or investigation as is necessary to enable them to express an informed
opinion as to whether or not such condition has been complied with, and
(iii) a statement as to whether, in the opinion of the signers, such
condition has been complied with.
"Operating Lease" means, as applied to any Person, any lease
(including leases that may be terminated by the lessee at any time) of
any property (whether real, personal or mixed) that is not a Capital
Lease other than any such lease under which that Person is the lessor.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"Pension Plan" means any Employee Benefit Plan, other than a
Multi- employer Plan, which is subject to Section 412 of the Internal
Revenue Code or Section 302 of ERISA.
"Permitted Acquisition" means a Business Acquisition effected
in accordance with the terms and conditions of this Agreement.
"Permitted Cure Security" means an equity Security of Holdings
having no mandatory redemption, repurchase or similar requirements
prior to June 1, 2004 and upon which all dividends, at the election of
Holdings, may be payable in additional shares of such equity Security.
"Permitted Encumbrances" means the following types of Liens
(excluding any such Lien imposed pursuant to Section 401(a)(29) or
412(n) of the Internal Revenue Code or by ERISA, any such Lien relating
to or imposed in connection with any Environmental Claim, and any such
Lien expressly prohibited by any applicable terms of any of the
Collateral Documents):
-27-
(i) Liens for taxes, assessments or governmental
charges or claims the payment of which is not, at the time,
required by subsection 6.3;
(ii) statutory Liens of landlords, statutory Liens
of banks and rights of set-off, statutory Liens of carriers,
warehousemen, mechanics, repairmen, workmen and materialmen,
and other Liens imposed by law, in each case incurred in the
ordinary course of business (a) for amounts not yet overdue or
(b) for amounts that are overdue and that are being contested
in good faith by appropriate proceedings, so long as (1) such
reserves or other appropriate provisions, if any, as shall be
required by GAAP shall have been made for any such contested
amounts, and (2) in the case of a Lien with respect to any
material portion of the Collateral, such contest proceedings
conclusively operate to stay the sale of any portion of the
Collateral on account of such Lien;
(iii) Liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation,
unemployment insurance and other types of social security, or
to secure the performance of tenders, statutory obligations,
surety and appeal bonds, bids, leases, government contracts,
trade contracts, performance and return-of-money bonds and
other similar obligations (exclusive of obligations for the
payment of borrowed money), so long as no foreclosure, sale or
similar proceedings have been commenced with respect to any
material portion of the Collateral on account thereof;
(iv) any attachment or judgment Lien not
constituting an Event of Default under subsection 8.8;
(v) leases or subleases granted to third
parties in accordance with any applicable terms of the
Collateral Documents and not interfering in any material
respect with the ordinary conduct of the business of
Borrower or any of its Subsidiaries or resulting in a
material diminution in the value of any Collateral as
security for the Obligations;
(vi) easements, rights-of-way, restrictions,
encroachments, and other minor defects or irregularities in
title, in each case which do not and will not interfere in any
material respect with the ordinary conduct of the business of
Borrower or any of its Subsidiaries or result in a material
diminution in the value of any Collateral as security for the
Obligations;
-28-
(vii) any (a) interest or title of a lessor or
sublessor under any lease, (b) restriction or encumbrance that
the interest or title of such lessor or sublessor may be
subject to, or (c) subordination of the interest of the lessee
or sublessee under such lease to any restriction or
encumbrance referred to in the preceding clause (b), so long
as the holder of such restriction or encumbrance agrees to
recognize the rights of such lessee or sublessee under such
lease;
(viii) Liens arising from filing UCC financing
statements relating solely to leases permitted by this
Agreement;
(ix) Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of
customs duties in connection with the importation of goods;
(x) any zoning or similar law or right reserved
to or vested in any governmental office or agency to control
or regulate the use of any real property; and
(xi) Liens securing obligations (other than
obligations representing Indebtedness for borrowed money)
under operating, reciprocal easement or similar agreements
entered into in the ordinary course of business of Borrower
and its Subsidiaries.
"Person" means and includes natural persons, corporations,
limited partnerships, general partnerships, limited liability
companies, limited liability partnerships, joint stock companies, Joint
Ventures, associations, companies, trusts, banks, trust companies, land
trusts, business trusts or other organizations, whether or not legal
entities, and governments (whether federal, state or local, domestic or
foreign, and including political subdivisions thereof) and agencies or
other administrative or regulatory bodies thereof.
"Pledged Collateral" means, collectively, the "Pledged
Collateral" as defined in the Holdings Pledge Agreement, the Borrower
Pledge Agreement and the Subsidiary Pledge Agreement.
"Potential Event of Default" means a condition or event that,
after notice or lapse of time or both, would constitute an Event of
Default.
"Pricing Premium" means, if as of the end of any Fiscal
Quarter, commencing with the Fiscal Quarter ending June 30, 1997, the
ratio of Consolidated Adjusted EBITDA to Consolidated Interest Expense
(excluding
-29-
Premium Interest, as hereinafter defined) for the four Fiscal Quarter
period then ended is less than 1.50:1.00, then the Applicable Margin
set forth in the chart in clause (i) of the definition of "Applicable
Margin" (and clause (ii) thereof, except to the extent set forth in
the respective Acknowledgement of Additional Term Loans) shall be
increased by 0.25% per annum (such additional .25% referred to herein
as "Premium Interest") on all Loans (other than Additional Term Loans
except to the extent set forth in the respective Acknowledgment of
Additional Term Loans) outstanding during such Fiscal Quarter (or with
respect to the initial test on June 30, 1997, on all Loans (other than
Additional Term Loans except to the extent set forth in the respective
Acknowledgment of Additional Term Loans) at any time outstanding
during the period from the Closing Date through June 30, 1997). The
Pricing Premium shall be determined on the basis of the financial
statements and Compliance Certificates delivered by Borrower to
Administrative Agent and Lenders pursuant to clauses (i) , (ii), (iii)
or (iv) of subsection 6.1, as applicable.
"Pricing Reduction" means (i) if at any time after the first
anniversary of the Closing Date as of the end of any Fiscal Quarter,
the Leverage Ratio is equal to or less than 5.75:1.00, a pricing
reduction equal to .25% and (ii) if at any time after the second
anniversary of the Closing Date, as of the end of any Fiscal Quarter,
the Leverage Ratio is equal to or less than 5.00:1.00, a pricing
reduction equal to .50%, provided, that any pricing reduction for the
Additional Term Loans shall be as set forth in the respective
Acknowledgement of Additional Term Loans. The Pricing Reduction shall
be determined by reference to the Leverage Ratio set forth in the most
recent financial statements delivered by Borrower to Administrative
Agent and Lenders pursuant to clause (i) or (ii) of subsection 6.1
(accompanied by a Compliance Certificate delivered by Borrower pursuant
to clause (iii) of subsection 6.1). Any changes in the Pricing
Reduction shall become effective on the day following delivery of the
relevant Compliance Certificate to Administrative Agent and Lenders and
shall remain in effect through the next scheduled date for delivery of
a Compliance Certificate. It is understood and agreed that the Pricing
Reductions set forth in clause (i) and (ii) are not cumulative.
Notwithstanding anything herein to the contrary, (a) from the Closing
Date to and including the date of the first anniversary of the Closing
Date, the Pricing Reduction shall be zero and (b) at any time an Event
of Default shall have occurred and be continuing, the Pricing
Reduction shall be zero.
"Prime Rate" means the rate that Administrative Agent
announces from time to time as its prime lending rate for Dollars at
its Funding and Payment Office, as in effect from time to time. The
Prime Rate is a reference rate and does not necessarily represent the
lowest or best rate actually charged to any
-30-
customer. Administrative Agent or any other Lender may make commercial
loans or other loans at rates of interest at, above or below the Prime
Rate.
"Pro Forma EBITDA Adjustment" means, as of any date of
determination commencing on December 31, 1996 and ending on December
31, 1997 the sum of (i) the pro forma cost savings set forth on
Schedule 1.1B annexed hereto multiplied by a fraction, the numerator of
which is 365 minus the number of days elapsed since December 31, 1996
and the denominator of which is 365 and (ii) an adjustment to
Consolidated Adjusted EBITDA to reflect the annual effect of Borrower's
investment policy realignment for the endowment care fund acquired as
part of the Transaction as such annual effect is described on Schedule
1.1B annexed hereto.
"Pro Forma Projected EBITDA" means, with respect to any
Acquired Business to be acquired in a Permitted Acquisition, the net
income attributable to the Acquired Business for the most recently
ended four quarter period of the Acquired Business, after giving effect
on a pro forma basis to (i) the elimination of any expense items
attributable to the Acquired Business which will not be assumed by
Borrower in connection with the proposed acquisition of the Acquired
Business, (ii) any projected cost savings reasonably projected by
Borrower and reasonably acceptable to Administrative Agent in
connection with the proposed acquisition of the Acquired Business and
(iii) any adjustment attributable to Borrower's investment policy
realignment for any endowment care fund acquired as part of the
Acquired Business and with such adjustment to be made on a basis
reasonably acceptable to Administrative Agent plus, (A) without
duplication, any draw on the reserve of any endowment care fund and any
revenues earned on any endowment care fund and (B) to the extent
deducted in computing the net income attributable to the Acquired
Business, the sum of (a) interest expense, (b) provisions for taxes
based on income attributable to the Acquired Business, (c) depreciation
and amortization expenses (including, to the extent not already
included therein, amortization of grave sites included in cost of
sales) and (d) any other non-cash items reducing net income less, to
the extent added in calculating net income attributable to the
Acquired Business (e) any non-cash items (other than non-cash items
included as installment revenues) increasing net income and (f) any
extraordinary gains, all as determined with respect to the Acquired
Business in conformity with GAAP and as set forth in reasonable detail
in an Officers' Certificate delivered by Borrower to Administrative
Agent, accompanied by the financial statements of the Acquired
Business for the periods covered by the Officers' Certificate and
accompanied by such other supporting documentation as may be
reasonably requested by Administrative Agent.
-31-
"Pro Rata Share" means (i) with respect to all payments,
computations and other matters relating to the AXEL Commitment or the
AXEL of any Lender, the percentage obtained by dividing (a) the AXEL
Exposure of that Lender by (b) the aggregate AXEL Exposure of all
Lenders, (ii) with respect to all payments, computations and other
matters relating to the Additional Term Loans of any Lender, the
percentage obtained by dividing (a) the Additional Term Loan Exposure
of that Lender by (b) the aggregate Additional Term Loan Exposure of
all Lenders, (iii) with respect to all payments, computations and other
matters relating to the Revolving Loan Commitment or the Revolving
Loans of any Lender or any Letters of Credit issued or participations
therein purchased by any Lender or any participations in any Swing Line
Loans purchased by any Lender, the percentage obtained by dividing (a)
the Revolving Loan Exposure of that Lender by (b) the aggregate
Revolving Loan Exposure of all Lenders, and (iv) for all other purposes
with respect to each Lender, the percentage obtained by dividing (a)
the sum of the AXEL Exposure of that Lender plus the Additional Term
Loan Exposure of that Lender plus the Revolving Loan Exposure of that
Lender by (b) the sum of the aggregate AXEL Exposure of all Lenders
plus the aggregate Additional Term Loan Exposure of all Lenders plus
the aggregate Revolving Loan Exposure of all Lenders, in any such case
as the applicable percentage may be adjusted by assignments permitted
pursuant to subsection 10.1. The initial Pro Rata Share of each Lender
for purposes of each of clauses (i), (iii) and (iv) of the preceding
sentence is set forth opposite the name of that Lender in Schedule 2.1
annexed hereto.
"Refunded Swing Line Loans" has the meaning assigned to that
term in subsection 2.1A(iii).
"Register" has the meaning assigned to that term in
subsection 2.1D.
"Regulation D" means Regulation D of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Reimbursement Date" has the meaning assigned to that term in
subsection 3.3B.
"Related Agreements" means, collectively, the Acquisition
Agreement, the Merger Agreement, the Subscription Agreement, the
Holdings Certificate of Designations, the Senior Subordinated Note
Indenture and the Administrative Agreement.
"Release" means any release, spill, emission, leaking,
pumping, pouring, injection, escaping, deposit, disposal, discharge,
dispersal, dumping, leaching or
-32-
migration of Hazardous Materials into the indoor or outdoor
environment (including the abandonment or disposal of any barrels,
containers or other closed receptacles containing any Hazardous
Materials), including the movement of any Hazardous Materials through
the air, soil, surface water or groundwater.
"Requisite Class Lenders" means, at any time of determination
(i) for the Class of Lenders having AXEL Exposure and Additional Term
Loan Exposure, Lenders having or holding more than 50% of the sum of
the aggregate AXEL Exposure and Additional Term Loan Exposure of all
Lenders, and (ii) for the Class of Lenders having Revolving Loan
Exposure, Lenders having or holding more than 50% of the sum of the
aggregate Revolving Loan Exposure of all Lenders.
"Requisite Lenders" means Lenders having or holding more than
50% of the sum of the aggregate AXEL Exposure of all Lenders plus the
aggregate Additional Term Loan Exposure of all Lenders plus the
aggregate Revolving Loan Exposure of all Lenders.
"Reserve Requirement" means, for any Interest Rate
Determination Date, the maximum aggregate reserve requirement
(including all basic, supplemental, marginal and other reserves) which
is imposed under Regulation D on such Interest Rate Determination Date.
"Restricted Junior Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class
of stock of Holdings or Borrower now or hereafter outstanding, except a
dividend payable solely in shares of that class of stock to the holders
of that class, (ii) any redemption, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect,
of any shares of any class of stock of Borrower or Holdings now or
hereafter outstanding, (iii) any payment made to retire, or to obtain
the surrender of, any outstanding warrants, options or other
rights to acquire shares of any class of stock of Borrower or Holdings
now or hereafter outstanding, and (iv) any payment or prepayment of
principal of, premium, if any, or interest on, or redemption, purchase,
retirement, defeasance (including in-substance or legal defeasance),
sinking fund or similar payment with respect to, any Subordinated
Indebtedness.
"Revolving Loan Commitment" means the commitment of a Lender
to make Revolving Loans to Borrower pursuant to subsection 2.1A(ii),
and "Revolving Loan Commitments" means such commitments of all Lenders
in the aggregate.
-33-
"Revolving Loan Commitment Termination Date" means November
1, 2001.
"Revolving Loan Exposure" means, with respect to any Lender as
of any date of determination (i) prior to the termination of the
Revolving Loan Commitments, that Lender's Revolving Loan Commitment and
(ii) after the termination of the Revolving Loan Commitments, the sum
of (a) the aggregate outstanding principal amount of the Revolving
Loans of that Lender plus (b) in the event that Lender is Issuing
Lender, the aggregate Letter of Credit Usage in respect of all Letters
of Credit issued by that Lender (in each case net of any participations
purchased by other Lenders in such Letters of Credit or any
unreimbursed drawings thereunder) plus (c) the aggregate amount of all
participations purchased by that Lender in any outstanding Letters of
Credit or any unreimbursed drawings under any Letters of Credit plus
(d) in the case of Swing Line Lender, the aggregate outstanding
principal amount of all Swing Line Loans (net of any participations
therein purchased by other Lenders) plus (e) the aggregate amount of
all participations purchased by that Lender in any outstanding Swing
Line Loans.
"Revolving Loans" means the Loans made by Lenders to Borrower
pursuant to subsection 2.1A(ii).
"Revolving Notes" means (i) the promissory notes of Borrower
issued pursuant to subsection 2.1E(i)(b) on the Closing Date and (ii)
any promissory notes issued by Borrower pursuant to the last sentence
of subsection 10.1B(i) in connection with assignments of the Revolving
Loan Commitments and Revolving Loans of any Lenders, in each case
substantially in the form of Exhibit V annexed hereto, as they may be
amended, supplemented or otherwise modified from time to time.
"Revolving Outstandings" means, at any time, the sum of (1)
the aggregate principal amount of Revolving Loans and Swing Line Loans
then outstanding plus (2) the aggregate amount of Letter of Credit
Usage at such time.
"RH Cemetery" has the meaning assigned to that term in the
Recitals.
"RH Mortuary" has the meaning assigned to that term in the
Recitals.
"RH Properties" has the meaning assigned to that term in the
Recitals.
"Rose Hills" has the meaning assigned to that term in the
Recitals.
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"Satellite Properties" means the fourteen funeral homes and
two combination funeral home and cemetery properties contributed to RH
Holdings as part of the Contribution and pursuant to the terms and
conditions of the Subscription Agreement.
"Securities" means any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation in
any profit-sharing agreement or arrangement, options, warrants, bonds,
debentures, notes, or other evidences of indebtedness, secured or
unsecured, convertible, subordinated or otherwise, or in general any
instruments commonly known as "securities" or any certificates of
interest, shares or participations in temporary or interim certificates
for the purchase or acquisition of, or any right to subscribe to,
purchase or acquire, any of the foregoing.
"Securities Act" means the Securities Act of 1933, as amended
from time to time, and any successor statute.
"Senior Subordinated Note Indenture" means the indenture
pursuant to which the Senior Subordinated Notes are issued, as such
indenture may be amended from time to time to the extent permitted
under subsection 7.13A.
"Senior Subordinated Notes" means the $80,000,000 in aggregate
principal amount of 9-1/2% Senior Subordinated Notes due 2004 of
Borrower issued pursuant to the Senior Subordinated Note Indenture.
"Solvent" means, with respect to any Person, that as of the
date of determination both (i)(a) the then fair saleable value of the
property of such Person is (1) greater than the total amount of
liabilities (including contingent liabilities) of such Person and (2)
not less than the amount that will be required to pay the probable
liabilities on such Person's then existing debts as they become
absolute and matured considering all financing alternatives and
potential asset sales reasonably available to such Person; (b) such
Person's capital is not unreasonably small in relation to its business
or any contemplated or undertaken transaction; and (c) such Person does
not intend to incur, or believe (nor should it reasonably believe) that
it will incur, debts beyond its ability to pay such debts as they
become due; and (ii) such Person is "solvent" within the meaning given
that term and similar terms under applicable laws relating to
fraudulent transfers and conveyances. For purposes of this definition,
the amount of any contingent liability at any time shall be computed as
the amount that, in light of all of the facts and circumstances
existing at such time, represents the amount that can reasonably be
expected to become an actual or matured liability.
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"Standby Letter of Credit" means any standby letter of credit
or similar instrument issued for the purpose of supporting (i)
Indebtedness of Borrower or any of its Subsidiaries in respect of
industrial revenue or development bonds or financings, (ii) workers'
compensation liabilities of Borrower or any of its Subsidiaries, (iii)
the obligations of third party insurers of Borrower or any of its
Subsidiaries arising by virtue of the laws of any jurisdiction
requiring third party insurers, (iv) obligations with respect to
Capital Leases or Operating Leases of Borrower or any of its
Subsidiaries, (v) performance, payment, deposit or surety obligations
of Borrower or any of its Subsidiaries, in any case if required by law
or governmental rule or regulation or in accordance with custom and
practice in the industry and (vi) other obligations of Borrower and its
Subsidiaries permitted hereunder; provided that Standby Letters of
Credit may not be issued without the consent of Issuing Lender (which
consent may be withheld in the sole discretion of Issuing Lender) for
the purpose of supporting (a) trade payables or (b) any Indebtedness
constituting "antecedent debt" (as that term is used in Section 547 of
the Bankruptcy Code).
"Subordinated Indebtedness" means (i) Indebtedness of Borrower
evidenced by the Senior Subordinated Notes and (ii) any other
Indebtedness of Borrower subordinated in right of payment to the
Obligations pursuant to documentation containing maturities,
amortization schedules, covenants, defaults, remedies, subordination
provisions and other material terms in form and substance satisfactory
to Administrative Agent and Requisite Lenders.
"Subscription Agreement" means that certain Subscription
Agreement by and among Investors and RH Holdings, dated as of November
19, 1996, in the form delivered to Arranging Agent prior to the
execution of this Agreement.
"Subsidiary" means, with respect to any Person, any
corporation, partnership, limited liability company, association, joint
venture or other business entity of which more than 50% of the total
voting power of shares of stock or other ownership interests entitled
(without regard to the occurrence of any contingency) to vote in the
election of the Person or Persons (whether directors, managers,
trustees or other Persons performing similar functions) having the
power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by
that Person or one or more of the other Subsidiaries of that Person or
a combination thereof.
"Subsidiary Guarantor" means any Subsidiary of Borrower that
executes and delivers a counterpart of the Subsidiary Guaranty on the
Closing Date or from time to time thereafter pursuant to subsection
6.8.
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"Subsidiary Guaranty" means the Subsidiary Guaranty executed
and delivered by existing domestic Subsidiaries of Borrower on the
Closing Date and to be executed and delivered by additional domestic
Subsidiaries of Borrower from time to time thereafter in accordance
with subsection 6.8, substantially in the form of Exhibit XV annexed
hereto, as such Subsidiary Guaranty may hereafter be amended,
supplemented or otherwise modified from time to time.
"Subsidiary Pledge Agreement" means the Subsidiary Pledge
Agreement executed and delivered by existing Subsidiary Guarantors and
Administrative Agent on the Closing Date and to be executed and
delivered by any additional Subsidiary Guarantors from time to time
thereafter in accordance with subsection 6.8, substantially in the form
of Exhibit XVI annexed hereto, as such Subsidiary Pledge Agreement may
be amended, supplemented or otherwise modified from time to time.
"Subsidiary Security Agreement" means the Subsidiary Security
Agreement executed and delivered by existing Subsidiary Guarantors and
Administrative Agent on the Closing Date and to be executed and
delivered by any additional Subsidiary Guarantors from time to time
thereafter in accordance with subsection 6.8, substantially in the form
of Exhibit XVII annexed hereto, as such Subsidiary Security Agreement
may be amended, supplemented or otherwise modified from time to time.
"Supplemental Collateral Agent" has the meaning assigned to
that term in subsection 9.1D.
"Swing Line Lender" means Scotiabank, or any Person serving as
a successor Administrative Agent hereunder, in its capacity as Swing
Line Lender hereunder.
"Swing Line Loan Commitment" means the commitment of Swing
Line Lender to make Swing Line Loans to Borrower pursuant to subsection
2.1A(iii).
"Swing Line Loans" means the Loans made by Swing Line Lender
to Borrower pursuant to subsection 2.1A(iii).
"Swing Line Note" means (i) the promissory note of Borrower
issued pursuant to subsection 2.1E(ii) on the Closing Date and (ii) any
promissory note issued by Borrower to any successor Administrative
Agent and Swing Line Lender pursuant to the last sentence of subsection
9.5B, in each case substantially
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in the form of Exhibit VI annexed hereto, as it may be amended,
supplemented or otherwise modified from time to time.
"Syndication Agent" has the meaning assigned to that term in
the introduction to this Agreement.
"Tax" or "Taxes" means any present or future tax, levy,
impost, duty, charge, fee, deduction or withholding of any nature and
whatever called, by whomsoever, on whomsoever and wherever imposed,
levied, collected, withheld or assessed; provided that "Tax on the
overall net income" of a Person shall be construed as a reference to a
tax imposed by the jurisdiction in which that Person is organized or in
which that Person's principal office (and/or, in the case of a Lender,
its lending office) is located or in which that Person (and/or, in the
case of a Lender, its lending office) is deemed to be doing business on
all or part of the net income, profits or gains (whether worldwide, or
only insofar as such income, profits or gains are considered to arise
in or to relate to a particular jurisdiction, or otherwise) of that
Person (and/or, in the case of a Lender, its lending office).
"Total Modified Senior Debt" means, as at any date of
determination, the aggregate amount of Total Senior Debt at such date
less the aggregate amount of all Revolving Outstandings at such date.
"Total Senior Debt" means, as at any date of determination,
the aggregate stated balance sheet amount of all Indebtedness and
Contingent Obligations of Holdings and its Subsidiaries in respect of
Indebtedness, in each case other than Indebtedness evidenced by the
Senior Subordinated Notes, Covenants not to Compete and the Existing
Sellers Notes, all as determined on a consolidated basis in accordance
with GAAP.
"Total Utilization of Revolving Loan Commitments" means, as at
any date of determination, the sum of (i) the aggregate principal
amount of all outstanding Revolving Loans (other than Revolving Loans
made for the purpose of repaying any Refunded Swing Line Loans or
reimbursing Issuing Lender for any amount drawn under any Letter of
Credit but not yet so applied) plus (ii) the aggregate principal amount
of all outstanding Swing Line Loans plus (iii) the Letter of Credit
Usage.
"Transaction" means, collectively, (i) the execution and
delivery of this Agreement and the incurrence of Loans on the Closing
Date, (ii) the consummation of the Acquisition, (iii) the consummation
of the Merger, (iv) the issuance of the Senior Subordinated Notes, (v)
the consummation of the
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Contribution and (vi) the consummation of the other transactions
contemplated by the other Related Agreements.
"Transaction Costs" means the fees, costs and expenses payable
by Borrower on or before the Closing Date in connection with the
Transaction.
"UCC" means the Uniform Commercial Code (or any similar or
equivalent legislation) as in effect in any applicable jurisdiction.
"Wholly Owned Subsidiary" means, with respect to any Person,
any Subsidiary of such Person of which such Person owns, directly or
indirectly, 90% or more of all classes of the capital stock.
1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations
Under Agreement.
Except as otherwise expressly provided in this Agreement, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Borrower to Lenders pursuant to clauses (i), (ii),
and (xi) of subsection 6.1 shall be prepared in accordance with GAAP as in
effect at the time of such preparation (and delivered together with the
reconciliation statements provided for in subsection 6.1(iv)). Calculations in
connection with the definitions, covenants and other provisions of this
Agreement shall utilize accounting principles and policies in conformity with
those used to prepare the financial statements referred to in subsection 5.3;
provided that the purchase accounting adjustments made in connection with the
Acquisition and the Merger and the Contribution shall be included; and provided
further, that if Borrower notifies Lenders that Borrower wishes to amend any
covenant in subsection 2.4B(iii)(d), 7.6 or 7.8 or any related definition to
eliminate the effect of any change in GAAP occurring after the date of this
Agreement on the operation of such covenant (or if Administrative Agent
notifies Borrower that Lenders wish to amend subsection 2.4B(iii)(d), 7.6 or
7.8 or any related definition for such purpose), then Borrower and Lenders
hereby agree to negotiate in good faith to agree upon an appropriate amendment
to such covenant.
1.3 Other Definitional Provisions and Rules of Construction.
Any of the terms defined herein may, unless the context otherwise
requires, be used in the singular or the plural, depending on the reference.
References to "Sections" and "subsections" shall be to Sections and subsections,
respectively, of this Agreement unless otherwise specifically provided. The use
herein of the word "include" or "including", when following any general
statement, term or matter, shall not be construed to limit such statement, term
or matter to the specific items or matters set forth
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immediately following such word or to similar items or matters, whether or not
nonlimiting language (such as "without limitation" or "but not limited to" or
words of similar import) is used with reference thereto, but rather shall be
deemed to refer to all other items or matters that fall within the broadest
possible scope of such general statement, term or matter.
SECTION 2.
AMOUNTS AND TERMS OF COMMITMENTS AND LOANS
2.1 Commitments; Making of Loans; the Register; Notes.
A. Commitments. Subject to the terms and conditions of this
Agreement and in reliance upon the representations and warranties of Borrower
herein set forth, each Lender hereby severally agrees to make the Loans
described in subsections 2.1A(i) and 2.1A(ii) and Swing Line Lender hereby
agrees to make the Loans described in subsection 2.1A(iii).
(i) AXELs. Each Lender severally agrees to lend to Borrower
on the Closing Date an amount not exceeding its Pro Rata Share of the
aggregate amount of the AXEL Commitments to be used for the purposes
identified in subsection 2.5A. The amount of each Lender's AXEL
Commitment is set forth opposite its name on Schedule 2.1 annexed
hereto and the aggregate amount of the AXEL Commitments is $75,000,000;
provided that the AXEL Commitments of Lenders shall be adjusted to give
effect to any assignments of the AXEL Commitments pursuant to
subsection 10.1B. Each Lender's AXEL Commitment shall expire
immediately and without further action on February 28, 1997 if the
AXELs are not made on or before that date. Borrower may make only one
borrowing under the AXEL Commitments. Amounts borrowed under this
subsection 2.1A(i) and subsequently repaid or prepaid may not be
reborrowed.
(ii) Revolving Loans. Each Lender severally agrees, subject
to the limitations set forth below with respect to the maximum amount
of Revolving Loans permitted to be outstanding from time to time, to
lend to Borrower from time to time during the period from the Closing
Date to but excluding the Revolving Loan Commitment Termination Date an
aggregate amount not exceeding its Pro Rata Share of the aggregate
amount of the Revolving Loan Commitments to be used for the purposes
identified in subsection 2.5B. The original amount of each Lender's
Revolving Loan Commitment is set forth opposite its name on Schedule
2.1 annexed hereto and the aggregate original amount of the Revolving
Loan Commitments is $25,000,000; provided that the Revolving Loan
Commitments of Lenders shall be adjusted to give effect to any
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assignments of the Revolving Loan Commitments pursuant to subsection
10.1B; and provided further, that the amount of the Revolving Loan
Commitments shall be reduced from time to time by the amount of any
reductions thereto made pursuant to subsections 2.4B(ii) and 2.4B(iii).
Each Lender's Revolving Loan Commitment shall expire on the Revolving
Loan Commitment Termination Date and all Revolving Loans and all other
amounts owed hereunder with respect to the Revolving Loans and the
Revolving Loan Commitments shall be paid in full no later than that
date; provided that each Lender's Revolving Loan Commitment shall
expire immediately and without further action on February 28, 1997 if
the AXELs are not made on or before that date. Amounts borrowed under
this subsection 2.1A(ii) may be repaid and reborrowed to but excluding
the Revolving Loan Commitment Termination Date.
Anything contained in this Agreement to the contrary
notwithstanding, the Revolving Loans and the Revolving Loan Commitments
shall be subject to the limitations that (i) in no event shall the
Total Utilization of Revolving Loan Commitments at any time exceed the
Revolving Loan Commitments then in effect and (ii) no Revolving Loans
shall be made on the Closing Date.
(iii) Swing Line Loans. Swing Line Lender hereby agrees,
subject to the limitations set forth below with respect to the maximum
amount of Swing Line Loans permitted to be outstanding from time to
time, to make a portion of the Revolving Loan Commitments available to
Borrower from time to time during the period from the Closing Date to
but excluding the Revolving Loan Commitment Termination Date by making
Swing Line Loans to Borrower in an aggregate amount not exceeding the
amount of the Swing Line Loan Commitment to be used for the purposes
identified in subsection 2.5B, notwithstanding the fact that such
Swing Line Loans, when aggregated with Swing Line Lender's outstanding
Revolving Loans and Swing Line Lender's Pro Rata Share of the Letter
of Credit Usage then in effect, may exceed Swing Line Lender's
Revolving Loan Commitment. The original amount of the Swing Line Loan
Commitment is $5,000,000; provided that any reduction of the Revolving
Loan Commitments made pursuant to subsection 2.4B(ii) or 2.4B(iii)
which reduces the aggregate Revolving Loan Commitments to an amount
less than the then current amount of the Swing Line Loan Commitment
shall result in an automatic corresponding reduction of the Swing Line
Loan Commitment to the amount of the Revolving Loan Commitments, as so
reduced, without any further action on the part of Borrower,
Administrative Agent or Swing Line Lender. The Swing Line Loan
Commitment shall expire on the Revolving Loan Commitment Termination
Date and all Swing Line Loans and all other amounts owed hereunder
with respect to the Swing Line Loans shall be paid in full no later
than that date; provided that the Swing Line Loan Commitment shall
expire
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immediately and without further action on February 28, 1997 if the
AXELs are not made on or before that date. Amounts borrowed under this
subsection 2.1A(iii) may be repaid and reborrowed to but excluding the
Revolving Loan Commitment Termination Date.
Anything contained in this Agreement to the contrary
notwithstanding, the Swing Line Loans and the Swing Line Loan
Commitment shall be subject to the limitations that (i) in no event
shall the Total Utilization of Revolving Loan Commitments at any time
exceed the Revolving Loan Commitments then in effect and (ii) no Swing
Line Loans shall be made on the Closing Date.
With respect to any Swing Line Loans which have not been
voluntarily prepaid by Borrower pursuant to subsection 2.4B(i), Swing
Line Lender may, at any time in its sole and absolute discretion,
deliver to Administrative Agent (with a copy to Borrower), no later
than 10:00 A.M. (New York City time) on the first Business Day in
advance of the proposed Funding Date, a notice requesting Lenders to
make Revolving Loans that are Base Rate Loans on such Funding Date in
an amount equal to the amount of such Swing Line Loans (the "Refunded
Swing Line Loans") outstanding on the date such notice is given which
Swing Line Lender requests Lenders to prepay (which request shall be
deemed to have also been made by Borrower). Anything contained in this
Agreement to the contrary notwithstanding, (i) the proceeds of such
Revolving Loans made by Lenders other than Swing Line Lender shall be
immediately delivered by Administrative Agent to Swing Line Lender (and
not to Borrower) and applied to repay a corresponding portion of the
Refunded Swing Line Loans and (ii) on the day such Revolving Loans are
made, Swing Line Lender's Pro Rata Share of the Refunded Swing Line
Loans shall be deemed to be paid with the proceeds of a Revolving Loan
made by Swing Line Lender, and such portion of the Swing Line Loans
deemed to be so paid shall no longer be outstanding as Swing Line
Loans and shall no longer be due under the Swing Line Note of Swing
Line Lender but shall instead constitute part of Swing Line Lender's
outstanding Revolving Loans and shall be due under the Revolving Note
of Swing Line Lender. Borrower hereby authorizes Administrative Agent
and Swing Line Lender to charge Borrower's accounts with
Administrative Agent and Swing Line Lender (up to the amount available
in each such account) one Business Day after requesting Borrower to
repay the Refunded Swing Line Loans in order to pay Swing Line Lender
the amount of the Refunded Swing Line Loans to the extent the proceeds
of such Revolving Loans made by Lenders, including the Revolving Loan
deemed to be made by Swing Line Lender, are not sufficient to repay in
full the Refunded Swing Line Loans. If any portion of any such amount
paid (or deemed to be paid) to Swing Line Lender should be recovered
by or on behalf of Borrower from Swing Line Lender in bankruptcy,
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by assignment for the benefit of creditors or otherwise, the loss of
the amount so recovered shall be ratably shared among all Lenders in
the manner contemplated by subsection 10.5.
If for any reason (a) Revolving Loans are not made upon the
request of Swing Line Lender as provided in the immediately preceding
paragraph in an amount sufficient to repay any amounts owed to Swing
Line Lender in respect of any outstanding Swing Line Loans or (b) the
Revolving Loan Commitments are terminated at a time when any Swing Line
Loans are outstanding, each Lender shall be deemed to, and hereby
agrees to, have purchased a participation in such outstanding Swing
Line Loans in an amount equal to its Pro Rata Share (calculated, in the
case of the foregoing clause (b), immediately prior to such termination
of the Revolving Loan Commitments) of the unpaid amount of such Swing
Line Loans together with accrued interest thereon. Upon one Business
Day's notice from Swing Line Lender, each Lender shall deliver to Swing
Line Lender an amount equal to its respective participation in same day
funds at the Funding and Payment Office. In order to further evidence
such participation (and without prejudice to the effectiveness of the
participation provisions set forth above), each Lender agrees to enter
into a separate participation agreement at the request of Swing Line
Lender in form and substance reasonably satisfactory to Swing Line
Lender. In the event any Lender fails to make available to Swing Line
Lender the amount of such Lender's participation as provided in this
paragraph, Swing Line Lender shall be entitled to recover such amount
on demand from such Lender together with interest thereon at the rate
customarily used by Swing Line Lender for the correction of errors
among banks for three Business Days and thereafter at the Base Rate. In
the event Swing Line Lender receives a payment of any amount in which
other Lenders have purchased participations as provided in this
paragraph, Swing Line Lender shall promptly distribute to each such
other Lender its Pro Rata Share of such payment.
