EXHIBIT 10.1
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EXHIBIT 10.1
$450,000,000
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
AMONG
TEXAS INDUSTRIES, INC.
CERTAIN LENDERS,
CERTAIN CO-AGENTS
AND
NATIONSBANK, N.A.,
AS ADMINISTRATIVE LENDER
March 10, 1999
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NATIONSBANC XXXXXXXXXX SECURITIES LLC, AS LEAD ARRANGER
TABLE OF CONTENTS
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Page
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ARTICLE 1
Definitions
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Section 1.1 Defined Terms............................................................... 1
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Section 1.2 Amendments and Renewals..................................................... 19
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Section 1.3 Construction................................................................ 19
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ARTICLE 2
Advances
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Section 2.1 The Advances............................................................... 19
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Section 2.2 Manner of Borrowing and Disbursement....................................... 20
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Section 2.3 Interest................................................................... 24
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Section 2.4 Fees....................................................................... 25
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Section 2.5 Prepayment................................................................. 26
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Section 2.6 Reduction of Commitment.................................................... 27
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Section 2.7 Non-Receipt of Funds by the Administrative Lender.......................... 28
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Section 2.8 Payment of Principal of Advances........................................... 28
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Section 2.9 Reimbursement.............................................................. 29
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Section 2.10 Manner of Payment.......................................................... 29
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Section 2.11 LIBOR Lending Offices...................................................... 30
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Section 2.12 Sharing of Payments........................................................ 30
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Section 2.13 Calculation of LIBOR Rate.................................................. 31
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Section 2.14 Booking Loans.............................................................. 31
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Section 2.15 Taxes...................................................................... 31
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Section 2.16 Letters of Credit.......................................................... 34
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ARTICLE 3
Conditions Precedent
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Section 3.1 Conditions Precedent to the Initial Advance and the Letters of Credit...... 40
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Section 3.2 Conditions Precedent to All Advances and Letters of Credit................. 41
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ARTICLE 4
Representations and Warranties
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Section 4.1 Representations and Warranties............................................. 43
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Section 4.2 Survival of Representations and Warranties, etc............................ 49
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ARTICLE 5
General Covenants
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Section 5.1 Preservation of Existence and Similar Matters.............................. 50
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Section 5.2 Business; Compliance with Applicable Law................................... 50
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Section 5.3 Maintenance of Properties.................................................. 50
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Section 5.4 Accounting Methods and Financial Records................................... 50
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Section 5.5 Insurance.................................................................. 50
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Section 5.6 Payment of Taxes and Claims................................................ 51
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Section 5.7 Visits and Inspections..................................................... 51
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Section 5.8 Payment of Indebtedness.................................................... 51
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Section 5.9 Use of Proceeds............................................................ 51
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Section 5.10 Indemnity.................................................................. 51
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Section 5.11 Year 2000 Compliance....................................................... 53
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ARTICLE 6
Information Covenants
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Section 6.1 Quarterly Financial Statements and Information.............................. 53
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Section 6.2 Annual Financial Statements and Information; Certificate of No Default...... 54
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Section 6.3 Compliance Certificates..................................................... 54
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Section 6.4 Copies of Other Reports and Notices......................................... 55
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Section 6.5 Notice of Litigation, Default and Other Matters............................. 56
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Section 6.6 ERISA Reporting Requirements................................................ 56
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ARTICLE 7
Negative Covenants
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Section 7.1 Indebtedness................................................................ 58
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Section 7.2 Liens....................................................................... 59
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Section 7.3 Investments................................................................. 59
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Section 7.4 Liquidation, Merger, New Subsidiaries....................................... 60
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Section 7.5 Guaranties.................................................................. 60
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Section 7.6 Treasury Stock Purchases, Venture Investments and Other Investments......... 60
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Section 7.7 Affiliate Transactions...................................................... 61
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Section 7.8 Compliance with ERISA....................................................... 61
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Section 7.9 Leverage Ratio.............................................................. 61
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Section 7.10 Fixed Charge Coverage Ratio................................................. 61
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Section 7.11 Capitalization Ratio........................................................ 62
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Section 7.12 Sale and Leaseback.......................................................... 62
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Section 7.13 Sale or Discount of Receivables............................................. 62
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Section 7.14 Subordinated Debt........................................................... 62
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Section 7.15 Acquisitions................................................................ 62
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ARTICLE 8
Default
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Section 8.1 Events of Default........................................................... 63
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Section 8.2 Remedies.................................................................... 66
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ARTICLE 9
Changes in Circumstances
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Section 9.1 LIBOR Basis Determination Inadequate........................................ 67
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Section 9.2 Illegality.................................................................. 67
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Section 9.3 Increased Costs............................................................. 68
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Section 9.4 Base Rate Advances Rather than LIBOR Advances............................... 69
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Section 9.5 Capital Adequacy............................................................ 69
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ARTICLE 10
Agreement Among Lenders
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Section 10.1 Agreement Among Lenders..................................................... 70
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Section 10.2 Lender Credit Decision...................................................... 72
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Section 10.3 Benefits of Article......................................................... 72
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ARTICLE 11
Miscellaneous
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Section 11.1 Notices..................................................................... 73
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Section 11.2 Expenses.................................................................... 74
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Section 11.3 Waivers..................................................................... 74
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Section 11.4 Determination by the Lenders Conclusive and Binding......................... 74
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Section 11.5 Set-Off..................................................................... 75
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Section 11.6 Assignment.................................................................. 75
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Section 11.7 Counterparts................................................................ 77
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Section 11.8 Severability................................................................ 77
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Section 11.9 Interest and Charges........................................................ 77
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Section 11.10 Headings.................................................................... 78
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Section 11.11 Amendment and Waiver........................................................ 78
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Section 11.12 Exception to Covenants...................................................... 78
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Section 11.13 No Liability of Issuing Bank................................................ 78
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Section 11.14 Confidentiality............................................................. 79
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Section 11.15 No Duties of Co-Agents...................................................... 79
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Section 11.16 GOVERNING LAW............................................................... 79
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Section 11.17 WAIVER OF JURY TRIAL........................................................ 80
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Section 11.18 ENTIRE AGREEMENT............................................................ 80
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Schedules and Exhibits
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Schedule 1: LIBOR Lending Offices
Schedule 2: Existing Liens
Schedule 3: Existing Litigation
Schedule 4: Subsidiaries
Schedule 5: Existing Investments
Schedule 6: Existing Indebtedness
Schedule 7: Money Market Funds
Schedule 8: Existing Letters of Credit
Exhibit A: Promissory Note
Exhibit B: Bid Rate Note
Exhibit C: Subsidiary Guaranty
Exhibit D: Compliance Certificate
Exhibit E: Assignment Agreement
Exhibit F: Bid Rate Advance Request
Exhibit G: Invitation to Bid
Exhibit H: Confirmation of Bid
Exhibit I: Notice of Acceptance of Bid
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
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THIS THIRD AMENDED AND RESTATED CREDIT AGREEMENT is dated as of March 10,
1999, among TEXAS INDUSTRIES, INC., a Delaware corporation ("Borrower"), the
Lenders from time to time party hereto (the "Lenders"), the Co-Agents from time
to time party hereto (the "Co-Agents"), and NATIONSBANK, N.A., a national
banking association, as Administrative Lender for the Lenders (the
"Administrative Lender").
BACKGROUND
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The Borrower, certain of the Lenders and the Administrative Lender are
parties to that certain Second Amended and Restated Credit Agreement, dated as
of December 18, 1997 (said Second Amended and Restated Credit Agreement, as
amended, the "Existing Credit Agreement"). The Borrower has requested that the
Lenders amend and restate the Existing Credit Agreement by making a revolving
credit facility available to the Borrower in the maximum principal amount of
$450,000,000. The Lenders have agreed to do so, subject to the terms and
conditions set forth below.
In consideration of the mutual covenants and agreements contained herein,
and other good and valuable consideration hereby acknowledged, the parties
hereto agree that the Existing Credit Agreement is amended and restated in its
entirety as follows:
ARTICLE 1
Definitions
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Section 1.1 Defined Terms. For purposes of this Agreement:
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"Absolute Bid Rate" means an absolute fixed rate of interest per annum.
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"Absolute Bid Rate Advances" means a Bid Rate Advance that bears interest
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at an Absolute Bid Rate.
"Account" has the meaning assigned to such term in the UCC and also means
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receivables from the sale of royalty income from the CemStar process.