Anything contained herein to the contrary notwithstanding,
each Lender's obligation to make Revolving Loans for the purpose of
repaying any Refunded Swing Line Loans pursuant to the second preceding
paragraph and each Lender's obligation to purchase a participation in
any unpaid Swing Line Loans pursuant to the immediately preceding
paragraph shall be absolute and unconditional and shall not be affected
by any circumstance, including (a) any set-off, counterclaim,
recoupment, defense or other right which such Lender may have against
Swing Line Lender, Borrower or any other Person for any reason
whatsoever; (b) the occurrence or continuation of an Event of Default
or a Potential Event of Default; (c) any adverse change in the
business, operations, properties, assets, condition (financial or
otherwise) or prospects of Borrower or any of its Subsidiaries; (d) any
breach of this Agreement or any other Loan Document by any party
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thereto; or (e) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing; provided that such
obligations of each Lender are subject to the condition that (1) Swing
Line Lender believed in good faith that all conditions under Section 4
to the making of the applicable Refunded Swing Line Loans or other
unpaid Swing Line Loans, as the case may be, were satisfied at the time
such Refunded Swing Line Loans or unpaid Swing Line Loans were made or
(2) the satisfaction of any such condition not satisfied had been
waived in accordance with subsection 10.6 prior to or at the time such
Refunded Swing Line Loans or other unpaid Swing Line Loans were made.
(iv) Additional Term Loans. Borrower acknowledges that each
Lender that has agreed to make Additional Term Loans is making such
Additional Term Loans on the terms and conditions of this Agreement and
in reliance upon the representations and warranties of Borrower herein
set forth. In addition, Additional Term Loans once borrowed and
subsequently repaid or prepaid may not be reborrowed.
B. Borrowing Mechanics. AXELs or Revolving Loans made on any
Funding Date (other than Revolving Loans made pursuant to a request by Swing
Line Lender pursuant to subsection 2.1A(iii) for the purpose of repaying any
Refunded Swing Line Loans or Revolving Loans made pursuant to subsection 3.3B
for the purpose of reimbursing Issuing Lender for the amount of a drawing under
a Letter of Credit issued by it) shall be in an aggregate minimum amount of
$1,000,000. Swing Line Loans made on any Funding Date shall be in an aggregate
minimum amount of $100,000. Whenever Borrower desires that Lenders make AXELs or
Revolving Loans it shall deliver to Administrative Agent a Notice of Borrowing
no later than 10:00 A.M. (New York City time) at least three Business Days in
advance of the proposed Funding Date (in the case of a Eurodollar Rate Loan) or
at least one Business Day in advance of the proposed Funding Date (in the case
of a Base Rate Loan). Whenever Borrower desires that Swing Line Lender make a
Swing Line Loan, it shall deliver to Administrative Agent a Notice of Borrowing
no later than 12:00 Noon (New York City time) on the proposed Funding Date. The
Notice of Borrowing shall specify (i) the proposed Funding Date (which shall be
a Business Day), (ii) the amount and type of Loans requested, (iii) in the case
of Swing Line Loans, that such Loans shall be Base Rate Loans, (iv) in the case
of AXELs, Additional Term Loans and Revolving Loans, whether such Loans shall be
Base Rate Loans or Eurodollar Rate Loans, and (v) in the case of any Loans
requested to be made as Eurodollar Rate Loans, the initial Interest Period
requested therefor. Additional Term Loans shall be made in coordination with
Borrower, Lender or Lenders making such Additional Term Loans and Administrative
Agent. AXELs, Additional Term Loans and Revolving Loans may be continued as or
converted into Base Rate Loans and Eurodollar Rate Loans in the manner provided
in subsection 2.2D. In lieu of delivering the above-described Notice of
Borrowing, Borrower may give Administrative Agent telephonic
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notice by the required time of any proposed borrowing under this subsection
2.1B; provided that such notice shall be promptly confirmed in writing by
delivery of a Notice of Borrowing to Administrative Agent on or before the
applicable Funding Date.
Neither Administrative Agent nor any Lender shall incur any liability
to Borrower in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of Borrower or
for otherwise acting in good faith under this subsection 2.1B, and upon funding
of Loans by Lenders in accordance with this Agreement pursuant to any such
telephonic notice Borrower shall have effected Loans hereunder.
Borrower shall notify Administrative Agent prior to the funding of any
Loans in the event that any of the matters to which Borrower has certified in
the applicable Notice of Borrowing is no longer true and correct as of the
applicable Funding Date, and the acceptance by Borrower of the proceeds of any
Loans shall constitute a re-certi- fication by Borrower, as of the applicable
Funding Date, as to the matters to which Borrower is required to certify in the
applicable Notice of Borrowing.
Except as otherwise provided in subsections 2.6B and 2.6C, a Notice of
Borrowing for a Eurodollar Rate Loan (or telephonic notice in lieu thereof)
shall be irrevocable on and after the related Interest Rate Determination Date,
and Borrower shall be bound to make a borrowing in accordance therewith.
C. Disbursement of Funds. All AXELs and Revolving Loans under this
Agreement shall be made by Lenders simultaneously and proportionately to their
respective Pro Rata Shares, it being understood that no Lender shall be
responsible for any default by any other Lender in that other Lender's
obligation to make a Loan requested hereunder nor shall the Commitment of any
Lender to make the particular type of Loan requested be increased or decreased
as a result of a default by any other Lender in that other Lender's obligation
to make a Loan requested hereunder. Promptly after receipt by Administrative
Agent of a Notice of Borrowing pursuant to subsection 2.1B (or telephonic notice
in lieu thereof), Administrative Agent shall notify each Lender or Swing Line
Lender, as the case may be, of the proposed borrowing. Each Lender shall make
the amount of its Loan available to Administrative Agent not later than 12:00
Noon (New York City time) on the applicable Funding Date, and Swing Line Lender
shall make the amount of its Swing Line Loan available to Administrative Agent
not later than 12:00 Noon (New York City time) on the applicable Funding Date,
in each case in same day funds in Dollars, at the Funding and Payment Office.
Except as provided in subsection 2.1A(iii) or subsection 3.3B with respect to
Revolving Loans used to repay Refunded Swing Line Loans or to reimburse Issuing
Lender for the amount of a drawing under a Letter of Credit issued by it, upon
satisfaction or waiver of the
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conditions precedent specified in subsections 4.1 (in the case of Loans made on
the Closing Date) and 4.2 (in the case of all Loans), Administrative Agent
shall make the proceeds of such Loans available to Borrower on the applicable
Funding Date by causing an amount of same day funds in Dollars equal to the
proceeds of all such Loans received by Administrative Agent from Lenders or
Swing Line Lender, as the case may be, to be credited to the account of
Borrower at the Funding and Payment Office. Notwithstanding anything to the
contrary contained above in this subsection 2.1C, all Additional Term Loans
under this Agreement shall be made in Dollars and in coordination with
Borrower, Lender or Lenders making such Additional Term Loans and
Administrative Agent.
Unless Administrative Agent shall have been notified by any Lender
prior to the Funding Date for any Loans that such Lender does not intend to make
available to Administrative Agent the amount of such Lender's Loan requested on
such Funding Date, Administrative Agent may assume that such Lender has made
such amount available to Administrative Agent on such Funding Date and
Administrative Agent may, in its sole discretion, but shall not be obligated to,
make available to Borrower a corresponding amount on such Funding Date. If such
corresponding amount is not in fact made available to Administrative Agent by
such Lender, Administrative Agent shall be entitled to recover such
corresponding amount on demand from such Lender together with interest thereon,
for each day from such Funding Date until the date such amount is paid to
Administrative Agent, at the customary rate set by Administrative Agent for the
correction of errors among banks for three Business Days and thereafter at the
Base Rate. If such Lender does not pay such corresponding amount forthwith upon
Administrative Agent's demand therefor, Administrative Agent shall promptly
notify Borrower and Borrower shall immediately pay such corresponding amount to
Administrative Agent together with interest thereon, for each day from such
Funding Date until the date such amount is paid to Administrative Agent, at the
rate payable under this Agreement for Base Rate Loans. Nothing in this
subsection 2.1C shall be deemed to relieve any Lender from its obligation to
fulfill its Commitments hereunder or to prejudice any rights that Borrower may
have against any Lender as a result of any default by such Lender hereunder.
D. The Register.
(i) Administrative Agent shall maintain, at its address
referred to in subsection 10.8, a register for the recordation of the
names and addresses of Lenders and the Commitments and Loans of each
Lender from time to time (the "Register"). The Register shall be
available for inspection by Borrower or any Lender at any reasonable
time and from time to time upon reasonable prior notice.
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(ii) Administrative Agent shall record in the Register the
AXEL Commitment and Revolving Loan Commitment and the AXEL, Additional
Term Loans and Revolving Loans from time to time of each Lender, the
Swing Line Loan Commitment and the Swing Line Loans from time to time
of Swing Line Lender, and each repayment or prepayment in respect of
the principal amount of the AXEL, Additional Term Loans or Revolving
Loans of each Lender or the Swing Line Loans of Swing Line Lender. Any
such recordation shall be conclusive and binding on Borrower and each
Lender, absent demonstrable error; provided that failure to make any
such recordation, or any error in such recorda- tion, shall not affect
any Lender's Commitments or Borrower's Obligations in respect of any
applicable Loans.
(iii) Each Lender shall record on its internal records
(including the Notes held by such Lender) the amount of the AXEL, the
Additional Term Loans and each Revolving Loan made by it and each
payment in respect thereof. Any such recordation shall be conclusive
and binding on Borrower, absent demonstrable error; provided that
failure to make any such recordation, or any error in such recordation,
shall not affect any Lender's Commitments or Borrower's Obligations in
respect of any applicable Loans; and provided further, that in the
event of any inconsistency between the Register and any Lender's
records, the recordations in the Register shall govern.
(iv) Borrower, Administrative Agent and Lenders shall deem
and treat the Persons listed as Lenders in the Register as the holders
and owners of the corresponding Commitments and Loans listed therein
for all purposes hereof, and no assignment or transfer of any such
Commitment or Loan shall be effective, in each case unless and until
an Assignment Agreement effecting the assignment or transfer thereof
shall have been accepted by Administrative Agent and recorded in the
Register as provided in subsection 10.1B(ii). Prior to such
recordation, all amounts owed with respect to the applicable
Commitment or Loan shall be owed to the Lender listed in the Register
as the owner thereof, and any request, authority or consent of any
Person who, at the time of making such request or giving such
authority or consent, is listed in the Register as a Lender shall be
conclusive and binding on any subsequent holder, assignee or
transferee of the corresponding Commitments or Loans.
(v) Borrower hereby designates Administrative Agent to serve
as Borrower's agent solely for purposes of maintaining the Register as
provided in this subsection 2.1D, and Borrower hereby agrees that, to
the extent Administrative Agent serves in such capacity, Administrative
Agent and its officers, directors, employees, agents and affiliates
shall constitute Indemnitees for all purposes under subsection 10.3.
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E. Notes. Borrower shall execute and deliver on the Closing
Date (i) to each Lender (or to Administrative Agent for that Lender) (a) an
AXEL Note substantially in the form of Exhibit IV annexed hereto to evidence
that Lender's AXEL, in the principal amount of that Lender's AXEL and with
other appropriate insertions, and (b) a Revolving Note substantially in the
form of Exhibit V annexed hereto to evidence that Lender's Revolving Loans, in
the principal amount of that Lender's Revolving Loan Commitment and with other
appropriate insertions, and (ii) to Swing Line Lender (or to Administrative
Agent for Swing Line Lender) a Swing Line Note substantially in the form of
Exhibit VI annexed hereto to evidence Swing Line Lender's Swing Line Loans, in
the principal amount of the Swing Line Loan Commitment and with other
appropriate insertions. Borrower shall execute and deliver to each Lender that
has made an Additional Term Loan an Additional Term Note at the time such
Additional Term Loan is made.
2.2 Interest on the Loans.
A. Rate of Interest. Subject to the provisions of subsections
2.6 and 2.7, each AXEL, each Additional Term Loan and each Revolving Loan shall
bear interest on the unpaid principal amount thereof from the date made through
maturity (whether by acceleration or otherwise) at a rate determined by
reference to the Base Rate or the Adjusted Eurodollar Rate. Subject to the
provisions of subsection 2.7, each Swing Line Loan shall bear interest on the
unpaid principal amount thereof from the date made through maturity (whether by
acceleration or otherwise) at a rate determined by reference to the Base Rate.
The applicable basis for determining the rate of interest with respect to any
AXEL or any Revolving Loan shall be selected by Borrower initially at the time
a Notice of Borrowing is given with respect to such Loan pursuant to subsection
2.1B. The applicable basis for determining the rate of interest with respect to
any Additional Term Loan shall be selected by the Borrower initially at the
time a Notice of Borrowing is given with respect to such Additional Term Loan.
The basis for determining the interest rate with respect to any AXEL, any
Additional Term Loan or any Revolving Loan may be changed from time to time
pursuant to subsection 2.2D. If on any day an AXEL, an Additional Term Loan or
a Revolving Loan is outstanding with respect to which notice has not been
delivered to Administrative Agent in accordance with the terms of this
Agreement specifying the applicable basis for determining the rate of interest,
then for that day that Loan shall bear interest determined by reference to the
Base Rate.
(i) Subject to the provisions of subsections 2.2E and 2.7,
the AXELs, the Additional Term Loans and the Revolving Loans shall bear
interest through maturity as follows:
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(a) if a Base Rate Loan, then at the sum of
the Base Rate plus the Applicable Margin in effect from time
to time, or
(b) if a Eurodollar Rate Loan, then at the sum
of the Adjusted Eurodollar Rate plus the Applicable Margin
in effect from time to time; and
(ii) Subject to the provisions of subsections 2.2E and 2.7,
the Swing Line Loans shall bear interest through maturity at the sum of
the Base Rate plus 1.75% per annum plus the Pricing Premium, if any,
less the Pricing Reduction, if any.
B. Interest Periods. In connection with each Eurodollar Rate
Loan, Borrower may, pursuant to the applicable Notice of Borrowing or Notice of
Conversion/Continuation, as the case may be, select an interest period (each an
"Interest Period") to be applicable to such Loan, which Interest Period shall
be, at Borrower's option, either a one-, two-, three- or six-month period or,
if deposits in the interbank Eurodollar market are generally available to each
Lender for such period (as determined by each Lender making, converting to or
continuing such Eurodollar Rate Loan), a nine- or twelve-month period; provided
that:
(i) the initial Interest Period for any Eurodollar Rate Loan
shall commence on the Funding Date in respect of such Loan, in the case
of a Loan initially made as a Eurodollar Rate Loan, or on the date
specified in the applicable Notice of Conversion/Continuation, in the
case of a Loan converted to a Eurodollar Rate Loan;
(ii) in the case of immediately successive Interest
Periods applicable to a Eurodollar Rate Loan continued as such
pursuant to a Notice of Conversion/Continuation, each successive
Interest Period shall commence on the day on which the next preceding
Interest Period expires;
(iii) if an Interest Period would otherwise expire on a day
that is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day; provided that, if any Interest Period
would otherwise expire on a day that is not a Business Day but is a day
of the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the next preceding Business Day;
(iv) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day
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in the calendar month at the end of such Interest Period) shall,
subject to clause (v) of this subsection 2.2B, end on the last
Business Day of a calendar month;
(v) there shall be no more than six Interest Periods
outstanding at any time;
(vi) in the event Borrower fails to specify an Interest
Period for any Eurodollar Rate Loan in the applicable Notice of
Borrowing or Notice of Conversion/Continuation, Borrower shall be
deemed to have selected an Interest Period of one month; and
(vii) Borrower may not select an Interest Period in excess of
one month with respect to any Eurodollar Rate Loan until the earlier of
(a) the date the Arranging Agent advises Borrower that the AXELs have
been fully syndicated or any earlier date agreed to by Arranging Agent
and (b) the date which is 60 days after the Closing Date.
C. Interest Payments. Subject to the provisions of subsection
2.2E, interest on each Loan shall be payable in arrears on and to each Interest
Payment Date applicable to that Loan, upon any prepayment of that Loan (to the
extent accrued on the amount being prepaid) and at maturity (including final
maturity); provided that in the event any Swing Line Loans or any Revolving
Loans that are Base Rate Loans are prepaid pursuant to subsection 2.4B(i),
interest accrued on such Swing Line Loans or Revolving Loans through the date
of such prepayment shall be payable on the next succeeding Interest Payment
Date applicable to Base Rate Loans (or, if earlier, at final maturity).
D. Conversion or Continuation. Subject to the provisions of
subsection 2.6, Borrower shall have the option (i) to convert at any time all
or any part of its outstanding AXELs, Additional Term Loans or Revolving Loans
equal to at least $1,000,000 from Loans bearing interest at a rate determined
by reference to one basis to Loans bearing interest at a rate determined by
reference to an alternative basis or (ii) upon the expiration of any Interest
Period applicable to a Eurodollar Rate Loan, to continue all or any portion of
such Loan equal to at least $1,000,000 as a Eurodollar Rate Loan.
Borrower shall deliver a Notice of Conversion/Continuation to
Administrative Agent no later than 10:00 A.M. (New York City time) at least one
Business Day in advance of the proposed conversion date (in the case of a
conversion to a Base Rate Loan) and at least three Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion to, or
a continuation of, a Eurodollar Rate Loan). A Notice of
Conversion/Continuation shall specify (i) the proposed conversion/continuation
date (which shall be a Business Day), (ii) the amount and type of the Loan to
be
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converted/continued, (iii) the nature of the proposed conversion/continuation
and (iv) in the case of a conversion to, or a continuation of, a Eurodollar
Rate Loan, the requested Interest Period. In lieu of delivering the
above-described Notice of Conversion/Continuation, Borrower may give
Administrative Agent telephonic notice by the required time of any proposed
conversion/continuation under this subsection 2.2D; provided that such notice
shall be promptly confirmed in writing by delivery of a Notice of
Conversion/Continuation to Administrative Agent on or before the proposed
conver- sion/continuation date. Upon receipt of written or telephonic notice of
any proposed conversion/continuation under this subsection 2.2D, Administrative
Agent shall promptly transmit such notice by telefacsimile or telephone to each
Lender.
Neither Administrative Agent nor any Lender shall incur any liability
to Borrower in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to act on behalf of Borrower or
for otherwise acting in good faith under this subsection 2.2D, and upon
conversion or continuation of the applicable basis for determining the interest
rate with respect to any Loans in accordance with this Agreement pursuant to any
such telephonic notice Borrower shall have effected a conversion or
continuation, as the case may be, hereunder.
Except as otherwise provided in subsections 2.6B and 2.6C, a Notice of
Conversion/Continuation for conversion to, or continuation of, a Eurodollar
Rate Loan (or telephonic notice in lieu thereof) shall be irrevocable on and
after the related Interest Rate Determination Date, and Borrower shall be bound
to effect a conversion or continuation in accordance therewith.
E. Post-Maturity Interest. Any principal payments on the Loans not paid
when due and, to the extent permitted by applicable law, any interest payments
on the Loans or any fees or other amounts owed hereunder not paid when due, in
each case whether at stated maturity, by notice of prepayment, by acceleration
or otherwise, shall thereafter bear interest (including post-petition interest
in any proceeding under the Bankruptcy Code or other applicable bankruptcy laws)
payable on demand at a rate which is 2% per annum in excess of the interest rate
otherwise payable under this Agreement with respect to the applicable Loans (or,
in the case of any such fees and other amounts, at a rate which is 2% per annum
in excess of the interest rate otherwise payable under this Agreement for Base
Rate Loans); provided that, in the case of Eurodollar Rate Loans, upon the
expiration of the Interest Period in effect at the time any such increase in
interest rate is effective, such Eurodollar Rate Loans shall thereupon become
Base Rate Loans and shall thereafter bear interest payable upon demand at a rate
which is 2% per annum in excess of the interest rate otherwise payable under
this Agreement for Base Rate Loans. Payment or acceptance of the increased rates
of interest provided for in this subsection 2.2E is not a permitted alternative
to timely
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payment and shall not constitute a waiver of any Event of Default or
otherwise prejudice or limit any rights or remedies of Agent or any Lender.
F. Computation of Interest. Interest on the Loans shall be
computed (i) in the case of Base Rate Loans, on the basis of a 365-day or
366-day year, as the case may be, and (ii) in the case of Eurodollar Rate
Loans, on the basis of a 360-day year, in each case for the actual number of
days elapsed in the period during which it accrues. In computing interest on
any Loan, the date of the making of such Loan or the first day of an Interest
Period applicable to such Loan or, with respect to a Base Rate Loan being
converted from a Eurodollar Rate Loan, the date of conversion of such
Eurodollar Rate Loan to such Base Rate Loan, as the case may be, shall be
included, and the date of payment of such Loan or the expiration date of an
Interest Period applicable to such Loan or, with respect to a Base Rate Loan
being converted to a Eurodollar Rate Loan, the date of conversion of such Base
Rate Loan to such Eurodollar Rate Loan, as the case may be, shall be excluded;
provided that if a Loan is repaid on the same day on which it is made, one
day's interest shall be paid on that Loan.
2.3 Fees.
A. Commitment Fees. Borrower agrees to pay to Administrative
Agent, for distribution to each Lender in proportion to that Lender's Pro Rata
Share, commitment fees for the period from and including the Closing Date to
and excluding the Revolving Loan Commitment Termination Date equal to the
average of the daily excess of the Revolving Loan Commitments over the sum of
(i) the aggregate principal amount of outstanding Revolving Loans (but not any
outstanding Swing Line Loans) plus (ii) the Letter of Credit Usage multiplied
by 1/2 of 1% per annum, such commitment fees to be calculated on the basis of a
365- or 366-day year and the actual number of days elapsed and to be payable
quarterly in arrears on February 1, May 1, August 1 and November 1 of each
year, commencing on the first such date to occur after the Closing Date, and on
the Revolving Loan Commitment Termination Date.
B. Other Fees. Borrower agrees to pay to Arranging Agent and
Administrative Agent such other fees in the amounts and at the times separately
agreed upon between Borrower, Arranging Agent and Administrative Agent. Borrower
agrees to pay to each Lender making Additional Term Loans such fees in the
amounts and at the times separately agreed upon between Borrower and such
Lenders.
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2.4 Repayments, Prepayments and Reductions in Revolving Loan Commitments;
General Provisions Regarding Payments; Application of Proceeds of
Collateral and Payments Under Guaranties.
A. Scheduled Payments of AXELs and Additional Term Loans.
(i) Scheduled Payments of AXELs. Borrower shall make
principal payments on the AXELs in installments on the dates and in
the amounts set forth below:
===============================================================================
(A) (B)
Scheduled
Payment Repayment of
Date AXELs
===============================================================================
May 1, 1997 $500,000
-------------------------------------------------------------------------------
November 1, 1997 $500,000
-------------------------------------------------------------------------------
May 1, 1998 $500,000
-------------------------------------------------------------------------------
November 1, 1998 $500,000
-------------------------------------------------------------------------------
May 1, 1999 $500,000
-------------------------------------------------------------------------------
November 1, 1999 $500,000
-------------------------------------------------------------------------------
May 1, 2000 $1,500,000
-------------------------------------------------------------------------------
November 1, 2000 $1,500,000
-------------------------------------------------------------------------------
May 1, 2001 $3,500,000
-------------------------------------------------------------------------------
November 1, 2001 $3,500,000
-------------------------------------------------------------------------------
May 1, 2002 $4,500,000
-------------------------------------------------------------------------------
November 1, 2002 $4,500,000
-------------------------------------------------------------------------------
May 1, 2003 $26,500,000
-------------------------------------------------------------------------------
November 1, 2003 $26,500,000
-------------------------------------------------------------------------------
TOTAL $75,000,000
===============================================================================
; provided that the scheduled installments of principal of the AXELs
set forth above shall be reduced in connection with any voluntary or
mandatory
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prepayments of the AXELs in accordance with subsection 2.4B(iv); and
provided further, that the AXELs and all other amounts owed hereunder
with respect to the AXELs shall be paid in full no later than November
1, 2003, and the final installment payable by Borrower in respect of
the AXELs on such date shall be in an amount, if such amount is
different from that specified above, sufficient to repay all amounts
owing by Borrower under this Agreement with respect to the AXELs.
(ii) Scheduled Payments of Additional Term Loans. Borrower
shall make principal payments on the Additional Term Loans in
installments on the dates and in the amounts set forth in the
applicable Acknowledgement of Additional Term Loans executed by
Borrower and Lender or Lenders making such Additional Term Loans (with
such dates and amounts to be consistent with the provisions of
subsection 10.6C); provided that the scheduled installments of
principal of the Additional Term Loans set forth in such Acknowledgment
of Additional Term Loans shall be reduced in connection with any
voluntary or mandatory prepayments of the Additional Term Loans in
accordance with subsection 2.4B(iv); and provided further, that the
Additional Term Loans and all other amounts owed hereunder with respect
to the Additional Term Loans shall be paid in full no later than
November 1, 2003.
B. Prepayments and Reductions in Revolving Loan Commitments.
(i) Voluntary Prepayments.
(a) Notice of Prepayment. Borrower may, upon written
or telephonic notice to Administrative Agent on or prior to
12:00 Noon (New York City time) on the date of prepayment,
which notice, if telephonic, shall be promptly confirmed in
writing, at any time and from time to time prepay any Swing
Line Loan on any Business Day in whole or in part in an
aggregate minimum amount of $100,000. Borrower may, upon not
less than one Business Day's prior written or telephonic
notice, in the case of Base Rate Loans, and three Business
Days' prior written or telephonic notice, in the case of
Eurodollar Rate Loans, in each case given to Administrative
Agent by 12:00 Noon (New York City time) on the date required
and, if given by telephone, promptly confirmed in writing to
Administrative Agent (which original written or telephonic
notice Administrative Agent will promptly transmit by
telefacsimile or telephone to each Lender), at any time and
from time to time prepay any AXELs, Additional Term Loans or
Revolving Loans on any Business Day in whole or in part in an
aggregate minimum amount of $1,000,000; provided, however,
that with respect to any Eurodollar Rate Loan not
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prepaid on the expiration of the Interest Period applicable
thereto, Borrower shall pay any amounts payable pursuant to
subsection 2.6D. Notice of prepayment having been given as
aforesaid, the principal amount of the Loans specified in
such notice shall become due and payable on the prepayment
date specified therein. Any such voluntary prepayment shall
be applied as specified in subsection 2.4B(iv).
(b) Prepayment Fees. If any portion of the AXELs is
prepaid for any reason other than (1) pursuant to subsection
2.4A, (2) pursuant to subsection 2.4B(iii)(d), or (3) pursuant
to an acceleration other than an acceleration upon the
occurrence of an Event of Default under subsection 8.11, on or
prior to the second anniversary of the Closing Date, Borrower
shall pay to Administrative Agent, for distribution to Lenders
having AXELs so prepaid in accordance with their Pro Rata
Shares, a fee equal to (x) 2.75% of the principal amount of
AXELs so prepaid during the period commencing on the Closing
Date and ending on the day prior to the first anniversary of
the Closing Date and (y) 1.75% of the principal amount of
AXELs so prepaid during the period commencing on the first
anniversary of the Closing Date and ending on the second
anniversary of the Closing Date. Borrower shall pay to
Administrative Agent, for distribution to Lenders having
Additional Term Loans, such prepayment fees, if any, as may be
agreed to by Borrower and such Lenders as set forth in the
respective Acknowledgement of Additional Term Loans.
(ii) Voluntary Reductions of Revolving Loan Commitments.
Borrower may, upon not less than three Business Days' prior written or
telephonic notice confirmed in writing to Administrative Agent (which
original written or telephonic notice Administrative Agent will
promptly transmit by telefacsimile or telephone to each Lender), at any
time and from time to time terminate in whole or permanently reduce in
part, without premium or penalty, the Revolving Loan Commitments in an
amount up to the amount by which the Revolving Loan Commitments exceed
the Total Utilization of Revolving Loan Commitments at the time of such
proposed termination or reduction; provided that any such partial
reduction of the Revolving Loan Commitments shall be in an aggregate
minimum amount of $1,000,000. Borrower's notice to Administrative Agent
shall designate the date (which shall be a Business Day) of such
termination or reduction and the amount of any partial reduction, and
such termination or reduction of the Revolving Loan Commitments shall
be effective on the date specified in Borrower's notice and shall
reduce the Revolving Loan Commitment of each Lender proportionately to
its Pro Rata Share.
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(iii) Mandatory Prepayments and Mandatory Reductions of
Revolving Loan Commitments. The Loans shall be prepaid and/or the
Revolving Loan Commitments shall be permanently reduced in the amounts
and under the circumstances set forth below, all such prepayments be
applied as set forth below or as more specifically provided in
subsection 2.4B(iv):
(a) Prepayments and Reductions From Net Asset Sale
Proceeds. No later than the first Business Day following the
date of receipt by Holdings or any of its Subsidiaries of any
Net Asset Sale Proceeds in respect of any Asset Sale, Borrower
shall prepay the Loans and/or the Revolving Loan Commitments
shall be permanently reduced in an aggregate amount equal to
such Net Asset Sale Proceeds. Notwithstanding the foregoing,
Borrower shall not be required to make a mandatory prepayment
pursuant to this subsection 2.4B(iii)(a) if the Net Asset Sale
Proceeds are reinvested in assets of substantially equivalent
value within 365 days of the receipt thereof; provided,
however, that the total Net Asset Sale Proceeds which may be
so reinvested shall not exceed $15,000,000 in the aggregate.
If upon any Asset Sale, Borrower elects to reinvest the Net
Asset Sale Proceeds as permitted under this subsection
2.4B(iii)(a), (1) no later than the First Business Day
following the consummation of such Asset Sale, Borrower shall
deliver an Officers' Certificate to Administrative Agent
indicating Borrower's election to reinvest the Net Asset
Sale Proceeds and (2) upon the expiration of 365 days
after the date of receipt of the Net Asset Sale Proceeds
of such Asset Sale, Borrower shall deliver to
Administrative Agent an Officers' Certificate indicating
the amount of Net Asset Sale Proceeds reinvested as of such
date, the assets in which such Net Asset Sale Proceeds have
been reinvested, and the amount of any remaining Net Asset
Sale Proceeds which shall be applied upon the expiration of
such 365-day period to prepay the Loans and/or reduce the
Revolving Loan Commitments as set forth in this subsection
2.4B(iii)(a).
(b) Prepayments and Reductions from Net
Insurance/Condemnation Proceeds. No later than the first
Business Day following the date of receipt by Administrative
Agent or by Holdings or any of its Subsidiaries of any Net
Insurance/Condemnation Proceeds that are required to be
applied to prepay the Loans and/or reduce the Revolving Loan
Commitments pursuant to the provisions of subsection 6.4C,
Borrower shall prepay the Loans and/or the Revolving Loan
Commitments shall be permanently reduced in an aggregate
amount equal to the amount of such Net Insurance/Condemnation
Proceeds.
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(c) Prepayments and Reductions Due to Reversion of
Surplus Assets of Pension Plans. No later than the first
Business Day following the date of return to Holdings or any
of its Subsidiaries of any surplus assets of any pension plan
of Holdings or any of its Subsidiaries, Borrower shall prepay
the Loans and/or the Revolving Loan Commitments shall be
permanently reduced in an aggregate amount (such amount being
the "Net Pension Proceeds") equal to 100% of such returned
surplus assets, net of transaction costs and expenses incurred
in obtaining such return, including incremental taxes payable
as a result thereof.
(d) Prepayments and Reductions from Consolidated
Excess Cash Flow. In the event that there shall be
Consolidated Excess Cash Flow for any Fiscal Year (commencing
with Fiscal Year 1997) in amount greater than (x) $10,000,000
in the case of each of Fiscal Year 1997 and Fiscal Year 1998
or (y) $7,500,000 in the case of each Fiscal Year thereafter,
Borrower shall, no later than 90 days after the end of each
such Fiscal Year, prepay the Loans and/or the Revolving Loan
Commitments shall be permanently reduced in an aggregate
amount equal to 50% of such Consolidated Excess Cash Flow in
excess of (x) $10,000,000 in the case of each of Fiscal Year
1997 and Fiscal Year 1998 or (y) $7,500,000 in the case of
each Fiscal Year thereafter; provided that if as of the last
day of any Fiscal Year the sum of (1) the outstanding
principal amount of AXELS and Additional Term Loans on the
last of such Fiscal Year plus (2) the average Revolving
Outstandings for such Fiscal Year is less than $50,000,000,
then the foregoing percentage of Consolidated Excess Cash
Flow shall instead be 25%.
(e) Prepayments Upon Receipt of Capital Contributions
from Holdings. Upon receipt by Borrower of any capital
contribution from Holdings of the Cash proceeds (any such
proceeds, net of underwriting discounts and commissions and
other reasonable costs and expenses associated therewith,
including reasonable legal fees and expenses, being "Net
Contribution Proceeds") from the issuance of any equity
Securities of Holdings (other than any Permitted Cure
Securities or any such equity Securities the proceeds of which
are contributed to Borrower to fund a Permitted Acquisition),
Borrower shall prepay the Loans and/or the Revolving Loan
Commitments shall be permanently reduced in an aggregate
amount equal to 50% of such Net Contribution Proceeds.
(f) Prepayments Due to Reductions or Restrictions of
Revolving Loan Commitments. Borrower shall from time to time
prepay first the Swing Line Loans and second the Revolving
Loans to the extent
-57-
necessary so that the Total Utilization of Revolving Loan
Commitments shall not at any time exceed the Revolving Loan
Commitments then in effect.
(g) Calculations of Net Proceeds Amounts; Additional
Prepayments and Reductions Based on Subsequent Calculations.
Concurrently with any prepayment of the Loans and/or reduction
of the Revolving Loan Commitments pursuant to subsections
2.4B(iii)(a)-(e), Borrower shall deliver to Administrative
Agent an Officers' Certificate demonstrating the calculation
of the amount (the "Net Proceeds Amount") of the applicable
Net Asset Sale Proceeds or Net Insurance/Condemnation
Proceeds, the applicable Net Pension Proceeds or Net
Contribution Proceeds (as such terms are defined in
subsections 2.4B(iii)(c) and (e), respectively) or the
applicable Consolidated Excess Cash Flow, as the case may be,
that gave rise to such prepayment and/or reduction. In the
event that Borrower shall subsequently determine that the
actual Net Proceeds Amount was greater than the amount set
forth in such Officers' Certificate, Borrower shall promptly
make an additional prepayment of the Loans (and/or, if
applicable, the Revolving Loan Commitments shall be
permanently reduced) in an amount equal to the amount of such
excess, and Borrower shall concurrently therewith deliver
to Administrative Agent an Officers' Certificate demonstrating
the derivation of the additional Net Proceeds Amount resulting
in such excess.
(h) Prepayments of Revolving Loans and Swing Line
Loans during a Clean-Down Period. If on December 1 of each
year commencing on December 1, 1997, a Clean-Down Period shall
not have occurred since January 30 of such year, Borrower
shall prepay Revolving Loans and/or Swing Line Loans in an
amount necessary to reduce the sum of the aggregate
outstanding principal amount of Revolving Loans and Swing Line
Loans plus the Letter of Credit Usage to no more than
$15,000,000, which amount may not be exceeded until the
Clean-Down Period for such year has ended. Borrower shall
notify Administrative Agent of the occurrence of a Clean-Down
Period.
(iv) Application of Prepayments.
(a) Application of Voluntary Prepayments by Type of
Loans and Order of Maturity. Any voluntary prepayments
pursuant to subsection 2.4B(i) shall be applied as specified
by Borrower in the applicable notice of prepayment; provided
that (i) each prepayment of AXELs or Additional Term Loans
pursuant to this subsection 2.4B(iv)
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must consist of a pro rata payment of outstanding AXELs and
Additional Term Loans (based upon the then outstanding
principal amount of AXELs and Additional Term Loans) and (ii)
in the event Borrower fails to specify the Loans to which any
such prepayment shall be applied, such prepayment shall be
applied first to repay outstanding Swing Line Loans to the
full extent thereof, second to repay outstanding Revolving
Loans to the full extent thereof, and third to repay
outstanding AXELs and Additional Term Loans on a pro rata
basis (based upon the then outstanding principal amount of
AXELs and Additional Term Loans) to the full extent thereof.
Any voluntary prepayments of the AXELs pursuant to subsection
2.4B(i) shall be applied to reduce the scheduled installments
of principal of the AXELs set forth in subsections 2.4A(i) on
a pro rata basis.
(b) Application of Mandatory Prepayments by Type of
Loans. Any amount (the "Applied Amount") required to be
applied as a mandatory prepayment of the Loans and/or a
reduction of the Revolving Loan Commitments pursuant to
subsections 2.4B(iii)(a)-(e) shall be applied first to prepay
the AXELs and the Additional Term Loans on a pro rata basis
(based upon the then outstanding principal amount of AXELs and
Additional Term Loans) to the full extent thereof, second, to
the extent of any remaining portion of the Applied Amount, to
prepay the Swing Line Loans to the full extent thereof and to
permanently reduce the Revolving Loan Commitments by the
amount of such prepayment, third, to the extent of any
remaining portion of the Applied Amount, to prepay the
Revolving Loans to the full extent thereof and to further
permanently reduce the Revolving Loan Commitments by the
amount of such prepayment, and fourth, to the extent of any
remaining portion of the Applied Amount, to further
permanently reduce the Revolving Loan Commitments to the full
extent thereof. Any amount required to be applied as a
mandatory prepayment of Revolving Loans and/or Swing Line
Loans pursuant to subsection 2.4B(iii)(h) shall be applied
first to prepay outstanding Swing Line Loans and second to
prepay outstanding Revolving Loans, in each case in an amount
necessary to cause a Clean-Down Period to commence.
(c) Application of Mandatory Prepayments of AXELs and
Additional Term Loans to the Scheduled Installments of
Principal Thereof. Any mandatory prepayments of the AXELs and
Additional Term Loans pursuant to subsection 2.4B(iii) shall
be applied to each scheduled installment of principal
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of the AXELs set forth in subsection 2.4A(i) on a pro rata
basis and to each scheduled installment of principal of the
Additional Term Loans set forth in the applicable
Acknowledgement of Additional Term Loans on a pro rata basis.
(d) Application of Prepayments to Base Rate Loans and
Eurodollar Rate Loans. Considering AXELs, Additional Term
Loans and Revolving Loans being prepaid separately, any
prepayment thereof shall be applied first to Base Rate Loans
to the full extent thereof before application to Eurodollar
Rate Loans, in each case in a manner which minimizes the
amount of any payments required to be made by Borrower
pursuant to subsection 2.6D.
(e) Prepayment of Certain Eurodollar Rate Loans. In
the event the amount of any prepayment required to be made
above shall exceed the aggregate principal amount of the Base
Rate Loans outstanding required to be prepaid (the amount of
any such excess being called the "Excess Amount"), Borrower
shall have the right, in lieu of making such prepayment in
full, to prepay all the outstanding applicable Base Rate Loans
and to deposit an amount equal to the Excess Amount with
Administrative Agent in the Collateral Account. Any amounts so
deposited shall be held by Administrative Agent as collateral
for the Obligations and applied to the prepayment of the
applicable Eurodollar Rate Loans at the end of the current
Interest Periods applicable thereto.
C. General Provisions Regarding Payments.
(i) Manner and Time of Payment. All payments by Borrower of
principal, interest, fees and other Obligations hereunder and under the
Notes shall be made in Dollars in same day funds, without defense,
setoff or counterclaim, free of any restriction or condition, and
delivered to Administrative Agent not later than 1:00 P.M. (New York
City time) on the date due at the Funding and Payment Office for the
account of Lenders; funds received by Administrative Agent after that
time on such due date shall be deemed to have been paid by Borrower on
the next succeeding Business Day. Borrower hereby authorizes
Administrative Agent to charge its accounts with Administrative Agent
in order to cause timely payment to be made to Administrative Agent of
all principal, interest, fees and expenses due hereunder (subject to
sufficient funds being available in its accounts for that purpose).
(ii) Application of Payments to Principal and Interest.
Except as provided in subsection 2.2C, all payments in respect of the
principal amount of any Loan shall include payment of accrued interest
on the principal amount being
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repaid or prepaid, and all such payments shall be applied to the
payment of interest before application to principal.
(iii) Apportionment of Payments. Aggregate principal and
interest payments in respect of AXELs, Additional Term Loans and
Revolving Loans shall be apportioned among all outstanding Loans to
which such payments relate, in each case proportionately to Lenders'
respective Pro Rata Shares. Administrative Agent shall promptly
distribute to each Lender, at its primary address set forth below its
name on the appropriate signature page hereof or at such other address
as such Lender may request, its Pro Rata Share of all such payments
received by Administrative Agent and the commitment fees of such Lender
when received by Administrative Agent pursuant to subsection 2.3.
Notwithstanding the foregoing provisions of this subsection 2.4C(iii),
if, pursuant to the provisions of subsection 2.6C, any Notice of
Conversion/Continuation is withdrawn as to any Affected Lender or if
any Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share
of any Eurodollar Rate Loans, Administrative Agent shall give effect
thereto in apportioning payments received thereafter.
(iv) Payments on Business Days. Whenever any payment to be
made hereunder shall be stated to be due on a day that is not a
Business Day, such payment shall be made on the next succeeding
Business Day and such extension of time shall be included in the
computation of the payment of interest hereunder or of the commitment
fees hereunder, as the case may be.
(v) Notation of Payment. Each Lender agrees that before
disposing of any Note held by it, or any part thereof (other than by
granting participations therein), that Lender will make a notation
thereon of all Loans evidenced by that Note and all principal payments
previously made thereon and of the date to which interest thereon has
been paid; provided that the failure to make (or any error in the
making of) a notation of any Loan made under such Note shall not limit
or otherwise affect the obligations of Borrower hereunder or under such
Note with respect to any Loan or any payments of principal or interest
on such Note.
D. Application of Proceeds of Collateral and Payments Under
Guaranties:
(i) Application of Proceeds of Collateral. Except as
provided in subsection 2.4B(iii)(a) with respect to prepayments from
Net Asset Sale Proceeds, all proceeds received by Administrative Agent
in respect of any sale of, collection from, or other realization upon
all or any part of the Collateral under any Collateral Document shall
be applied by Administrative Agent against the
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applicable Secured Obligations (used hereinafter as defined in such
Collateral Document) then due and owing in the following order of
priority:
(a) To the payment of all costs and expenses of such
sale, collection or other realization, including reasonable
compensation to Administrative Agent and its agents and
counsel, and all other expenses, liabilities and advances made
or incurred by Administrative Agent in connection therewith,
and all amounts for which Administrative Agent is entitled to
indemnification under such Collateral Document and all
advances made by Administrative Agent thereunder for the
account of the applicable Loan Party, and to the payment of
all costs and expenses paid or incurred by Administrative
Agent in connection with the exercise of any right or remedy
under such Collateral Document, all in accordance with the
terms of this Agreement and such Collateral Document;
(b) thereafter, to the extent of any excess such
proceeds, to the payment of all other such Secured Obligations
(as defined in such Collateral Document) for the ratable
benefit of the holders thereof; and
(c) thereafter, to the extent of any excess such
proceeds, to the payment to or upon the order of such Loan
Party or to whosoever may be lawfully entitled to receive the
same or as a court of competent jurisdiction may direct.
(ii) Application of Payments Under Guaranties. All payments
received by Administrative Agent under any Guaranty shall be applied
promptly from time to time by Administrative Agent in the following
order of priority:
(a) To the payment of the costs and expenses of any
collection or other realization under such Guaranty, including
reasonable compensation to Administrative Agent and its agents
and counsel, and all expenses, liabilities and advances made
or incurred by Administrative Agent in connection therewith,
all in accordance with the terms of this Agreement and such
Guaranty;
(b) thereafter, to the extent of any excess such
payments, to the payment of all other Guarantied Obligations
(as defined in such Guaranty) for the ratable benefit of the
holders thereof; and
(c) thereafter, to the extent of any excess such
payments, to the payment to Holdings or the applicable
Subsidiary Guarantor or to
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whosoever may be lawfully entitled to receive the same or as a
court of competent jurisdiction may direct.
2.5 Use of Proceeds.
A. AXELs. The proceeds of the AXELs, together with the proceeds
of the issuance and sale of the Senior Subordinated Notes and the Cash proceeds
from the Contribution, shall be applied by Borrower and/or RH Cemetery and RH
Mortuary, as the case may be, to pay the purchase price under the Acquisition
Agreement and the Merger Agreement, to repay Existing Indebtedness, to pay
Transaction Costs in an aggregate amount not to exceed $20,000,000, to fund
working capital of Borrower and its Subsidiaries, and to prefund certain
Consolidated Capital Expenditures and severance costs in an aggregate amount not
to exceed $2,000,000.
B. Additional Term Loans. The proceeds of any Additional Term
Loans shall be applied by Borrower for general corporate purposes, which may
include the making of Permitted Acquisitions.
C. Revolving Loans; Swing Line Loans. The proceeds of any
Revolving Loans and any Swing Line Loans shall be applied by Borrower for
general corporate purposes, which may include the making of Permitted
Acquisitions.
D. Margin Regulations. No portion of the proceeds of any
borrowing under this Agreement shall be used by Borrower or any of its
Subsidiaries in any manner that might cause the borrowing or the application of
such proceeds to violate Regulation G, Regulation U, Regulation T or Regulation
X of the Board of Governors of the Federal Reserve System or to violate any
other law, in each case as in effect on the date or dates of such borrowing and
such use of proceeds.
2.6 Special Provisions Governing Eurodollar Rate Loans.
Notwithstanding any other provision of this Agreement to the contrary,
the following provisions shall govern with respect to Eurodollar Rate Loans as
to the matters covered:
A. Determination of Applicable Interest Rate. As soon as
practicable after 10:00 A.M. (New York City time) on each Interest Rate
Determination Date, Administrative Agent shall determine (which determination
shall, absent demonstrable error, be final, conclusive and binding upon all
parties) the interest rate that shall apply to the Eurodollar Rate Loans for
which an interest rate is then being determined for the applicable Interest
Period and shall promptly give notice thereof (in writing or by telephone
confirmed in writing) to Borrower and each Lender.
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B. Inability to Determine Applicable Interest Rate. In the
event that Administrative Agent shall have determined (which determination shall
be final and conclusive and binding upon all parties hereto), on any Interest
Rate Determination Date with respect to any Eurodollar Rate Loans, that by
reason of circumstances affecting the interbank Eurodollar market adequate and
fair means do not exist for ascertaining the interest rate applicable to such
Loans on the basis provided for in the definition of Adjusted Eurodollar Rate,
Administrative Agent shall on such date give notice (by telefacsimile or by
telephone confirmed in writing) to Borrower and each Lender of such
determination, whereupon (i) no Loans may be made as, or converted to,
Eurodollar Rate Loans until such time as Administrative Agent notifies Borrower
and Lenders that the circumstances giving rise to such notice no longer exist
(which Administrative Agent agrees to do promptly after such circumstances cease
to exist) and (ii) any Notice of Borrowing or Notice of Conversion/Continuation
given by Borrower with respect to the Loans in respect of which such
determination was made shall be deemed to be rescinded by Borrower.
C. Illegality or Impracticability of Eurodollar Rate Loans. In
the event that on any date any Lender shall have determined (which determination
shall be final and conclusive and binding upon all parties hereto but shall be
made only after consultation with Borrower and Administrative Agent) that the
making, maintaining or continuation of its Eurodollar Rate Loans (i) has become
unlawful as a result of compliance by such Lender in good faith with any law,
treaty, governmental rule, regulation, guideline or order (or would conflict
with any such treaty, governmental rule, regulation, guideline or order not
having the force of law even though the failure to comply therewith would not be
unlawful) or (ii) has become impracticable, or would cause such Lender material
hardship, as a result of contingencies occurring after the date of this
Agreement which materially and adversely affect the interbank Eurodollar market
or the position of such Lender in that market, then, and in any such event, such
Lender shall be an "Affected Lender" and it shall on that day give notice (by
telefacsimile or by telephone confirmed in writing) to Borrower and
Administrative Agent of such determination (which notice Administrative Agent
shall promptly transmit to each other Lender). Thereafter (a) the obligation of
the Affected Lender to make Loans as, or to convert Loans to, Eurodollar Rate
Loans shall be suspended until such notice shall be withdrawn by the Affected
Lender (which such Lender agrees to do promptly after such Lender ceases to be
so affected), (b) to the extent such determination by the Affected Lender
relates to a Eurodollar Rate Loan then being requested by Borrower pursuant to
a Notice of Borrowing or a Notice of Conversion/Continuation, the Affected
Lender shall make such Loan as (or convert such Loan to, as the case may be) a
Base Rate Loan, (c) the Affected Lender's obligation to maintain its outstanding
Eurodollar Rate Loans (the "Affected Loans") shall be terminated at the earlier
to occur of the expiration of the Interest Period then in effect with respect to
the Affected Loans or when required by law, and (d) the Affected Loans shall
automatically convert into Base Rate Loans on the
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date of such termination. Notwithstanding the foregoing, to the extent a
determination by an Affected Lender as described above relates to a Eurodollar
Rate Loan then being requested by Borrower pursuant to a Notice of Borrowing or
a Notice of Conversion/Continuation, Borrower shall have the option, subject to
the provisions of subsection 2.6D, to rescind such Notice of Borrowing or Notice
of Conversion/Continuation as to all Lenders by giving notice (by telefacsimile
or by telephone confirmed in writing) to Administrative Agent of such rescission
on the date on which the Affected Lender gives notice of its determination as
described above (which notice of rescission Administrative Agent shall promptly
transmit to each other Lender). Except as provided in the immediately preceding
sentence, nothing in this subsection 2.6C shall affect the obligation of any
Lender other than an Affected Lender to make or maintain Loans as, or to convert
Loans to, Eurodollar Rate Loans in accordance with the terms of this Agreement.
D. Compensation For Breakage or Non-Commencement of Interest
Periods. Borrower shall compensate each Lender, upon written request by that
Lender (which request shall set forth the basis for requesting such amounts and
the calculation thereof in reasonable detail), for all reasonable losses,
expenses and liabilities (including any interest paid by that Lender to lenders
of funds borrowed by it to make or carry its Eurodollar Rate Loans and any loss,
expense or liability sustained by that Lender in connection with the liquidation
or re-employment of such funds) which that Lender may sustain: (i) if for any
reason (other than a default by that Lender) a borrowing of any Eurodollar Rate
Loan does not occur on a date specified therefor in a Notice of Borrowing or a
telephonic request for borrowing, or a conversion to or continuation of any
Eurodollar Rate Loan does not occur on a date specified therefor in a Notice of
Conversion/Continuation or a telephonic request for conversion or continuation,
(ii) if any prepayment (including any prepayment pursuant to subsection 2.4B(i))
or other principal payment or any conversion of any of its Eurodollar Rate Loans
occurs on a date prior to the last day of an Interest Period applicable to that
Loan, (iii) if any prepayment of any of its Eurodollar Rate Loans is not made on
any date specified in a notice of prepayment given by Borrower, or (iv) as a
consequence of any other default by Borrower in the repayment of its Eurodollar
Rate Loans when required by the terms of this Agreement.
E. Booking of Eurodollar Rate Loans. Any Lender may make,
carry or transfer Eurodollar Rate Loans at, to, or for the account of any of its
branch offices or the office of an Affiliate of that Lender.
F. Assumptions Concerning Funding of Eurodollar Rate Loans.
Calculation of all amounts payable to a Lender under this subsection 2.6 and
under subsection 2.7A may be made as though that Lender had actually funded each
of its relevant Eurodollar Rate Loans through the purchase of a Eurodollar
deposit bearing interest at
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the rate obtained pursuant to clause (i) of the definition of Adjusted
Eurodollar Rate in an amount equal to the amount of such Eurodollar Rate Loan
and having a maturity comparable to the relevant Interest Period and through the
transfer of such Eurodollar deposit from an offshore office of that Lender to a
domestic office of that Lender in the United States of America; provided,
however, that each Lender may fund each of its Eurodollar Rate Loans in any
manner it sees fit and the foregoing assumptions shall be utilized only for the
purposes of calculating amounts payable under this subsection 2.6 and under
subsection 2.7A.
2.7 Increased Costs; Taxes; Capital Adequacy.
A. Compensation for Increased Costs and Taxes. Subject to the
provisions of subsection 2.7B (which shall be controlling with respect to the
matters covered thereby), in the event that any Lender shall determine (which
determination shall, absent demonstrable error, be final and conclusive and
therein or in the interpretation, administration or application thereof
(including the introduction of any new law, treaty or governmental rule,
regulation or order), or any determination of a court or governmental authority,
in each case that becomes effective after the date hereof, or compliance by such
Lender with any guideline, request or directive issued or made after the date
hereof by any central bank or other governmental or quasi-governmental authority
(whether or not having the force of law):
(i) subjects such Lender (or its applicable lending office)
to any additional Tax (other than any Tax on the overall net income of
such Lender) with respect to this Agreement or any of its obligations
hereunder or any payments to such Lender (or its applicable lending
office) of principal, interest, fees or any other amount payable
hereunder;
(ii) imposes, modifies or holds applicable any reserve
(including any marginal, emergency, supplemental, special or other
reserve), special deposit, compulsory loan, FDIC insurance or similar
requirement against assets held by, or deposits or other liabilities in
or for the account of, or advances or loans by, or other credit
extended by, or any other acquisition of funds by, any office of such
Lender (other than any such reserve or other requirements with respect
to Eurodollar Rate Loans that are reflected in the definition of
Adjusted Eurodollar Rate); or
(iii) imposes any other condition (other than with respect to
a Tax matter) on or affecting such Lender (or its applicable lending
office) or its obligations hereunder or the interbank Eurodollar
market;
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and the result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining Loans hereunder or to reduce any amount
received or receivable by such Lender (or its applicable lending office) with
respect thereto; then, in any such case, Borrower shall within 10 days pay to
such Lender, upon receipt of the statement referred to in the next sentence,
such additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder. Such Lender shall deliver to Borrower (with a copy to Administrative
Agent) a written statement, setting forth in reasonable detail the basis for
calculating the additional amounts owed to such Lender under this subsection
2.7A, which statement shall be conclusive and binding upon all parties hereto
absent manifest error.
Promptly after any Lender has determined, in its sole judgment, that it
will make a request for increased compensation pursuant to this Section 2.7A,
such Lender will notify Borrower thereof. Failure on the part of any Lender so
to notify Borrower or to demand compensation for any increased costs or
reduction in amounts received or receivable or reduction in return on capital
with respect to any period shall not constitute a waiver of such Lender's right
to demand compensation with respect to such period or any other period; provided
that Borrower shall not be under any obligation to compensate any Lender with
respect to increased costs or reductions with respect to any period prior to the
date that is six months prior to such request if such Lender knew of the
circumstances giving rise to such increased costs or reductions and of the fact
that such circumstances would in fact result in a claim for increased
compensation by reason of such increased costs or reductions; and provided
further, that the foregoing limitation shall not apply to any increased costs or
reductions arising out of the retroactive application of any law, regulation,
rule, guideline or directive as aforesaid within such six-month period.
B. Withholding of Taxes.
(i) Payments to Be Free and Clear. All sums payable by
Borrower under this Agreement and the other Loan Documents shall
(except to the extent required by law) be paid free and clear of, and
without any deduction or withholding on account of, any Tax (other than
a Tax on the overall net income of any Lender) imposed, levied,
collected, withheld or assessed by or within the United States of
America or any political subdivision in or of the United States of
America or any other jurisdiction from or to which a payment is made by
or on behalf of Borrower or by any federation or organization of which
the United States of America or any such jurisdiction is a member at
the time of payment.
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(ii) Grossing-up of Payments. If Borrower or any other Person
is required by law to make any deduction or withholding on account of
any such Tax from any sum paid or payable by Borrower to Administrative
Agent or any Lender under any of the Loan Documents:
(a) Borrower shall notify Administrative Agent
of any such requirement or any change in any such
requirement as soon as Borrower becomes aware of it;
(b) Borrower shall pay any such Tax before the
date on which penalties attach thereto, such payment to be
made (if the liability to pay is imposed on Borrower) for
its own account or (if that liability is imposed on
Administrative Agent or such Lender, as the case may be) on
behalf of and in the name of Administrative Agent or such
Lender;
(c) the sum payable by Borrower in respect of
which the relevant deduction, withholding or payment is
required shall be increased to the extent necessary to
ensure that, after the making of that deduction, withholding
or payment, Administrative Agent or such Lender, as the case
may be, receives on the due date a net sum equal to what it
would have received had no such deduction, withholding or
payment been required or made; and
(d) within 30 days after paying any sum from
which it is required by law to make any deduction or
withholding, and within 30 days after the due date of payment
of any Tax which it is required by clause (b) above to pay,
Borrower shall deliver to Administrative Agent evidence
satisfactory to the other affected parties of such deduction,
withholding or payment and of the remittance thereof to the
relevant taxing or other authority;
provided that no such additional amount shall be required to be paid to
any Lender under clause (c) above except to the extent that any change
after the date hereof (in the case of each Lender listed on the
signature pages hereof) or after the date of the Assignment Agreement
pursuant to which such Lender became a Lender (in the case of each
other Lender) in any such requirement for a deduction, withholding or
payment as is mentioned therein shall result in an increase in the rate
of such deduction, withholding or payment from that in effect at the
date of this Agreement or at the date of such Assignment Agreement, as
the case may be, in respect of payments to such Lender.
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(iii) Evidence of Exemption from U.S. Withholding Tax.
(a) Each Lender that is organized under the laws of
any jurisdiction other than the United States or any state or
other political subdivision thereof (for purposes of this
subsection 2.7B(iii), a "Non-US Lender") shall deliver to
Administrative Agent for transmission to Borrower, on or prior
to the Closing Date (in the case of each Lender listed on the
signature pages hereof) or on or prior to the date of the
Assignment Agreement pursuant to which it becomes a Lender (in
the case of each other Lender), and at such other times as may
be necessary in the determination of Borrower or
Administrative Agent (each in the reasonable exercise of its
discretion), (1) two original copies of Internal Revenue
Service Form 1001 or 4224 (or any successor forms), properly
completed and duly executed by such Lender, together with any
other certificate or statement of exemption required under the
Internal Revenue Code or the regulations issued thereunder to
establish that such Lender is not subject to deduction or
withholding of United States federal income tax with respect
to any payments to such Lender of principal, interest,
fees or other amounts payable under any of the Loan Documents
or (2) if such Lender is not a "bank" or other Person
described in Section 881(c)(3) of the Internal Revenue Code
and cannot deliver either Internal Revenue Service Form 1001
or 4224 pursuant to clause (1) above, a Certificate re
Non-Bank Status together with two original copies of Internal
Revenue Service Form W-8 (or any successor form), properly
completed and duly executed by such Lender, together with any
other certificate or statement of exemption required under the
Internal Revenue Code or the regulations issued thereunder to
establish that such Lender is not subject to deduction or
withholding of United States federal income tax with respect
to any payments to such Lender of interest payable under any
of the Loan Documents.
(b) Each Lender required to deliver any forms,
certificates or other evidence with respect to United States
federal income tax withholding matters pursuant to subsection
2.7B(iii)(a) hereby agrees, from time to time after the
initial delivery by such Lender of such forms, certificates or
other evidence, whenever a lapse in time or change in
circumstances renders such forms, certificates or other
evidence obsolete or inaccurate in any material respect, that
such Lender shall promptly (1) deliver to Administrative Agent
for transmission to Borrower two new original copies of
Internal Revenue Service Form 1001 or 4224, or a Certificate
re Non-Bank Status and two original copies of Internal Revenue
Service Form W-8, as the case may be, properly completed and
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duly executed by such Lender, together with any other
certificate or statement of exemption required in order to
confirm or establish that such Lender is not subject to
deduction or withholding of United States federal income tax
with respect to payments to such Lender under the Loan
Documents or (2) notify Administrative Agent and Borrower of
its inability to deliver any such forms, certificates or other
evidence.
(c) Borrower shall not be required to pay any
additional amount to any Non-US Lender under clause (c) of
subsection 2.7B(ii) if such Lender shall have failed to
satisfy the requirements of clause (a) or (b)(1) of this
subsection 2.7B(iii); provided that if such Lender shall have
satisfied the requirements of subsection 2.7B(iii)(a) on the
Closing Date (in the case of each Lender listed on the
signature pages hereof) or on the date of the Assignment
Agreement pursuant to which it became a Lender (in the case of
each other Lender), nothing in this subsection 2.7B(iii)(c)
shall relieve Borrower of its obligation to pay any additional
amounts pursuant to clause (c) of subsection 2.7B(ii) in the
event that, as a result of any change in any applicable law,
treaty or governmental rule, regulation or order, or any
change in the interpretation, administration or application
thereof, such Lender is no longer properly entitled to deliver
forms, certificates or other evidence at a subsequent date
establishing the fact that such Lender is not subject to
withholding as described in subsection 2.7B(iii)(a).
C. Capital Adequacy Adjustment. If any Lender shall have determined
that the adoption, effectiveness, phase-in or applicability after the date
hereof of any law, rule or regulation (or any provision thereof) regarding
capital adequacy, or any change therein or in the interpretation or
administration thereof by the National Association of Insurance Commissioners,
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or its
applicable lending office) with any guideline, request or directive regarding
capital adequacy (whether or not having the force of law) of the National
Association of Insurance Commissioners, any such governmental authority, central
bank or comparable agency, has or would have the effect of reducing the rate of
return on the capital of such Lender or any corporation controlling such Lender
as a consequence of, or with reference to, such Lender's Loans or Commitments or
Letters of Credit or participations therein or other obligations hereunder with
respect to the Loans or the Letters of Credit to a level below that which such
Lender or such controlling corporation could have achieved but for such
adoption, effectiveness, phase-in, applicability, change or compliance (taking
into consideration the policies of such Lender or such controlling corporation
with regard to capital adequacy), then from time to time, within ten Business
Days after receipt by Borrower from such Lender of the statement referred to in
the next
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sentence, Borrower shall pay to such Lender such additional amount or
amounts as will compensate such Lender or such controlling corporation on an
after-tax basis for such reduction. Such Lender shall deliver to Borrower (with
a copy to Administrative Agent) a written statement, setting forth in reasonable
detail the basis of the calculation of such additional amounts, which statement
shall be conclusive and binding upon all parties hereto absent demonstrable
error.
D. Substitute Lenders. In the event Borrower is required under
the provisions of this subsection 2.7 or subsection 3.6 to make payments in a
material amount to any Lender or in the event any Lender fails to lend to
Borrower in accordance with this Agreement or if any Lender becomes an Affected
Lender, Borrower may, so long as no Event of Default or Potential Event of
Default shall have occurred and be continuing, elect to terminate such Lender as
a party to this Agreement; provided that, concurrently with such termination,
(i) Borrower shall pay that Lender all principal, interest and fees and other
amounts (including without limitation, amounts, if any, owed under this
subsection 2.7 or subsection 3.6) owed to such Lender through such date of
termination, (ii) another financial institution satisfactory to Borrower and
Administrative Agent (or if Administrative Agent is also the Lender to be
terminated, the successor Administrative Agent) shall agree, as of such date,
to become a Lender for all purposes under this Agreement (whether by assignment
or amendment) and to assume all obligations of the Lender to be terminated as of
such date, and (iii) all documents and supporting materials necessary, in the
judgment of Administrative Agent (or if Administrative Agent is also the Lender
to be terminated, the successor Administrative Agent), to evidence the
substitution of such Lender shall have been received and approved by
Administrative Agent as of such date.
2.8 Obligation of Lenders and Issuing Lender to Mitigate.
Each Lender and Issuing Lender agrees that, as promptly as practicable
after the officer of such Lender or Issuing Lender responsible for administering
the Loans or Letters of Credit of such Lender or Issuing Lender, as the case may
be, becomes aware of the occurrence of an event or the existence of a condition
that would cause such Lender to become an Affected Lender or that would entitle
such Lender or Issuing Lender to receive payments under subsection 2.7 or
subsection 3.6, it will, to the extent not inconsistent with the internal
policies of such Lender or Issuing Lender and any applicable legal or regulatory
restrictions, use reasonable efforts (i) to make, issue, fund or maintain the
Commitments of such Lender or the affected Loans or Letters of Credit of such
Lender or Issuing Lender through another lending or letter of credit office of
such Lender or Issuing Lender, or (ii) take such other measures as such Lender
or Issuing Lender may deem reasonable, if as a result thereof the circumstances
which would cause such Lender to be an Affected Lender would cease to exist or
the additional amounts which would otherwise be required to be paid to such
Lender or Issuing Lender
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pursuant to subsection 2.7 or subsection 3.6 would be materially reduced and if,
as determined by such Lender or Issuing Lender in its sole discretion, the
making, issuing, funding or maintaining of such Commitments or Loans or Letters
of Credit through such other lending or letter of credit office or in accordance
with such other measures, as the case may be, would not otherwise materially
adversely affect such Commitments or Loans or Letters of Credit or the interests
of such Lender or Issuing Lender; provided that such Lender or Issuing Lender
will not be obligated to utilize such other lending or letter of credit office
pursuant to this subsection 2.8 unless Borrower agrees to pay all incremental
expenses incurred by such Lender or Issuing Lender as a result of utilizing such
other lending or letter of credit office as described in clause (i) above. A
certificate as to the amount of any such expenses payable by Borrower pursuant
to this subsection 2.8 (setting forth in reasonable detail the basis for
requesting such amount) submitted by such Lender or Issuing Lender to Borrower
(with a copy to Administrative Agent) shall be conclusive absent demonstrable
error.
SECTION 3.
LETTERS OF CREDIT
3.1 Issuance of Letters of Credit and Lenders' Purchase of Participations
Therein.
A. Letters of Credit. In addition to Borrower requesting that Lenders
make Revolving Loans pursuant to subsection 2.1A(ii) and that Swing Line Lender
make Swing Line Loans pursuant to subsection 2.1A(iii), Borrower may request, in
accordance with the provisions of this subsection 3.1, from time to time during
the period from the Closing Date to but excluding the Revolving Loan Commitment
Termination Date, that Issuing Lender issue Letters of Credit for the account of
Borrower for the purposes specified in the definitions of Commercial Letters of
Credit and Standby Letters of Credit. Subject to the terms and conditions of
this Agreement and in reliance upon the representations and warranties of
Borrower herein set forth, Issuing Lender shall issue such Letters of Credit in
accordance with the provisions of this subsection 3.1; provided that Borrower
shall not request that Issuing Lender issue (and Lender shall not issue):
(i) any Letter of Credit if, after giving effect to such
issuance, the Total Utilization of Revolving Loan Commitments would
exceed the Revolving Loan Commitments then in effect; or
(ii) any Letter of Credit if, after giving effect to such
issuance, the Letter of Credit Usage would exceed $15,000,000; or
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(iii) any Standby Letter of Credit having an expiration date
later than the earlier of (a) the Revolving Loan Commitment Termination
Date and (b) the date which is one year from the date of issuance of
such Standby Letter of Credit; provided that the immediately preceding
clause (b) shall not prevent Issuing Lender from agreeing that a
Standby Letter of Credit will automatically be extended for one or more
successive periods not to exceed one year each unless Issuing Lender
elects not to extend for any such additional period; and provided
further, that Issuing Lender shall elect not to extend such Standby
Letter of Credit if it has knowledge that [a Potential Event of Default
or] an Event of Default has occurred and is continuing (and has not
been waived in accordance with subsection 10.6) at the time Issuing
Lender must elect whether or not to allow such extension; or
(iv) any Commercial Letter of Credit having an expiration
date (a) later than the earlier of (a) the date which is 30 days prior
to the Revolving Loan Commitment Termination Date and (b) the date
which is 180 days from the date of issuance of such Commercial Letter
of Credit or (b) that is otherwise unacceptable to Issuing Lender in
its reasonable discretion; or
(v) any Letter of Credit denominated in a currency other
than Dollars.
B. Mechanics of Issuance.
(i) Notice of Issuance. Whenever Borrower desires the
issuance of a Letter of Credit, it shall deliver to Issuing Lender a
Notice of Issuance of Letter of Credit substantially in the form of
Exhibit III annexed hereto no later than 12:00 Noon (New York City
time) at least three Business Days, or such shorter period as may be
agreed to by Issuing Lender in any particular instance, in advance of
the proposed date of issuance. The Notice of Issuance of Letter of
Credit shall specify (a) the proposed date of issuance (which shall be
a Business Day), (b) whether the Letter of Credit is to be a Standby
Letter of Credit or a Commercial Letter of Credit, (c) the face amount
of the Letter of Credit, (d) the expiration date of the Letter of
Credit, (e) the name and address of the beneficiary, and (f) either the
verbatim text of the proposed Letter of Credit or the proposed terms
and conditions thereof, including a precise description of any
documents to be presented by the beneficiary which, if presented by the
beneficiary prior to the expiration date of the Letter of Credit, would
require Issuing Lender to make payment under the Letter of Credit;
provided that Issuing Lender, in its reasonable discretion, may require
changes in the text of the proposed Letter of Credit or any such
documents; and provided further, that, unless otherwise agreed by the
Issuing Lender, no Letter of Credit shall require payment against a
conforming draft to be made thereunder on the same business day
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(under the laws of the jurisdiction in which the office of Issuing
Lender to which such draft is required to be presented is located)
that such draft is presented if such presentation is made after 10:00
A.M. (in the time zone of such office of Issuing Lender) on such
business day.
Borrower shall notify Issuing Lender (and Administrative
Agent, if Administrative Agent is not Issuing Lender) prior to the
issuance of any Letter of Credit in the event that any of the matters
to which Borrower has certified in the applicable Notice of Issuance of
Letter of Credit is no longer true and correct as of the proposed date
of issuance of such Letter of Credit, and upon the issuance of any
Letter of Credit Borrower shall be deemed to have re-certified, as of
the date of such issuance, as to the matters to which Borrower is
required to certify in the applicable Notice of Issuance of Letter of
Credit.
(ii) Issuance of Letter of Credit. Upon satisfaction or
waiver (in accordance with subsection 10.6) of the conditions set forth
in subsection 4.3, Issuing Lender shall issue the requested Letter of
Credit in accordance with Issuing Lender's standard operating
procedures.
(iii) Notification to Lenders. Upon the issuance of any Letter
of Credit Issuing Lender shall promptly notify Administrative Agent (if
Issuing Lender is not Administrative Agent) and each other Lender of
such issuance, which notice shall be accompanied by a copy of such
Letter of Credit. Promptly after receipt of such notice (or, if
Administrative Agent is Issuing Lender, together with such notice),
Administrative Agent shall notify each Lender of the amount of such
Lender's respective participation in such Letter of Credit, determined
in accordance with subsection 3.1C.
(iv) Reports to Lenders. Within 30 days after the end of each
calendar quarter ending after the Closing Date, so long as any Letter
of Credit shall have been outstanding during such calendar quarter,
Issuing Lender shall deliver to each other Lender a report setting
forth for such calendar quarter the daily aggregate amount available to
be drawn under the Letters of Credit issued by Issuing Lender that were
outstanding during such calendar quarter.
C. Lenders' Purchase of Participations in Letters of Credit.
Immediately upon the issuance of each Letter of Credit, each Lender shall be
deemed to, and hereby agrees to, have irrevocably purchased from Issuing Lender
a participation in such Letter of Credit and any drawings honored thereunder in
an amount equal to such Lender's Pro Rata Share of the maximum amount which is
or at any time may become available to be drawn thereunder.
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3.2 Letter of Credit Fees.
Borrower agrees to pay the following amounts with respect to Letters of
Credit issued hereunder:
(i) with respect to each Letter of Credit, (a) a fronting
fee, payable directly to Issuing Lender for its own account, equal to
the greater of (1) $500 and (2) 0.25% per annum of the daily amount
available to be drawn under such Letter of Credit and (b) a letter of
credit fee, payable to Administrative Agent for the account of Lenders,
equal to the product of the Applicable Margin for Revolving Loans that
are Eurodollar Rate Loans and the daily amount available to be drawn
under such Letter of Credit, each such fronting fee or letter of credit
fee to be payable in arrears on and to (but excluding) each February 1,
May 1, August 1 and November 1 of each year and computed on the basis
of a 365-day or 366-day year, as the case may be, for the actual
number of days elapsed; and
(ii) with respect to the issuance, amendment or transfer of
each Letter of Credit and each payment of a drawing made thereunder
(without duplication of the fees payable under clause (i) above),
documentary and processing charges payable directly to Issuing Lender
for its own account in accordance with Issuing Lender's standard
schedule for such charges in effect at the time of such issuance,
amendment, transfer or payment, as the case may be.
For purposes of calculating any fees payable under clause (i) of this subsection
3.2, the daily amount available to be drawn under any Letter of Credit shall be
determined as of the close of business on any date of determination. Promptly
upon receipt by Administrative Agent of any amount described in clause (i)(b) of
this subsection 3.2, Administrative Agent shall distribute to each Lender its
Pro Rata Share of such amount.
3.3 Drawings and Reimbursement of Amounts Paid Under Letters of Credit.
A. Responsibility of Issuing Lender With Respect to Drawings. In
determining whether to honor any drawing under any Letter of Credit by the
beneficiary thereof, Issuing Lender shall be responsible only to examine the
documents delivered under such Letter of Credit with reasonable care so as to
ascertain whether they appear on their face to be in accordance with the terms
and conditions of such Letter of Credit.