"Acquisition" means any transaction pursuant to which the Borrower or any
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of its Subsidiaries, (a) whether by means of a capital contribution or purchase
or other acquisition of stock or other securities or other equity participation
or interest, (i) acquires more than 50% of the equity interest in any Person
pursuant to a solicitation by the Borrower or such Subsidiary of tenders of
equity securities of such Person, or through one or more negotiated block,
market, private or other transactions, or a combination of any of the foregoing,
or (ii) makes any entity a Subsidiary of the Borrower or such Subsidiary, or
causes any entity, other than a Subsidiary of the Borrower or such Subsidiary,
to be merged into the Borrower or such Subsidiary (or agrees to be merged into
any other entity other than a wholly-owned Subsidiary (excluding directors'
qualifying shares) of the Borrower or such Subsidiary), or (b) purchases all or
substantially all of the business or assets of any Person or of any operating
division of any Person.
"Adjusted EBITDA" means, for the four fiscal quarters immediately preceding
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any date of determination, calculated for the Borrower and its Subsidiaries on a
consolidated basis, an amount equal to the sum of (a) EBITDA (excluding, to the
extent included, equity in earnings of any Venture), plus (b) Distributions
received from any Venture. For purposes of determining Adjusted EBITDA, there
shall be (i) excluded the EBITDA attributable to any asset disposed of during
the four fiscal quarters immediately preceding the date of determination for the
twelve-month period preceding the date of determination and (ii) included the
EBITDA attributable to any asset acquired during the four fiscal quarters
immediately preceding the date of determination for the twelve-month period
preceding the date of determination.
"Adjusted LIBOR Rate" means, for any LIBOR Advance for any Interest Period
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therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100th of 1%) determined by the Administrative Lender to be equal to the
quotient obtained by dividing (a) the LIBOR Rate for such LIBOR Advance for such
Interest Period by (b) 1 minus the Reserve Requirement for such LIBOR Advance
for such Interest Period.
"Administrative Lender" means NationsBank, N.A., a national banking
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association, as administrative agent for the Lenders, or such successor
administrative agent appointed pursuant to Section 10.1(b) hereof.
"Administrative Lender Fee Letter" has the meaning set forth in Section
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2.4(b) hereof.
"Advance" means a Revolving Credit Advance or a Bid Rate Advance.
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"Affiliate" means any Person that directly or indirectly through one or
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more Subsidiaries Controls, or is Controlled By or Under Common Control with,
the Borrower.
"Agreement" means this Third Amended and Restated Credit Agreement, as
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further amended, modified, supplemented and restated from time to time.
"Agreement Date" means the date of this Agreement.
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"Applicable Environmental Laws" means applicable laws pertaining to health
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or the environment, including without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended by
the Superfund Amendments and
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Reauthorization Act of 1986 (as amended from time to time, "CERCLA"), the
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Resource Conservation and Recovery Act of 1976, as amended by the Used Oil
Recycling Act of 1980, the Solid Waste Disposal Act amendments of 1980, and the
Hazardous and Solid Waste Amendments of 1984 (as amended from time to time,
"RCRA"), the Texas Water Code, and the Texas Solid Waste Disposal Act.
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"Applicable Law" means (a) in respect of any Person, all provisions of
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constitutions, statutes, rules, regulations and orders of governmental bodies or
regulatory agencies applicable to such Person and its properties, including,
without limiting the foregoing, all orders and decrees of all courts and
arbitrators in proceedings or actions to which the Person in question is a
party, and (b) in respect of contracts relating to interest or finance charges
that are made or performed in the State of Texas, "Applicable Law" shall mean
the laws of the United States of America, including without limitation 12 USC
(S)(S) 85 and 86, as amended from time to time, and any other statute of the
United States of America now or at any time hereafter prescribing the maximum
rates of interest on loans and extensions of credit, and the laws of the State
of Texas, including, without limitation, Article 5069-1H, Title 79, Revised
Civil Statutes of Texas, 1925, as amended, and if said Article 5069-1H is not
applicable, Article 5069-1D, Title 79, Revised Civil Statutes of Texas, 1925, as
amended, and any other statute of the State of Texas now or at any time
hereafter prescribing maximum rates of interest on loans and extensions of
credit; provided that the parties hereto agree that the provisions of Chapter
346 of the Texas Finance Code, as amended, shall not apply to Advances, this
Agreement, the Notes or any other Loan Documents.
"Applicable Margin" means the following per annum percentages, applicable
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in the following situations:
Base Rate LIBOR
Applicability Margin Margin
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(i) Category 1 - The Leverage Ratio is equal to or 0.00% 1.500%
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greater than 3.0 to 1
(ii) Category 2 - The Leverage Ratio is less than 3.0 to 0.00% 1.250%
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1 but is equal to or greater than 2.0 to 1
(iii) Category 3 - The Leverage Ratio is less than 2.0 to 1 but 0.00% 1.000%
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is equal to or greater than 1.0 to 1
(iv) Category 4 - The Leverage Ratio is less than 1.0 to 1 0.00% 0.750%
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The Applicable Margin payable by the Borrower on the Revolving Credit Advances
outstanding hereunder shall be subject to reduction or increase, as applicable
and as set forth in the table above, on a quarterly basis according to the
performance of the Borrower as tested by the Leverage Ratio; provided, that each
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adjustment in the Applicable Margin shall be effective as of the first day of
the
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month immediately following the month in which the Administrative Lender
receives the financial statements required pursuant to Section 6.1 or 6.2
hereof, as appropriate. If financial statements of the Borrower (and
corresponding Compliance Certificate setting forth the Leverage Ratio) are not
received by the Administrative Lender by the date required pursuant to Section
6.1 or 6.2 hereof, as appropriate, the Applicable Margin shall be determined
pursuant to Category 1 above until such time as such financial statements and
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Compliance Certificate are received. The Applicable Margin shall initially be
determined pursuant to Category 2 above until such time as a calculation of the
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Leverage Ratio which would result in an adjustment of the Applicable Margin is
received.
"Assignment Agreement" has the meaning ascribed thereto in Section 11.6
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hereof.
"Authorized Signatory" means such senior personnel of the Borrower as may
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be duly authorized and designated in writing by the Borrower to execute
documents, agreements and instruments on behalf of the Borrower, and to request
Advances hereunder.
"Bank Affiliate" means the holding company of any Lender, or any wholly-
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owned direct or indirect subsidiary of such holding company or of such Lender.
"Base Rate Advance" means any Revolving Credit Advance bearing interest at
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the Base Rate Basis.
"Base Rate Basis" means, for any day, a per annum interest rate equal to
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the lesser of (a) the Highest Lawful Rate on such day, or (b) the higher of (i)
the sum of (A) 0.50% plus (B) the Federal Funds Rate plus (C) the Applicable
Margin, or (ii) the sum of (A) the Prime Rate on such day plus (B) the
Applicable Margin. The Base Rate Basis shall be adjusted automatically as of
the opening of business on the effective date of each change in the Prime Rate
or Federal Funds Rate, as the case may be, to account for such change.
"Bid Rate Advance" means an Advance the interest rate on which is
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determined by agreement between the Borrower and the Lender making such Advance
pursuant to Section 2.1(c) hereof.
"Bid Rate Advance Request" means any certificate signed by an Authorized
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Signatory requesting Bid Rate Advances hereunder, substantially in the form of
Exhibit F hereto.
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"Bid Rate Note" means each promissory note of the Borrower evidencing Bid
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Rate Advances, substantially in the form of Exhibit B hereto, together with any
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extension, renewal or amendment thereof or substitution therefor.
"Borrower" means Texas Industries, Inc., a Delaware corporation.
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"Business Day" means a day on which commercial banks are open (a) for the
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transaction of business in Dallas, Texas and, (b) with respect to any LIBOR
Advance, for the transaction of international business (including dealings in
Dollar deposits) in London, England.
"Capitalization Ratio" means, for any date of determination, the ratio of
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(a) Total Debt (which for purposes of this definition only shall exclude
obligations in respect of letters of credit) to (b) the sum of Total Debt plus
Net Worth, in each case for the four fiscal quarters immediately preceding the
date of determination.
"Capitalized Lease Obligations" means that portion of any obligation of the
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Borrower or any Subsidiary as lessee under a lease which at the time would be
required to be capitalized on a balance sheet prepared in accordance with GAAP.
"Change of Control" means (a) any merger or consolidation of the Borrower
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with or into any person or any sale, transfer or other conveyance, whether
direct or indirect, of all or substantially all of the assets of the Borrower,
on a consolidated basis, in one transaction or a series of related transactions,
(b) any "person" or "group" (as such terms are used for purposes of Sections
13(d) and 14(d) of the Securities Exchange Act, whether or not applicable) is or
becomes the "beneficial owner", directly or indirectly, of more than 50% of the
total voting power in the aggregate of all classes of capital stock of the
Borrower then outstanding normally entitled to vote in elections of directors,
or (c) during any period of 24 consecutive months after the Agreement Date,
individuals who at the beginning of such 24-month period constituted the board
of directors of the Borrower (together with any new directors whose election by
such board of directors or whose nomination for election by the shareholders of
the Borrower was approved by a vote of a majority of the directors then still in
office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the board of directors of the Borrower then
in office.