B. Reimbursement by Borrower of Amounts Paid Under Letters of Credit.
In the event Issuing Lender has determined to honor a drawing under a Letter of
Credit issued by it, Issuing Lender shall immediately notify Borrower and
Administrative Agent, and Borrower shall reimburse Issuing Lender on or before
the Business Day immediately following the date on which such drawing is honored
(the "Reimburse-
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ment Date") in an amount in Dollars and in same day funds equal to the amount of
such honored drawing; provided that, anything contained in this Agreement to the
contrary notwithstanding, (i) unless Borrower shall have notified Administrative
Agent and Issuing Lender prior to 10:00 A.M. (New York City time) on the date
such drawing is honored that Borrower intends to reimburse Issuing Lender for
the amount of such honored drawing with funds other than the proceeds of
Revolving Loans, Borrower shall be deemed to have given a timely Notice of
Borrowing to Administrative Agent requesting Lenders to make Revolving Loans
that are Base Rate Loans on the Reimbursement Date in an amount in Dollars equal
to the amount of such honored drawing and (ii) subject to satisfaction or waiver
of the conditions specified in subsection 4.2B, Lenders shall, on the
Reimbursement Date, make Revolving Loans that are Base Rate Loans in the amount
of such honored drawing, the proceeds of which shall be applied directly by
Administrative Agent to reimburse Issuing Lender for the amount of such
honored drawing; and provided further, that if for any reason proceeds of
Revolving Loans are not received by Issuing Lender on the Reimbursement Date
in an amount equal to the amount of such honored drawing, Borrower shall
reimburse Issuing Lender, on demand, in an amount in same day funds equal to
the excess of the amount of such honored drawing over the aggregate amount of
such Revolving Loans, if any, which are so received. Nothing in this
subsection 3.3B shall be deemed to relieve any Lender from its obligation to
make Revolving Loans on the terms and conditions set forth in this Agreement,
and Borrower shall retain any and all rights it may have against any Lender
resulting from the failure of such Lender to make such Revolving Loans under
this subsection 3.3B.
C. Payment by Lenders of Unreimbursed Amounts Paid Under Letters
of Credit.
(i) Payment by Lenders. In the event that Borrower shall
fail for any reason to reimburse Issuing Lender as provided in
subsection 3.3B in an amount equal to the amount of any drawing honored
by Issuing Lender under a Letter of Credit issued by it, Issuing Lender
shall promptly notify each other Lender of the unreimbursed amount of
such honored drawing and of such other Lender's respective
participation therein based on such Lender's Pro Rata Share. Each
Lender shall make available to Issuing Lender an amount equal to its
respective participation, in Dollars and in same day funds, at the
office of Issuing Lender specified in such notice, not later than 12:00
Noon (New York City time) on the first business day (under the laws of
the jurisdiction in which such office of Issuing Lender is located)
after the date notified by Issuing Lender. In the event that any Lender
fails to make available to Issuing Lender on such business day the
amount of such Lender's participation in such Letter of Credit as
provided in this subsection 3.3C, Issuing Lender shall be entitled to
recover such amount on demand from such Lender together with interest
thereon at the rate customarily
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used by Issuing Lender for the correction of errors among banks for
three Business Days and thereafter at the Base Rate. Nothing in this
subsection 3.3C shall be deemed to prejudice the right of any Lender to
recover from Issuing Lender any amounts made available by Lender to
Issuing Lender pursuant to this subsection 3.3C in the event that it is
determined by the final judgment of a court of competent jurisdiction
that the payment with respect to a Letter of Credit by Issuing Lender
in respect of which payment was made by Lender constituted gross
negligence or willful misconduct on the part of Issuing Lender.
(ii) Distribution to Lenders of Reimbursements Received
From Borrower. In the event Issuing Lender shall have been reimbursed
by other Lenders pursuant to subsection 3.3C(i) for all or any portion
of any drawing honored by Issuing Lender under a Letter of Credit
issued by it, Issuing Lender shall distribute to each other Lender
which has paid all amounts payable by it under subsection 3.3C(i) with
respect to such honored drawing such other Lender's Pro Rata Share of
all payments subsequently received by Issuing Lender from Borrower in
reimbursement of such honored drawing when such payments are received.
Any such distribution shall be made to a Lender at its primary address
set forth below its name on the appropriate signature page hereof or at
such other address as such Lender may request.
D. Interest on Amounts Paid Under Letters of Credit.
(i) Payment of Interest by Borrower. Borrower agrees to pay
to Issuing Lender, with respect to drawings honored under any Letters
of Credit issued by it, interest on the amount paid by Issuing Lender
in respect of each such honored drawing from the date such drawing is
honored to but excluding the date such amount is reimbursed by Borrower
(including any such reimbursement out of the proceeds of Revolving
Loans pursuant to subsection 3.3B) at a rate equal to (a) for the
period from the date such drawing is honored to but excluding the
Reimbursement Date, the rate then in effect under this Agreement with
respect to Revolving Loans that are Base Rate Loans and (b) thereafter,
a rate which is 2% per annum in excess of the rate of interest
otherwise payable under this Agreement with respect to Revolving Loans
that are Base Rate Loans. Interest payable pursuant to this subsection
3.3D(i) shall be computed on the basis of a 365-day or 366-day year, as
the case may be, for the actual number of days elapsed in the period
during which it accrues and shall be payable on demand or, if no demand
is made, on the date on which the related drawing under a Letter of
Credit is reimbursed in full.
(ii) Distribution of Interest Payments by Issuing Lender.
Promptly upon receipt by Issuing Lender of any payment of interest
pursuant to subsection
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3.3D(i) with respect to a drawing honored under a Letter of Credit
issued by it, (a) Issuing Lender shall distribute to each other Lender,
out of the interest received by Issuing Lender in respect of the period
from the date such drawing is honored to but excluding the date on
which Issuing Lender is reimbursed for the amount of such drawing
(including any such reimbursement out of the proceeds of Revolving
Loans pursuant to subsection 3.3B), the amount that such other Lender
would have been entitled to receive in respect of the letter of credit
fee that would have been payable in respect of such Letter of Credit
for such period pursuant to subsection 3.2 if no drawing had been
honored under such Letter of Credit, and (b) in the event Issuing
Lender shall have been reimbursed by other Lenders pursuant to
subsection 3.3C(i) for all or any portion of such honored drawing,
Issuing Lender shall distribute to each other Lender which has paid all
amounts payable by it under subsection 3.3C(i) with respect to such
honored drawing such other Lender's Pro Rata Share of any interest
received by Issuing Lender in respect of that portion of such honored
drawing so reimbursed by other Lenders for the period from the date on
which Issuing Lender was so reimbursed by other Lenders to but
excluding the date on which such portion of such honored drawing is
reimbursed by Borrower. Any such distribution shall be made to a Lender
at its primary address set forth below its name on the appropriate
signature page hereof or at such other address as such Lender may
request.
3.4 Obligations Absolute.
The obligation of Borrower to reimburse Issuing Lender for drawings
honored under the Letters of Credit issued by it and to repay any Revolving
Loans made by Lenders pursuant to subsection 3.3B and the obligations of Lenders
under subsection 3.3C(i) shall be unconditional and irrevocable and shall be
paid strictly in accordance with the terms of this Agreement under all
circumstances including any of the following circumstances:
(i) any lack of validity or enforceability of any
Letter of Credit;
(ii) the existence of any claim, set-off, defense or other
right which Borrower or any Lender may have at any time against a
beneficiary or any transferee of any Letter of Credit (or any Persons
for whom any such transferee may be acting), Issuing Lender or other
Lender or any other Person or, in the case of a Lender, against
Borrower, whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction (including any
underlying transaction between Borrower or one of its Subsidiaries and
the beneficiary for which any Letter of Credit was procured);
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(iii) any draft or other document presented under any
Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) payment by Issuing Lender under any Letter of Credit
against presentation of a draft or other document which does not
substantially comply with the terms of such Letter of Credit;
(v) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or prospects of
Holdings or any of its Subsidiaries;
(vi) any breach of this Agreement or any other Loan
Document by any party thereto;
(vii) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing; or
(viii) the fact that an Event of Default or a Potential
Event of Default shall have occurred and be continuing; provided, in
each case, that payment by Issuing Lender under the applicable Letter
of Credit shall not have constituted gross negligence, willful
misconduct or bad faith of Issuing Lender under the circumstances in
question.
3.5 Indemnification; Nature of Issuing Lender's Duties.
A. Indemnification. In addition to amounts payable as provided
in subsection 3.6, Borrower hereby agrees to protect, indemnify, pay and save
harmless Issuing Lender from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel and allocated costs of internal
counsel) which Issuing Lender may incur or be subject to as a consequence,
direct or indirect, of (i) the issuance of any Letter of Credit by Issuing
Lender, other than as a result of (a) the gross negligence, willful misconduct
or bad faith of Issuing Lender or (b) subject to the following clause (ii), the
wrongful dishonor by Issuing Lender of a proper demand for payment made under
any Letter of Credit issued by it or (ii) the failure of Issuing Lender to honor
a drawing under any such Letter of Credit as a result of any act or omission,
whether rightful or wrongful, of any present or future de jure or de facto
government or governmental authority (all such acts or omissions herein called
"Governmental Acts").
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B. Nature of Issuing Lender's Duties. As between Borrower and
Issuing Lender, Borrower assumes all risks of the acts and omissions of, or
misuse of the Letters of Credit issued by Issuing Lender by, the respective
beneficiaries of such Letters of Credit. In furtherance and not in limitation of
the foregoing, Issuing Lender shall not be responsible for: (i) the form,
validity, sufficiency, accuracy, genuineness or legal effect of any document
submitted by any party in connection with the application for and issuance of
any such Letter of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (iii) failure of the beneficiary of
any such Letter of Credit to comply fully with any conditions required in order
to draw upon such Letter of Credit; (iv) errors, omissions, interruptions or
delays in transmission or delivery of any messages, by mail, cable, telegraph,
telex or otherwise, whether or not they be in cipher; (v) errors in
interpretation of technical terms; (vi) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under any such
Letter of Credit or of the proceeds thereof; (vii) the misapplication by the
beneficiary of any such Letter of Credit of the proceeds of any drawing under
such Letter of Credit; or (viii) any consequences arising from causes beyond the
control of Issuing Lender, including any Governmental Acts, and none of the
above shall affect or impair, or prevent the vesting of, any of Issuing Lender's
rights or powers hereunder.
In furtherance and extension and not in limitation of the specific
provisions set forth in the first paragraph of this subsection 3.5B, any action
taken or omitted by Issuing Lender under or in connection with the Letters of
Credit issued by it or any documents and certificates delivered thereunder, if
taken or omitted in good faith, shall not put Issuing Lender under any resulting
liability to Borrower.
Notwithstanding anything to the contrary contained in this subsection
3.5, Borrower shall retain any and all rights it may have against Issuing Lender
for any liability arising solely out of the gross negligence, willful misconduct
or bad faith of Issuing Lender.
3.6 Increased Costs and Taxes Relating to Letters of Credit.
Subject to the provisions of subsection 2.7B (which shall be
controlling with respect to the matters covered thereby), in the event that
Issuing Lender or any Lender shall determine (which determination shall, absent
manifest error, be final and conclusive and binding upon all parties hereto)
that any law, treaty or governmental rule,
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regulation or order, or any change therein or in the interpretation,
administration or application thereof (including the introduction of any new
law, treaty or governmental rule, regulation or order), or any determination of
a court or governmental authority, in each case that becomes effective after the
date hereof, or compliance by Issuing Lender or any Lender with any guideline,
request or directive issued or made after the date hereof by any central bank or
other governmental or quasi-governmental authority (whether or not having the
force of law):
(i) subjects Issuing Lender or such Lender (or its
applicable lending or letter of credit office) to any additional Tax
(other than any Tax on the overall net income of Issuing Lender or such
Lender) with respect to the issuing or maintaining of any Letters of
Credit or the purchasing or maintaining of any participations therein
or any other obligations under this Section 3, whether directly or by
such being imposed on or suffered by Issuing Lender;
(ii) imposes, modifies or holds applicable any reserve
(including any marginal, emergency, supplemental, special or other
reserve), special deposit, compulsory loan, FDIC insurance or similar
requirement in respect of any Letters of Credit issued by Issuing
Lender or participations therein purchased by such Lender; or
(iii) imposes any other condition (other than with respect to
a Tax matter) on or affecting Issuing Lender or Lender (or its
applicable lending or letter of credit office) regarding this Section 3
or any Letter of Credit or any participation therein;
and the result of any of the foregoing is to increase the cost to Issuing Lender
or such Lender of agreeing to issue, issuing or maintaining any Letter of Credit
or agreeing to purchase, purchasing or maintaining any participation therein or
to reduce any amount received or receivable by Issuing Lender or such Lender (or
its applicable lending or letter of credit office) with respect thereto; then,
in any case, Borrower shall promptly pay to Issuing Lender or such Lender, upon
receipt of the statement referred to in the next sentence, such additional
amount or amounts as may be necessary to compensate Issuing Lender or such
Lender for any such increased cost or reduction in amounts received or
receivable hereunder. Issuing Lender or such Lender shall deliver to Borrower a
written statement, setting forth in reasonable detail the basis for calculating
the additional amounts owed to Issuing Lender or such Lender under this
subsection 3.6, which statement shall be conclusive and binding upon all parties
hereto absent demonstrable error. Promptly after Issuing Lender or any Lender
has determined, in its sole judgment, that it will make a request for increased
compensation pursuant to this subsection 3.6, Issuing Lender or such Lender, as
the case may be, will notify Borrower thereof. Failure on the part of Issuing
Lender or such Lender, as the case may be, so to notify Borrower or to demand
compensation for any increased costs or reduction in amounts received or
receivable or reduction in return on capital with respect to any
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period shall not constitute a waiver of Issuing Lender's or such Lender's right
to demand compensation with respect to such period or any other period; provided
that Borrower shall not be under any obligation to compensate Issuing Lender or
any Lender with respect to increased costs or reductions with respect to any
period prior to the date that is six months prior to such request if Issuing
Lender or such Lender knew of the circumstances giving rise to such increased
costs or reductions and of the fact that such circumstances would in fact result
in a claim for increased compensation by reason of such increased costs or
reductions; provided further, that the foregoing limitation shall not apply to
any increased costs or reductions arising out of the retroactive application of
any law, regulation, rule, guideline or directive as aforesaid within such
six-month period.
SECTION 4.
CONDITIONS TO LOANS AND LETTERS OF CREDIT
The obligations of Lenders to make Loans and the issuance of Letters of
Credit hereunder are subject to the satisfaction of the following conditions.
4.1 Conditions to AXELs and Initial Revolving Loans and Swing Line Loans.
The obligations of Lenders to make the AXELs to be made on the Closing
Date are, in addition to the conditions precedent specified in subsection 4.2,
subject to prior or concurrent satisfaction of the following conditions:
A. Loan Party Documents. On or before the Closing Date, Borrower
shall, and shall cause each other Loan Party to, deliver to Lenders (or to
Administrative Agent for Lenders with sufficient originally executed copies,
where appropriate, for each Lender and its counsel) the following with respect
to Borrower or such other Loan Party, as the case may be, each, unless otherwise
noted, dated the Closing Date:
(i) Certified copies of the Certificate or Articles of
Incorporation of such Person, together with a good standing certificate
from the Secretary of State of its jurisdiction of incorporation and
each other state in which such Person is qualified as a foreign
corporation to do business and, to the extent generally available, a
certificate or other evidence of good standing as to payment of any
applicable franchise or similar taxes from the appropriate taxing
authority of each of such jurisdictions, each dated a recent date prior
to the Closing Date;
(ii) Copies of the Bylaws of such Person, certified as of the
Closing Date by such Person's corporate secretary or an assistant
secretary;
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(iii) Resolutions of the Board of Directors of such Person
approving and authorizing the execution, delivery and performance of
the Loan Documents and Related Agreements to which it is a party,
certified as of the Closing Date by the corporate secretary or an
assistant secretary of such Person as being in full force and effect
without modification or amendment;
(iv) Signature and incumbency certificates of the officers
of such Person executing the Loan Documents to which it is a party;
and
(v) Executed originals of the Loan Documents to which such
Person is a party.
B. No Material Adverse Change. After giving effect to the
Transaction, since December 31, 1995, no event, change or development has
occurred which has a Material Adverse Effect.
C. Senior Subordinated Notes. On or prior to the Closing Date, Borrower
shall have issued and sold the Senior Subordinated Notes and received gross
proceeds of not less than $80,000,000. The Senior Subordinated Notes shall be
unsecured and shall have terms, including without limitation, maturity, interest
rates, covenants and subordination provisions in form and substance as set forth
in the Indenture dated November 15, 1996, with such changes thereto, if any,
that have been approved by Administrative Agent and Requisite Lenders or that
would otherwise have been permitted to be made pursuant to subsection 7.13A if
the Subordinated Notes were issued and outstanding at the time of any such
change. Borrower shall deliver to Arranging Agent and Administrative Agent true
and complete copies of the all documentation relating to the Senior Subordinated
Notes, all of which shall be in form and substance satisfactory to Arranging
Agent and Administrative Agent. In no event shall the maturity or the first
scheduled repayment date on the Senior Subordinated Notes be earlier than May 1,
2004.
D. Holdings Common Stock and Holdings Preferred Stock. On or prior to
the Closing Date, Holdings shall have (i) issued and sold $130,000,000 in the
aggregate of Holdings Common Stock and Holdings Preferred Stock to Xxxxxx and
the Blackstone Investors in exchange for $107,000,000 in Cash proceeds and the
Satellite Properties valued at $23,000,000 and (ii) all of the foregoing,
including the terms and conditions thereof and all documentation executed
therewith, shall be in form and substance satisfactory to Arranging Agent and
Administrative Agent.
E. Related Agreements. (i) Administrative Agent and Arranging
Agent shall have received executed or conformed copies of each of the Related
Agreements and any amendments thereto on or before the Closing Date, the terms
are conditions of which shall be in all respects satisfactory to Administrative
Agent and Arranging Agent, (ii) the
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Related Agreements shall be in full force and effect and no term or condition
thereof shall have been amended, modified or waived after the execution thereof,
except as provided in a written amendment thereto delivered to and approved by
Administrative Agent and Arranging Agent, (iii) no Loan Party shall have failed
in any material respect to perform any material obligation or covenant required
by the Related Agreement to be performed with or complied with by it on or
before the Closing Date and (iv) Administrative Agent and Arranging Agent shall
have received an Officers' Certificate from Holdings and Borrower in form and
substance satisfactory to Administrative Agent and Arranging Agent to the
effects set forth in clauses (i), (ii) and (iii) above.
F. Matters Relating to Existing Indebtedness. On the Closing Date,
Borrower and its Subsidiaries shall have (i) repaid in full all Existing
Indebtedness outstanding or defeased such Existing Indebtedness pursuant to
escrow agreements or other arrangements which shall be in form and substance
satisfactory to Arranging Agent and Administrative Agent, (ii) terminated any
commitments to lend or make other extensions of credit under the documentation
governing the Existing Indebtedness, and (iii) delivered to Arranging Agent and
Administrative Agent all documents or instruments necessary (including
termination statements and discharges and releases of mortgages) to release all
Liens securing the Existing Indebtedness and release letters in form and
substance satisfactory to Arranging Agent and Administrative Agent from the
holders of the Existing Indebtedness releasing their claims and giving further
assurances as to any other actions or documents necessary to release all Liens
securing such Existing Indebtedness.
G. Necessary Governmental Authorizations and Consents;
Expiration of Waiting Periods, Etc. Except as set forth on Schedule 4.1G annexed
hereto, Holdings and Borrower shall have obtained all Governmental
Authorizations and all consents of other Persons, in each case that are
necessary or advisable in connection with the Acquisition, the Merger, the
Contribution, the other transactions contemplated by the Loan Documents and the
Related Agreements, and the continued operation of the business conducted by
Holdings and its Subsidiaries in substantially the same manner as conducted by
Rose Hills, the Association, the Satellite Properties and their respective
Subsidiaries prior to the consummation of the Acquisition, the Merger and the
Contribution and each of the foregoing shall be in full force and effect, in
each case other than those the failure to obtain or maintain which, either
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect. All applicable waiting periods shall have expired
without any action being taken or threatened by any competent authority which
would restrain, prevent or otherwise impose adverse conditions on the
Acquisition or the financing thereof. No action, request for stay, petition for
review or rehearing, reconsideration, or appeal with respect to any of the
foregoing shall be pending, and the time for any applicable agency to take
action to set aside its consent on its own motion shall have expired.
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H. Consummation of Acquisition, Merger and Contribution.
(i) All conditions to the Acquisition and the Merger set
forth in the Acquisition Agreement and the Merger Agreement,
respectively, shall have been satisfied or the fulfillment of any such
conditions which shall not have been satisfied shall have been waived
with the consent of Arranging Agent, Administrative Agent and Requisite
Lenders;
(ii) Arranging Agent and Administrative Agent shall have
received evidence reasonably satisfactory to Arranging Agent and
Administrative Agent that (a) the Acquisition and the Merger shall
become effective before or concurrently with the making of the initial
Loans and (b) all of the transactions contemplated in connection with
the Contribution shall become effective before or concurrently with the
making of the initial Loans and such transactions and the documentation
entered into in connection therewith shall be in form and substance
reasonably satisfactory to Arranging Agent and Administrative Agent;
(iii) the aggregate Cash proceeds from the issuance of the
equity of Holdings to Xxxxxx and the Blackstone Investors contemplated
by subsection 4.1D, plus the Cash proceeds of the Senior Subordinated
Notes, plus the amount of the AXELs made on the Closing Date will equal
or exceed the sum of (a) the aggregate Cash consideration paid in
connection with the Acquisition and the Merger, (b) the Transaction
Costs, (c) the amounts required to repay or defease the Existing
Indebtedness as required by subsection 4.1F and (d) the amounts
necessary to prefund up to $2,000,000 of certain capital expenditures
and severance costs; and
(iv) Arranging Agent and Administrative Agent shall have
received an Officers' Certificate of Borrower to the effect set forth
in clauses (i)-(iii) above.
I. Security Interests in the Cemetery and Personal Property.
Each of Arranging Agent and Administrative Agent shall have received evidence
satisfactory to it that each Loan Party shall have taken or caused to be taken
all such actions, executed and delivered or caused to be executed and delivered
all such agreements, documents and instruments, and made or caused to be made
all such filings and recordings (other than the filing or recording of items
described in clauses (iii), (iv) and (v) below) that may be necessary or, in the
opinion of Arranging Agent and Administrative Agent, desirable in order to
create in favor of Administrative Agent, for the benefit of Lenders, a valid and
(upon such filing and recording) perfected First Priority security interest in
the Collateral. Such actions shall include the following:
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(i) Schedules to Collateral Documents. Delivery to
Administrative Agent of accurate and complete schedules to all of the
applicable Collateral Documents.
(ii) Stock Certificates and Instruments. Delivery to
Administrative Agent of (a) certificates (which certificates shall be
accompanied by irrevocable undated stock powers, duly endorsed in blank
and otherwise satisfactory in form and substance to Administrative
Agent) representing all capital stock pledged pursuant to the Holdings
Pledge Agreement, the Borrower Pledge Agreement
and the Subsidiary Pledge Agreement and (b) all promissory notes or
other instruments (duly endorsed, where appropriate, in a manner
satisfactory to Administrative Agent) evidencing any Collateral;
(iii) Lien Searches and UCC Termination Statements. Delivery
to Arranging Agent and Administrative Agent of (a) the results of a
recent search, by a Person satisfactory to Arranging Agent and
Administrative Agent, of all effective UCC financing statements and
fixture filings and all tax lien filings which may have been made with
respect to the Cemetery or any personal or mixed property of any Loan
Party, together with copies of all such filings requested by
Administrative Agent disclosed by such search, and (b) UCC termination
statements duly executed by all applicable Persons for filing in all
applicable jurisdictions as may be necessary to terminate any effective
UCC financing statements or fixture filings disclosed in such search
(other than any such financing statements or fixture filings in respect
of Liens permitted to remain outstanding pursuant to the terms of this
Agreement);
(iv) UCC Financing Statements. Delivery to Administrative
Agent of UCC financing statements duly executed by each applicable Loan
Party with respect to all personal property Collateral of such Loan
Party, for filing in all jurisdictions as may be necessary or, in the
opinion of Arranging Agent and Administrative Agent, desirable to
perfect the security interests created in such Collateral pursuant to
the Collateral Documents; and
(v) Mortgage; Title Insurance; Survey. Delivery to Arranging
Agent and Administrative Agent of (a) a fully executed Mortgage,
together with evidence that counterparts of the Mortgage have been
delivered to the title insurance company insuring the Lien of the
Mortgage for recording in all jurisdictions as may be necessary or, in
the opinion of Arranging Agent and Administrative Agent, desirable to
perfect the security interests created in the Cemetery pursuant to the
Mortgage, (b) a mortgage title insurance policy on the Cemetery issued
by a title insurer satisfactory to Arranging Agent and Administrative
Agent in form and substance, and in an amount, satisfactory to
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Arranging Agent and Administrative Agent and (c) a recent survey in
form and substance satisfactory to Arranging Agent and Administrative
Agent, of the Cemetery, certified by a licensed professional surveyor
satisfactory to Arranging Agent and Administrative Agent.
J. Financial Statements; Pro Forma Balance Sheet. On or before
the Closing Date, Lenders shall have received from Borrower (i) audited
financial state- ments of Rose Hills and its Subsidiaries, the Association and
its Subsidiary and the Satellite Properties, in each case for Fiscal Year 1995,
consisting of a balance sheet and the related consolidated statements of income,
stockholders' equity and cash flows for such Fiscal Year (all as included in
Borrower's Offering Memorandum, dated November 14, 1996, prepared in connection
with the Senior Subordinated Notes), (ii) (x) unaudited financial statements of
Rose Hills and its Subsidiaries, the Association and its Subsidiary and the
Satellite Properties for the six month period ended June 30, 1996 and (y)
monthly unaudited financial statements prepared by management for internal use
of each of the Association and Rose Hills Mortuary L.P. for the monthly periods
ended July 31, 1996, August 31, 1996 and September 30, 1996, in each case (in
respect of the foregoing clause (x)) consisting of a balance sheet and the
related consolidated statements of income, stockholders' equity and cash flows
for such periods, all in reasonable detail and certified by the chief executive
officer or chief financial officer of Holdings that they fairly present in all
material respects the financial condition of respective Persons as at the dates
indicated and the results of their operations and their cash flows for the
periods indicated, subject to changes resulting from audit and normal year-end
adjustments, and (iii) a pro forma consolidated balance sheet of Holdings and
its Subsidiaries as of June 30, 1996 and a pro forma income statement of
Holdings and its Subsidiaries for the twelve month period ended December 31,
1995 and the six month period ended June 30, 1996, in each case prepared in
accordance with GAAP and reflecting the consummation of the Acquisition, the
Merger and the Contribution, the related financings and the other transactions
contemplated by the Loan Documents and the Related Agreements, which pro forma
financial statements shall be in form and substance consistent with the pro
forma financial statements contained in the Confidential Information Memorandum
and otherwise satisfactory to Lenders.
K. Solvency Opinion. On the Closing Date, Arranging Agent,
Administrative Agent and Lenders shall have received a letter from Xxxxxx,
Xxxxxx & Co., dated the Closing Date and addressed to Arranging Agent,
Administrative Agent and Lenders, in form and substance reasonably satisfactory
to Arranging Agent and Administrative Agent, demonstrating that, after giving
effect to the consummation of the Acquisition, the Merger, the Contribution, the
related financings and the other transactions contemplated by the Loan
Documents and the Related Agreements, Holdings and its Subsidiaries on a
consolidated basis and Borrower will be Solvent.
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L. Evidence of Insurance. Arranging Agent and Administrative
Agent shall have received a certificate from Borrower's insurance broker or
other evidence satisfactory to it that all insurance required to be maintained
pursuant to subsection 6.4 is in full force and effect and that Administrative
Agent on behalf of Lenders has been named as additional insured and/or loss
payee thereunder to the extent required under subsection 6.4.
M. Opinions of Counsel to Loan Parties. Lenders and their
respective counsel shall have received (i) originally executed copies of one or
more favorable written opinions of Xxxxxxx Xxxxxxx & Xxxxxxxx, counsel for Loan
Parties, dated as of the Closing Date and substantially in the form of Exhibit
VIII-A annexed hereto and as to such other matters as Administrative Agent or
Arranging Agent and acting on behalf of Lenders may reasonably request, (ii)
originally executed copies of one or more favorable written opinions of Xxx,
Castle & Xxxxxxxxx, LLP, counsel for Loan Parties, dated as of the Closing Date
and substantially in the form of Exhibit VIII-B annexed hereto and as to such
other matters as Administrative Agent or Arranging Agent and acting on behalf of
Lenders may reasonably request and (iii) evidence satisfactory to Arranging
Agent and Administrative Agent that Borrower has requested each such counsel to
deliver such opinions to Lenders.
N. Opinions of Agents' Counsel. Lenders shall have received originally
executed copies of one or more favorable written opinions of White & Case,
counsel to Agents, dated as of the Closing Date, substantially in the form of
Exhibit IX annexed hereto and as to such other matters as Arranging Agent may
reasonably request.
O. Opinions of Counsel Delivered Under Related Agreements.
Administrative Agent and Arranging Agent and its counsel shall have received
copies of each of the opinions of counsel delivered to the parties under the
Acquisition Agreement, the Merger Agreement and the purchase or subscription
agreements relating to the Senior Subordinated Notes and the Holdings Common
Stock and Holdings Preferred Stock, together, to the extent agreed to by such
law firm, with a letter from each such counsel authorizing Lenders to rely upon
such opinion to the same extent as though it were addressed to Lenders.
P. Fees. Borrower shall have paid to Arranging Agent and
Administrative Agent, for distribution (as appropriate) to Arranging Agent,
Administrative Agent and Lenders, the fees payable on the Closing Date referred
to in subsection 2.3 and all other compensation, fees, costs and expenses
(including fees and expenses of counsel to Arranging Agent and Administrative
Agent) and payable hereunder or in connection herewith to Arranging Agent and
Administrative Agent on or prior to the Closing Date.
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Q. Administrative Agreement. Administrative Agent and
Arranging Agent shall have received duly executed copies of the Administrative
Agreement, which shall be in form and substance reasonably satisfactory to
Arranging Agent and Administrative Agent.
R. Representations and Warranties; Performance of Agreements.
Holdings and Borrower shall have delivered to Arranging Agent and Administrative
Agent an Officers' Certificate, in form and substance satisfactory to Arranging
Agent and Administrative Agent, to the effect that the representations and
warranties in Section 5 are true and correct in all material respects on and as
of the Closing Date to the same extent as though made on and as of that date
(or, to the extent such representations and warranties specifically relate to an
earlier date, that such representations and warranties were true and correct in
all material respects on and as of such earlier date) and that each of Holdings
and Borrower shall have performed in all material respects all agreements and
satisfied all conditions which this Agreement provides shall be performed or
satisfied by it on or before the Closing Date except as otherwise disclosed to
and agreed to in writing by Arranging Agent, Administrative Agent and Requisite
Lenders.
S. Completion of Proceedings. All corporate and other
proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by Administrative Agent, acting on behalf of Lenders, or Arranging
Agent and its counsel shall be satisfactory in form and substance to
Administrative Agent and Arranging Agent and such counsel, and Administrative
Agent, Arranging Agent and such counsel shall have received all such counterpart
originals or certified copies of such documents as Administrative Agent or
Arranging Agent may reasonably request.
Each Lender by delivering its signature page to this Agreement and
funding its AXEL Commitment on the Closing Date shall be deemed to have
acknowledged receipt of, and consented to and approved (as long as substantially
in the form delivered to Lenders including any changed pages thereto delivered
to Lenders), each Loan Document and each other document required to be approved
by Requisite Lenders or Lenders, as applicable.
4.2 Conditions to All Loans.
The obligations of Lenders to make Loans on each Funding Date are
subject to the following further conditions precedent:
A. Administrative Agent shall have received before that Funding Date,
in accordance with the provisions of subsection 2.1B, an originally executed
Notice of Borrowing, in each case signed by the chief executive officer, the
president, the chief
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financial officer or the treasurer of Borrower or by any executive officer of
Borrower designated by any of the above-described officers on behalf of Borrower
in a writing delivered to Administrative Agent.
B. As of that Funding Date:
(i) The representations and warranties contained herein and
in the other Loan Documents shall be true and correct in all material
respects on and as of that Funding Date to the same extent as though
made on and as of that date, except to the extent such representations
and warranties specifically relate to an earlier date, in which case
such representations and warranties shall have been true and correct in
all material respects on and as of such earlier date;
(ii) No event shall have occurred and be continuing or would
result from the consummation of the borrowing contemplated by such
Notice of Borrowing that would constitute an Event of Default or a
Potential Event of Default;
(iii) Each Loan Party shall have performed in all material
respects all agreements and satisfied all conditions which this
Agreement provides shall be performed or satisfied by it on or before
that Funding Date;
(iv) No order, judgment or decree of any court, arbitrator or
governmental authority shall purport to enjoin or restrain any Lender
from making the Loans to be made by it on that Funding Date;
(v) The making of the Loans requested on such Funding Date
shall not violate any law, including Regulation G, Regulation T,
Regulation U or Regulation X of the Board of Governors of the Federal
Reserve System; and
(vi) There shall not be pending or, to the knowledge of
Borrower, threatened, any action, suit, proceeding, governmental
investigation or arbitration against or affecting Holdings or any of
its Subsidiaries or any property of Holdings or any of its Subsidiaries
that has not been disclosed by Borrower in writing pursuant to
subsection 6.1(viii) prior to the making of the last preceding Loans
(or, in the case of the initial Loans, prior to the execution of this
Agreement), and there shall have occurred no development not so
disclosed in any such action, suit, proceeding, governmental
investigation or arbitration so disclosed, that, in either event, in
the opinion of Administrative Agent or of Requisite Lenders, could
reasonably be expected to have a Material Adverse Effect; and no
injunction or other restraining order shall have been issued and no
hearing to cause an injunction or other restraining order to be issued
shall be
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pending or noticed with respect to any action, suit or
proceeding seeking to enjoin or otherwise prevent the consummation of,
or to recover any damages or obtain relief as a result of, the
transactions contemplated by this Agreement or the making of Loans
hereunder.
4.3 Conditions to Letters of Credit.
The issuance of any Letter of Credit hereunder (whether or not Issuing
Lender is obligated to issue such Letter of Credit) is subject to the following
conditions precedent:
A. On or before the date of issuance of the initial
Letter of Credit pursuant to this Agreement, the initial Loans shall
have been made.
B. Or before the date of issuance of such Letter of
it, Issuing Lender shall have received, in accordance with the
provisions of subsection 3.1B(i), an originally executed Notice of
Issuance of Letter of Credit, in each case signed by the chief
executive officer, the president, the chief financial officer or the
treasurer of Borrower or by any executive officer of Borrower
designated by any of the above-described officers on behalf of Borrower
in a writing delivered to Issuing Lender, together with all other
information specified in subsection 3.1B(i) and such other documents or
information as Issuing Lender may reasonably require in connection with
the issuance of such Letter of Credit.
C. On the date of issuance of such Letter of Credit, all
conditions precedent described in subsection 4.2B shall be satisfied to
the same extent as if the issuance of such Letter of Credit were the
making of a Loan and the date of issuance of such Letter of Credit were
a Funding Date.
SECTION 5.
REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to make the
Loans, to induce Issuing Lender to issue Letters of Credit and to induce other
Lenders to purchase participations therein, Holdings and Borrower each represent
and warrant to each Lender, on the date of this Agreement, on each Funding Date
and on the date of issuance of each Letter of Credit, that the following
statements are true, correct and complete:
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5.1 Organization, Powers, Qualification, Good Standing, Business and
Subsidiaries.
A. Organization and Powers. Each Loan Party is a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation as specified in Schedule 5.1 annexed hereto,
except, in the case of any Loan Party other than Holdings or Borrower, where
failure to be in good standing has not had and could not reasonably be expected
to have a Material Adverse Effect. Each Loan Party has all requisite corporate
power and authority to own and operate its properties, to carry on its business
as now conducted and as proposed to be conducted, to enter into the Loan
Documents and Related Agreements to which it is a party and to carry out the
transactions contemplated thereby.
B. Qualification and Good Standing. Each Loan Party is
qualified to do business and in good standing in every jurisdiction where its
assets are located and wherever necessary to carry out its business and
operations, except in jurisdictions where the failure to be so qualified or in
good standing has not had and could not reasonably be expected to have a
Material Adverse Effect.
C. Conduct of Business. Loan Parties are engaged only in the
businesses permitted to be engaged in pursuant to subsection 7.12.
D. Subsidiaries. All of the Subsidiaries of Holdings as of the
Closing Date are identified in Schedule 5.1 annexed hereto, as said Schedule 5.1
may be supplemented from time to time pursuant to the provisions of subsection
6.1(xiv). The capital stock of each of the Subsidiaries of Holdings identified
in Schedule 5.1 annexed hereto (as so supplemented) is duly authorized, validly
issued, fully paid and nonassessable and none of such capital stock constitutes
Margin Stock. Schedule 5.1 annexed hereto (as so supplemented) correctly sets
forth the ownership interest of Borrower and each of its Subsidiaries in each of
the Subsidiaries of Borrower identified therein.
5.2 Authorization of Borrowing, etc.
A. Authorization of Borrowing. The execution, delivery and
performance of the Loan Documents and the Related Agreements have been duly
authorized by all necessary corporate action on the part of each Loan Party that
is a party thereto.
B. No Conflict. The execution, delivery and performance by
Loan Parties of the Loan Documents and the Related Agreements to which they are
parties and the consummation of the transactions contemplated by the Loan
Documents and such Related Agreements do not and will not (i) violate any
provision of (a) any law or any governmental rule or regulation applicable to
any Loan Party or any of its Subsidiaries
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except for such violations which could not reasonably be expected to have a
Material Adverse Effect, (b) the Certificate or Articles of Incorporation or
Bylaws of any Loan Party or any of its Subsidiaries or (c) any order, judgment
or decree of any court or other agency of government binding on any Loan Party
or any of its Subsidiaries, (ii) conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under any
Contractual Obligation of any Loan Party or any of its Subsidiaries which could
reasonably be expected to have a Material Adverse Effect, (iii) result in or
require the creation or imposition of any material Lien upon any of the
properties or assets of any Loan Party or any of its Subsidiaries (other than
Permitted Encumbrances or any Liens created under any of the Loan Documents in
favor of Administrative Agent on behalf of Lenders), or (iv) require any
approval of stockholders or any approval or consent of any Person under any
Contractual Obligation of any Loan Party or any of its Subsidiaries, except for
such approvals or consents which will be obtained on or before the Closing Date
and disclosed in writing to Lenders or which could not reasonably be expected to
have a Material Adverse Effect.
C. Governmental Consents. The execution, delivery and
performance by Loan Parties of the Loan Documents and the Related Agreements to
which they are parties and the consummation of the transactions contemplated by
the Loan Documents and such Related Agreements do not and will not require any
registration with, consent or approval of, or notice to, or other action to,
with or by, any federal, state or other governmental authority or regulatory
body except as provided in subsection 5.16B with respect to the Collateral
Documents, except as set forth on Schedule 4.1G annexed hereto and except to the
extent the absence thereof could not reasonably be expected to have a Material
Adverse Effect.
D. Binding Obligation. Each of the Loan Documents and Related
Agreements has been duly executed and delivered by each Loan Party that is a
party thereto and is the legally valid and binding obligation of such Loan
Party, enforceable against such Loan Party in accordance with its respective
terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium, other similar laws relating to or affecting
creditors' rights generally and general equitable principles (whether considered
in a proceeding in equity or at law).
E. Valid Issuance of Holdings Common Stock, Holdings Preferred
Stock and Senior Subordinated Notes.
(i) Holdings Common Stock and Holdings Preferred Stock.
The Holdings Common Stock and Holdings Preferred Stock to be sold on or
before the Closing Date, when issued and delivered, will be duly and
validly issued, fully paid and nonassessable. The issuance and sale of
such Holdings Common Stock and Holdings Preferred Stock, upon such
issuance and sale, will either
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(a) have been registered or qualified under applicable federal and
state securities laws or (b) be exempt therefrom.
(ii) Senior Subordinated Notes. Borrower has the
corporate power and authority to issue the Senior Subordinated Notes.
The Senior Subordinated Notes when issued and paid for, will be the
legally valid and binding obligations of Borrower, enforceable against
Borrower in accordance with their respective terms, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium, other similar laws relating to or affecting
creditors' rights generally and general equitable principles (whether
considered in a proceeding in equity or at law). The subordination
provisions of the Senior Subordinated Notes will be
enforceable against the holders thereof and the Loans and all other
monetary Obligations hereunder are and will be within the definition of
"Senior Indebtedness" included in such provisions. The Senior
Subordinated Notes, when issued and sold, will either (a) have been
registered or qualified under applicable federal and state securities
laws or (b) be exempt therefrom.
5.3 Financial Condition.
Borrower has heretofore delivered to Lenders, at Lenders' request, the
following financial statements and information: (i) the audited consolidated
balance sheet of Rose Hills and its Subsidiaries, the Association and its
Subsidiary and the Satellite Properties, in each case as at December 31, 1995
and the related consolidated statements of income, stockholders' equity and cash
flows of such Persons for the Fiscal Year then ended, (ii) the unaudited
consolidated balance sheet of Rose Hills and its Subsidiaries and the
Association and its Subsidiary and the unaudited balance sheets of the Satellite
Properties, in each case as at June 30, 1996 and the related unaudited
consolidated and other statements of income, stockholders' equity and cash flows
of Rose Hills and its Subsidiaries, the Association and its Subsidiary and of
the Satellite Properties for the six months then ended and (iii) the unaudited
monthly balance sheets of each of the Association and Rose Hills Mortuary L.P.
as at the monthly periods ended July 31, 1996, August 31, 1996 and September 30,
1996 and the related unaudited statements for such monthly periods, in each case
prepared by management for internal purposes. All such statements in clauses (i)
and (ii) were prepared in conformity with GAAP and fairly present, in all
material respects, the financial position (on a consolidated basis) of the
entities described in such financial statements as at the respective dates
thereof and the results of operations and cash flows (on a consolidated basis)
of the entities described therein for each of the periods then ended, subject,
in the case of any such unaudited financial statements, to changes resulting
from audit and normal year-end adjustments. Except as set forth on Schedule 5.3
annexed hereto and, in respect of the Guaranties as of the Closing Date, neither
Holdings nor any of its Subsidiaries has (and neither Holdings nor any of its
Subsidiaries will have following the funding of the initial Loans)
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any Contingent Obligation, contingent liability or liability for taxes,
long-term lease or unusual forward or long-term commitment that is not reflected
in the foregoing financial statements or the notes thereto and which in any such
case is material in relation to the business, operations, properties, assets,
condition (financial or otherwise) or prospects of Holdings or any of its
Subsidiaries.
5.4 No Material Adverse Change; No Restricted Junior Payments.
After giving effect to the Transaction, since December 31, 1995, no
event or change has occurred that has caused or evidences, either in any case or
in the aggregate, a Material Adverse Effect. Neither Holdings nor any of its
Subsidiaries has directly or indirectly declared, ordered, paid or made, or set
apart any sum or property for, any Restricted Junior Payment or agreed to do so
except as permitted by subsection 7.5.
5.5 Title to Properties; Liens.
Loan Parties have (i) good, sufficient and legal title to (in the case
of fee interests in real property), (ii) valid leasehold interests in (in the
case of leasehold interests in real or personal property), or (iii) good title
to (in the case of all other personal property), all of their respective
properties and assets reflected in the financial statements referred to in
subsection 5.3 or in the most recent financial statements delivered pursuant to
subsection 6.1, in each case except for Permitted Encumbrances and assets
disposed of since the date of such financial statements in the ordinary course
of business or as otherwise permitted under subsection 7.7. Except as permitted
by this Agreement, all such properties and assets are free and clear of Liens.
5.6 Litigation; Adverse Facts.
Except to the extent set forth in Schedule 5.6 annexed hereto, there
are no actions, suits, proceedings, arbitrations or governmental investigations
(whether or not purportedly on behalf of any Loan Party or any of its
Subsidiaries) at law or in equity, or before or by any federal, state, municipal
or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign (including any Environmental Claims) that
are pending or, to the knowledge of Holdings or Borrower, threatened against or
affecting the Transaction or any Loan Party or any of its Subsidiaries or any
property of any Loan Party or any of its Subsidiaries and that, individually or
in the aggregate, could reasonably be expected to result in a Material Adverse
Effect. No Loan Party nor any of its Subsidiaries (i) is in violation of any
applicable laws (including Environmental Laws) that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect,
or (ii) is subject to or in default with respect to any final judgments, writs,
injunctions, decrees, rules or regulations of any court or any federal, state,
municipal or other governmental
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department, commission, board, bureau, agency or instrumentality, domestic or
foreign, that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect.
5.7 Payment of Taxes.
Except to the extent permitted by subsection 6.3, all income tax
returns and reports of Holdings and its Subsidiaries required to be filed by any
of them have been timely filed, and all taxes shown on such tax returns to be
due and payable and all assessments, fees and other governmental charges upon
Holdings and its Subsidiaries and upon their respective properties, assets,
income, businesses and franchises which are due and payable have been paid when
due and payable. No Loan Party knows of any proposed tax assessment against any
Loan Party or any of its Subsidiaries which is not being actively contested by
such Loan Party or such Subsidiary in good faith and by appropriate proceedings;
provided that such reserves or other appropriate provisions, if any, as shall be
required in conformity with GAAP shall have been made or provided therefor.
5.8 Performance of Agreements; Materially Adverse Agreements; Material
Contracts.
A. No Loan Party nor any of its Subsidiaries is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any of its Contractual Obligations, and no condition
exists that, with the giving of notice or the lapse of time or both, would
constitute such a default, except where the consequences, direct or indirect, of
such default or defaults, if any, could not reasonably be expected to have a
Material Adverse Effect.
B. No Loan Party nor any of its Subsidiaries is a party to or is
otherwise subject to any agreements or instruments or any charter or other
internal restrictions which, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect.
C. Schedule 5.8 annexed hereto contains a true, correct and complete
list of all the Material Contracts in effect on the Closing Date. Except as
described on Schedule 5.8, all such Material Contracts are in full force and
effect and no material defaults currently exist thereunder.
5.9 Governmental Regulation.
No Loan Party nor any of its Subsidiaries is subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate
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Commerce Act or the Investment Company Act of 1940 or under any other federal or
state statute or regulation (other than usury laws, Regulation X and other
similar laws) which may limit its ability to incur Indebtedness or which may
otherwise render all or any portion of the Obligations unenforceable.
5.10 Securities Activities.
A. No Loan Party nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock.
B. Following application of the proceeds of each Loan, not more than
25% of the value of the assets (either of Borrower only or of Borrower and its
Subsidiaries on a consolidated basis) subject to the provisions of subsection
7.2 or 7.7 or subject to any restriction contained in any agreement or
instrument, between Borrower and any Lender or any Affiliate of any Lender,
relating to Indebtedness and within the scope of subsection 8.2, will be Margin
Stock.
5.11 Employee Benefit Plans.
A. Each Loan Party and each of their respective ERISA Affiliates are in
material compliance with all applicable provisions and requirements of ERISA and
the regulations and published interpretations thereunder with respect to each
Employee Benefit Plan, and have performed all obligations under each Employee
Benefit Plan which could reasonably be expected to result in a material
liability. Each Employee Benefit Plan which is intended to qualify under Section
401(a) of the Internal Revenue Code has received a determination from the IRS
that it is so qualified.
B. No ERISA Event has occurred or is reasonably expected to occur.
C. Except to the extent required under Section 4980B of the Internal
Revenue Code or except as set forth in Schedule 5.11 annexed hereto, no Employee
Benefit Plan provides health or welfare benefits (through the purchase of
insurance or otherwise) for any retired or former employee of any Loan Party or
any of their respective ERISA Affiliates.
D. As of the most recent valuation date for any Pension Plan, the
amount of unfunded benefit liabilities (as defined in Section 4001(a)(18) of
ERISA), individually or in the aggregate for all Pension Plans (excluding for
purposes of such computation any Pension Plans with respect to which assets
exceed benefit liabilities), does not exceed $4,000,000.
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E. As of the most recent valuation date for each Multiemployer
Plan for which the actuarial report is available, the potential liability of
Loan Parties and their respective ERISA Affiliates for a complete withdrawal
from such Multiemployer Plan (within the meaning of Section 4203 of ERISA), when
aggregated with such potential liability for a complete withdrawal from all
Multiemployer Plans, based on information available pursuant to Section 4221(e)
of ERISA, does not exceed $1,000,000.
5.12 Certain Fees.
Except to the extent included in Transaction Costs, no broker's or
finder's fee or commission will be payable by Holdings or any of its
Subsidiaries with respect to this Agreement or any of the transactions
contemplated hereby, and Holdings and Borrower hereby, jointly and severally,
indemnify Lenders against, and agrees that it will hold Lenders harmless from,
any claim, demand or liability for any such broker's or finder's fees alleged to
have been incurred in connection herewith or therewith and any expenses
(including reasonable fees, expenses and disbursements of counsel) arising in
connection with any such claim, demand or liability.
5.13 Environmental Protection.
Except as set forth in Schedule 5.13 annexed hereto,
(i) No Loan Party nor any of its Subsidiaries nor any of
their respective Facilities or operations are subject to any
outstanding written order, consent decree or settlement agreement with
any Person relating to (a) any Environmental Law, (b) any Environmental
Claim, or (c) any Hazardous Materials Activity;
(ii) No Loan Party nor any of its Subsidiaries has
received any letter or request for information under Section 104 of the
Comprehensive Environmental Response, Compensation, and Liability Act
(42 U.S.C. ss. 9604) or any comparable state law;
(iii) There are and, to Holdings' and Borrower's knowledge
have been, no conditions, occurrences, or Hazardous Materials
Activities which could reasonably be expected to form the basis of an
Environmental Claim against any Loan Party or any of its Subsidiaries
that, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect;
(iv) Except as could not, individually or in the aggregate,
be reasonably expected to have a Material Adverse Effect, (a) no Loan
Party nor any of its Subsidiaries nor, to Holdings' or Borrower's
knowledge, any predecessor of
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any Loan Party or any of its Subsidiaries has filed any notice under
any Environmental Law indicating past or present treatment of Hazardous
Materials at any Facility, and (b) no Loan Party's or any of its
Subsidiaries' operations involve the transportation, treatment, storage
or disposal of hazardous waste, as defined under 40 C.F.R. Parts
260-270 or any state equivalent; and
(v) Compliance with all current or, to the best knowledge of
each Loan Party and its Subsidiaries, future requirements pursuant to
or under Environmental Laws could not, individually or in the
aggregate, reasonably be expected to give rise to a Material Adverse
Effect.
Notwithstanding anything in this subsection 5.13 to the contrary, no
event or condition has occurred or is occurring with respect to any Loan Party
or any of its Subsidiaries relating to any Environmental Law, any Release of
Hazardous Materials, or any Hazardous Materials Activity, including any matter
disclosed on Schedule 5.13 annexed hereto, which individually or in the
aggregate has had or could reasonably be expected to have a Material Adverse
Effect.
5.14 Employee Matters.
Except as set forth on Schedule 5.14 annexed hereto, no Loan Party nor
any of its Subsidiaries is party to any collective bargaining agreement and, to
the knowledge of Holdings and Borrower, no union representation question exists
with respect to the employees of any Loan Party or any of its Subsidiaries.
There is no strike, work stoppage, slow down, lockout or other labor dispute
pending, or to the knowledge of Holdings and Borrower, threatened, involving any
Loan Party or any of its Subsidiaries that singly or in the aggregate could
reasonably be expected to have a Material Adverse Effect.
5.15 Solvency.
Each Loan Party is and, upon the incurrence of any Obligations by such
Loan Party on any date on which this representation is made, will be, Solvent.
5.16 Matters Relating to Collateral.
A. Creation, Perfection and Priority of Liens. The execution and
delivery of the Collateral Documents by Loan Parties, together with (i) the
actions taken on or prior to the date hereof pursuant to subsections 4.1I and
6.8 and (ii) the delivery to Administrative Agent of any Pledged Collateral not
delivered to Administrative Agent at the time of execution and delivery of the
applicable Collateral Document (all of which Pledged Collateral has been so
delivered) are effective to create in favor of Adminis-
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trative Agent for the benefit of Lenders, as security for the respective Secured
Obligations (as defined in the applicable Collateral Document in respect of any
Collateral), a valid and perfected First Priority Lien on all of the Collateral,
and all filings and other actions necessary or desirable to perfect and maintain
the perfection and First Priority status of such Liens have been duly made or
taken and remain in full force and effect, other than the filing of any UCC
financing statements delivered to Administrative Agent for filing (but not yet
filed) and the periodic filing of UCC continuation statements in respect of UCC
financing statements filed by or on behalf of Administrative Agent.
B. Governmental Authorizations. No authorization, approval or
other action by, and no notice to or filing with, any governmental authority or
regulatory body is required for either (i) the pledge or grant by any Loan Party
of the Liens purported to be created in favor of Administrative Agent pursuant
to any of the Collateral Documents or (ii) the exercise by Administrative Agent
of any rights or remedies in respect of any Collateral (whether specifically
granted or created pursuant to any of the Collateral Documents or created or
provided for by applicable law), except for filings or recordings contemplated
by subsection 5.16A and except as may be required, in connection with the
disposition of any Pledged Collateral, by laws generally affecting the offering
and sale of securities or as may be required in connection with the foreclosure
of the Mortgage.
C. Absence of Third-Party Filings. Except such as may have been
filed in favor of Administrative Agent as contemplated by subsection 5.16A and
in respect of Liens permitted under subsection 7.2 hereof, following the filing
of the UCC termination statements delivered to Administrative Agent pursuant to
subsection 4.1I(iii), no effective UCC financing statement, fixture filing,
mortgage or other instrument similar in effect covering all or any part of the
Collateral is on file in any filing or recording office.
D. Margin Regulations. The pledge of the Pledged Collateral
pursuant to the Collateral Documents does not violate Regulation G, T, U or X of
the Board of Governors of the Federal Reserve System.
E. Information Regarding Collateral. All information supplied to
Administrative Agent by or on behalf of any Loan Party with respect to any of
the Collateral (in each case taken as a whole with respect to any particular
Collateral) is accurate and complete in all material respects.
5.17 Representations and Warranties in Acquisition Agreement.
Except to the extent otherwise set forth herein or in the Schedules
hereto, each of the representations and warranties in the Acquisition Agreement
and in the Merger Agreement is true and correct in all material respects as of
the date hereof (or as of any
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earlier date to which such representation and warranty specifically relates) and
will be true and correct in all material respects as of the Closing Date, or as
of such earlier date (as the case may be), in each case subject to the
qualifications set forth in the schedules to the Acquisition Agreement and in
the Merger Agreement.
5.18 Disclosure.
No representation or warranty of any Loan Party contained in the
Confidential Information Memorandum or in any Loan Document or in any other
document, certificate or written statement furnished to Lenders by any Loan
Party for use in connection with the transactions contemplated by this Agreement
contains any untrue statement of a material fact or omits to state a material
fact (known to Holdings or Borrower, in the case of any document not furnished
by it) necessary in order to make the statements contained herein or therein not
misleading in light of the circumstances in which the same were made. Any
projections and pro forma financial information contained in such materials are
based upon good faith estimates and assumptions believed by Holdings and
Borrower to be reasonable at the time made, it being recognized by Lenders that
such projections as to future events are not to be viewed as facts and that
actual results during the period or periods covered by any such projections will
differ from the projected results. There are no facts known (or which should
upon the reasonable exercise of diligence be known) to Holdings or Borrower
(other than matters of a general economic nature) that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect
and that have not been disclosed herein or in such other documents, certificates
and statements furnished to Lenders for use in connection with the transactions
contemplated hereby.
SECTION 6.
AFFIRMATIVE COVENANTS
Each of Holdings and Borrower covenants and agrees that, so long as any
of the Commitments hereunder shall remain in effect and until payment in full of
all of the Loans and other Obligations and the cancellation or expiration of all
Letters of Credit, unless Requisite Lenders shall otherwise give prior written
consent, each of Holdings and Borrower shall perform, and shall cause each of
its Subsidiaries to perform, all covenants in this Section 6.
6.1 Financial Statements and Other Reports.
Holdings will maintain, and cause each of its Subsidiaries to maintain,
a system of accounting established and administered in accordance with sound
business practices
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to permit preparation of financial statements in conformity with GAAP, Holdings
will deliver to Administrative Agent and Lenders:
(i) Quarterly Financials: as soon as available and in any
event within 45 days (or 90 days in the case each Fiscal Quarter ending
on or before September 30, 1997) after the end of each Fiscal Quarter,
(a) the consolidated balance sheet of Holdings and its Subsidiaries as
at the end of such Fiscal Quarter and the related consolidated
statements of income, stockholders' equity and cash flows of Holdings
and its Subsidiaries for such Fiscal Quarter and for the period from
the beginning of the then current Fiscal Year to the end of such Fiscal
Quarter and, commencing March 31, 1998, setting forth in each case in
comparative form the corresponding figures for the corresponding
periods of the previous Fiscal Year and the corresponding figures from
the Financial Plan for the current Fiscal Year, all in reasonable
detail and certified by the chief financial officer of Holdings that
they fairly present, in all material respects, the financial condition
of Holdings and its Subsidiaries as at the dates indicated and the
results of their operations and their cash flows for the periods
indicated, subject to changes resulting from audit and normal year-end
adjustments, and (b) a narrative report describing the operations of
Holdings and its Subsidiaries in the form prepared for presentation to
senior management for such Fiscal Quarter and for the period from the
beginning of the then current Fiscal Year to the end of such Fiscal
Quarter; provided that delivery of Borrower's Form 10-Q for such Fiscal
Quarter shall be deemed to satisfy the requirements of this clause (b);
(ii) Year-End Financials: as soon as available and in any
event within 90 days (or, in the case of the Fiscal Year ending
December 31, 1996, 120 days) after the end of each Fiscal Year, (a) the
consolidated balance sheet of Holdings and its Subsidiaries as at the
end of such Fiscal Year and the related consolidated statements of
income, stockholders' equity and cash flows of Holdings and its
Subsidiaries for such Fiscal Year, setting forth in each case in
comparative form the corresponding figures for the previous Fiscal Year
(commencing with the Fiscal Year ending on December 31, 1997) and the
corresponding figures from the Financial Plan for the Fiscal Year
covered by such financial statements, all in reasonable detail and
certified by the chief financial officer of Holdings that they fairly
present, in all material respects, the financial condition of Holdings
and its Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated, (b) a
narrative report describing the operations of Holdings and its
Subsidiaries in the form prepared for presentation to senior management
for such Fiscal Year; provided that delivery of Borrower's Form 10-K
for such Fiscal Year shall be deemed to satisfy the requirements of
this clause (b), and (c) in the case of such consolidated financial
statements, a report thereon of KPMG Peat Marwick LLP or other
independent certified public
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accountants of recognized national standing selected by Holdings and
satisfactory to Administrative Agent, which report shall be
unqualified, shall express no doubts about the ability of Holdings and
its Subsidiaries to continue as a going concern, and shall state that
such consolidated financial statements fairly present, in all material
respects, the consolidated financial position of Holdings and its
Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated in conformity
with GAAP applied on a basis consistent with prior years (except as
otherwise disclosed in such financial statements) and that the
examination by such accountants in connection with such consolidated
financial statements has been made in accordance with generally
accepted auditing standards;
(iii) Officers' and Compliance Certificates: together with
each delivery of financial statements of Holdings and its Subsidiaries
pursuant to subdivisions (i) and (ii) above, (a) an Officers'
Certificate of Holdings stating that the signers have reviewed the
terms of this Agreement and have made, or caused to be made under their
supervision, a review in reasonable detail of the transactions and
condition of Holdings and its Subsidiaries during the accounting period
covered by such financial statements and that such review has not
disclosed the existence during or at the end of such accounting period,
and that the signers do not have knowledge of the existence as at the
date of such Officers' Certificate, of any condition or event that
constitutes an Event of Default or Potential Event of Default, or, if
any such condition or event existed or exists, specifying the nature
and period of existence thereof and what action Holdings has taken, is
taking and proposes to take with respect thereto; and (b) a Compliance
Certificate demonstrating in reasonable detail compliance during and at
the end of the applicable accounting periods with the restrictions
contained in Section 7, in each case to the extent compliance with such
restrictions is required to be tested at the end of the applicable
accounting period;
(iv) Reconciliation Statements: if, as a result of any change
in accounting principles and policies from those used in the
preparation of the audited financial statements referred to in
subsection 5.3, the consolidated financial statements of Holdings and
its Subsidiaries delivered pursuant to subdivisions (i), (ii) or (xi)
of this subsection 6.1 will differ in any material respect from the
consolidated financial statements that would have been delivered
pursuant to such subdivisions had no such change in accounting
principles and policies been made, then (a) together with the first
delivery of financial statements pursuant to subdivision (i), (ii) or
(xi) of this subsection 6.1 following such change to the extent
Borrower is required to prepare such pro forma financial statements
under the Securities Act or the Exchange Act or the rules and
regulations thereunder, consolidated financial statements of Holdings
and its
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Subsidiaries for (1) the current Fiscal Year to the effective date of
such change and (2) the two full Fiscal Years immediately preceding the
Fiscal Year in which such change is made, in each case prepared on a
pro forma basis as if such change had been in effect during such
periods, and (b) together with each delivery of financial statements
pursuant to subdivision (i), (ii) or (xi) of this subsection 6.1
following such change, a written statement of the chief accounting
officer or chief financial officer of Holdings setting forth the
material differences (including any differences that would affect any
calculations relating to the financial covenants set forth in
subsection 7.6) which would have resulted if such financial statements
had been prepared without giving effect to such change;
(v) Accountants' Certification: concurrently with any
delivery of financial statements under subdivision (ii) above, a
certificate of the accounting firm opining on or certifying such
statements on behalf of Holdings or Borrower (which certificate may be
limited to accounting matters and may disclaim responsibility for legal
interpretations) certifying that no Event of Default or Potential Event
of Default has occurred or, if such an Event of Default or Potential
Event of Default has occurred, specifying the nature and extent thereof
and any corrective action taken or proposed to be taken with respect
thereto;
(vi) SEC Filings and Press Releases: promptly upon their
becoming available, copies of (a) all financial statements, reports,
notices and proxy statements sent or made available generally by
Holdings to its security holders or by any Subsidiary of Holdings to
its security holders other than Holdings or another Subsidiary of
Holdings, (b) all regular and periodic reports and all registration
statements (other than on Form S-8 or a similar form) and prospectuses,
if any, filed by Holdings or any of its Subsidiaries with any
securities exchange or with the Securities and Exchange Commission, and
(c) all press releases and other statements made available generally by
Holdings or any of its Subsidiaries to the public concerning material
developments in the business of Holdings or any of its Subsidiaries;
(vii) Events of Default, etc.: promptly upon any officer of
Holdings or Borrower obtaining knowledge (a) of any condition or event
that constitutes an Event of Default or a Potential Event of Default,
or becoming aware that any Lender has given any notice (other than to
Administrative Agent) or taken any other action with respect to a
claimed Event of Default or Potential Event of Default, (b) that any
Person has given any notice to Holdings or Borrower or any of its
Subsidiaries or taken any other action with respect to a claimed
default or event or condition of the type referred to in subsection
8.2, (c) at any time when neither Holdings nor Borrower is required to
file such reports, of any condition or event that would be required to
be disclosed in a current report filed by
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Holdings or Borrower with the Securities and Exchange Commission on
Form 8-K (Items 1, 2, 4, 5 and 6 of such Form as in effect on the date
hereof) if Holdings or Borrower were required to file such reports
under the Exchange Act, or (d) of the occurrence of any event or change
that has caused or evidences, either in any case or in the aggregate, a
Material Adverse Effect, an Officers' Certificate specifying the nature
and period of existence of such condition, event or change, or
specifying the notice given or action taken by any such Person and the
nature of such claimed Event of Default, Potential Event of Default,
default, event or condition, and what action Holdings has taken, is
taking and proposes to take with respect thereto;
(viii) Litigation or Other Proceedings: promptly upon any
officer of Holdings or Borrower obtaining knowledge of (a) the
institution of, or non- frivolous threat of, any action, suit,
proceeding (whether administrative, judicial or otherwise),
governmental investigation or arbitration against or affecting Holdings
or any of its Subsidiaries or any property of Holdings or any of its
Subsidiaries (collectively, "Proceedings") not previously disclosed in
writing by Holdings to Lenders or (b) any material development in any
Proceeding that, in any case:
(1) if adversely determined, has a reasonable
possibility of giving rise to a Material Adverse
Effect; or
(2) seeks to enjoin or otherwise prevent the
consummation of, or to recover any damages or obtain
relief as a result of, the transactions contemplated
hereby;
written notice thereof together with such other information as may be
reasonably available to Holdings to enable Lenders and their counsel to
evaluate such matters;
(ix) ERISA Events: promptly upon becoming aware of the
occurrence of or forthcoming occurrence of any ERISA Event, a written
notice specifying the nature thereof, what action Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates has taken, is
taking or proposes to take with respect thereto and, when known, any
action taken or threatened by the Internal Revenue Service, the
Department of Labor or the PBGC with respect thereto;
(x) ERISA Notices: with reasonable promptness, copies of (a)
if requested by Administrative Agent each Schedule B (Actuarial
Information) to the annual report (Form 5500 Series) filed by Holdings,
any of its Subsidiaries or any of their respective ERISA Affiliates
with the Internal Revenue Service with
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respect to each Pension Plan; (b) all notices received by Holdings, any
of its Subsidiaries or any of their respective ERISA Affiliates from a
Multiemployer Plan sponsor concerning an ERISA Event; and (c) copies of
such other documents or governmental reports or filings relating to any
Employee Benefit Plan as Administrative Agent shall reasonably request;
(xi) Financial Plans: as soon as practicable and in any event
no later than 60 days after the beginning of each Fiscal Year, a
consolidated plan and financial forecast for such Fiscal Year (the
"Financial Plan" for such Fiscal Year), including (a) a forecasted
consolidated balance sheet and forecasted consolidated statements of
income and cash flows of Holdings and its Subsidiaries for each such
Fiscal Year, together with an explanation of the assumptions on which
such forecasts are based, (b) forecasted consolidated statements of
income and cash flows of Holdings and its Subsidiaries for each month
of the first such Fiscal Year, together with an explanation of the
assumptions on which such forecasts are based, and (c) such other
information and projections as any Lender may reasonably request;
(xii) Insurance: as soon as practicable and in any event by
the last day of each Fiscal Year, a report in form and substance
satisfactory to Administrative Agent outlining all material insurance
coverage maintained as of the date of such report by Holdings and its
Subsidiaries and all material insurance coverage planned to be
maintained by Holdings and its Subsidiaries in the immediately
succeeding Fiscal Year;
(xiii) Board of Directors: with reasonable promptness,
written notice of any change in the Board of Directors of Holdings or
Borrower;
(xiv) New Subsidiaries: promptly upon any Person becoming a
Subsidiary of Holdings, a written notice setting forth with respect to
such Person (a) the date on which such Person became a Subsidiary of
Holdings and (b) all of the data required to be set forth in Schedule
5.1 annexed hereto with respect to all Subsidiaries of Holdings (it
being understood that such written notice shall be deemed to supplement
Schedule 5.1 annexed hereto for all purposes of this Agreement);
(xv) Material Contracts: promptly, and in any event within
ten Business Days after any Material Contract of Holdings or any of its
Subsidiaries is terminated or amended in a manner that is materially
adverse to Holdings or such Subsidiary, as the case may be, or any new
Material Contract is entered into, a written statement describing such
event with copies of such material
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amendments or new contracts, and an explanation of any actions being
taken with respect thereto;
(xvi) Administrative Agreement: as promptly as practicable,
and in any event within ten Business Days prior to such termination, a
written notice of any pending termination of the Administrative
Agreement;
(xvii) UCC Search Report: as promptly as practicable after the
date of delivery to Administrative Agent of any UCC financing statement
executed by any Loan Party pursuant to subsection 4.1I(iv) or 6.8A,
copies of completed UCC searches evidencing the proper filing,
recording and indexing of all such UCC financing statement and listing
all other effective financing statements that name such Loan Party as
debtor, together with copies of all such other financing statements not
previously delivered to Administrative Agent by or on behalf of
Holdings or such Loan Party; and
(xviii) Other Information: with reasonable promptness, such
other information and data with respect to Holdings or any of its
Subsidiaries as from time to time may be reasonably requested by any
Lender.
6.2 Corporate Existence, etc.
Except as permitted under subsection 7.7, Holdings will, and will cause
each of its Subsidiaries to, at all times preserve and keep in full force and
effect (i) its corporate existence and (ii) all rights and franchises the loss
of which could reasonably be expected to have a Material Adverse Effect;
provided, however that neither Holdings nor any of its Subsidiaries shall be
required to preserve any such right or franchise if the Board of Directors of
Holdings or such Subsidiary shall determine that the preservation thereof is no
longer desirable in the conduct of the business of Holdings or such Subsidiary,
as the case may be, and that the loss thereof is not disadvantageous in any
material respect to Holdings, such Subsidiary or Lenders.
6.3 Payment of Taxes and Claims; Tax Consolidation.
A. Holdings will, and will cause each of its Subsidiaries to, pay all
taxes, assessments and other governmental charges imposed upon it or any of its
properties or assets or in respect of any of its income, businesses or
franchises before any penalty accrues thereon, and all claims (including claims
for labor, services, materials and supplies) for sums that have become due and
payable and that by law have or may become a Lien upon any of its properties or
assets, prior to the time when any penalty or fine shall be incurred with
respect thereto; provided that no such charge or claim need be paid if it is
being contested in good faith by appropriate proceedings promptly instituted
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and diligently conducted, so long as (i) such reserve or other appropriate
provision, if any, as shall be required in conformity with GAAP shall have been
made therefor and (ii) in the case of a charge or claim which has or may become
a Lien against any of the Collateral, such contest proceedings conclusively
operate to stay the sale of any portion of the Collateral to satisfy such
charge or claim.
B. Holdings will not, nor will it permit any of its
Subsidiaries to, file or consent to the filing of any consolidated income tax
return with any Person (other than Holdings or any of its Subsidiaries).
6.4 Maintenance of Properties; Insurance; Application of Net
Insurance/Condemnation Proceeds.
A. Maintenance of Properties. Holdings will, and will cause each of its
Subsidiaries to, maintain or cause to be maintained in good repair, working
order and condition, ordinary wear and tear excepted, all properties used or
useful in the business of Holdings and its Subsidiaries (including all
Intellectual Property) that are material to Holdings and its Subsidiaries, taken
as a whole, and from time to time will make or cause to be made all appropriate
repairs, renewals and replacements thereof.
B. Insurance. Borrower will maintain or cause to be maintained, with
financially sound and reputable insurers, such public liability insurance, third
party property damage insurance, business interruption insurance and casualty
insurance with respect to liabilities, losses or damage in respect of the
assets, properties and businesses of Borrower and its Subsidiaries as may
customarily be carried or maintained under similar circumstances by corporations
of established reputation engaged in similar businesses, in each case in such
amounts (giving effect to self-insurance), with such deductibles, covering such
risks and otherwise on such terms and conditions as shall be customary for
corporations similarly situated in the industry. Without limiting the generality
of the foregoing, Borrower will maintain or cause to be maintained replacement
value casualty insurance on the Collateral constituting tangible personal
property and improvements on real property under such policies of insurance,
with such insurance companies, in such amounts, with such deductibles, and
covering such risks as are at all times satisfactory to Administrative Agent in
its commercially reasonable judgment. Each such policy of insurance shall (i)
name Administrative Agent for the benefit of Lenders as an additional insured
thereunder as its interests may appear and (ii) in the case of each business
interruption and casualty insurance policy, contain a loss payable clause or
endorsement, satisfactory in form and substance to Administrative Agent, that
names Administrative Agent for the benefit of Lenders as the loss payee
thereunder for any covered loss in excess of $250,000 and provides for at least
30 days prior written notice to Administrative Agent of any modification or
cancellation of such policy.
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C. Application of Net Insurance/Condemnation Proceeds.