"Chaparral" means Chaparral Steel Company, a Delaware corporation, and a
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wholly-owned Subsidiary of the Borrower.
"Code" means the Internal Revenue Code of 1986, as amended.
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"Commitment" means $450,000,000, as reduced from time to time pursuant to
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Section 2.6 hereof.
"Compliance Certificate" means a certificate, signed by an Authorized
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Signatory, in substantially the form of Exhibit D hereto, appropriately
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completed.
"Confirmation of Bid" means any certificate signed by an Authorized
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Signatory confirming the terms of its Bid Rate Advance, substantially in the
form of Exhibit H hereto.
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"Control" or "Controlled By" or "Under Common Control" means possession,
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directly or indirectly, of power to direct or cause the direction of management
or policies (whether through ownership of voting securities, by contract or
otherwise); provided, however, that in any event any Person which beneficially
owns, directly or indirectly, 5% or more (in number of votes) of the securities
(or in the case of a Person that is not a corporation, 5% or more of the equity
interest) having ordinary voting power shall be conclusively presumed to control
such Person.
"Controlled Group" means as of the applicable date, as to any Person, all
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members of a controlled group of corporations and all trades or businesses
(whether or not incorporated) which are under common control with such Person
and which, together with such Person, are treated as a single employer under
Section 414(b), (c), (m) or (o) of the Code; provided, however, that the
Subsidiaries of the Borrower shall be deemed to be members of the Borrower's
Controlled Group.
"Convertible Subordinated Debentures" means the 5.5% Convertible
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Subordinated Debentures of the Borrower, in an aggregate principal amount of
$200,000,000, due 2028.
"Convertible Trust Preferred Securities" means the 5.5% Convertible Trust
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Preferred Securities, in an aggregate amount of $200,000,000 evidencing
preferred undivided beneficial interests in the assets of TXI Capital Trust I.
"Debt Conversion Event" means the earliest to occur of (a) any default or
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event of default (however defined or designated) in any instrument or agreement
governing, evidencing or creating the Convertible Trust Preferred Securities or
the Convertible Subordinated Debentures, (b) any non-payment, postponement or
deferral of distributions, dividends or interest on the Convertible Trust
Preferred Securities or the Convertible Subordinated Debentures, whether or not
expressly permitted, (c) any mandatory redemption of the Convertible Trust
Preferred Securities or the Convertible Subordinated Debentures or (d) any
Special Event (or other event howsoever designated) the effect of which would
result in the dissolution or termination of TXI Capital Trust I or would cause
the holders of the Convertible Trust Preferred Securities to become holders of
the Convertible Subordinated Debentures.
"Debtor Relief Laws" means any applicable liquidation, conservatorship,
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bankruptcy, moratorium, rearrangement, insolvency, reorganization or similar
debtor relief Laws affecting the rights of creditors generally from time to time
in effect.
"Default" means an Event of Default and/or any of the events specified in
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Section 8.1, regardless of whether there shall have occurred any passage of time
or giving of notice that would be necessary in order to constitute such event an
Event of Default.
"Default Rate" means a simple per annum interest rate equal to the lesser
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of (a) the Highest Lawful Rate, or (b) the sum of the Base Rate plus two
percent.
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"Depreciation" means depreciation and depletion expense as determined in
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accordance with GAAP.
"Determining Lenders" means, on any date of determination, any combination
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of the Lenders having more than 50% of the aggregate amount of the Revolving
Credit Advances then outstanding; provided, however, that if there are no
Revolving Credit Advances outstanding hereunder, "Determining Lenders" shall
mean any combination of Lenders whose Specified Percentages aggregate more than
50%.
"Distributions" means, as to any Venture, any payment on, or the making of
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any distribution to any holder of, any equity interest of such Venture.
"Dividend" means, as to any Person, any declaration or payment of any
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dividend (other than a stock dividend) on, or the making of any distribution,
loan, advance or investment to or in any holder of, (a) any shares of capital
stock (or other equity or beneficial interest) of such Person (other than
salaries and bonuses paid in the ordinary course of business) or (b) the
Convertible Trust Preferred Securities.
"Dollar" or "$" means the lawful currency of the United States of America.
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"EBITDA" means, for any period, determined in accordance with GAAP on a
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consolidated basis for the Borrower and its Subsidiaries, the sum of (a) pre-tax
net income (excluding therefrom any items of extraordinary gain, including net
gains on the sale of assets other than asset sales in the ordinary course of
business, and adding thereto any items of extraordinary loss, including net
losses on the sale of assets other than asset sales in the ordinary course of
business), plus (b) interest expense (including interest expense pursuant to
Capitalized Lease Obligations and interest expense associated with any
Securitization), Depreciation and amortization.
"Eligible Assignee" means (a) a Lender, (b) an Affiliate of a Lender, and
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(c) any other Person approved by both the Administrative Lender and, unless an
Event of Default has occurred and is continuing at the time any assignment is
effected in accordance with Section 11.6(d) hereof, the Borrower, such approval
not to be unreasonably withheld or delayed by the Borrower or the Administrative
Lender and such approval to be deemed given by the Borrower if no objection is
received by the assigning Lender and the Administrative Lender from the Borrower
within two Business Days after notice of such proposed assignment has been
provided by the assigning Lender to the Borrower; provided, however, that
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neither the Borrower nor any of its Affiliates shall qualify as an Eligible
Assignee.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
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amended from time to time, and any regulation promulgated thereunder.
"ERISA Event" means, with respect to the Borrower or any member of its
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Controlled Group, (a) a Reportable Event (other than a Reportable Event not
subject to the provision for 30-day notice
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to the PBGC under regulations issued under Section 4043 of ERISA), (b) the
withdrawal of any such Person or any member of its Controlled Group from a Plan
subject to Title IV of ERISA during a plan year in which it was a "substantial
employer" as defined in Section 4001(a)(2) of ERISA, (c) the filing of a notice
of intent to terminate under Section 4041(c) of ERISA, (d) the institution of
proceedings to terminate a Plan by the PBGC, (e) the failure to make required
contributions which could result in the imposition of a lien under Section 412
of the Code or Section 302 of ERISA, or (f) any other event or condition which
might reasonably be expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any Plan
or the imposition of any liability under Title IV of ERISA other than PBGC
premiums due but not delinquent under Section 4007 of ERISA.
"Event of Default" means any of the events specified in Section 8.1,
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provided that any requirement for notice or lapse of time has been satisfied.
"Existing Letters of Credit" means those letters of credit listed on
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Schedule 8 hereto and issued pursuant to the Existing Credit Agreement.
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"Federal Funds Rate" means, for any day, the rate per annum (rounded
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upwards if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of Dallas on the Business Day next
succeeding such day, provided that (a) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day,
and (b) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate quoted to the
Administrative Lender on such day on such transactions as determined by the
Administrative Lender.
"Fixed Charges" means, for any date of calculation, calculated for the
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Borrower and its Subsidiaries on a consolidated basis determined in accordance
with GAAP, the sum of, without duplication, (a) scheduled principal payments on
Total Debt (excluding any payments pursuant to Section 2.8(c) or 2.8(d) hereof),
plus (b) interest expense (including interest expense pursuant to Capitalized
Lease Obligations and interest expense associated with any Asset
Securitization), plus (c) Dividends (including accrued and unpaid Dividends), in
each case for the four fiscal quarters immediately preceding the date of
calculation.
"Fixed Charge Coverage Ratio" means the ratio of Adjusted EBITDA to Fixed
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Charges.
"GAAP" means generally accepted accounting principles applied on a
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consistent basis, set forth in the Opinions of the Accounting Principles Board
of the American Institute of Certified Public Accountants, or their successors
which are applicable in the circumstances as of the date in question. The
requisite that such principles be applied on a consistent basis shall mean that
the accounting principles observed in a current period are comparable in all
material respects to those
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applied in a preceding period, except as otherwise required by the adoption of
Statement of Financial Accounting Standards No. 106.
"Governmental Authority" means (a) the government of (i) the United States
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of America and any State or other political subdivision thereof or (ii) any
jurisdiction in which the Borrower or any Subsidiary conducts all or any part of
its business or owns any property or (b) any entity exercising executive,
legislative, judicial, regulatory or administrative functions of, or pertaining
to, any such government.