(i) Business Interruption Insurance. Upon receipt by
Holdings or any of its Subsidiaries of any business interruption
insurance proceeds constituting Net Insurance/Condemnation Proceeds,
(a) so long as no Event of Default or Potential Event of Default shall
have occurred and be continuing, Borrower or such Subsidiary may retain
and apply such Net Insurance/Condemnation Proceeds for working capital
purposes, and (b) if an Event of Default or Potential Event of Default
shall have occurred and be continuing and Administrative Agent shall so
request, Borrower shall apply an amount equal to such Net
Insurance/Condemnation Proceeds to prepay the Loans (and/or the
Revolving Loan Commitments shall be reduced) as provided in subsection
2.4B(iii)(b);
(ii) Casualty Insurance/Condemnation Proceeds. Upon receipt
by Holdings or any of its Subsidiaries of any Net
Insurance/Condemnation Proceeds other than from business interruption
insurance, (a) so long as no Event of Default or Potential Event of
Default shall have occurred and be continuing, Borrower shall, or shall
cause one or more of its Subsidiaries to, promptly and diligently apply
such Net Insurance/Condemnation Proceeds to pay or reimburse the costs
of repairing, restoring or replacing the assets in respect of which
such Net Insurance/Condemnation Proceeds were received or, to the
extent not so applied, to prepay the Loans (and/or the Revolving Loan
Commitments shall be reduced) as provided in subsection 2.4B(iii)(b),
and (b) if an Event of Default or Potential Event of Default shall have
occurred and be continuing and Administrative Agent shall so request,
Borrower shall apply an amount equal to such Net Insurance/Condemnation
Proceeds to prepay the Loans (and/or the Revolving Loan Commitments
shall be reduced) as provided in subsection 2.4B(iii)(b).
(iii) Net Insurance/Condemnation Proceeds Received by
Administrative Agent. Upon receipt by Administrative Agent of any Net
Insurance/Condemnation Proceeds as loss payee, (a) if and to the extent
Borrower would have been required to apply such Net
Insurance/Condemnation Proceeds (if it had received them directly) to
prepay the Loans and/or reduce the Revolving Loan Commitments,
Administrative Agent shall, and Borrower hereby authorizes
Administrative Agent to, apply such Net Insurance/Condemnation Proceeds
to prepay the Loans (and/or the Revolving Loan Commitments shall be
reduced) as provided in subsection 2.4B(iii)(b), and (b) to the extent
the foregoing clause (a) does not apply and, and Borrower shall deliver
written notice to Administrative Agent that it has elected to apply
such Net Insurance/Condemnation Proceeds to the costs of repairing,
restoring, or replacing the assets in respect of which such Net
Insurance/Condemnation Proceeds were received or to working capital
(but
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only in the case of business interruption insurance), Administrative
Agent shall deliver to Borrower and Borrower shall, or shall cause one
or more of its Subsidiaries to, promptly apply such Net
Insurance/Condemnation Proceeds to the costs of repairing, restoring or
replacing the assets in respect of which such Net
Insurance/Condemnation Proceeds were received or to working capital
(but only in the case of business interruption insurance).
6.5 Inspection Rights.
Holdings will, and will cause each of its Subsidiaries to, permit any
authorized representatives designated by any Lender to visit and inspect the
headquarters of Holdings or Borrower, to inspect its and their financial and
accounting records, and to discuss its and their affairs, finances and accounts
with its and their officers and independent public accountants (provided that
Holdings or Borrower may, if it so chooses, be present at or participate in any
such discussion), all upon reasonable notice and at such reasonable times during
normal business hours and as often as may reasonably be requested.
6.6 Compliance with Laws, etc.
Holdings will comply, and will cause each of its Subsidiaries and all
other Persons occupying any Facilities to comply, with the requirements of all
applicable laws, rules, regulations and orders of any governmental authority
(including all applicable current and future Environmental Laws and all laws,
rules, regulations and orders relating to pre-arranged funeral products and
services and the maintenance of trust accounts in respect thereof),
noncompliance with which could reasonably be expected to cause, individually or
in the aggregate, a Material Adverse Effect.
6.7 Environmental Review and Investigation, Disclosure, Etc.; Borrower's
Actions Regarding Hazardous Materials Activities, Environmental Claims
and Violations of Environmental Laws.
A. Environmental Review and Investigation. Borrower agrees that
Administrative Agent may, from time to time and in its reasonable discretion,
(i) retain, at Borrower's reasonable expense, an independent professional
consultant to review any environmental audits, investigations, analyses and
reports relating to Hazardous Materials prepared by or for Borrower and provided
to Administrative Agent pursuant to subsection 6.7B(i) and (ii) in the event (a)
an Event of Default occurs as a result of a breach of subsection 5.6 (to the
extent relating to Environmental Laws or Environmental Claims), 5.13, 6.6 (to
the extent resulting from noncompliance with Environmental Laws) or 6.7 and is
continuing, or (b) the Loans and all other Obligations shall (automatically
or by declaration) have become immediately due and payable pursuant to
Section 8,
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conduct its own investigation of reasonable scope and at reasonable expense;
provided that, Borrower shall only be obligated to use commercially reasonable
efforts to obtain permission for Administrative Agent's professional consultant
to conduct an investigation of any Facility which is the basis of such Event of
Default or such acceleration of the Loans and Obligations that is (x) no longer
owned, leased, operated or used by Borrower or any of its Subsidiaries, or (y)
currently used by Borrower (but not owned, leased, or operated by Borrower) and
with respect to which Borrower has no right or authority to permit
Administrative Agent's professional consultant to conduct an investigation
thereon. For purposes of conducting such a review and/or investigation,
Borrower, to the extent that it has the power and authority to do so, hereby
grants to Administrative Agent and its agents, employees, consultants and
contractors the right to enter into or onto any Facilities currently owned,
leased, operated or used by Borrower or any of its Subsidiaries and to perform
such tests on such property (including taking samples of soil, groundwater and
suspected asbestos-containing materials) as are reasonably necessary in
connection therewith. Any such investigation of any Facility shall be conducted,
unless otherwise agreed to by Borrower and Administrative Agent, during normal
business hours and, to the extent reasonably practicable, shall be conducted so
as not to interfere with the ongoing operations at such Facility or to cause any
damage or loss to any property at such Facility. To the extent reasonably
practicable, Administrative Agent shall restore any property damaged by such
investigation to its condition immediately prior to such investigation. Borrower
and Administrative Agent hereby acknowledge and agree that any report of any
investigation conducted at the request of Administrative Agent pursuant to this
subsection 6.7A will be obtained and shall be used by Administrative Agent and
Lenders for the purposes of Lenders' internal credit decisions, to monitor and
police the Loans and to protect Lenders' security interests, if any, created by
the Loan Documents. Administrative Agent agrees to deliver a copy of any such
report to Borrower with the understanding that Borrower acknowledges and agrees
that (1) it will indemnify and hold harmless Administrative Agent and each
Lender from any costs, losses or liabilities relating to Borrower's use of or
reliance on such report, (2) neither Administrative Agent nor any Lender makes
any representation or warranty with respect to such report, and (3) by
delivering such report to Borrower, neither Administrative Agent nor any Lender
is requiring or recommending the implementation of any suggestions or
recommendations contained in such report.
B. Environmental Disclosure. Borrower will deliver to
Administrative Agent and Lenders:
(i) Environmental Audits and Reports. As soon as
practicable following receipt thereof, copies of all material and
non-privileged environmental audits, investigations, analyses and
reports of any kind or character, whether prepared by personnel of
Borrower or any of its Subsidiaries or by independent consultants,
governmental authorities or any other Persons, with respect to
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environmental matters at any Facility which, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse
Effect or with respect to any Environmental Claims which, individually
or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect;
(ii) Notice of Certain Releases, Remedial Actions, Etc.
Promptly upon the occurrence thereof, written notice describing in
reasonable detail (a) any Release required to be reported to any
federal, state or local governmental or regulatory agency under any
applicable Environmental Laws that could reasonably be expected to have
a Material Adverse Effect, (b) any remedial action taken by Borrower or
any other Person in response to (1) any Hazardous Materials Activities
the existence of which could reasonably be expected to result in one or
more Environmental Claims having, individually or in the aggregate, a
Material Adverse Effect, or (2) any Environmental Claims that,
individually or in the aggregate, could reasonably be expected to have
a Material Adverse Effect, and (c) Borrower's discovery of any
occurrence or condition on any real property adjoining or in the
vicinity of any Facility that could cause such Facility or any part
thereof to be subject to any material restrictions on the ownership,
occupancy, transferability or use thereof under any Environmental Laws
which, individually or in the aggregate, could reasonably be expected
to have a Material Adverse Effect.
(iii) Written Communications Regarding Environmental Claims,
Releases, Etc. As soon as practicable following the sending or receipt
thereof by Borrower or any of its Subsidiaries, a copy of any and all
material and non- privileged written communications with respect to (a)
any Environmental Claims that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect, (b) any
Release required to be reported to any federal, state or local
governmental or regulatory agency that could reasonably be expected to
have a Material Adverse Effect, and (c) any request for information
from any governmental agency that suggests such agency is investigating
whether Borrower or any of its Subsidiaries may be potentially
responsible for any Hazardous Materials Activity that could reasonably
be expected to have a Material Adverse Effect.
(iv) Notice of Certain Proposed Actions Having Environmental
Impact. Prompt written notice describing in reasonable detail (a) any
proposed acquisition of stock, assets, or property by Borrower or any
of its Subsidiaries that could reasonably be expected to (1) expose
Borrower or any of its Subsidiaries to, or result in, Environmental
Claims that could reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect or (2) affect the ability of
Borrower or any of its Subsidiaries to maintain in full force and
effect all
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Governmental Authorizations required under any Environmental
Laws for their respective operations, except to the extent the failure
to maintain such Governmental Authorizations could not reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect, and (b) any proposed action to be taken by Borrower or any of
its Subsidiaries to commence manufacturing or other industrial
operations or to modify current operations in a manner that could
reasonably be expected to subject Borrower or any of its Subsidiaries
to any additional obligations or requirements under any Environmental
Laws which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
(v) Other Information. With reasonable promptness, such
other material and non-privileged documents and information as from
time to time may be reasonably requested by Administrative Agent in
relation to any matters disclosed pursuant to this subsection 6.7.
C. Borrower's Actions Regarding Hazardous Materials Activities,
Environmental Claims and Violations of Environmental Laws.
(i) Remedial Actions Relating to Hazardous Materials
Activities. Borrower will promptly undertake, and will cause each of
its Subsidiaries promptly to undertake, any and all investigations,
studies, sampling, testing, abatement, cleanup, removal, remediation or
other response actions necessary to remove, remediate, clean up or
xxxxx any Hazardous Materials Activity on, under or about any Facility
that is in violation of any Environmental Laws or that presents a risk
of giving rise to an Environmental Claim, in each case that could
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect. In the event Borrower or any of its
Subsidiaries undertakes any such action with respect to any Hazardous
Materials, Borrower or such Subsidiary shall conduct and complete such
action in all material respects in compliance with all applicable
Environmental Laws and in accordance with the policies, orders and
directives of all relevant federal, state and local governmental
authorities except when, and only to the extent that, Borrower's or
such Subsidiary's liability with respect to such Hazardous Materials
Activity is being contested in good faith by Borrower or such
Subsidiary.
(ii) Actions with Respect to Environmental Claims and
Violations of Environmental Laws. Borrower will promptly take, and
will cause each of its Subsidiaries promptly to take, any and all
actions necessary to (i) cure any material violation of applicable
Environmental Laws by Borrower or its Subsidiaries where failure to do
so could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect and (ii) make an
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appropriate response to any Environmental Claim against Borrower or any
of its Subsidiaries and discharge any obligations it may have to any
Person thereunder where failure to do so could reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect.
6.8 Execution of Subsidiary Guaranty and Personal Property Collateral
Documents by Certain Subsidiaries and Future Subsidiaries.
A. Execution of Subsidiary Guaranty and Personal Property Collateral
Documents. In the event that any Person becomes a Subsidiary of Borrower after
the date hereof, Borrower will promptly notify Administrative Agent of that fact
and cause such Subsidiary to execute and deliver to Administrative Agent a
counterpart of the Subsidiary Guaranty if such Subsidiary is a domestic
Subsidiary, the Subsidiary Pledge Agreement and the Subsidiary Security
Agreement and to take all such further actions and execute all such further
documents and instruments (including actions, documents and instruments
comparable to those described in subsection 4.1I) as may be necessary or, in the
opinion of Administrative Agent, desirable to create in favor of Administrative
Agent, for the benefit of Lenders, a valid and perfected First Priority Lien on
all of the personal assets of such Subsidiary described in the applicable forms
of Collateral Documents.
B. Subsidiary Charter Documents, Legal Opinions, Etc. Borrower will
deliver to Administrative Agent, together with such Loan Documents, (i)
certified copies of such Subsidiary's Certificate or Articles of Incorporation,
together with a good standing certificate from the Secretary of State of the
jurisdiction of its incorporation and each other state in which such Person is
qualified as a foreign corporation to do business and, to the extent generally
available, a certificate or other evidence of good standing as to payment of any
applicable franchise or similar taxes from the appropriate taxing authority of
each of such jurisdictions, each to be dated a recent date prior to their
delivery to Administrative Agent, (ii) a copy of such Subsidiary's Bylaws,
certified by its corporate secretary or an assistant secretary as of a recent
date prior to their delivery to Administrative Agent, (iii) a certificate
executed by the secretary or an assistant secretary of such Subsidiary as to (a)
the fact that the attached resolutions of the Board of Directors of such
Subsidiary approving and authorizing the execution, delivery and performance of
such Loan Documents are in full force and effect and have not been modified or
amended and (b) the incumbency and signatures of the officers of such Subsidiary
executing such Loan Documents, and (iv) a favorable opinion of counsel to such
Subsidiary, in form and substance satisfactory to Administrative Agent and its
counsel, as to (a) the due organization and good standing of such Subsidiary,
(b) the due authorization, execution and delivery by such Subsidiary of such
Loan Documents, (c) the enforceability of such Loan Documents against such
Subsidiary, (d) such other matters (including matters relating to the creation
and perfection of Liens in any
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Collateral pursuant to such Loan Documents) as Administrative Agent may
reasonably request, all of the foregoing to be satisfactory in form and
substance to Administrative Agent and its counsel.
6.9 Interest Rate Protection.
Within 45 days after the Closing Date, Borrower will obtain and
maintain in effect one or more Interest Rate Agreements with respect to the
Loans, in an aggregate notional principal amount of not less than $37,500,000,
which Interest Rate Agreements shall have the effect of establishing a fixed
interest rate or capping the interest rate in a manner satisfactory to
Administrative Agent and Arranging Agent with respect to such notional principal
amount, each such Interest Rate Agreement to be in form and substance
satisfactory to Administrative Agent and Arranging Agent and with a term of not
less than two years after the Closing Date.
6.10 Future Capital Contributions.
Upon receipt by Holdings of any Cash proceeds (any such proceeds net of
underwriting discounts and commissions and other reasonable costs and expenses
associated therewith, including reasonable legal fees and expenses) from the
issuance of any equity Securities of Holdings or any other contributions to the
capital of Holdings, Holdings shall contribute such net Cash proceeds to
Borrower as a contribution to capital (provided that if Holdings receives any
capital stock of Borrower as a result of such contribution it shall be common
stock) to be used by Borrower in accordance with subsection 2.4B(iii)(e).
SECTION 7.
NEGATIVE COVENANTS
Each of Holdings and Borrower covenants and agrees that, so long as any
of the Commitments hereunder shall remain in effect and until payment in full of
all of the Loans and other Obligations and the cancellation or expiration of all
Letters of Credit, unless Requisite Lenders shall otherwise give prior written
consent, each of Holdings and Borrower shall perform, and shall cause each of
its Subsidiaries to perform, all covenants in this Section 7.
7.1 Indebtedness.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume or guaranty, or otherwise become
or remain directly or indirectly liable with respect to, any Indebtedness,
except:
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(i) Borrower may become and remain liable with respect to the
Obligations;
(ii) Holdings and its Subsidiaries may become and remain
liable with respect to Contingent Obligations permitted by subsection
7.4 and, upon any matured obligations actually arising pursuant
thereto, the Indebtedness corresponding to the Contingent Obligations
so extinguished;
(iii) Borrower or a Subsidiary of Borrower may become and
remain liable with respect to Indebtedness that represents the
assumption by Borrower or such Subsidiary of Indebtedness of a Wholly
Owned Subsidiary in connection with the permitted merger of such Wholly
Owned Subsidiary with or into the Person assuming such Indebtedness or
in connection with the permitted purchase of all or substantially all
the assets of such Wholly Owned Subsidiary by Borrower or a Subsidiary
of Borrower; provided that such Indebtedness was not incurred pursuant
to subsection 7.1(v);
(iv) Borrower and its Subsidiaries may become and remain
liable with respect to Indebtedness arising from the honoring by a bank
or other financial institution of a check, draft or similar instrument
drawn against insufficient funds in the ordinary course of business,
provided that such Indebtedness is extinguished within two Business
Days of its incurrence;
(v) a Subsidiary of Borrower acquired after the date hereof in
a Permitted Acquisition may remain liable with respect to Indebtedness
of such Subsidiary incurred prior to such Permitted Acquisition, and a
Subsidiary of Borrower formed after the date hereof for the purpose of
acquiring assets (whether by merger, consolidation or otherwise) in a
Permitted Acquisition may become and remain liable with respect to
Indebtedness assumed in such Permitted Acquisition, which Indebtedness
in each case exists at the time of such Permitted Acquisition and was
not created in contemplation of such Permitted Acquisition; provided
that the aggregate principal amount of Indebtedness with respect to
which Subsidiaries of Borrower may become and remain liable pursuant to
this subsection 7.1(v) with maturities, amortization payments or other
required payments of principal prior to January 1, 2004 shall not
exceed at any time $5,000,000;
(vi) Borrower and its Subsidiaries may become and remain
liable with respect to Indebtedness in respect of Capital Leases and
purchase money Indebtedness, in each case which is incurred in respect
of Consolidated Adjusted Capital Expenditures permitted by subsection
7.8; provided that any such purchase money Indebtedness or Indebtedness
in respect of Capital Leases is
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incurred by Borrower or any of its Subsidiaries prior to or within 270
days after the applicable Consolidated Adjusted Capital Expenditure;
(vii) Borrower and its Subsidiaries may become and remain
liable with respect to Indebtedness under Capital Leases of automobiles
to be used by employees and directors of Borrower and its Subsidiaries
entered into in the ordinary course of business;
(viii) Borrower may become and remain liable with respect to
Indebtedness to any of its Wholly Owned Subsidiaries, and any domestic
Wholly Owned Subsidiary of Borrower may become and remain liable with
respect to Indebtedness to Borrower or any other domestic Wholly Owned
Subsidiary of Borrower; provided that (a) all such intercompany
Indebtedness shall be evidenced by Intercompany Notes which shall be
pledged to Administrative Agent to secure the Obligations, (b) all such
intercompany Indebtedness shall be subordinated in right of payment to
the payment in full of the Obligations (and, in the case of any
intercompany Indebtedness owed by Borrower, to the Senior Subordinated
Notes) pursuant to the terms of the applicable Intercompany Notes, and
(c) any payment by any Subsidiary of Borrower under any guaranty of the
Obligations shall result in a pro tanto reduction of the amount of any
intercompany Indebtedness owed by such Subsidiary to Borrower or to any
of its Subsidiaries for whose benefit such payment is made;
(ix) Borrower and its Subsidiaries, as applicable, may remain
liable with respect to Indebtedness described in Schedule 7.1 annexed
hereto;
(x) Borrower may become and remain liable with respect to
Indebtedness evidenced by the Senior Subordinated Notes and any
refinancing Indebtedness in respect thereof; provided that the
subordination provisions, maturity, amortization, interest rates,
events of default, covenants and all other terms and conditions of such
refinancing Indebtedness are at least as favorable to Lenders and to
Borrower and its Subsidiaries as the Senior Subordinated Notes; and
provided further, that no Potential Event of Default or Event of
Default shall have occurred and be continuing at the time of any such
refinancing; and
(xi) Borrower and its Subsidiaries may become and remain
liable with respect to other Indebtedness in an aggregate principal
amount not to exceed $5,000,000 at any time outstanding.
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7.2 Liens and Related Matters.
A. Prohibition on Liens. Holdings shall not, and shall not permit any
of its Subsidiaries to, directly or indirectly, create, incur, assume or permit
to exist any Lien on or with respect to any property or asset of any kind
(including any document or instrument in respect of goods or accounts
receivable) of Holdings or any of its Subsidiaries, whether now owned or
hereafter acquired, or any income or profits therefrom, or file or permit the
filing of, or permit to remain in effect, any financing statement or other
similar notice of any Lien with respect to any such property, asset, income or
profits under the Uniform Commercial Code of any State or under any similar
recording or notice statute, except:
(i) Permitted Encumbrances;
(ii) Liens granted pursuant to the Collateral Documents;
(iii) Liens described in Schedule 7.2A annexed hereto;
(iv) Liens securing Indebtedness permitted pursuant to
subsection 7.1(xi) provided that such Liens relate solely to the assets
financed with such Indebtedness;
(v) any Lien securing Indebtedness permitted by subsection
7.1(v) existing on any property or asset which is the subject of a
Permitted Acquisition; provided that (i) such Lien was not created in
contemplation of or in connection with such Permitted Acquisition and
(ii) such Lien does not apply to any other property or asset of
Borrower or any of its Subsidiaries; and provided further, that the
aggregate principal amount of Indebtedness secured by such Liens shall
not exceed $5,000,000 at any time;
(vi) purchase money security interests in real property
(other than the Cemetery), improvements thereto or equipment hereafter
acquired (or, in the case of improvements, constructed) by Borrower or
any of its Subsidiaries (including the interests of vendors and lessors
under conditional sale and title retention agreements), provided that
(a) such security interests secure Indebtedness permitted by Section
7.1(vi), (b) such security interests are created, and the Indebtedness
secured thereby is incurred, within 270 days after such acquisition (or
construction), and (c) such security interests do not encumber any
other property or assets of Borrower or any Subsidiary (other than
accessions to such real property, improvements or equipment and
provided that individual financings of equipment provided by a single
lender may be cross-collateralized to other financings of equipment
provided solely by such lender);
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(vii) the replacement, extension or renewal of any Lien
permitted by clause (v) or (vi) above, provided that such replacement,
extension or renewal Lien shall not encumber any property other than
the property that was subject to such Lien prior to such replacement,
extension or renewal; and provided further, that the Indebtedness and
other obligations secured by such replacement, extension or renewal
Lien are permitted by subsection 7.1; and
(viii) Liens arising by operation of law pursuant to Section
107(1) of the Comprehensive Environmental Response, Compensation and
Liability Act, 42 U.S.C. ss. 9607(1), or pursuant to analogous state
law, (a) for costs or damages which are not yet due (by virtue of a
written demand of payment by a governmental authority), or (b) which
are being actively contested in good faith by appropriate proceedings,
or (c) on property that Borrower and its Subsidiaries have determined
to abandon if the sole recourse for such costs or damages is to such
property; provided, however, that the liability of Holdings and its
Subsidiaries with respect to the matters giving rise to all Liens
described in this subsection 7.2A(viii) shall not, in the reasonable
estimation of Borrower, exceed $1,000,000.
B. Equitable Lien in Favor of Lenders. If Holdings or any of its
Subsidiaries shall create or assume any Lien upon any of its properties or
assets, whether now owned or hereafter acquired, other than Liens excepted by
the provisions of subsection 7.2A, it shall make or cause to be made effective
provision whereby the Obligations will be secured by such Lien equally and
ratably with any and all other Indebtedness secured thereby as long as any such
Indebtedness shall be so secured; provided that, notwithstanding the foregoing,
this covenant shall not be construed as a consent by Requisite Lenders to the
creation or assumption of any such Lien not permitted by the provisions of
subsection 7.2A.
C. No Further Negative Pledges. Except with respect to specific
property encumbered to secure payment of particular Indebtedness or to be sold
pursuant to an executed agreement with respect to an Asset Sale, neither
Holdings nor any of its Subsidiaries shall enter into any agreement (other than
the Senior Subordinated Note Indenture) prohibiting the creation or assumption
of any Lien upon any of its properties or assets, whether now owned or hereafter
acquired.
D. No Restrictions on Subsidiary Distributions to Borrower or Other
Subsidiaries. Except as provided herein and in the Senior Subordinated Note
Indenture or as set forth on Schedule 7.2D annexed hereto, Borrower will not,
and will not permit any of its Subsidiaries to, create or otherwise cause or
suffer to exist or become effective any consensual encumbrance or restriction of
any kind on the ability of any such Subsidiary to (i) pay dividends or make any
other distributions on any of such
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Subsidiary's capital stock owned by Borrower or any other Subsidiary of
Borrower, (ii) repay or prepay any Indebtedness owed by such Subsidiary to
Borrower or any other Subsidiary of Borrower, (iii) make loans or advances to
Borrower or any other Subsidiary of Borrower, or (iv) transfer any of its
property or assets to Borrower or any other Subsidiary of Borrower, except
encumbrances or restrictions contained in agreements relating to Indebtedness of
Subsidiaries acquired after the date hereof in a Permitted Acquisition; provided
that such Indebtedness is permitted pursuant to subsection 7.1(v) and such
encumbrances or restrictions relate solely to the property or assets of such
Subsidiary.
7.3 Investments; Joint Ventures.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, make or own any Investment in any Person, including any
Joint Venture, except:
(i) Borrower and its Subsidiaries may make and own Investments
in Cash and Cash Equivalents;
(ii) Borrower and its Subsidiaries may make and own
Investments in Persons that are, at the time of such Investments,
domestic Subsidiaries of Borrower;
(iii) Borrower and its Subsidiaries may make intercompany
loans to the extent permitted under subsection 7.1(viii);
(iv) Borrower and its Subsidiaries may continue to own the
Investments owned by them and described in Schedule 7.3 annexed hereto;
(v) Holdings may continue to own the Investment owned by it as
of the Closing Date in Borrower;
(vi) Borrower and its Subsidiaries may make and own
Investments which constitute Permitted Acquisitions permitted under
subsection 7.7(v);
(vii) Borrower and its Subsidiaries may make and own other
Investments in an aggregate amount not to exceed at any time
$1,000,000;
(viii) Borrower and its Subsidiaries may make and own
Investments arising out of the receipt by Borrower or any of its
Subsidiaries of non-cash consideration for any sale of assets permitted
under subsection 7.7; provided that
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such consideration (if the stated amount or value thereof is in excess
of $200,000) is pledged upon receipt to Administrative Agent;
(ix) Borrower and its Subsidiaries may make loans and advances
to employees of Borrower or its Subsidiaries not to exceed $1,500,000
in the aggregate at any time outstanding; and
(x) Borrower and its Subsidiaries may make and own Investments
in respect of (a) accounts receivable arising and trade credit granted
in the ordinary course of business and any securities received in
satisfaction or partial satisfaction thereof from financially troubled
account debtors to the extent reasonably necessary in order to prevent
or limit loss and (b) prepayments and other credits to suppliers made
in the ordinary course of business consistent with the past practices
of Borrower and its Subsidiaries.
7.4 Contingent Obligations.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create or become or remain liable with respect to any
Contingent Obligation, except:
(i) Holdings and any Subsidiaries of Borrower may become and
remain liable with respect to Contingent Obligations in respect of the
Holdings Guaranty and the Subsidiary Guaranty, respectively;
(ii) Borrower may become and remain liable with respect to
Contingent Obligations in respect of Letters of Credit, and Borrower
and its Subsidiaries may become and remain liable with respect to
Contingent Obligations in respect of other Commercial Letters of Credit
and Standby Letters of Credit in an aggregate amount not to exceed at
any time $5,000,000;
(iii) Borrower may become and remain liable with respect to
Contingent Obligations under Hedge Agreements;
(iv) Borrower and its Subsidiaries may become and remain
liable with respect to Contingent Obligations in respect of customary
indemnification and purchase price adjustment obligations incurred in
connection with Asset Sales or other sales of assets;
(v) Borrower and its Subsidiaries may become and remain liable
with respect to Contingent Obligations in respect of any Indebtedness
of Borrower or any of its Subsidiaries permitted by subsection 7.1
(other than subsection 7.1(v));
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(vi) Borrower and its Subsidiaries, as applicable, may remain
liable with respect to Contingent Obligations described in Schedule 7.4
annexed hereto; and
(vii) Borrower and its Subsidiaries may become and remain
liable with respect to other Contingent Obligations; provided that the
maximum aggregate liability, contingent or otherwise, of Borrower and
its Subsidiaries in respect of all such Contingent Obligations shall at
no time exceed $1,000,000.
7.5 Restricted Junior Payments.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, declare, order, pay, make or set apart any sum for any
Restricted Junior Payment; provided that
(i) Borrower may make regularly scheduled payments of interest
in respect of the Senior Subordinated Notes in accordance with the
terms of, and only to the extent required by, and subject to the
subordination provisions contained in, the Senior Subordinated Note
Indenture; and
(ii) so long as no Event of Default or Potential Event of
Default shall have occurred and be continuing or shall be caused
thereby, Borrower may make Restricted Junior Payments to Holdings (a)
to the extent necessary to permit Holdings to pay general
administrative costs and expenses then due and payable in the ordinary
course of business of Holdings and (b) to the extent necessary to
permit Holdings to discharge the consolidated tax liabilities of
Holdings and its Subsidiaries, in each case so long as Holdings applies
the amount of any such Restricted Junior Payment for such purpose.
7.6 Financial Covenants.
A. Minimum Interest Coverage Ratio. Holdings and Borrower shall not
permit the ratio of (i) Consolidated Adjusted EBITDA to (ii) Consolidated Cash
Interest Expense for any four-Fiscal Quarter period ending during any of the
periods set forth below to be less than the correlative ratio indicated:
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================================================================================
Minimum
Interest Coverage Ratio
Period
================================================================================
06/30/97 through 12/31/97 1.00:1.00
--------------------------------------------------------------------------------
01/01/98 through 06/30/98 1.05:1.00
--------------------------------------------------------------------------------
07/01/98 through 03/31/99 1.25:1.00
--------------------------------------------------------------------------------
04/01/99 through 12/31/99 1.30:1.00
--------------------------------------------------------------------------------
01/01/00 through 12/31/00 1.40:1.00
--------------------------------------------------------------------------------
01/01/01 and thereafter 1.60:1.00
================================================================================
B. Minimum Fixed Charge Coverage Ratio. Holdings and Borrower shall not
permit the ratio of (i) Consolidated Adjusted EBITDA to (ii) Consolidated Fixed
Charges for any four-Fiscal Quarter period ending during any of the periods set
forth below to be less than the correlative ratio indicated:
======================================================================================
Minimum
Period Fixed Charge
Coverage Ratio
======================================================================================
06/30/98 through 09/30/98 1.00:1.00
--------------------------------------------------------------------------------------
10/01/98 through 09/30/99 1.15:1.00
--------------------------------------------------------------------------------------
10/01/99 through 12/31/99 1.20:1.00
--------------------------------------------------------------------------------------
01/01/00 through 09/30/01 1.10:1.00
--------------------------------------------------------------------------------------
10/01/01 through 09/30/02 1.05:1.00
--------------------------------------------------------------------------------------
10/01/02 and thereafter 1.00:1.00
======================================================================================
C. Maximum Total Senior Debt Leverage Ratio. Holdings and Borrower
shall not permit the ratio of (i) Total Senior Debt as of the last day of any
Fiscal Quarter
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to (ii) Consolidated Adjusted EBITDA for the four-Fiscal Quarter period
then ended, during any of the periods set forth below to exceed the correlative
ratio indicated:
=======================================================================================
Maximum Total
Period Senior Debt
Leverage Ratio
=======================================================================================
06/30/97 through 09/30/98 5.85:1.00
---------------------------------------------------------------------------------------
10/01/98 through 09/30/99 4.65:1.00
---------------------------------------------------------------------------------------
10/01/99 through 09/30/00 4.45:1.00
---------------------------------------------------------------------------------------
10/01/00 through 09/30/01 4.00:1.00
---------------------------------------------------------------------------------------
10/01/01 through 09/30/02 3.30:1.00
---------------------------------------------------------------------------------------
10/01/02 and thereafter 3.25:1.00
=======================================================================================
D. Maximum Total Modified Senior Debt Leverage Ratio. Holdings and
Borrower shall not permit the ratio of (i) Total Modified Senior Debt as of the
last day of any Fiscal Quarter to (ii) Consolidated Adjusted EBITDA for the
four-Fiscal Quarter period then ended, during any of the periods set forth below
to exceed the correlative ratio indicated:
======================================================================================
Maximum Total
Period Modified Senior Debt
Leverage Ratio
======================================================================================
06/30/97 through 09/30/98 4.85:1.00
--------------------------------------------------------------------------------------
10/01/98 through 09/30/99 3.90:1.00
--------------------------------------------------------------------------------------
10/01/99 through 09/30/00 3.70:1.00
--------------------------------------------------------------------------------------
10/01/00 through 09/30/01 3.30:1.00
--------------------------------------------------------------------------------------
10/01/01 and thereafter 3.00:1.00
======================================================================================
E. Minimum Cumulative Consolidated Adjusted EBITDA. Holdings and
Borrower shall not permit Cumulative Consolidated Adjusted EBITDA as at any of
the dates set forth below to be less than the correlative amount indicated:
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=================================================================================
Minimum
Date Cumulative Consolidated
Adjusted EBITDA
=================================================================================
09/30/98 $15,000,000
---------------------------------------------------------------------------------
09/30/99 $34,000,000
---------------------------------------------------------------------------------
09/30/00 $54,000,000
---------------------------------------------------------------------------------
09/30/01 $75,000,000
---------------------------------------------------------------------------------
09/30/02 $98,000,000
---------------------------------------------------------------------------------
09/30/03 $123,000,000
=================================================================================
F. Certain Calculations.
(i) With respect to calculations of Consolidated Adjusted
EBITDA, Consolidated Cash Interest Expense and Consolidated Fixed
Charges for any four-Fiscal Quarter period including the Closing Date,
such calculations shall be made on a pro forma basis assuming, in each
case, that the Closing Date, the Acquisition, the Merger, the issuance
and sale of the Holdings Common Stock and the Holdings Preferred Stock,
the Contribution, and the related borrowings by Borrower pursuant to
this Agreement and the Senior Subordinated Note Indenture all occurred
on the first day of the applicable four-Fiscal Quarter period and
assuming further, for purposes of calculation of the pro forma interest
accrued on Loans during any such periods prior to the Closing Date,
that all Loans outstanding were Eurodollar Rate Loans and that the
applicable reference interest rates were the average effective Adjusted
Eurodollar Rates on the Loans for the period from the Closing Date
through the date of determination, all such calculations to be in form
and substance satisfactory to Arranging Agent and Administrative Agent.
(ii) With respect to calculations of Consolidated Adjusted
EBITDA (other than for purposes of calculating Consolidated Excess Cash
Flow), Consolidated Cash Interest Expense and Consolidated Fixed
Charges for any four-Fiscal Quarter period during which any Permitted
Acquisition was consummated, such calculations shall be made on a pro
forma basis (including by giving effect to Pro Forma Projected EBITDA)
assuming, in each case, that such Permitted Acquisition was consummated
on the first day of the applicable four- Fiscal Quarter period. All
such calculations shall be in form and substance satisfactory to
Arranging Agent and Administrative Agent.
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(iii) With respect to calculations of Consolidated Adjusted
EBITDA (other than for purposes of calculating Consolidated Excess Cash
Flow) for any four-Fiscal Quarter Period including the Closing Date,
such calculations shall give effect to the Pro Forma EBITDA Adjustment.
G. Borrower's Right to Cure.
(i) Financial Performance Covenants. In the event that
Holdings and Borrower fail to comply with the requirements of any
Financial Performance Covenant, until the expiration of the 10th day
subsequent to the date the Compliance Certificate calculating such
Financial Performance Covenant is required to be delivered pursuant to
subsection 6.1(iv), Holdings shall have the right to issue Permitted
Cure Securities for Cash or otherwise receive Cash contributions to the
capital of Holdings and to contribute any such Cash to the capital of
Borrower (collectively, the "Cure Right"), and upon the receipt by
Borrower of such Cash pursuant to the exercise by Holdings of such Cure
Right such Financial Performance Covenant shall be recalculated giving
effect to the following pro forma adjustments:
"Consolidated Adjusted EBITDA" shall be increased,
solely for the purpose of measuring the Financial Performance
Covenants and not for any other purpose under this Agreement,
by an amount equal to the Cure Amount.
If, after giving effect to the foregoing recalculations,
Holdings and Borrower shall then be in compliance with the requirements
of all Financial Performance Covenants, Holdings and Borrower shall be
deemed to have satisfied the requirements of the Financial Performance
Covenants as of the relevant date of determination with the same effect
as though there had been no failure to comply therewith at such date,
and the applicable breach or default of the Financial Performance
Covenants which had occurred shall be deemed cured for all purposes of
this Agreement.
(ii) Limitation on Exercise of Cure Right. Notwithstanding
anything herein to the contrary, (a) in no event shall Holdings be
entitled to exercise the Cure Right in more than three consecutive
Fiscal Quarters, and (b) in any ten Fiscal Quarter period, there must
be a period of at least four consecutive Fiscal Quarters during which
Holdings has not exercised its Cure Right.
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7.7 Restriction on Fundamental Changes; Asset Sales and Acquisitions.
Holdings shall not, and shall not permit any of its Subsidiaries to,
alter the corporate, capital or legal structure of Holdings or any of its
Subsidiaries, or enter into any transaction of merger or consolidation, or
liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution), or convey, sell, lease or sub-lease (as lessor or sublessor),
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, property or assets, whether now
owned or hereafter acquired, or acquire by purchase or otherwise all or
substantially all the business, property or fixed assets of, or stock or other
evidence of beneficial ownership of, any Person or any division or line of
business of any Person, or make any Business Acquisition, except:
(i) any Subsidiary of Borrower (other than a Subsidiary
which has become liable for Indebtedness permitted under subsection
7.1(v)) may be merged with or into Borrower or any Wholly Owned
Subsidiary Guarantor, or be liquidated, wound up or dissolved, or all
or any part of its business, property or assets may be conveyed, sold,
leased, transferred or otherwise disposed of, in one transaction or a
series of transactions, to Borrower or any Wholly Owned Subsidiary
Guarantor; provided that, in the case of such a merger, Borrower or
such Wholly Owned Subsidiary Guarantor shall be the continuing or
surviving corporation;
(ii) Borrower and its Subsidiaries may dispose of
obsolete, worn out or surplus property in the ordinary course of
business;
(iii) Borrower and its Subsidiaries may sell or otherwise
dispose of assets in transactions that do not constitute Asset Sales;
provided that the consideration received for such assets shall be in an
amount at least equal to the fair market value thereof as determined by
Borrower in good faith;
(iv) subject to subsection 7.11, Borrower and its
Subsidiaries may make Asset Sales of assets having a fair market value
not in excess of $5,000,000 in any Fiscal Year or $15,000,000 in the
aggregate; provided that (a) the consideration received for such assets
shall be in an amount at least equal to the fair market value thereof
as determined by Borrower in good faith; (b) except in the case of a
like kind exchange, at least 85% of the consideration received shall be
Cash, Cash Equivalents or the assumption of Indebtedness; and (c) the
proceeds of such Asset Sales shall be applied as required by subsection
2.4B(iii)(a);
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(v) so long as no Potential Event of Default or Event of
Default shall have occurred and be continuing or would result therefrom
and Borrower delivers an Officers' Certificate to Administrative Agent
and Lenders, in form and substance reasonably satisfactory to
Administrative Agent, confirming that it will be in compliance, on a
pro forma basis (including by giving effect to Pro Forma Projected
EBITDA) after giving effect to such Permitted Acquisition as if it had
occurred at the beginning of the period specified in the applicable
covenant, with all covenants set forth in subsection 7.6 hereof,
commencing on January 1, 1997 Borrower and its Subsidiaries may make
Permitted Acquisitions in an amount not to exceed in the aggregate
$20,000,000 (the "Permitted Acquisition Amount") in any Fiscal Year;
provided that (a) Borrower and it Subsidiaries may make Permitted
Acquisitions in excess of the Permitted Acquisition Amount in any
Fiscal Year so long as such excess is funded by Cash common equity
contributions to, or Cash purchases of common equity from, Holdings,
the Cash proceeds of which are contributed to Borrower, (b) in the
event that the Permitted Acquisition Amount in any Fiscal Year (before
giving effect to any increase in such amount pursuant to this clause
(b) but after giving effect to any reduction in such amount as a result
of Permitted Acquisitions made pursuant to succeeding clause (c) is
greater than the amount of Permitted Acquisitions made by Borrower and
its Subsidiaries during such Fiscal Year, the lesser (i) 100% of such
unutilized amount and (ii) $10,000,000 may be utilized to effect
additional Permitted Acquisitions in the immediately succeeding two
Fiscal Years, provided, that (x) any amount carried forward from an
immediately preceding Fiscal Year may not be utilized during a current
Fiscal Year unless and until the relevant Permitted Acquisition Amount
for such current Fiscal Year shall have been utilized in full to make
Permitted Acquisitions during such current Fiscal Year and (y) no
amount once carried forward to the second succeeding Fiscal Year may be
carried forward to Fiscal Years thereafter, and (c) in the event that
Borrower and its Subsidiaries have made Permitted Acquisitions in any
Fiscal Year pursuant to preceding clauses (a) and (b) in an amount
equal to the maximum amount permitted to be made in such Fiscal Year
pursuant to such clauses, Borrower and its Subsidiaries may make
additional Permitted Acquisitions in such Fiscal Year by utilizing up
to 50% of the Permitted Acquisition Amount permitted to be made in the
immediately succeeding Fiscal Year and with any Permitted Acquisitions
made pursuant to this clause (c) in such current Fiscal Year to reduce
the Permitted Acquisition Amount in the immediately succeeding Fiscal
Year;
(vi) Holdings and its Subsidiaries may make the
Acquisition, the Merger and the Contribution on the Closing Date; and
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(vii) Borrower and its Subsidiaries may discount or
otherwise transfer defaulted receivables in connection with the
collection thereof in the ordinary course of business.
7.8 Consolidated Adjusted Capital Expenditures.
Holdings shall not, and shall not permit its Subsidiaries to, make or
incur Consolidated Adjusted Capital Expenditures in any period indicated below
in an aggregate amount in excess of the corresponding amount (the "Maximum
Consolidated Capital Expenditures Amount") set forth below opposite such period;
provided that the Maximum Consolidated Capital Expenditures Amount for any
period shall be increased by an amount equal to 100% of the excess, if any, of
the Maximum Consolidated Capital Expenditures Amount for the previous period set
forth in the table below (as adjusted in accordance with this proviso) over the
actual amount of Consolidated Adjusted Capital Expenditures for such previous
period; and provided further, that (x) Borrower and its Subsidiaries may make
Consolidated Adjusted Capital Expenditures in excess of the Maximum Consolidated
Capital Expenditures Amount for any period set forth below to the extent (i) the
Consolidated Adjusted Capital Expenditure does not exceed the Available Excess
Consolidated Capital Expenditure Amount at the time of such expenditure and (ii)
the Consolidated Adjusted Capital Expenditures are made from funds drawn from
the reserve of any endowment care fund and (y) Borrower and its Subsidiaries may
not make Permitted Acquisitions pursuant to this subsection 7.8:
===========================================================================================
Maximum Consolidated
Period Capital Expenditures
Amount
===========================================================================================
Closing Date through 12/31/97 $5,000,000
-------------------------------------------------------------------------------------------
Fiscal Year ending 12/31/98 $5,000,000
-------------------------------------------------------------------------------------------
Fiscal Year ending 12/31/99 $5,500,000
-------------------------------------------------------------------------------------------
Fiscal Year ending 12/31/00 $5,500,000
-------------------------------------------------------------------------------------------
Each Fiscal Year thereafter $6,000,000
===========================================================================================
7.9 Sales and Lease-Backs.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, become or remain liable as lessee or as a guarantor or
other surety with respect to any Operating Lease of any property (whether real,
personal or mixed), whether now owned or hereafter acquired, (i) which Borrower
or any of its Subsidiaries
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has sold or transferred or is to sell or transfer to any other Person (other
than Borrower or any of its Subsidiaries) or (ii) which Borrower or any of its
Subsidiaries intends to use for substantially the same purpose as any other
property which has been or is to be sold or transferred by Borrower or any of
its Subsidiaries to any Person (other than Borrower or any of its Subsidiaries)
in connection with such lease; provided, however, that Borrower and its
Subsidiaries may become and remain liable with respect to Operating Leases so
long as the product of (a) eight times (b) consolidated annual rental payments
thereunder shall not exceed $500,000 at any time.
7.10 Transactions with Shareholders and Affiliates.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, enter into or permit to exist any transaction (including
the purchase, sale, lease or exchange of any property or the rendering of any
service) with any holder of 5% or more of any class of equity Securities of
Holdings or with any Affiliate of Holdings or of any such holder, on terms that
are less favorable to Holdings or that Subsidiary, as the case may be, than
those that might be obtained at the time from Persons who are not such a holder
or Affiliate; provided that the foregoing restriction shall not apply to (i) any
transaction between Holdings and any of its Wholly Owned Subsidiaries or between
any of its Wholly Owned Subsidiaries, (ii) the transactions contemplated by the
Administrative Agreement, (iii) reasonable and customary fees paid to members of
the Boards of Directors of Holdings and its Subsidiaries or (iv) so long as no
Event of Default or Potential Event of Default has occurred and is continuing or
would be caused thereby, payment of Management Fees.
7.11 Disposal of Subsidiary Stock.
Except as permitted pursuant to subsection 7.7(i), (iii) or (iv),
neither Holdings nor any of its Subsidiaries shall:
(i) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any shares of capital stock or other equity
Securities of any of its Subsidiaries, except to qualify directors or
funeral directors if required by applicable law; or
(ii) permit any of its Subsidiaries directly or indirectly to
sell, assign, pledge or otherwise encumber or dispose of any shares of
capital stock or other equity Securities of any of its Subsidiaries
(including such Subsidiary), except to Borrower, another domestic
Wholly Owned Subsidiary of Borrower, or to qualify directors or funeral
directors if required by applicable law.
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7.12 Conduct of Business.
(i) From and after the Closing Date, Borrower shall not, and
shall not permit any of its Subsidiaries to, engage in any business
other than (i) the businesses engaged in by Borrower and its
Subsidiaries on the Closing Date and similar or related businesses and
(ii) such other lines of business as may be consented to by Requisite
Lenders.
(ii) Holdings shall engage in no business and have no assets
or liabilities other than (a) owning the stock of Borrower, (b) the
performance of its obligations under the Loan Documents, (c)
liabilities associated with the maintenance of its corporate existence
and with respect to consolidated tax liabilities of Holdings and its
Subsidiaries, (d) the receipt of Cash dividends or Cash distributions
from Borrower in accordance with the provisions of subsection 7.5 and
(e) the activities related to the maintenance of Permitted Cure
Securities.
7.13 Amendments or Waivers of Certain Related Agreements; Designation of
"Senior Indebtedness".
A. Amendments or Waivers of Certain Related Agreements. Neither
Holdings nor any of its Subsidiaries shall agree to any material amendment to,
request any material waiver of (other than a waiver for which no fee is paid and
no other concessions or consideration are granted by Holdings or Borrower), or
waive any of their respective rights under, any of the Related Agreements (other
than any amendment or waiver described in the next succeeding sentence) without
in each case obtaining the prior written consent of Administrative Agent and
Requisite Lenders (and giving notice to Arranging Agent) to such amendment,
request or waiver. Notwithstanding the foregoing, Holdings and its Subsidiaries
may agree to amend or waive any provisions of the Related Agreements (i) to cure
any ambiguity, to correct or supplement any provision therein which may be
defective or inconsistent with any other provision therein, or (ii) to comply
with the Trust Indenture Act of 1939, as amended, or (iii) to make modifications
of a technical or clarifying nature or which are no less favorable to the
Lenders, in the reasonable opinion of Administrative Agent and Requisite
Lenders, than the provisions of the Related Agreements as in effect on the
Closing (for the purposes of this subsection 7.13, any amendment, modification
or change which would extend the maturity or reduce the amount of any payment of
principal on the Senior Subordinated Notes or which would reduce the rate or
extend the date for payment of interest thereon, provided that no fee is payable
in connection therewith, shall be deemed to be an amendment, modification or
change that is no less favorable to the Lenders).
B. Designation of "Senior Indebtedness". Borrower shall not designate
any Indebtedness as "Designated Senior Indebtedness" (as defined in the Senior
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Subordinated Note Indenture) for purposes of the Senior Subordinated Note
Indenture without the prior written consent of Requisite Lenders.
7.14 Fiscal Year
Holdings shall not change its Fiscal Year-end from December 31.
SECTION 8.
EVENTS OF DEFAULT
If any of the following conditions or events ("Events of Default")
shall occur:
8.1 Failure to Make Payments When Due.
Failure by Borrower to pay any installment of principal of any Loan
when due, whether at stated maturity, by acceleration, by notice of voluntary
prepayment, by mandatory prepayment or otherwise; failure by Borrower to pay
when due any amount payable to Issuing Lender in reimbursement of any drawing
under a Letter of Credit; or failure by Borrower to pay any interest on any Loan
or any fee or any other amount due under this Agreement within five days after
the date due; or
8.2 Default in Other Agreements.
(i) Failure of Holdings or any of its Subsidiaries to pay when due any
principal of or interest on or any other amount payable in respect of one or
more items of Indebtedness (other than Indebtedness referred to in subsection
8.1) or Contingent Obligations in an individual principal amount of $1,000,000
or more or with an aggregate principal amount of $2,000,000 or more, in each
case beyond the end of any grace period provided therefor; or (ii) breach or
default by Holdings or any of its Subsidiaries with respect to any other
material term of (a) one or more items of Indebtedness or Contingent Obligations
in the individual or aggregate principal amounts referred to in clause (i) above
or (b) any loan agreement, mortgage, indenture or other agreement relating to
such item(s) of Indebtedness or Contingent Obligation(s), if the effect of such
breach or default is to permit the holder or holders of that Indebtedness or
Contingent Obligation(s) (or a trustee on behalf of such holder or holders) to
cause that Indebtedness or Contingent Obligation(s) to become or be declared due
and payable prior to its stated maturity or the stated maturity of any
underlying obligation, as the case may be (upon the giving or receiving of
notice, lapse of time, both, or otherwise); or (iii) breach or default by
Holdings or any of its Subsidiaries with respect to any term of (a) one or more
items of Indebtedness or Contingent Obligations in the individual or aggregate
principal amounts referred to in clause (i) above or (b) loan agreement,
-132-
mortgage, indenture or other agreement relating to such item(s)
of Indebtedness or Contingent Obligation(s), if the effect of such breach or
default is to cause that Indebtedness or Contingent Obligation(s) to become due
or be declared due and payable prior to its stated maturity or the stated
maturity of any underlying obligation, as the case may be (upon the giving or
receiving of notice, lapse of time, both, or otherwise) ; or
8.3 Breach of Certain Covenants.
Failure of Holdings or its Subsidiaries to perform or comply with any
term or condition contained in subsection 2.5 or 6.2 or Section 7 of this
Agreement; or
8.4 Breach of Warranty.
Any representation, warranty, certification or other statement made by
any Loan Party or any of its Subsidiaries in any Loan Document or in any
statement or certificate at any time given by any Loan Party or any of its
Subsidiaries in writing pursuant hereto or thereto or in connection herewith or
therewith shall be false in any material respect on the date as of which made
(or deemed made); or
8.5 Other Defaults Under Loan Documents.
Any Loan Party shall default in the performance of or compliance with
any term contained in this Agreement or any of the other Loan Documents, other
than any such term referred to in any other subsection of this Section 8, and
such default shall not have been remedied or waived within 30 days after the
earlier of (i) an officer of Borrower or such Loan Party becoming aware of such
default or (ii) receipt by Borrower and such Loan Party of notice from
Administrative Agent or any Lender of such default; or
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc.
(i) A court having jurisdiction in the premises shall enter a decree
or order for relief in respect of Holdings or any of its Subsidiaries in an
involuntary case under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect, which decree
or order is not stayed; or any other similar relief shall be granted under any
applicable federal or state law; or (ii) an involuntary case shall be commenced
against Holdings or any of its Subsidiaries under the Bankruptcy Code or under
any other applicable bankruptcy, insolvency or similar law now or hereafter in
effect; or a decree or order of a court having jurisdiction in the premises for
the appointment of a receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over Holdings or any of its Subsidiaries, or
over all or a substantial part of its property, shall have been entered; or
there shall have occurred the involuntary appointment of an interim receiver,
trustee or other custodian of Holdings or
-133-
any of its Subsidiaries for all or a substantial part of its property; or a
warrant of attachment, execution or similar process shall have been issued
against any substantial part of the property of Holdings or any of its
Subsidiaries, and any such event described in this clause (ii) shall continue
for 60 days unless dismissed, bonded or discharged; or
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc.
(i) Holdings or any of its Subsidiaries shall have an order for relief
entered with respect to it or commence a voluntary case under the Bankruptcy
Code or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, or shall consent to the entry of an order for relief in an
involuntary case, or to the conversion of an involuntary case to a voluntary
case, under any such law, or shall consent to the appointment of or taking
possession by a receiver, trustee or other custodian for all or a substantial
part of its property; or Holdings or any of its Subsidiaries shall make any
assignment for the benefit of creditors; or (ii) Holdings or any of its
Subsidiaries shall be unable, or shall fail generally, or shall admit in writing
its inability, to pay its debts as such debts become due; or the Board of
Directors of Holdings or any of its Subsidiaries (or any committee thereof)
shall adopt any resolution or otherwise authorize any action to approve any of
the actions referred to in clause (i) above or this clause (ii); or
8.8 Judgments and Attachments.
Any money judgment, writ or warrant of attachment or similar process
involving in the aggregate at any time an amount in excess of $2,000,000 (in
either case not adequately covered by insurance as to which a solvent and
unaffiliated insurance company has acknowledged coverage) shall be entered or
filed against Holdings or any of its Subsidiaries or any of their respective
assets and shall remain undischarged, unvacated, unbonded or unstayed for a
period of 60 days (or in any event later than five days prior to the date of any
proposed sale thereunder); or
8.9 Dissolution.
Any order, judgment or decree shall be entered against Holdings or any
of its Subsidiaries decreeing the dissolution or split up of Holdings or that
Subsidiary and such order shall remain undischarged or unstayed for a period in
excess of 30 days; or
8.10 Employee Benefit Plans.
There shall occur one or more ERISA Events which individually or in the
aggregate results in or might reasonably be expected to result in liability of
Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates in
excess of $1,000,000 during the term of this Agreement; or there shall exist an
amount of
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unfunded benefit liabilities (as defined in Section 4001(a)(18) of ERISA),
individually or in the aggregate for all Pension Plans (excluding for purposes
of such computation any Pension Plans with respect to which assets exceed
benefit liabilities), which exceeds $4,000,000, and the minimum funding
standards of Section 412 of the Internal Revenue Code (whether or not waived in
accordance with Section 412(d) of the Internal Revenue Code) have not been met
with respect to any Pension Plan; or
8.11 Change in Control.
(i) The Blackstone Investors and Xxxxxx Group and its Affiliates,
collectively, or Xxxxxx Group and its Affiliates, individually, shall cease to
beneficially own and control 95% of the issued and outstanding shares of capital
stock of Holdings entitled (without regard to the occurrence of any contingency)
to vote for the election of members of the Board of Directors of Borrower; (ii)
Holdings shall cease to own 100% of the outstanding capital stock of Borrower;
or (iii) a "Change of Control" under the Senior Subordinated Note Indenture
shall occur; or
8.12 Invalidity of Guaranties; Failure of Security; Repudiation of
Obligations.
At any time after the execution and delivery thereof, (i) any Guaranty
for any reason, other than the satisfaction in full of all Obligations, shall
cease to be in full force and effect (other than in accordance with its terms)
or shall be declared to be null and void, (ii) any Collateral Document shall
cease to be in full force and effect (other than by reason of a release of
Collateral thereunder in accordance with the terms hereof or thereof, the
satisfaction in full of the Obligations or any other termination of such
Collateral Document in accordance with the terms hereof or thereof) or shall be
declared null and void, or Administrative Agent shall not have or shall cease to
have a valid and perfected First Priority Lien in any Collateral purported to be
covered thereby, in each case for any reason other than the failure of
Administrative Agent or any Lender to take any action within its control, or
(iii) any Loan Party shall contest the validity or enforceability of any Loan
Document in writing or deny in writing that it has any further liability,
including with respect to future advances by Lenders, under any Loan Document to
which it is a party; or
8.13 Subordinated Indebtedness.
Borrower shall fail to comply with the subordination provisions
contained in the Senior Subordinated Note Indenture or any other agreement
governing any other Subordinated Indebtedness;
THEN (i) upon the occurrence of any Event of Default described in subsection 8.6
or 8.7 with respect to Borrower, each of (a) the unpaid principal amount of and
accrued
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interest on the Loans, (b) an amount equal to the maximum amount that
may at any time be drawn under all Letters of Credit then outstanding (whether
or not any beneficiary under any such Letter of Credit shall have presented, or
shall be entitled at such time to present, the drafts or other documents or
certificates required to draw under such Letter of Credit), and (c) all other
Obligations shall automatically become immediately due and payable, without
presentment, demand, protest or other requirements of any kind, all of which are
hereby expressly waived by Borrower, and the obligation of each Lender to make
any Loan, the obligation of Administrative Agent to issue any Letter of Credit
and the right of any Lender to issue any Letter of Credit hereunder shall
thereupon terminate, and (ii) upon the occurrence and during the continuation of
any other Event of Default, Administrative Agent shall, upon the written request
or with the written consent of Requisite Lenders, by written notice to Borrower,
declare all or any portion of the amounts described in clauses (a) through (c)
above to be, and the same shall forthwith become, immediately due and payable,
and the obligation of each Lender to make any Loan, the obligation of
Administrative Agent to issue any Letter of Credit and the right of any Lender
to issue any Letter of Credit hereunder shall thereupon terminate; provided that
the foregoing shall not affect in any way the obligations of Lenders under
subsection 3.3C(i) or the obligations of Lenders to purchase participations in
any unpaid Swing Line Loans as provided in subsection 2.1A(iii).
Any amounts described in clause (b) above, when received by
Administrative Agent, shall be held by Administrative Agent pursuant to the
terms of the Collateral Account Agreement and shall be applied as therein
provided.
Notwithstanding anything contained in the second preceding paragraph,
if at any time within 60 days after an acceleration of the Loans pursuant to
clause (ii) of such paragraph Borrower shall pay all arrears of interest and all
payments on account of principal which shall have become due otherwise than as a
result of such acceleration (with interest on principal and, to the extent
permitted by law, on overdue interest, at the rates specified in this Agreement)
and all Events of Default and Potential Events of Default (other than
non-payment of the principal of and accrued interest on the Loans, in each case
which is due and payable solely by virtue of acceleration) shall be remedied or
waived pursuant to subsection 10.6, then Requisite Lenders, by written notice to
Borrower, may at their option rescind and annul such acceleration and its
consequences; but such action shall not affect any subsequent Event of Default
or Potential Event of Default or impair any right consequent thereon. The
provisions of this paragraph are intended merely to bind Lenders to a decision
which may be made at the election of Requisite Lenders and are not intended,
directly or indirectly, to benefit Borrower, and such provisions shall not at
any time be construed so as to grant Borrower the right to require Lenders to
rescind or annul any acceleration hereunder or to preclude Administrative Agent
or Lenders from exercising any of the rights or remedies available
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to them under any of the Loan Documents, even if the conditions set forth in
this paragraph are met.
SECTION 9.
AGENTS
9.1 Appointment.
A. Appointment of Agents. Xxxxxxx, Xxxxx & Co. is hereby appointed
Syndication Agent and Arranging Agent hereunder, and each Lender hereby
authorizes Arranging Agent and Syndication Agent to act as its agent in
accordance with the terms of this Agreement and the other Loan Documents.
Scotiabank is hereby appointed Administrative Agent hereunder and under the
other Loan Documents and each Lender hereby authorizes Administrative Agent to
act as its agent in accordance with the terms of this Agreement and the other
Loan Documents. Each Agent hereby agrees to act upon the express conditions
contained in this Agreement and the other Loan Documents, as applicable. The
provisions of this Section 9 are solely for the benefit of Agents and Lenders
and Borrower shall have no rights as a third party beneficiary of any of the
provisions thereof. In performing its functions and duties under this Agreement,
each Agent shall act solely as an agent of Lenders and does not assume and shall
not be deemed to have assumed any obligation towards or relationship of agency
or trust with or for Borrower or any of its Subsidiaries. Each of Arranging
Agent and Syndication Agent, without consent of or notice to any party hereto,
may assign any and all of its rights or obligations hereunder to any of its
Affiliates. As of the Closing Date, all obligations of Arranging Agent and
Syndication Agent hereunder shall terminate.
B. Appointment of Supplemental Collateral Agents. It is the purpose of
this Agreement and the other Loan Documents that there shall be no violation of
any law of any jurisdiction denying or restricting the right of banking
corporations or associations to transact business as agent or trustee in such
jurisdiction. It is recognized that in case of litigation under this Agreement
or any of the other Loan Documents, and in particular in case of the enforcement
of any of the Loan Documents, or in case Administrative Agent deems that by
reason of any present or future law of any jurisdiction it may not exercise any
of the rights, powers or remedies granted herein xxxx any of the other Loan
Documents or take any other action which may be desirable or necessary in
connection therewith, it may be necessary that Administrative Agent appoint an
additional individual or institution as a separate trustee, co-trustee,
collateral agent or collateral co-agent (any such additional individual or
institution being referred to herein individually as a "Supplemental Collateral
Agent" and collectively as "Supplemental Collateral Agents").
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In the event that Administrative Agent appoints a Supplemental
Collateral Agent with respect to any Collateral, (i) each and every right,
power, privilege or duty expressed or intended by this Agreement or any of the
other Loan Documents to be exercised by or vested in or conveyed to
Administrative Agent with respect to such Collateral shall be exercisable by and
vest in such Supplemental Collateral Agent to the extent, and only to the
extent, necessary to enable such Supplemental Collateral Agent to exercise such
rights, powers and privileges with respect to such Collateral and to perform
such duties with respect to such Collateral, and every covenant and obligation
contained in the Loan Documents and necessary to the exercise or performance
thereof by such Supplemental Collateral Agent shall run to and be enforceable by
either Agent or such Supplemental Collateral Agent, and (ii) the provisions of
this Section 9 and of subsections 10.2 and 10.3 that refer to Administrative
Agent shall inure to the benefit of such Supplemental Collateral Agent and all
references therein to Administrative Agent shall be deemed to be references to
Administrative Agent and/or such Supplemental Collateral Agent, as the context
may require.
Should any instrument in writing from Borrower or any other Loan Party
be required by any Supplemental Collateral Agent so appointed by Administrative
Agent for more fully and certainly vesting in and confirming to him or it such
rights, powers, privileges and duties, Borrower shall, or shall cause such Loan
Party to, execute, acknowledge and deliver any and all such instruments promptly
upon request by Administrative Agent. In case any Supplemental Collateral Agent,
or a successor thereto, shall die, become incapable of acting, resign or be
removed, all the rights, powers, privileges and duties of such Supplemental
Collateral Agent, to the extent permitted by law, shall vest in and be exercised
by Administrative Agent until the appointment of a new Supplemental Collateral
Agent.
9.2 Powers and Duties; General Immunity.
X. Xxxxxx; Duties Specified. Each Lender irrevocably authorizes each
Agent to take such action on such Lender's behalf and to exercise such powers,
rights and remedies hereunder and under the other Loan Documents as are
specifically delegated or granted to such Agent by the terms hereof and thereof,
together with such powers, rights and remedies as are reasonably incidental
thereto. Each Agent shall have only those duties and responsibilities that are
expressly specified in this Agreement and the other Loan Documents. Each Agent
may exercise such powers, rights and remedies and perform such duties by or
through its agents or employees. No Agent shall have, by reason of this
Agreement or any of the other Loan Documents, a fiduciary relationship in
respect of any Lender; and nothing in this Agreement or any of the other Loan
Documents, expressed or implied, is intended to or shall be so construed as to
impose upon any Agent any obligations in respect of this Agreement or any of the
other Loan Documents except as expressly set forth herein or therein.
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B. No Responsibility for Certain Matters. No Agent shall be responsible
to any Lender for the execution, effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement or any other
Loan Document or for any representations, warranties, recitals or statements
made herein or therein or made in any written or oral statements or in any
financial or other statements, instruments, reports or certificates or any other
documents furnished or made by any of Agent to Lenders or by or on behalf of
Holdings, Borrower or any of their respective Subsidiaries to any Agent or any
Lender in connection with the Loan Documents and the transactions contemplated
thereby or for the financial condition or business affairs of Holdings, Borrower
or any of their respective Subsidiaries or any other Person liable for the
payment of any Obligations, nor shall any Agent be required to ascertain or
inquire as to the performance or observance of any of the terms, conditions,
provisions, covenants or agreements contained in any of the Loan Documents or as
to the use of the proceeds of the Loans or as to the existence or possible
existence of any Event of Default or Potential Event of Default. Anything
contained in this Agreement to the contrary notwithstanding, Administrative
Agent shall not have any liability arising from confirmations of the amount of
outstanding Loans or the Letter of Credit Usage or the component amounts
thereof.
C. Exculpatory Provisions. None of Agents nor any of their respective
officers, partners, directors, employees or agents shall be liable to Lenders
for any action taken or omitted by any Agent under or in connection with any of
the Loan Documents except to the extent caused by such Agent's gross negligence
or willful misconduct. Each Agent shall be entitled to refrain from any act or
the taking of any action (including the failure to take an action) in connection
with this Agreement or any of the other Loan Documents or from the exercise of
any power, discretion or authority vested in it hereunder or thereunder unless
and until such Agent shall have received instructions in respect thereof from
Requisite Lenders (or such other Lenders as may be required to give such
instructions under subsection 10.6) and, upon receipt of such instructions from
Requisite Lenders (or such other Lenders, as the case may be), such Agent shall
be entitled to act or (where so instructed) refrain from acting, or to exercise
such power, discretion or authority, in accordance with such instructions.
Without prejudice to the generality of the foregoing, (i) each Agent shall be
entitled to rely, and shall be fully protected in relying, upon any
communication, instrument or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and shall be
entitled to rely and shall be protected in relying on opinions and judgments of
attorneys (who may be attorneys for Holdings and its Subsidiaries), accountants,
experts and other professional advisors selected by it; and (ii) no Lender shall
have any right of action whatsoever against any Agent as a result of such Agent
acting or (where so instructed) refraining from acting under this Agreement or
any of the other Loan Documents in accordance with the instructions of Requisite
Lenders (or such other Lenders as may be required to give such instructions
under subsection 10.6).
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D. Agent Entitled to Act as Lender. The agency hereby created shall in
no way impair or affect any of the rights and powers of, or impose any duties or
obligations upon, any Agent in its individual capacity as a Lender hereunder.
With respect to its participation in the Loans and the Letters of Credit, each
Agent shall have the same rights and powers hereunder as any other Lender and
may exercise the same as though it were not performing the duties and functions
delegated to it hereunder, and the term "Lender" or "Lenders" or any similar
term shall, unless the context clearly otherwise indicates, include each Agent
in its individual capacity. Any Agent and its Affiliates may accept deposits
from, lend money to and generally engage in any kind of banking, trust,
financial advisory or other business with Holdings or any of its Subsidiaries or
Affiliates as if it were not performing the duties specified herein, and may
accept fees and other consideration from Holdings and its Subsidiaries for
services in connection with this Agreement and otherwise without having to
account for the same to Lenders.
9.3 Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness.
Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of Holdings and
its Subsidiaries in connection with the making of the Loans and the issuance of
Letters of Credit hereunder and that it has made and shall continue to make its
own appraisal of the creditworthiness of Holdings and its Subsidiaries. No Agent
shall have any duty or responsibility, either initially or on a continuing
basis, to make any such investigation or any such appraisal on behalf of Lenders
or to provide any Lender with any credit or other information with respect
thereto, whether coming into its possession before the making of the Loans or at
any time or times thereafter, and no Agent shall have any responsibility with
respect to the accuracy of or the completeness of any information provided to
Lenders.
9.4 Right to Indemnity.
Each Lender, in proportion to its Pro Rata Share, severally agrees to
indemnify Administrative Agent, to the extent that Administrative Agent shall
not have been reimbursed by Borrower, for and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including counsel fees and disbursements) or disbursements of any kind
or nature whatsoever which may be imposed on, incurred by or asserted against
Administrative Agent in exercising its powers, rights and remedies or performing
its duties hereunder or under the other Loan Documents or otherwise in its
capacity as Administrative Agent in any way relating to or arising out of this
Agreement or the other Loan Documents; provided that no Lender shall be liable
for any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from
Administrative Agent's gross negligence or willful misconduct.
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9.5 Successor Administrative Agent and Swing Line Lender.
A. Successor Administrative Agent. Administrative Agent may resign at
any time by giving 30 days' prior written notice thereof to Lenders and
Borrower. Upon any such notice of resignation, Requisite Lenders with Borrower's
consent (which may not be unreasonably withheld or delayed) shall have the
right, upon five Business Days' notice to Borrower, to appoint a successor
Administrative Agent. Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor Administrative Agent, that successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent and
the retiring Administrative Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Administrative Agent's
resignation hereunder as Administrative Agent, the provisions of this Section 9
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Agent under this Agreement.
B. Successor Swing Line Lender. Any resignation or removal of
Administrative Agent pursuant to subsection 9.5A shall also constitute the
resignation or removal of Scotiabank or its successor as Swing Line Lender, and
any successor Administrative Agent appointed pursuant to subsection 9.5A shall,
upon its acceptance of such appointment, become the successor Swing Line Lender
for all purposes hereunder. In such event (i) Borrower shall prepay any
outstanding Swing Line Loans made by the retiring or removed Administrative
Agent in its capacity as Swing Line Lender, (ii) upon such prepayment, the
retiring or removed Administrative Agent and Swing Line Lender shall surrender
the Swing Line Note held by it to Borrower for cancellation, and (iii) Borrower
shall issue a new Swing Line Note to the successor Administrative Agent and
Swing Line Lender substantially in the form of Exhibit VI annexed hereto, in the
principal amount of the Swing Line Loan Commitment then in effect and with other
appropriate insertions.
9.6 Collateral Documents and Guaranties.
Each Lender hereby further authorizes Administrative Agent, on behalf
of and for the benefit of Lenders, to enter into each Collateral Document as
secured party and to be the agent for and representative of Lenders under each
Guaranty, and each Lender agrees to be bound by the terms of each Collateral
Document and Guaranty; provided that Administrative Agent shall not (i) enter
into or consent to any material amendment, modification, termination or waiver
of any provision contained in any Collateral Document or Guaranty or (ii)
release any Collateral (except as otherwise expressly permitted or required
pursuant to the terms of this Agreement or the applicable Collateral Document),
in each case without the prior consent of Requisite Lenders (or, if required
pursuant to subsection 10.6, all Lenders); provided further, however, that,
without further
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written consent or authorization from Lenders, Administrative Agent may execute
any documents or instruments necessary to (a) release any Lien encumbering any
item of Collateral that is the subject of an Asset Sale or other sale or
disposition of assets permitted by this Agreement or to which Requisite Lenders
have otherwise consented in accordance with the provisions of this subsection
9.6 or (b) release any Subsidiary Guarantor from the Subsidiary Guaranty if all
of the capital stock of such Subsidiary Guarantor is sold to any Person (other
than an Affiliate of Borrower) pursuant to an Asset Sale or other disposition
permitted hereunder or to which Requisite Lenders have otherwise consented. In
the event Collateral is sold in such an Asset Sale or other transaction,
Administrative Agent may, without further consent or authorization from Lenders,
release the Liens granted under the Collateral Documents on the Collateral that
is the subject of such Asset Sale or other transaction concurrently with the
consummation of such Asset Sale or other transaction; provided that
Administrative Agent shall have received (i) reasonable, and in any event not
less than 30 days', prior written notice of such Asset Sale or such other
transaction from Borrower; (ii) an Officers' Certificate (1) certifying that no
Event of Default or Potential Event of Default shall have occurred and be
continuing as of the date of such release of Collateral, (2) setting forth a
detailed description of the Collateral subject to such Asset Sale or other
transaction, and (3) certifying such Asset Sale or other transaction is
permitted under this Agreement and that all conditions precedent to such Asset
Sale or other transaction under this Agreement have been met; and (iii) evidence
satisfactory to it that Administrative Agent shall have received all Net Cash
Proceeds of such Asset Sale or other transaction, if any, required to be applied
to repay Secured Obligations under this Agreement. Upon payment in full of all
of the Obligations and termination of the Commitments, Administrative Agent
shall release the Liens on such Collateral granted pursuant to the Collateral
Documents. Upon any release of Collateral pursuant to the foregoing,
Administrative Agent shall, at Borrower's expense, execute and deliver such
documents (without recourse or representation or warranty) as reasonably
requested to evidence such release. Anything contained in any of the Loan
Documents to the contrary notwithstanding, Borrower, Administrative Agent and
each Lender hereby agree that (1) no Lender shall have any right individually to
realize upon any of the Collateral under any Collateral Document or to enforce
any Guaranty, it being understood and agreed that all powers, rights and
remedies under the Collateral Documents and the Guaranties may be exercised
solely by Administrative Agent for the benefit of Lenders in accordance with the
terms thereof, and (2) in the event of a foreclosure by Administrative Agent on
any of the Collateral pursuant to a public or private sale, Administrative Agent
or any Lender may be the purchaser of any or all of such Collateral at any such
sale and Administrative Agent, as agent for and representative of Lenders (but
not any Lender or Lenders in its or their respective individual capacities
unless Requisite Lenders shall otherwise agree in writing) shall be entitled,
for the purpose of bidding and making settlement or payment of the purchase
price for all or any portion of the Collateral sold at any such public sale, to
use and
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apply any of the Obligations as a credit on account of the purchase price for
any collateral payable by Administrative Agent at such sale.