"Guaranty" or "Guaranteed", as applied to an obligation of another Person,
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means and include (a) a guaranty, direct or indirect, in any manner, of any part
or all of such obligation, and (b) an agreement, direct or indirect, contingent
or otherwise, the practical effect of which is to assure in any way the payment
or performance (or payment of damages in the event of nonperformance) of any
part or all of such obligation, including, without limiting the foregoing, any
reimbursement obligations with respect to amounts which may be drawn by
beneficiaries of outstanding letters of credit.
"Guarantor" means each Subsidiary which executes or becomes a party to a
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Subsidiary Guaranty.
"Highest Lawful Rate" means at the particular time in question the maximum
-------------------
rate of interest which, under Applicable Law, the Lenders are then permitted to
charge on the Obligations. If the maximum rate of interest which, under
Applicable Law, the Lenders are permitted to charge on the Obligations shall
change after the date hereof, the Highest Lawful Rate shall be automatically
increased or decreased, as the case may be, from time to time as of the
effective time of each change in the Highest Lawful Rate without notice to the
Borrower. For purposes of determining the Highest Lawful Rate under the
Applicable Law of the State of Texas, the applicable rate ceiling shall be (a)
the weekly rate ceiling described in and computed in accordance with the
provisions of Article 5069-1D, Title 79, Revised Civil Statutes of 1925, as
amended, or (b) either the quarterly ceiling or the annualized ceiling computed
pursuant to Art. 5069-1D.008, Title 79, Revised Civil Statutes of Texas, as
amended; provided, however, that at any time the weekly rate ceiling, the
quarterly ceiling or the annualized ceiling shall be less than 18% per annum or
more than 24% per annum, the provisions of Article 5069-1D.009(a) and (b), Title
79, Revised Civil Statutes of Texas, as amended, shall control for purposes of
such determination, as applicable.
"Indebtedness" means, with respect to any Person, (a) all items which in
------------
accordance with GAAP would be included in determining total liabilities as shown
on the liability side of a balance sheet of such Person, (b) all obligations
secured by any Lien (other than Liens referred to in clauses (b), (c), (d), (e),
(g) or (i) of the definition of Permitted Liens) on any property or asset owned
by such Person, whether or not the obligation secured thereby shall have been
assumed, (c) to the extent not otherwise included, all Capitalized Lease
Obligations of such Person, all obligations of such Person with respect to
leases constituting part of a sale and leaseback arrangement, all Guaranties,
all obligations under interest rate swap agreements, hedge agreements, foreign
exchange
-9-
contracts or agreements or similar agreements and arrangements, all indebtedness
for borrowed money, all reimbursement obligations with respect to outstanding
letters of credit and all Securitization Indebtedness of such Person, (d) any
"withdrawal liability" of the Borrower or any Subsidiary, as such term is
defined under Part I of Subtitle E of Title IV of ERISA, (e) the principal
portion of all obligations of such Person under any synthetic lease, tax
retention operating lease, off-balance sheet loan or similar off-balance sheet
financing product where such transaction is considered borrowed money
indebtedness for tax purposes but is classified as an operating lease pursuant
to GAAP, and (f) all preferred stock issued by such Person and required by the
terms thereof to be redeemed, or for which mandatory sinking fund payments are
due, by a fixed date.
"Indemnified Matters" has the meaning ascribed to it in Section 5.10(a)
-------------------
hereof.
"Indemnitees" has the meaning ascribed to it in Section 5.10(a) hereof.
-----------
"Interest Period" means, for (a) any LIBOR Advance, the period beginning on
---------------
the day such LIBOR Advance is made and ending one, two, three or six months
thereafter (as the Borrower shall select), (b) any Absolute Bid Rate Advance,
the period beginning on the day such Bid Rate Advance is made and ending not
less than 7 days nor more than 180 days thereafter (as the Borrower shall
select), and (c) any LIBOR Bid Rate Advance, the period beginning on the day
such Bid Rate Advance is made and ending one, two, three or six months
thereafter (as the Borrower shall select); provided, however, that all of the
-------- -------
foregoing provisions are subject to the following:
(i) if any Interest Period would otherwise end on a day which is not
a Business Day, such Interest Period shall be extended to the next
succeeding Business Day, unless, with respect to a LIBOR Advance or a LIBOR
Bid Rate Advance, the result of such extension would be to extend such
Interest Period into another calendar month, in which event such Interest
Period shall end on the immediately preceding Business Day;
(ii) any Interest Period with respect to a LIBOR Advance or a LIBOR
Bid Rate Advance that begins on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month;
(iii) the Borrower may not select any Interest Period in respect of
LIBOR Advances or LIBOR Bid Rate Advances having an aggregate amount less
than $1,000,000; and
(iv) there shall be outstanding at any one time no more than ten
Interest Periods in the aggregate.
"Interest Rate Protection Agreement" means an interest rate swap, cap,
----------------------------------
collar or similar interest rate protection agreement between the Borrower and
any Lender or any Bank Affiliate.
-10-
"Investment" means any direct or indirect purchase or other acquisition of,
----------
or beneficial interest in, capital stock, partnership interests or other
securities of any other Person, or any direct or indirect loan, advance (other
than advances to employees for moving and travel expenses, drawing accounts and
similar expenditures in the ordinary course of business) or capital contribution
to, or investment in any other Person, including without limitation the
incurrence or sufferance of Indebtedness or the purchase of accounts receivable
of any other Person that are not current assets or do not arise in the ordinary
course of business.
"Invitation to Bid" means any certificate by the Administrative Lender
-----------------
identifying each Lender of the Borrower's Bid Rate Advance Request,
substantially in the form of Exhibit I hereto.
---------
"Issuing Bank" means NationsBank, N.A. in its capacity as issuer of the
------------
Letters of Credit.
"Lender" means each financial institution shown on the signature pages
------
hereof so long as such financial institution maintains a portion of the
Commitment or is owed any part of the Obligations (including the Administrative
Lender in its individual capacity), and each Assignee that hereafter becomes
party hereto pursuant to Section 11.6 hereof.
"L/C Cash Collateral Account" has the meaning specified in Section 2.16(g)
---------------------------
hereof.
"L/C Related Documents" has the meaning specified in Section 2.16(e)
---------------------
hereof.
"Letter of Credit" has the meaning specified in Section 2.16(a) hereof, and
----------------
shall also mean and include the Existing Letters of Credit.
"Letter of Credit Agreement" has the meaning specified in Section 2.16(b)
--------------------------
hereof.
"Letter of Credit Facility" has the meaning specified in Section 2.16(a)
-------------------------
hereof.
"Leverage Ratio" means, for any date of calculation, calculated for the
--------------
Borrower and its Subsidiaries on a consolidated basis, the ratio of Total Debt
as of the date of calculation to Adjusted EBITDA for the four fiscal quarters
immediately preceding the date of calculation.
"LIBOR Advance" means a Revolving Credit Advance which the Borrower
-------------
requests to be made as a LIBOR Advance or which is reborrowed as a LIBOR
Advance, in accordance with the provisions of Section 2.2 hereof.
"LIBOR Basis" means a per annum interest rate equal to the lesser of (a)
-----------
the Highest Lawful Rate, or (b) the sum of the Adjusted LIBOR Rate plus the
Applicable Margin.
"LIBOR Bid Rate" means a simple per annum interest rate equal to the lesser
--------------
of (a) the Highest Lawful Rate or (b) the sum of the Adjusted LIBOR Rate plus or
minus the Margin.
-11-
"LIBOR Bid Rate Advance" means a Bid Rate Advance that bears interest at
----------------------
the LIBOR Bid Rate.
"LIBOR Lending Office" means, with respect to a Lender, the office
--------------------
designated as its LIBOR Lending Office on Schedule 1 attached hereto, and such
----------
other office of the Lender or any of its affiliates hereafter designated by
notice to the Borrower and the Administrative Lender.
"LIBOR Rate" means, for any LIBOR Advance for any Interest Period therefor,
----------
the rate per annum (rounded upwards, if necessary, to the nearest 1/100th of 1%)
appearing on Telerate Page 3750 (or any successor page) as the London interbank
offered rate for deposits in Dollars at approximately 11:00 a.m. (London time)
two Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period. If for any reason such rate is not
available, the term "LIBOR Rate" shall mean, for any LIBOR Advance for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary, to
the nearest 1/100th of 1%) appearing on Reuters Screen LIBO Page as the London
interbank offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period; provided, however, if more than
-------- -------
one rate is specified on Reuters Screen LIBO Page, the applicable rate shall be
the arithmetic mean of all such rates (rounded upwards, if necessary, to the
nearest 1/100th of 1%).
"Lien" means, with respect to any property, any mortgage, lien, pledge,
----
collateral assignment, hypothecation, charge, security interest, title retention
agreement, levy, execution, seizure, attachment, garnishment or other
encumbrance of any kind in respect of such property, whether or not xxxxxx,
vested or perfected.