SECTION 10.
MISCELLANEOUS
10.1 Assignments and Participations in Loans and Letters of Credit.
A. General. Subject to subsection 10.1B, each Lender shall have the
right at any time to (i) sell, assign or transfer to any Eligible Assignee, or
(ii) sell partici- pations to any Person in, all or any part of its Commitments
or any Loan or Loans made by it or its Letters of Credit or participations
therein or any other interest herein or in any other Obligations owed to it;
provided that no such sale, assignment, transfer or participation shall require
Borrower to file a registration statement with the Securities and Exchange
Commission or apply to qualify such sale, assignment, transfer or participation
under the securities laws of any state; provided further, that no such sale,
assignment or transfer described in clause (i) above shall be effective unless
and until an Assignment Agreement effecting such sale, assignment or transfer
shall have been accepted by Administrative Agent and recorded in the Register as
provided in subsection 10.1B(ii); provided, further that no such sale,
assignment, transfer or participation of any Letter of Credit or any
participation therein may be made separately from a sale, assignment, transfer
or participation of a corresponding interest in the Revolving Loan Commitment
and the Revolving Loans of the Lender effecting such sale, assignment, transfer
or participation; and provided further, that, anything contained herein to the
contrary notwithstanding, the Swing Line Loan Commitment and the Swing Line
Loans of Swing Line Lender may not be sold, assigned or transferred as described
in clause (i) above to any Person other than a successor Administrative Agent
and Swing Line Lender to the extent contemplated by subsection 9.5. Except as
otherwise provided in this subsection 10.1, no Lender shall, as between Borrower
and such Lender, be relieved of any of its obligations hereunder as a result of
any sale, assignment or transfer of, or any granting of participations in, all
or any part of its Commitments or the Loans, the Letters of Credit or
participations therein, or the other Obligations owed to such Lender.
B. Assignments.
(i) Amounts and Terms of Assignments. Each Commitment, Loan,
Letter of Credit or participation therein, or other Obligation may (a)
be assigned in any amount to another Lender, or to an Affiliate of the
assigning Lender or another Lender, with the giving of notice to
Borrower and Administrative Agent or (b) be assigned in an aggregate
amount of not less than $5,000,000 (or such lesser amount as shall
constitute the aggregate amount of the Commitments,
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Loans, Letters of Credit and participations therein, and other
Obligations of the assigning Lender) to any other Eligible Assignee
with the consent of Borrower and, in the case of assignments by Lenders
other than Xxxxxxx Xxxxx Credit Partners L.P., Administrative Agent
(which consent of Borrower and Administrative Agent shall not be
unreasonably withheld or delayed). To the extent of any such assignment
in accordance with either clause (a) or (b) above, the assigning Lender
shall be relieved of its obligations with respect to its Commitments,
Loans, Letters of Credit or participations therein, or other
Obligations or the portion thereof so assigned. The parties to each
such assignment shall execute and deliver to Administrative Agent, for
its acceptance and recording in the Register, an Assignment Agreement,
together with a processing and recordation fee of $3,000 and such
forms, certificates or other evidence, if any, with respect to United
States federal income tax withholding matters as the assignee under
such Assignment Agreement may be required to deliver to Administrative
Agent pursuant to subsection 2.7B(iii)(a). Upon such execution,
delivery, acceptance and recordation, from and after the effective date
specified in such Assignment Agreement, (1) 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
Agreement, shall have the rights and obligations of a Lender hereunder
and (2) the assigning Lender thereunder shall, to the extent that
rights and obligations hereunder have been assigned by it pursuant to
such Assignment Agreement, relinquish its rights (other than any rights
which survive the termination of this Agreement under subsection 10.9B)
and be released from its obligations under this Agreement (and, in the
case of an Assignment Agreement covering all or the remaining portion
of an assigning Lender's rights and obligations under this Agreement,
such Lender shall cease to be a party hereto; provided that, anything
contained in any of the Loan Documents to the contrary notwithstanding,
if such Lender is Issuing Lender with respect to any outstanding
Letters of Credit such Lender shall continue to have all rights and
obligations of Issuing Lender with respect to such Letters of Credit
until the cancellation or expiration of such Letters of Credit and the
reimbursement of any amounts drawn thereunder). The Commitments
hereunder shall be modified to reflect the Commitment of such assignee
and any remaining Commitment of such assigning Lender and, if any such
assignment occurs after the issuance of the Notes hereunder, the
assigning Lender shall, upon the effectiveness of such assignment or as
promptly thereafter as practicable, surrender its applicable Notes to
Administrative Agent for cancellation, and thereupon new Notes shall be
issued to the assignee and/or to the assigning Lender, substantially in
the form of Exhibit IV or Exhibit V annexed hereto or in the form of
Additional Term Notes, as the case may be, with appropriate insertions,
to reflect the new Commitments and/or outstanding AXELs or Additional
Term Loans of the assignee and/or the assigning Lender.
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(ii) Acceptance by Administrative Agent; Recordation in
Register. Upon its receipt of an Assignment Agreement executed by an
assigning Lender and an assignee representing that it is an Eligible
Assignee, together with the processing and recordation fee referred to
in subsection 10.1B(i) and any forms, certificates or other evidence
with respect to United States federal income tax withholding matters
that such assignee may be required to deliver to Administrative Agent
pursuant to subsection 2.7B(iii)(a), Administrative Agent shall, if
Administrative Agent and Borrower have consented to the assignment
evidenced thereby (in each case to the extent such consent is required
pursuant to subsection 10.1B(i)), (a) accept such Assignment Agreement
by executing a counterpart thereof as provided therein (which
acceptance shall evidence any required consent of Administrative Agent
to such assignment), (b) record the information contained therein in
the Register, and (c) give prompt notice thereof to Borrower.
Administrative Agent shall maintain a copy of each Assignment Agreement
delivered to and accepted by it as provided in this subsection
10.1B(ii).
C. Participations. The holder of any participation, other than an
Affiliate of the Lender granting such participation, shall not be entitled to
require such Lender to take or omit to take any action hereunder except action
directly affecting (i) the extension of the scheduled final maturity date of any
Loan allocated to such participation or (ii) a reduction of the principal amount
of or the rate of interest payable on any Loan allocated to such participation,
and all amounts payable by Borrower hereunder (includ- ing amounts payable to
such Lender pursuant to subsections 2.6D, 2.7 and 3.6) shall be determined as if
such Lender had not sold such participation. Borrower and each Lender hereby
acknowledge and agree that, solely for purposes of subsections 10.4 and 10.5,
(a) any participation will give rise to a direct obligation of Borrower to the
participant and (b) the participant shall be considered to be a "Lender".
D. Assignments to Federal Reserve Banks. In addition to the assignments
and participations permitted under the foregoing provisions of this subsection
10.1, any Lender may assign and pledge all or any portion of its Loans, the
other Obligations owed to such Lender, and its Notes to any Federal Reserve Bank
as collateral security pursuant to Regulation A of the Board of Governors of the
Federal Reserve System and any operating circular issued by such Federal Reserve
Bank; provided that (i) no Lender shall, as between Borrower and such Lender, be
relieved of any of its obligations hereunder as a result of any such assignment
and pledge and (ii) in no event shall such Federal Reserve Bank be considered to
be a "Lender" or be entitled to require the assigning Lender to take or omit to
take any action hereunder.
E. Information. Each Lender may furnish any information concerning
Holdings and its Subsidiaries in the possession of that Lender from time to
time to
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assignees and participants (including prospective assignees and participants),
subject to subsection 10.19.
F. Representations of Lenders. Each Lender listed on the signature
pages hereof hereby represents and warrants (i) that it is an Eligible Assignee
described in clause (i) of the definition thereof; (ii) that it has experience
and expertise in the making of loans such as the Loans; and (iii) that it will
make its Loans for its own account in the ordinary course of its business and in
accordance with all applicable laws). Each Lender that becomes a party hereto
pursuant to an Assignment Agreement shall be deemed to agree that the
representations and warranties of such Lender contained in Section 2(c) of such
Assignment Agreement are incorporated herein by this reference.
10.2 Expenses.
Whether or not the transactions contemplated hereby shall be
consummated, Borrower agrees to pay promptly (i) all the actual and reasonable
costs and expenses of Administrative Agent and Arranging Agent in connection
with the preparation of the Loan Documents and any consents, amendments, waivers
or other modifications thereto; (ii) all the costs of furnishing all opinions by
counsel for Borrower (including any opinions requested by Lenders as to any
legal matters arising hereunder) and of Borrower's performance of and compliance
with all agreements and conditions on its part to be performed or complied with
under this Agreement and the other Loan Documents including with respect to
confirming compliance with environmental, insurance and solvency requirements;
(iii) the reasonable fees, expenses and disbursements of counsel to Arranging
Agent and counsel to Administrative Agent in connection with the negotiation,
preparation, execution and administration of the Loan Documents and any
consents, amendments, waivers or other modifications thereto and any other
documents or matters requested by Borrower; (iv) all the actual costs and
reasonable expenses of creating and perfecting Liens in favor of Administrative
Agent on behalf of Lenders pursuant to any Collateral Document, including filing
and recording fees, expenses and taxes, stamp or documentary taxes, search fees,
and reasonable fees, expenses and disbursements of counsel to Arranging Agent
and counsel to Administrative Agent and of counsel providing any opinions that
Arranging Agent, Administrative Agent or Requisite Lenders may request in
respect of the Collateral Documents or the Liens created pursuant thereto; (v)
all the actual costs and reasonable expenses (including the reasonable fees,
expenses and disbursements of any auditors, accountants, appraisers,
environmental consultants or any other consultants, advisors and agents employed
or retained by Administrative Agent and its counsel) in connection with the
valuation (upon the occurrence and during the continuance of an Event of
Default), custody or preservation of any of the Collateral; (vi) all other
actual and reasonable costs and expenses incurred by Syndication Agent,
Arranging Agent or Administrative Agent in connection with the syndication of
the Commitments and the negotiation, preparation and
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execution of the Loan Documents and any consents, amendments, waivers or other
modifications thereto and the transactions contemplated thereby; and (vii) after
the occurrence and during the continuance of an Event of Default, all costs and
expenses, including reasonable attorneys' fees and costs of settlement, incurred
by Arranging Agent, Administrative Agent and Lenders in enforcing any
Obligations of or in collecting any payments due from any Loan Party hereunder
or under the other Loan Documents by reason of such Event of Default (including
in connection with the sale of, collection from, or other realization upon any
of the Collateral or the enforcement of the Guaranties) or in connection with
any refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a "work-out" or pursuant to any insolvency or
bankruptcy proceedings.
10.3 Indemnity.
In addition to the payment of expenses pursuant to subsection 10.2,
whether or not the transactions contemplated hereby shall be consummated,
Borrower agrees to indemnify, pay and hold harmless Agents and Lenders, and the
officers, partners, directors, trustees, employees, agents and affiliates of any
of Agents and Lenders (collectively called the "Indemnitees"), from and against
any and all Indemnified Liabilities (as hereinafter defined); provided that
Borrower shall not have any obligation to any Indemnitee hereunder with respect
to any Indemnified Liabilities to the extent such Indemnified Liabilities arise
solely from the gross negligence, willful misconduct or bad faith of that
Indemnitee.
As used herein, "Indemnified Liabilities" means, collectively, any and
all liabilities, obligations, losses, damages (including natural resource
damages), penalties, actions, judgments, suits, claims (including Environmental
Claims), costs (including the costs of any investigation, study, sampling,
testing, abatement, cleanup, removal, remediation or other response action
necessary to remove, remediate, clean up or xxxxx any Hazardous Materials
Activity), expenses and disbursements of any kind or nature whatsoever
(including the reasonable fees and disbursements of counsel for Indemnitees in
connection with any investigative, administrative or judicial proceeding
commenced or threatened by any Person, whether or not any such Indemnitee shall
be designated as a party or a potential party thereto, and any fees or expenses
incurred by Indemnitees in enforcing this indemnity), whether direct, indirect
or consequential and whether based on any federal, state or foreign laws,
statutes, rules or regulations (including securities and commercial laws,
statutes, rules or regulations and Environmental Laws), on common law or
equitable cause or on contract or otherwise, that may be imposed on, incurred
by, or asserted against any such Indemnitee, in any manner relating to or
arising out of (i) this Agreement or the other Loan Documents or the Related
Agreements or the transactions contemplated hereby or thereby (including
Lenders' agreement to make the Loans hereunder or the use or intended use of the
proceeds thereof or the issuance of
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Letters of Credit hereunder or the use or intended use of any thereof, or any
enforcement of any of the Loan Documents (including any sale of, collection
from, or other realization upon any of the Collateral or the enforcement of the
Guaranties)), (ii) the statements contained in the commitment letter delivered
by any Lender to Borrower with respect thereto, or (iii) any Environmental Claim
or any Hazardous Materials Activity relating to or arising from, directly or
indirectly, any past or present activity, operation, land ownership, or practice
of Borrower or any of its Subsidiaries.
To the extent that the undertakings to defend, indemnify, pay and hold
harmless set forth in this subsection 10.3 may be unenforceable in whole or in
part because they are violative of any law or public policy, Borrower shall
contribute the maximum portion that it is permitted to pay and satisfy under
applicable law to the payment and satisfaction of all Indemnified Liabilities
incurred by Indemnitees or any of them.
10.4 Set-Off; Security Interest in Deposit Accounts.
In addition to any rights now or hereafter granted under applicable law
and not by way of limitation of any such rights, upon the occurrence of any
Event of Default each Lender is hereby authorized by Borrower at any time or
from time to time, without notice to Borrower or to any other Person, any such
notice being hereby expressly waived, to set off and to appropriate and to apply
any and all deposits (general or special, including Indebtedness evidenced by
certificates of deposit, whether matured or unmatured, but not including trust
accounts) and any other Indebtedness at any time held or owing by that Lender to
or for the credit or the account of Borrower against and on account of the
obligations and liabilities of Borrower to that Lender under this Agreement, the
Letters of Credit and participations therein and the other Loan Documents,
including all claims of any nature or description arising out of or connected
with this Agreement, the Letters of Credit and participations therein or any
other Loan Document, irrespective of whether or not (i) that Lender shall have
made any demand hereunder or (ii) the principal of or the interest on the Loans
or any amounts in respect of the Letters of Credit or any other amounts due
hereunder shall have become due and payable pursuant to Section 8 and although
said obligations and liabilities, or any of them, may be contingent or
unmatured. Notwithstanding anything to the contrary contained in this subsection
10.4, no Lender shall exercise any such right of set-off without the prior
consent of Administrative Agent or Requisite Lenders so long as the Obligations
shall be secured by any real property located in the State of California, it
being understood and agreed, however, that this sentence is for the sole benefit
of Lenders and (notwithstanding anything to the contrary contained in subsection
10.6) may be amended, modified or waived in any respect by Requisite Lenders
without the requirement of prior notice to or consent by any Loan Party and does
not constitute a waiver of any right against any Loan Party or against any
Collateral.
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10.5 Ratable Sharing.
Lenders hereby agree among themselves that if any of them shall,
whether by voluntary payment (other than a voluntary prepayment of Loans made
and applied in accordance with the terms of this Agreement), by realization upon
security, through the exercise of any right of set-off or banker's lien, by
counterclaim or cross action or by the enforcement of any right under the Loan
Documents or otherwise, or as adequate protection of a deposit treated as Cash
collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of Letters of Credit, fees and other amounts then due and owing to that
Lender hereunder or under the other Loan Documents (collectively, the "Aggregate
Amounts Due" to such Lender) which is greater than the proportion received by
any other Lender in respect of the Aggregate Amounts Due to such other Lender,
then the Lender receiving such proportionately greater payment shall (i) notify
Administrative Agent and each other Lender of the receipt of such payment and
(ii) apply a portion of such payment to purchase participations (which it shall
be deemed to have purchased from each seller of a participation simultaneously
upon the receipt by such seller of its portion of such payment) in the Aggregate
Amounts Due to the other Lenders so that all such recoveries of Aggregate
Amounts Due shall be shared by all Lenders in proportion to the Aggregate
Amounts Due to them; provided that if all or part of such proportionately
greater payment received by such purchasing Lender is thereafter recovered from
such Lender upon the bankruptcy or reorganization of Borrower or otherwise,
those purchases shall be rescinded and the purchase prices paid for such
participations shall be returned to such purchasing Lender ratably to the extent
of such recovery, but without interest. Borrower expressly consents to the
foregoing arrangement and agrees that any holder of a participation so purchased
may exercise any and all rights of banker's lien, set-off or counterclaim with
respect to any and all monies owing by Borrower to that holder with respect
thereto as fully as if that holder were owed the amount of the participation
held by that holder.
10.6 Amendments and Waivers.
A. Except to the extent set forth in subsection 10.6C, no amendment,
modification, termination or waiver of any provision of this Agreement or of the
Notes, and no consent to any departure by Holdings or Borrower therefrom, shall
in any event be effective without the written concurrence of Requisite Lenders;
provided that any such amendment, modification, termination, waiver or consent
which: increases the amount of any of the Commitments or reduces the principal
amount of any of the Loans; increases the maximum amount of Letters of Credit;
changes in any manner the definition of "Class" or the definition of "Pro Rata
Share" or the definition of "Requisite Class Lenders" or the definition of
"Requisite Lenders"; changes in any manner any provision of this Agreement
which, by its terms, expressly requires the approval or
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concurrence of all Lenders; postpones the scheduled final maturity date; changes
any interim scheduled amortization payments on the AXELs or the Additional Term
Loans; postpones the date on which any interest or any fees are payable;
decreases the interest rate borne by any of the Loans (other than any waiver of
any increase in the interest rate applicable to any of the Loans pursuant to
subsection 2.2E) or the amount of any fees payable hereunder; increases the
maximum duration of Interest Periods permitted hereunder; reduces the amount or
postpones the due date of any amount payable in respect of, or increases the
maximum term hereunder of, any Letter of Credit; changes in any manner the
obligations of Lenders relating to the purchase of participations in Letters of
Credit; releases any Lien granted in favor of Administrative Agent with respect
to substantially all of the Collateral; releases Holdings from its obligations
under the Holdings Guaranty or releases any Subsidiary Guarantor from its
obligations under the Subsidiary Guaranty, in each case other than in accordance
with the terms of the Loan Documents; or changes in any manner the provisions
contained in subsection 8.1 or this subsection 10.6 shall be effective only if
evidenced by a writing signed by or on behalf of each Lender affected thereby.
In addition, (i) any amendment, modification, termination or waiver of any of
the provisions contained in Section 4 shall be effective only if evidenced by a
writing signed by or on behalf of Administrative Agent and Requisite Lenders,
(ii) no amendment, modification, termination or waiver of any provision of any
Note shall be effective without the written concurrence of the Lender which is
the holder of that Note, (iii) no amendment, modification, termination or waiver
of any provision of subsection 2.1A(iii) or of any other provision of this
Agreement relating to the Swing Line Loan Commitment or the Swing Line Loans
shall be effective without the written concurrence of Swing Line Lender, (iv) no
amendment, modification, termination or waiver of any provision of Section 9 or
of any other provision of this Agreement which, by its terms, expressly requires
the approval or concurrence of any Agent shall be effective without the written
concurrence of such Agent and (v) no amendment, modification, termination or
waiver of any provision disproportionately and adversely affecting the
obligation of any Loan Party to make payments to the holders of any Class shall
be effective without the written concurrence of the applicable Requisite Class
Lenders of such Class. Administrative Agent may, but shall have no obligation
to, with the concurrence of any Lender, execute amendments, modifications,
waivers or consents on behalf of that Lender. Any waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
it was given. No notice to or demand on Borrower in any case shall entitle
Borrower to any other or further notice or demand in similar or other
circumstances. Any amendment, modification, termination, waiver or consent
effected in accordance with this subsection 10.6 shall be binding upon each
Lender at the time outstanding, each future Lender and, if signed by Borrower,
on Borrower.
B. If, in connection with any proposed change, waiver, discharge or
termination to any of the provision of this Agreement as contemplated by the
proviso in
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the first sentence of subsection 10.6A, the consent of Requisite Lenders is
obtained but consent of one or more of such other Lenders whose consent is
required is not obtained, then Borrower may, so long as all non-consenting
Lenders are so treated, elect to terminate such Lender as a party to this
Agreement; provided that, concurrently with such termination, (i) Borrower shall
pay that Lender all principal, interest and fees and other amounts owed to such
Lender through such date of termination, (ii) another financial institution
satisfactory to Borrower and Administrative Agent (or if Administrative Agent is
also the Lender to be terminated, the successor Administrative Agent) shall
agree, as of such date, to become a Lender for all purposes under this Agreement
(whether by assignment or amendment) and to assume all obligations of the Lender
to be terminated as of such date, and (iii) all documents and supporting
materials necessary, in the judgment of Administrative Agent (or if
Administrative Agent is also the Lender to be terminated, the successor
Administrative Agent), to evidence the substitution of such Lender shall have
been received and approved by Administrative Agent as of such date.
C. Notwithstanding anything to the contrary contained in this Agreement
(including in subsection 10.6A), Lenders have granted Borrower the right to
borrow up to an additional $25,000,000 of term loans under this Agreement (the
"Additional Term Loans") from one or more Lenders (and/or Eligible Assignees
that will become Lenders), which Additional Term Loans may be made as additional
AXELs or as additional tranche of term loans, provided however, (I) Borrower can
obtain commitments for such Additional Term Loans at any time without the
consent of Lenders, and (II) Borrower may incur such Additional Term Loans only
so long as (i) the ratio of (x) Total Senior Debt at the time of incurrence of
the Additional Term Loans to (y) Consolidated Adjusted EBITDA for the
four-Fiscal Quarter period then last ended does not exceed 4.50:1.00, (ii) the
ratio (x) Consolidated Adjusted EBITDA to (y) Consolidated Cash Interest Expense
for the four-Fiscal Quarter period then last ended is not less than 1.50:1.00
(with the calculation of Consolidated Adjusted EBITDA and Consolidated Cash
Interest Expense for purposes of foregoing clauses (i) and (ii) to be made on a
pro forma basis (including by giving effect to Pro Forma Projected EBITDA)
assuming that the incurrence of such Additional Term Loans (and the use of the
proceeds thereof) had occurred on the first day of such four-Fiscal Quarter
period and had remained outstanding throughout such period and that the interest
rate on such Additional Term Loans was the effective interest rate on the date
of incurrence thereof, and with all such calculations to be in form and
substance satisfactory to Administrative Agent), (iii) no Event of Default or
Potential Event of Default then exists or would result from the incurrence of
the Additional Term Loans, (iv) the Additional Term Loans shall (x) mature on
November 1, 2003, (y) amortize ratably with the AXELs (with each scheduled
installment of principal of the Additional Term Loans being in the same
proportion as each remaining installment of the AXELs bears to the AXEL Exposure
as determined on the date of the making of any Additional Term Loans) and (z) be
subject to mandatory
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and voluntary repayments and prepayments on the same basis as AXELs at such
time, provided that the Applicable Margin on the Additional Term Loans shall be
the margin agreed upon at such time by Borrower and Lenders providing the
Additional Term Loans, (v) the Additional Term Loans shall be secured by the
Collateral on a pari passu basis with the then existing Loans and Letters of
Credit and guaranteed by Holdings and the Subsidiary Guarantors pursuant to the
applicable Guaranty on the same basis as the then existing Loans and Letters of
Credit, and (vi) no Lender shall be required to provide any Additional Term
Loans without the consent of such Lender (which consent may be withheld or given
in such Lender's sole discretion). The extension of the Additional Term Loans
shall be effected in coordination with Administrative Agent and shall be
accomplished through the execution and delivery by Borrower, Administrative
Agent and Lender or Lenders providing such Additional Term Loans of an
Acknowledgement of Additional Term Loans and, to the extent necessary, through
technical amendments and modifications to this Agreement and the other Loan
Documents which have been agreed to by Administrative Agent to preserve the
intent of the parties hereto with respect to the then existing Obligations and
to provide for the Additional Term Loans, and so long as the provisions of this
subsection 10.6C are complied with, Lenders agree that they shall promptly
execute and deliver such amendments and modifications.
10.7 Independence of Covenants.
All covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or would otherwise be within
the limitations of, another covenant shall not avoid the occurrence of an Event
of Default or Potential Event of Default if such action is taken or condition
exists.
10.8 Notices.
Unless otherwise specifically provided herein, any notice or other
communication herein required or permitted to be given shall be in writing and
may be personally served or sent by telefacsimile or United States mail or
courier service and shall be deemed to have been given when delivered in person
or by courier service or upon receipt if sent by telefacsimile or by the United
States mail with postage prepaid and properly addressed. For the purposes
hereof, the address of each party hereto shall be as set forth under such
party's name on the signature pages hereof or (i) as to Borrower and
Administrative Agent, such other address as shall be designated by such Person
in a written notice delivered to the other parties hereto and (ii) as to each
other party, such other address as shall be designated by such party in a
written notice delivered to Administrative Agent and Borrower.
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10.9 Survival of Representations, Warranties and Agreements.
A. All representations, warranties and agreements made herein shall
survive the execution and delivery of this Agreement and the making of the Loans
and the issuance of the Letters of Credit hereunder.
B. Notwithstanding anything in this Agreement or implied by law to the
contrary, the agreements of Borrower set forth in subsections 2.6D, 2.7, 3.5A,
3.6, 10.2, 10.3 and 10.4 and the agreements of Lenders set forth in subsections
9.2C, 9.4 and 10.5 shall survive the payment of the Loans, the cancellation or
expiration of the Letters of Credit and the reimbursement of any amounts drawn
thereunder, and the termination of this Agreement.
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative.
No failure or delay on the part of Administrative Agent or any Lender
in the exercise of any power, right or privilege hereunder or under any other
Loan Document shall impair such power, right or privilege or be construed to be
a waiver of any default or acquiescence therein, nor shall any single or partial
exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege. All rights and
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
10.11 Marshalling; Payments Set Aside.
Neither Administrative Agent nor any Lender shall be under any
obligation to marshal any assets in favor of Borrower or any other party or
against or in payment of any or all of the Obligations. To the extent that
Borrower makes a payment or payments to Administrative Agent or Lenders (or to
Administrative Agent for the benefit of Lenders), or Administrative Agent or
Lenders enforce any security interests or exercise their rights of setoff, and
such payment or payments or the proceeds of such enforcement or setoff or any
part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any bankruptcy law, any other state or federal law, common
law or any equitable cause, then, to the extent of such recovery, the obligation
or part thereof originally intended to be satisfied, and all Liens, rights and
remedies therefor or related thereto, shall be revived and continued in full
force and effect as if such payment or payments had not been made or such
enforcement or setoff had not occurred.
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10.12 Severability.
In case any provision in or obligation under this Agreement or the
Notes shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
10.13 Obligations Several; Independent Nature of Lenders' Rights.
The obligations of Lenders hereunder are several and no Lender shall be
responsible for the obligations or Commitments of any other Lender hereunder.
Nothing contained herein or in any other Loan Document, and no action taken by
Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders as a
partnership, an association, a joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights arising out of this Agreement and it shall not be necessary for any other
Lender to be joined as an additional party in any proceeding for such purpose.
10.14 Headings.
Section and subsection headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
10.15 Applicable Law.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES.
10.16 Successors and Assigns.
This Agreement shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of the parties
hereto and the successors and assigns of Lenders (it being understood that
Lenders' rights of assignment are subject to subsection 10.1). Neither Holdings
nor Borrower's rights or obligations hereunder nor any interest therein may be
assigned or delegated by Holdings or Borrower without the prior written consent
of all Lenders.
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10.17 Consent to Jurisdiction and Service of Process.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST HOLDINGS OR BORROWER ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY
OBLIGATIONS THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION IN XXX XXXXX, XXXXXX XXX XXXX XX XXX XXXX. BY EXECUTING
AND DELIVERING THIS AGREEMENT, EACH OF HOLDINGS AND BORROWER, FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (I) ACCEPTS GENERALLY AND
UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (II)
WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (III) AGREES THAT SERVICE OF ALL
PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO HOLDINGS OR BORROWER AT ITS ADDRESS
PROVIDED IN ACCORDANCE WITH SUBSECTION 10.8; (IV) AGREES THAT SERVICE AS
PROVIDED IN CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION
OVER HOLDINGS OR BORROWER IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND
OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; (V) AGREES
THAT LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR TO BRING PROCEEDINGS AGAINST HOLDINGS OR BORROWER IN THE COURTS OF ANY
OTHER JURISDICTION; AND (VI) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 10.17
RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE
FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1402
OR OTHERWISE.
10.18 Waiver of Jury Trial.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE
LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. The scope of this waiver
is intended to be all-encompassing of any and all disputes that may be filed
in any court and that relate to the subject matter of this transaction,
including contract claims, tort claims, breach of duty claims and all other
common law and statutory claims. Each party hereto acknowledges that this waiver
is a material inducement to enter into a business relationship, that each
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has already relied on this waiver in entering into this Agreement, and that each
will continue to rely on this waiver in their related future dealings. Each
party hereto further warrants and represents that it has reviewed this waiver
with its legal counsel and that it knowingly and voluntarily waives its jury
trial rights following consultation with legal counsel. THIS WAIVER IS
IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING
(OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SUBSECTION
10.18 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY
TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR
AGREEMENTS RELATING TO THE LOANS MADE HEREUNDER. In the event of litigation,
this Agreement may be filed as a written consent to a trial by the court.
10.19 Confidentiality.
Each Lender shall hold all non-public information obtained pursuant to
the requirements of this Agreement which has been identified as confidential by
Borrower in accordance with such Lender's customary procedures for handling
confidential information of this nature and in accordance with prudent lending
or investing practices, it being understood and agreed by Borrower that in any
event a Lender shall be permitted to disclose such information (a) to Affiliates
of such Lender or disclosures reasonably required by any bona fide assignee,
transferee or participant in connection with the contemplated assignment or
transfer by such Lender of its Loan or any participations therein, (b) to such
of its respective officers, directors, trustees, employees, agents, affiliates
and representatives as need to know such information, (c) to the extent
requested by any regulatory authority, (d) to the extent otherwise required by
applicable laws and regulations or by any subpoena or similar legal process or
disclosures required by the National Association of Insurance Commissioners, (e)
in connection with any suit, action or proceeding relating to the enforcement of
its rights hereunder or under the other Loan Documents or (f) to the extent such
information (i) publicly available other than as a result of a breach of this
Section 10.19 or (ii) becomes available to an Agent or any Lender on a
nonconfidential basis from a source other than Borrower.
10.20 Maximum Amount.
A. It is the intention of Borrower and Lenders to conform strictly to
the usury and similar laws relating to interest from time to time in force, and
all agreements between Borrower, Administrative Agent and Lenders, whether now
existing or hereafter arising and whether oral or written, are hereby expressly
limited so that in no contingency or event whatsoever, whether by acceleration
of maturity hereof or otherwise, shall
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the amount paid or agreed to be paid in the aggregate to Lenders or to
Administrative Agent on behalf of Lenders as interest hereunder or under the
other Loan Documents or in any other security agreement given to secure the
Obligations, or in any other document evidencing, securing or pertaining to the
Indebtedness evidenced hereby or thereby, exceed the maximum amount permissible
under applicable usury or such other laws (the "Maximum Amount"). If under any
circumstances whatsoever fulfillment of any provision hereof, or of any of the
other Loan Documents, at the time performance of such provision shall be due,
shall involve exceeding the Maximum Amount, then, ipso facto, the obligation to
be fulfilled shall be reduced to the Maximum Amount. For the purposes of
calculating the actual amount of interest paid and/or payable hereunder in
respect of laws pertaining to usury or such other laws, all sums paid or agreed
to be paid to Lenders for the use, forbearance or detention of the Indebtedness
of Borrower evidenced hereby, outstanding from time to time shall, to the extent
permitted by applicable law, be amortized, pro rated, allocated and spread from
the date of disbursement of the proceeds of the Loans until payment in full of
all of such Indebtedness, so that the actual rate of interest on account of such
Indebtedness is uniform throughout the term hereof. The terms and provisions of
this subsection shall control and supersede every other provision of all
agreements between Borrower, Administrative Agent and Lenders.
B. If under any circumstances Lenders shall receive an amount which
would exceed the Maximum Amount, such amount shall be deemed a payment in
reduction of the principal amount of the Loans and shall be treated as a
voluntary prepayment under subsection 2.4B(i), and shall be so applied in
accordance with subsection 2.4B(iv) hereof, or if such amount exceeds the unpaid
balance of the Loans and any other Indebtedness of Borrower in favor of Lenders,
the excess shall be deemed to have been a payment made by mistake and shall be
refunded to Borrower.
10.21 Counterparts; Effectiveness.
This Agreement and any amendments, waivers, consents or supplements
hereto or in connection herewith may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document. This Agreement shall become effective upon the execution of a
counterpart hereof by each of the parties hereto and receipt by Borrower and
Administrative Agent of written or telephonic notification of such execution and
authorization of delivery thereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
BORROWER:
ROSE HILLS COMPANY
By: /s/ Xxxxxxx X. Xxxxxxxxx
----------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title:
Notice Address:
0000 Xxxxx Xxxxxxx Xxxx Xxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to each of the following:
The Blackstone Group
31st Floor
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
The Xxxxxx Group Inc.
0000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx Xxxxxxxx
X0X 0X0 Xxxxxx
Attention: Chief Financial Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
GUARANTOR:
ROSE HILLS HOLDINGS CORP.
By: /s/ Xxxxxxx X. Xxxxxxxxx
---------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title:
Notice Address:
0000 Xxxxx Xxxxxxx Xxxx Xxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to each of the following:
The Blackstone Group
31st Floor
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
The Xxxxxx Group Inc.
0000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx Xxxxxxxx
X0X 0X0 Xxxxxx
Attention: Chief Financial Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-2
AGENTS AND LENDERS:
XXXXXXX, XXXXX & CO.,
as Syndication Agent and as
Arranging Agent
By: /s/ XXXXXXX, SACHS & CO.,
---------------------------------
Notice Address:
Xxxxxxx, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-3
XXXXXXX XXXXX CREDIT PARTNERS L.P.
By: /s/ Xxxxxx X. Xxxxx
--------------------------------
Notice Address:
Xxxxxxx Xxxxx Credit Partners L.P.
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxxx Sachs Credit Partners L.P.
c/o Goldman, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
X-0
XXX XXXX XX XXXX XXXXXX,
Individually and as Administrative
Agent
By: /s/ Xxxxx X. Xxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxx
Title:
Notice Address:
The Bank of Nova Scotia
New York Agency
Xxx Xxxxxxx Xxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-5
XXXXXXX XXXXX SENIOR FLOATING RATE
FUND, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------
Name:
Title:
S-6
SENIOR DEBT PORTFOLIO, INC.
By:
------------------------------
Name:
Title:
S-7
BANQUE INDOSUEZ
By: /s/ Xxxxxx Xxxxxxx
------------------------------
Name: Xxxxxx Xxxxxxx
Title:
Notice Address:
Bank Indosuez
Grand Cayman Island Branch
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-8
NEW YORK LIFE INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title:
Notice Address:
New York Life Insurance
00 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Investment
Facsimile: (000) 000-0000
S-9
PRIME INCOME TRUST
By:
-----------------------------
Name:
Title:
Notice Address:
Prime Income Trust
c/o Xxxx Xxxxxx InterCapital
2 World Trade Center --72nd Fl.
Xxx Xxxx, Xxx Xxxx 00000
Attention: April Chrysostomas
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-10
SCHEDULE 2.1
LENDERS' COMMITMENTS AND PRO RATA SHARES
----------------------------------------
Revolving
AXEL Loan
Lender Commitment Commitment
------ ---------- ----------
GSCP $32,000,000.00 $0
The Bank of
Nova Scotia 5,000,000.00 25,000,000.00
Xxxxxxx Xxxxx Senior
Floating Rate Fund, Inc. 7,000,000.00 0
Prime Income Trust 10,000,000.00 0
Banque Indosuez 10,000,000.00 0
New York Life 11,000,000.00 0
Total: $75,000,000.00 $25,000,000.00
============== ==============