"Loan Documents" means this Agreement, the Notes, the Subsidiary Guaranty,
--------------
all L/C Related Documents, any Interest Rate Protection Agreement, all fee
letters, and any other document or agreement executed or delivered from time to
time by the Borrower, any Subsidiary or any other Person in connection herewith
or as security for the Obligations.
"Long Term Debt" means any obligation which is due one year or more from
--------------
the date of creation thereof which under GAAP is shown as a liability, plus,
without duplication, amounts equal to the aggregate net rentals payable one year
or more from the date of creation thereof under Capitalized Lease Obligations.
"Margin" means, as to any LIBOR Bid Rate Advance, the margin expressed as a
------
percentage per annum (in the form of a decimal to no more than four decimal
places) to be added or subtracted from the Adjusted LIBOR Rate to determine the
interest rate applicable to such Advance.
"Material Adverse Effect" means any act or circumstance or event that (a)
-----------------------
could reasonably be expected to be material and adverse to (i) the business,
assets, liabilities, financial condition, results of operations, business or
prospects of the Borrower and its Subsidiaries taken as a whole or (ii) the
ability of the Borrower or any Guarantor to perform their obligations under the
respective
-12-
Loan Documents, or (b) in any manner whatsoever does or could reasonably be
expected to materially and adversely affect the validity or enforceability of
any Loan Document.
"Maturity Date" means March 10, 2004, or the earlier date of termination in
-------------
whole of the Commitment pursuant to Section 2.6 or 8.2 hereof.
"Maximum Amount" means the maximum amount of interest which, under
--------------
Applicable Law, the Lenders are permitted to charge on the Obligations.
"Multiemployer Plan" means, as to any Person, at any time, a "multiemployer
------------------
plan" within the meaning of Section 4001(a)(3) of ERISA and to which such Person
or any member of its Controlled Group is making, or is obligated to make
contributions or has made, or been obligated to make, contributions.
"Necessary Authorization" means any right, franchise, license, permit,
-----------------------
consent, approval or authorization from, or any filing or registration with, any
governmental or other regulatory authority necessary or appropriate to enable
the Borrower or any Subsidiary to maintain and operate its business and
properties.
"Negative Pledge Agreement" means any agreement, contract or arrangement
-------------------------
whereby any Person is prohibited from, or would otherwise be in default as a
result of, creating, assuming, incurring or suffering to exist, directly or
indirectly, any Lien on any of its assets.
"Net Cash Proceeds" means, with respect to any sale, lease, transfer or
-----------------
disposition of any asset by any Person, the aggregate amount of cash received by
such Person in connection with such transaction minus reasonable fees, costs and
expenses and related taxes.
"Net Worth" means, for the Borrower and its Subsidiaries, on a consolidated
---------
basis, determined in accordance with GAAP, the sum of (without duplication):
(i) capital stock taken at par value, plus (ii) capital surplus, plus (iii)
retained earnings less treasury stock, plus (iv) the Convertible Trust Preferred
Securities.
"Note" means any Revolving Credit Note or Bid Rate Note and "Notes" means
---- -----
the Revolving Credit Notes and the Bid Rate Notes.
"Notice of Acceptance of Bid" means any certificate signed by an Authorized
---------------------------
Signatory accepting bids for Bid Rate Advances, substantially in the form of
Exhibit I hereto.
---------
"Notice of Issuance" has the meaning ascribed to it in Section 2.16(b)
------------------
hereof.
"Obligations" means (a) all obligations of any nature (whether matured or
-----------
unmatured, fixed or contingent, including the Reimbursement Obligations) of the
Borrower or any Subsidiary to the Lenders or any Bank Affiliate under the Loan
Documents as they may be amended from time to
-13-
time, and (b) all obligations of the Borrower or any Subsidiary for losses,
damages, expenses or any other liabilities of any kind that any Lender or any
Bank Affiliate may suffer by reason of a breach by the Borrower or any
Subsidiary of any obligation, covenant or undertaking with respect to any Loan
Document.
"Participant" has the meaning ascribed to it in Section 11.6(c) hereof.
-----------
"Participation" has the meaning ascribed to it in Section 11.6(c) hereof.
-------------
"Payment Date" means the last day of the Interest Period for any Advance.
------------
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
----
succeeding to any or all of its functions under ERISA.
"Permitted Liens" means, as applied to any Person:
---------------
(a) any Lien in favor of the Lenders to secure the Obligations hereunder;
(b) (i) Liens on real estate for real estate taxes not yet delinquent,
(ii) Liens on leasehold interests created by the lessor in favor of any
mortgagee of the leased premises, and (iii) Liens for taxes, assessments,
governmental charges, levies or claims that are being diligently contested in
good faith by appropriate proceedings and for which adequate reserves shall have
been set aside on such Person's books, but only so long as no foreclosure,
restraint, sale or similar proceedings have been commenced with respect thereto;
(c) Liens of carriers, landlords, warehousemen, mechanics, laborers and
materialmen and other similar Liens incurred in the ordinary course of business
for sums not yet due or being contested in good faith, if such reserve or
appropriate provision, if any, as shall be required by GAAP shall have been made
therefor;
(d) Liens incurred in the ordinary course of business in connection with
worker's compensation, unemployment insurance or similar legislation;
(e) Easements, right-of-way, restrictions and other similar encumbrances
on the use of real property which do not interfere with the ordinary conduct of
the business of such Person;
(f) Liens created to secure Indebtedness permitted by Sections 7.1(d) and
7.1(j) hereof, which is incurred solely for the purpose of financing the
acquisition or construction of such assets and incurred at the time of
acquisition or construction, so long as each such Lien shall at all times be
confined solely to the asset or assets so acquired or constructed (and proceeds
thereof), and refinancings thereof so long as any such Lien remains solely on
the asset or assets acquired or constructed and the amount of Indebtedness
related thereto is not increased;
-14-
(g) Liens in respect of judgments or awards for which appeals or
proceedings for review are being prosecuted and in respect of which a stay of
execution upon any such appeal or proceeding for review shall have been secured,
provided that (i) such Person shall have established adequate reserves for such
judgments or awards, (ii) such judgments or awards shall be fully insured and
the insurer shall not have denied coverage, or (iii) such judgments or awards
shall have been bonded to the satisfaction of the Determining Lenders;
(h) Any Liens existing on the Agreement Date which are described on
Schedule 2 hereto, and Liens resulting from the refinancing of the related
Indebtedness, provided that the Indebtedness secured thereby shall not be
increased and the Liens shall not cover additional assets of the Borrower;
(i) Liens filed of record out of an abundance of caution by lessors of
personal property, so long as each such Lien shall at all times be confined
solely to the asset or assets so leased; and
(j) Liens against Accounts, or fractional interests therein, and proceeds
thereof, sold or pledged by such Person in a Securitization to secure the
Securitization Indebtedness with respect thereto and security interests on
reserve, payment or other accounts required to be maintained in connection with
any such Securitization.
"Person" means an individual, corporation, partnership, trust or
------
unincorporated organization, or a government or any agency or political
subdivision thereof.
"Plan" means an employee benefit plan as defined in Section 3(3) of ERISA
----
(including a Multiemployer Plan that is covered by Title IV of ERISA) pursuant
to which any employees of the Borrower, its Subsidiaries or any member of their
Controlled Group participate.
"Preferred Securities Guarantee" means that certain Preferred Securities
------------------------------
Guarantee executed by the Borrower and guaranteeing, on a subordinated basis to
the Obligations, distributions and redemption obligations in respect of the
Convertible Trust Preferred Securities.
"Prime Rate" means, at any time, the prime interest rate announced or
----------
published by the Administrative Lender from time to time as its reference rate
for the determination of interest rates for loans of varying maturities in
United States dollars to United States residents of varying degrees of
creditworthiness and being quoted at such time by the Administrative Lender as
its "prime rate;" it being understood that such rate may not be the lowest rate
of interest charged by the Administrative Lender.
"Prudential Borrower Notes" means, collectively, those certain (a)
-------------------------
$25,000,000 7.14% Senior Notes, Series A of the Borrower, dated as of April 9,
1996, payable to the order of The Prudential Insurance Company of America and
maturing on Xxxxx 0, 0000, (x) $25,000,000 7.30% Senior Notes, Series B of the
Borrower, dated as of April 9, 1996, payable to the order of The Prudential
Insurance Company of America and maturing on April 9, 2006, and (c) $25,000,000
7.40% Senior
-15-
Notes, Series C of the Borrower, dated as of April 9, 1996, payable to the order
of The Prudential Insurance Company of America and maturing on April 9, 2008.
"Prudential Assumed Notes" means, collectively, those certain (a)
------------------------
$14,000,000 in aggregate principal amount 10.85% Senior Notes of the Borrower,
dated as of December 31, 1997, payable to the order of The Prudential Insurance
Company of America and maturing on Xxxxx 00, 0000, (x) $14,000,000 in aggregate
principal amount 10.35% Senior Notes of the Borrower, dated as of December 31,
1997, payable to the order of The Prudential Insurance Company of America and
maturing on April 30, 2004, (c) $14,000,000 in aggregate principal amount 10.50%
Senior Notes of the Borrower, dated as of December 31, 1997, payable to the
order The Prudential Insurance Company of America and maturing on April 30,
2004, and (d) $14,000,000 in aggregate principal amount 9.08% Senior Notes of
the Borrower, dated as of December 31, 1997, payable to the order of The
Prudential Insurance Company of America and maturing on April 30, 2004.
"Quarterly Date" means the last day of each February, May, August and
--------------
November, beginning May 31, 1999.
"Reimbursement Obligations" means, in respect of any Letter of Credit as at
-------------------------
any date of determination, the sum of (a) the maximum aggregate amount which is
then available to be drawn under such Letter of Credit plus (b) the aggregate
amount of all drawings under such Letter of Credit and not theretofore
reimbursed by the Borrower.
"Refinancing Advance" means any Revolving Credit Advance which is used to
-------------------
pay the principal amount (or any portion thereof) of a Revolving Credit Advance
at the end of its Interest Period and which, after giving effect to such
application, does not result in an increase in the aggregate amount of
outstanding Revolving Credit Advances.
"Release Date" means the date on which the Notes have been paid, all other
------------
Obligations due and owing have been paid and performed in full, and the
Commitment has been terminated.
"Reportable Event" has the meaning set forth in Section 4043(b) of ERISA.
----------------
"Reserve Requirement" means, at any time, the maximum rate at which
-------------------
reserves (including, without limitation, any marginal, special, supplemental or
emergency reserves) are required to be maintained under regulations issued from
time to time by the Board of Governors of the Federal Reserve System (or any
successor) by member banks of the Federal Reserve System against "Eurocurrency
liabilities" (as such term is used in Regulation D). Without limiting the
effect of the foregoing, the Reserve Requirement shall reflect any other
reserves required to be maintained by such member banks with respect to (i) any
category of liabilities which includes deposits by reference to which the
Adjusted LIBOR Rate is to be determined, or (ii) any category of extensions of
credit or other assets which include LIBOR Advances or LIBOR Bid Rate Advances.
The Adjusted LIBOR Rate shall be adjusted automatically on and as of the
effective date of any change in the Reserve Requirement.
-16-
"Revolving Credit Advance" means an Advance made pursuant to Section 2.1(a)
------------------------
hereof.
"Revolving Credit Note" means each promissory note of the Borrower
---------------------
evidencing Revolving Credit Advances hereunder, substantially in the form of
Exhibit A hereto, together with any extension, renewal or amendment thereof, or
---------
substitution therefor.
"Securitization" means any transaction in which the Accounts of the
--------------
Borrower or any of its Subsidiaries, or a fractional interest therein, are sold
by the Borrower or sold or pledged by any of its Subsidiaries.
"Securitization Indebtedness" means, for any date of calculation,
---------------------------
calculated for the Borrower and its Subsidiaries on a consolidated basis
determined in accordance with GAAP, any and all obligations of the Borrower and
its Subsidiaries funded under any Securitization, to the extent that the same
constitute liabilities of the Borrower or any its Subsidiaries under GAAP or
would, under GAAP, constitute liabilities of the Borrower or any of its
Subsidiaries if the Securitization were treated as an on balance sheet
transaction.
"Senior Notes" means, collectively, those certain (a) $80,000,000 7.15%
------------
Senior Notes, Series A of the Borrower, dated December, 1997 and maturing Xxxxx
00, 0000, (x) $40,000,000 7.20% Senior Notes, Series B of the Borrower, dated
December, 1997 and maturing April 15, 2007, (c) $10,000,000 7.28% Senior Notes,
Series C of the Borrower, dated December, 1997 and maturing Xxxxx 00, 0000, (x)
$45,000,000 7.395% Senior Notes, Series D of the Borrower, dated December, 1997
and maturing April 15, 2012, and (e) $25,000,000 7.59% Senior Notes, Series E of
the Borrower, dated December, 1997 and maturing April 15, 2017, in form and
substance satisfactory to the Determining Lenders.
"Solvent" means, with respect to any Person, that the fair value of the
-------
assets of such Person (both at fair valuation and at present fair saleable
value) is, on the date of determination, greater than the total amount of
liabilities (including contingent and unliquidated liabilities) of such Person
as of such date and that, as of such date, such Person is able to pay all
liabilities of such Person as such liabilities mature and such Person does not
have unreasonably small capital with which to carry on its business. In
computing the amount of contingent or unliquidated liabilities at any time, such
liabilities will be computed at the amount which, in light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability discounted to present value
at rates believed to be reasonable by such Person.
"Special Counsel" means the law firm of Xxxxxxx, Xxxxxxx & Xxxxxxx, P.C.,
---------------
or such other legal counsel as the Administrative Lender may select.
"Specified Percentage" means, as to any Lender, the percentage indicated
--------------------
beside its name on the signature pages hereof, or if applicable, specified in
its most recent Assignment Agreement or in any amendment to this Agreement.
-17-
"Subordinated Debt" means all Indebtedness of the Borrower or any
-----------------
Subsidiary which shall be subordinated, on terms satisfactory to the Determining
Lenders, to the Obligations.
"Subsidiary" means any corporation, partnership, joint venture, trust,
----------
estate or other Person of which 50% or more of (a) the outstanding stock (other
than directors' qualifying shares) having ordinary voting power to elect a
majority of its board of directors, regardless of the existence at the time of a
right of the holders of any class of securities of such corporation to exercise
such voting power by reason of the happening of any contingency, (b) the
interest in the capital or profits of such partnership or joint venture, (c) the
beneficial interest of such trust or estate, or (d) the equity interest of such
other Person, is at the time owned by the Borrower, directly or through one or
more intermediaries; provided, however, notwithstanding anything herein to the
contrary, a Venture shall not be a Subsidiary unless otherwise designated in
writing by the Borrower and such Venture shall have satisfied the requirements
of Section 7.3(c) hereof.
"Subsidiary Guaranty" means each Subsidiary Guaranty, executed by each
-------------------
Guarantor, guarantying payment and performance of the Obligations, substantially
in the form of Exhibit C hereto, as such agreement may be amended, modified,
---------
supplemented or restated from time to time.
"Tax-Exempt Project Letters of Credit" means those certain irrevocable
------------------------------------
letters of credit not to exceed $150,000,000 in aggregate face amount issued or
to be issued by the Issuing Bank in connection with the financing of tax-exempt
projects of the Borrower or any Subsidiary, which shall provide for renewal
thereof for additional one-year periods, but which in no event shall be extended
beyond the Maturity Date.
"Taxes" has the meaning ascribed thereto in Section 2.15 hereof.
-----
"Total Debt" means, as of any date of determination, determined for the
----------
Borrower and its Subsidiaries on a consolidated basis determined in accordance
with GAAP, the sum (without duplication) of (a) all principal outstanding under
the Loan Documents, (b) all obligations evidenced by a promissory note or
otherwise representing borrowed money, (c) all reimbursement obligations for
letters of credit, (d) all Capitalized Lease Obligations, and (e) all
Securitization Indebtedness. Notwithstanding the immediately preceding
sentence, Total Debt shall not include the Convertible Subordinated Debentures
until and unless a Debt Conversion Event shall occur.
"Treasury Stock Purchases" means, with respect to any Person, any purchase,
------------------------
redemption or other acquisition or retirement for value by such Person of any
shares of capital stock of such Person.
"TXI Capital Trust I" means TXI Capital Trust I, a Delaware statutory
-------------------
business trust and wholly-owned Subsidiary of the Borrower.
"UCC" means the Uniform Commercial Code of Texas, as amended from time to
---
time.
-18-
"Venture" means any Person (other than a corporation or any other Person
-------
designated in writing by the Borrower as a Subsidiary) in which the Borrower,
directly or indirectly, has an ownership interest of at least 50% but less than
100%.
"Venture Investments" means all Investments by the Borrower or any
-------------------
Subsidiary in Ventures.
Section 1.2 Amendments and Renewals. Each definition of an agreement in
-----------------------
this Article 1 shall include such agreement as amended to date, and as amended
or renewed from time to time in accordance with its terms pursuant to the
provisions of Section 11.11 hereof.
Section 1.3 Construction. The terms defined in this Article 1 (except as
------------
otherwise expressly provided in this Agreement) for all purposes shall have the
meanings set forth in Section 1.1 hereof, and the singular shall include the
plural, and vice versa, unless otherwise specifically required by the context.
All accounting terms used in this Agreement which are not otherwise defined
herein shall be construed in accordance with GAAP on a consolidated basis for
the Borrower and its Subsidiaries, unless otherwise expressly stated herein.
ARTICLE 2
Advances
--------
Section 2.1 The Advances.
------------
(a) Revolving Credit Advances. Each Lender severally agrees, upon the
-------------------------
terms and subject to the conditions of this Agreement, to make Revolving Credit
Advances to the Borrower from time to time in an aggregate amount not to exceed
its Specified Percentage of the Commitment less its Specified Percentage of the
aggregate amount of all Reimbursement Obligations then outstanding (assuming
compliance with all conditions to drawing) for the purposes set forth in Section
5.9 hereof. Notwithstanding the immediately preceding sentence, at no time shall
the sum of (i) the aggregate principal amount of Revolving Credit Advances
outstanding plus (ii) the aggregate outstanding amount of Reimbursement
Obligations plus (iii) the aggregate principal amount of Bid Rate Advances
outstanding exceed the Commitment. Subject to Section 2.9 hereof, Advances may
be repaid and then reborrowed. Any Advance shall, at the option of the Borrower
as provided in Section 2.2 hereof (and, in the case of LIBOR Advances, subject
to availability and to the provisions of Article 9 hereof), be made as a Base
Rate Advance or a LIBOR Advance; provided that there shall not be outstanding to
any Lender, at any one time, more than ten LIBOR Advances under the Commitment.
On the Maturity Date unless sooner paid as provided herein, the outstanding
Revolving Credit Advances shall be repaid in full.
(b) Bid Rate Advances. Each Lender may, in its sole discretion and on the
-----------------
terms and conditions set forth in this Agreement, make Bid Rate Advances to the
Borrower from time to time
-19-
in an aggregate amount not in excess of the difference between (i) the
Commitment minus (ii) the sum of (A) the aggregate outstanding principal amount
of all Revolving Credit Advances, plus (B) the amount of all Reimbursement
Obligations. Bid Rate Advances may either bear interest at the Absolute Bid Rate
or the LIBOR Bid Rate. Each Absolute Bid Rate Advance shall be for a period of
not less than 7 days and not more than 180 days. Each LIBOR Bid Rate Advance
shall be for a period of one, two, three or six months. Bid Rate Advances may
not be prepaid without the prior written consent of the Lender making such Bid
Rate Advance. Each borrowing of a Bid Rate Advance shall be a principal amount
which is at least $10,000,000 and which is an integral multiple of $1,000,000.
No Lender shall have an obligation to make Bid Rate Advances, and the Borrower
shall have no obligation to accept any offer for Bid Rate Advances.
Section 2.2 Manner of Borrowing and Disbursement.
------------------------------------
(a) In the case of Base Rate Advances other than a Refinancing Advance,
the Borrower, through an Authorized Signatory, shall give the Administrative
Lender prior to 10:30 a.m., Dallas, Texas time, on the date of any proposed Base
Rate Advance irrevocable written notice, or irrevocable telephonic notice
followed immediately by written notice (provided, however, that the Borrower's
failure to confirm any telephonic notice in writing shall not invalidate any
notice so given), of its intention to borrow or reborrow a Base Rate Advance
hereunder. Such notice of borrowing shall specify the requested funding date,
which shall be a Business Day, and the amount of the proposed aggregate Base
Rate Advances to be made by Lenders.
(b) In the case of LIBOR Advances, the Borrower, through an Authorized
Signatory, shall give the Administrative Lender at least three Business Days'
irrevocable written notice, or irrevocable telephonic notice followed
immediately by written notice (provided, however, that the Borrower's failure to
confirm any telephonic notice in writing shall not invalidate any notice so
given), of its intention to borrow or reborrow a LIBOR Advance hereunder. Notice
shall be given to the Administrative Lender prior to 11:00 a.m., Dallas, Texas
time, in order for such Business Day to count toward the minimum number of
Business Days required. LIBOR Advances shall in all cases be subject to
availability and to Article 9 hereof. For LIBOR Advances, the notice of
borrowing shall specify the requested funding date, which shall be a Business
Day, the amount of the proposed aggregate LIBOR Advances to be made by Lenders
and the Interest Period selected by the Borrower, provided that no such Interest
Period shall extend past the Maturity Date, or prohibit or impair the Borrower's
ability to comply with Section 2.8 hereof.
(c) Subject to Sections 2.1 and 2.9 hereof, at least three Business Days
prior to each Payment Date for a LIBOR Advance, the Borrower, through an
Authorized Signatory, shall give the Administrative Lender irrevocable written
notice, or irrevocable telephonic notice followed immediately by written notice
(provided, however, that the Borrower's failure to confirm any telephonic notice
in writing shall not invalidate any notice so given), specifying whether all or
a portion of such LIBOR Advance outstanding on the Payment Date (i) is to be
repaid and then reborrowed in whole or in part as a LIBOR Advance, (ii) is to be
repaid and then reborrowed in whole or in part as a Base Rate Advance, or (iii)
is to be repaid and not reborrowed; provided,
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however, notwithstanding anything in this Agreement to the contrary, if on any
Payment Date a Default shall exist, such LIBOR Advance may only be reborrowed as
a Base Rate Advance. Upon such Payment Date, such LIBOR Advance shall, subject
to the provisions hereof, be so repaid and, as applicable, reborrowed.
(d) Subject to Sections 2.1 and 2.9 hereof, upon at least two Business
Days' (or at least three Business Days' for a reborrowing as one or more LIBOR
Advances) irrevocable prior written notice, through an Authorized Signatory, or
irrevocable telephonic notice followed immediately by written notice (provided,
however, that the Borrower's failure to confirm any telephonic notice in writing
shall not invalidate any notice so given), the Borrower may repay or prepay a
Base Rate Advance, and (i) reborrow all or a portion of the principal amount
thereof as a Base Rate Advance, (ii) provided no Default shall exist, reborrow
all or a portion of the principal amount thereof as one or more LIBOR Advances,
or (iii) not reborrow all or any portion of such Base Rate Advance. Upon such
Payment Date or date of repayment, such Base Rate Advance shall, subject to the
provisions hereof, be so repaid and, as applicable, reborrowed.
(e) The aggregate amount of Base Rate Advances to be made by the Lenders on
any day shall be in a principal amount which is at least $500,000 and which is
an integral multiple of $250,000; provided, however, that such amount may equal
the unused amount of the Commitment. The aggregate amount of LIBOR Advances
having the same Interest Period and to be made by the Lenders on any day shall
be in a principal amount which is at least $1,000,000 and which is an integral
multiple of $250,000.
(f) The Administrative Lender shall promptly notify the Lenders of each
notice (other than with respect to a Bid Rate Advance) received from the
Borrower pursuant to this Section. Failure of the Borrower to give any notice in
accordance with Sections 2.2(c) and (d) hereof shall result in a repayment of
any such existing Revolving Credit Advance on the applicable Payment Date by a
Refinancing Advance which is a Base Rate Advance. Each Lender shall, not later
than noon, Dallas, Texas time, on the date of any Revolving Credit Advance that
is not a Refinancing Advance, deliver to the Administrative Lender, at its
address set forth herein, such Lender's Specified Percentage of such Revolving
Credit Advance in immediately available funds in accordance with the
Administrative Lender's instructions. Prior to 2:00 p.m., Dallas, Texas time, on
the date of any Revolving Credit Advance hereunder, the Administrative Lender
shall, subject to satisfaction of the conditions set forth in Article 3,
disburse the amounts made available to the Administrative Lender by the Lenders
by (i) transferring such amounts by wire transfer pursuant to the Borrower's
instructions, or (ii) in the absence of such instructions, crediting such
amounts to the account of the Borrower maintained with the Administrative
Lender. All Revolving Credit Advances shall be made by each Lender according to
its Specified Percentage. No Lender shall be relieved of its obligation to fund
its Specified Percentage of any Revolving Credit Advance notwithstanding the
fact that at any time the aggregate outstanding principal amount of all Bid Rate
Advances made by such Lender exceed its Specified Percentage of the Commitment.
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(g) Bid Rate Advances. With respect to each borrowing consisting of Bid
-----------------
Rate Advances, the Borrower shall give the Administrative Lender prior to 11:00
a.m. (Dallas time), (i) in the case of LIBOR Bid Rate Advances, at least four
Business Days prior to the proposed date of borrowing and (ii) in the case of
Absolute Bid Rate Advances, at least three Business Days prior to the proposed
date of borrowing, written notice of its intention to borrow Bid Rate Advances
pursuant to a Bid Rate Advance. Such Bid Rate Advance Request shall specify (i)
the requested date of borrowing, which shall be a Business Day, (ii) the
aggregate amount of the proposed borrowing of Bid Rate Advances (which shall be
at least $10,000,000 and which is an integral multiple of $1,000,000 in excess
thereof), (iii) the Interest Period with respect thereto, provided that such
Interest Period shall not extend past the Maturity Date, and (iv) whether the
Bid Rate Advances requested are Absolute Bid Rate Advances or LIBOR Bid Rate
Advances. Bid Rate Advance Requests that do not conform substantially to the
format of Exhibit F may be rejected by the Administrative Lender, and the
---------
Administrative Lender shall give prompt notice to the Borrower of such
rejection. The Borrower shall pay a $1,000 non-refundable, administrative fee
for the account of the Administrative Lender for each notice of proposed
borrowing consisting of Bid Rate Advances. Such fee shall be paid to the
Administrative Lender on the date of delivery of the Borrower's notice of
intention to borrow Bid Rate Advances, and shall not be refunded notwithstanding
that the proposed borrowing is canceled by Borrower or no Lender offers to make
a Bid Rate Advance.
(i) Upon the receipt by the Administrative Lender of a Bid Rate
Advance Request that conforms with the requirements herein, the
Administrative Lender shall, by telecopy in the form of the Invitation to
Bid, invite each Lender to bid, on the terms and conditions of this
Agreement, to make Bid Rate Advances pursuant to the Bid Rate Advance
Request.
(ii) Each Lender shall, if, in its sole discretion, it elects to do
so, irrevocably offer to make one or more Bid Rate Advances to the Borrower
as part of such proposed borrowing at a rate or rates of interest specified
by such Lender in its sole discretion, by delivering a Confirmation of Bid
to the Administrative Lender before 11:00 a.m. (Dallas time), (A) three
Business Days prior to the proposed date of borrowing, in the case of a
request for LIBOR Bid Rate Advances, and (B) two Business Days prior to the
proposed date of borrowing, in the case of a request for Absolute Bid Rate
Advances, (1) setting forth (a) the minimum amount (which shall be
$1,000,000 or an integral multiple in excess thereof) and maximum amount of
each Bid Rate Advance which such Lender would be willing to make as part of
the proposed borrowing (which amounts may exceed such Lender's Specified
Percentage) and (b) the Absolute Bid Rate or Margin therefor, as
applicable, and (2) confirming the Interest Period therefor. Confirmation
of Bids that do not conform substantially to Exhibit H may be rejected by
---------
the Administrative Lender, and the Administrative Lender shall notify the
applicable Lender of such rejection as soon as practicable. If any Lender
shall fail to respond to the Administrative Lender by such time, such
Lender shall be deemed to have elected not to make an offer. Any
Confirmation of Bid submitted by a Lender pursuant to this Section
2.2(g)(ii) is irrevocable.
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(iii) The Administrative Lender shall promptly notify the Borrower of
the number of Confirmation of Bids, the interest rate(s) and Interest
Period(s) applicable thereto, the maximum principal amount bid at each
interest rate for each Interest Period, and the identity of each Lender
submitting a Confirmation of Bid.
(iv) Not later than 1:00 p.m. (Dallas time) (A) three Business Days
prior to the proposed date of borrowing in the case of LIBOR Bid Rate
Advances and (B) two Business Days prior to the proposed date of the
proposed borrowing in the case of Absolute Bid Rate Advances, the Borrower
shall, in turn, either
(A) cancel such proposed borrowing by giving the Administrative
Lender notice to that effect, or
(B) accept one or more of the offers made by any Lender or
Lenders pursuant to clause (ii) above, in its sole discretion, by
giving notice to the Administrative Lender of the amount of each Bid
Rate Advance (which amount shall be equal to or greater than the
minimum amount, and equal to or less than the maximum amount, for
which notification was given to the Borrower by any Lender for such
Bid Rate Advance pursuant to clause (ii) above) to be made by each
Lender as part of such borrowing, and reject any remaining offers made
by Lenders pursuant to clause (ii) above by giving the Administrative
Lender notice to that effect; provided, however, that if offers are
made by two or more such Lenders with the same LIBOR Bid Rates or
Absolute Bid Rates for a greater aggregate principal amount than the
amount for which such offers are accepted for the related term, the
principal amount of Bid Rate Advances accepted shall be allocated by
the Borrower among such Lenders as nearly as possible (in multiples
not less than $1,000,000) in proportion to the aggregate principal
amount of such offers, and (3) the aggregate principal amount of
offers accepted by the Borrower shall not exceed the maximum amount
contained in the related Bid Rate Advance Request.
(v) The Administrative Lender shall promptly give telephonic notice
to each bidding Lender if any of its offers have been accepted (and if so,
in what amount, at what interest rate and for what Interest Period), and
each successful Lender will thereupon become bound, subject to the other
applicable conditions hereof, to make each Bid Rate Advance for which its
offer has been accepted.
(vi) After completing the notifications referred to in clause (v)
above, the Administrative Lender shall notify each bidding Lender (A) the
aggregate amount of Bid Rate Advances made in connection with such proposed
borrowing, (B) the maturities thereof, and (C) the lowest and highest
interest rates at which Bid Rate Advances were made for each maturity.
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(vii) If the Administrative Lender shall at any time elect to submit
a bid for a Bid Rate Advance in its capacity as a Lender, it shall submit
such bid directly to the Borrower one-half hour earlier than the latest
time at which other Lenders are required to submit their bid to the
Administrative Lender pursuant to Section 2(g)(ii) hereof.
(viii) If the Borrower accepts one or more offers made by any Lender
or Lenders pursuant to clause (iv)(B) above, each such Lender shall, unless
any applicable condition specified in Article 3 hereof has not been
satisfied, not later than 12:00 noon (Dallas time) on the date of a Bid
Rate Advance hereunder, make available to the Administrative Lender the
principal amount of each Bid Rate Advance in immediately available funds,
to be disbursed by the Administrative Lender by wire transfer pursuant to
instructions of the Borrower.
Section 2.3 Interest.
--------
(a) On Base Rate Advances.
---------------------
(i) The Borrower shall pay interest on the outstanding unpaid
principal amount of each Base Rate Advance, from the date such Advance is
made until it is due (whether at maturity, by reason of acceleration, by
scheduled reduction, or otherwise) and repaid, which shall be payable as
set forth in Section 2.3(a)(ii) hereof, at a simple interest rate per annum
equal to the Base Rate Basis for such Base Rate Advance as in effect from
time to time, provided that interest on such Base Rate Advance shall not
exceed the Maximum Amount.
(ii) Interest on each Base Rate Advance shall be computed on the
basis of a year of 365 or 366 days, as applicable, for the number of days
actually elapsed, and shall be payable in arrears on each Quarterly Date
and on the Maturity Date.
(b) On LIBOR Advances.
-----------------
(i) The Borrower shall pay interest on the unpaid principal amount
of each LIBOR Advance, from the date such Advance is made until it is due
(whether at maturity, by reason of acceleration, by scheduled reduction, or
otherwise) and repaid, at a rate per annum equal to the LIBOR Basis for
such Advance. The Administrative Lender, whose determination shall be
conclusive, shall determine the LIBOR Basis on the second Business Day
prior to the applicable funding date and shall notify the Borrower and the
Lenders of such LIBOR Basis.
(ii) Subject to Section 11.9 hereof, interest on each LIBOR Advance
shall be computed on the basis of a 360-day year for the actual number of
days elapsed, and shall be payable in arrears on the applicable Payment
Date and on the Maturity Date; provided, however, that if the Interest
Period for such Advance exceeds three months, interest shall
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also be due and payable in arrears on the three-month anniversary of the
beginning of such Interest Period.
(c) On Bid Rate Advances. The Borrower shall pay interest on each
--------------------
Absolute Bid Rate Advance at the Absolute Bid Rate offered by the Lender making
such Advance (but not in excess of the Highest Lawful Rate) in arrears on its
Payment Date, and, in addition, if the Interest Period for an Absolute Bid Rate
Advance exceeds 90 days, interest on such Bid Rate Advance shall also be due and
payable on the ninetieth day from the beginning of such Interest Period.
Interest on each Absolute Bid Rate Advance shall be computed on the basis of a
year of 365 or 366 days, as applicable, for the number of days actually elapsed.
The Borrower shall pay interest on each LIBOR Bid Rate Advance at the LIBOR Bid
Rate offered by the Lender making such Advance (but not in excess of the Highest
Lawful Rate) in arrears on its Payment Date, and, in addition, if the Interest
Period for a LIBOR Bid Rate Advance exceeds three months, interest on such LIBOR
Bid Rate Advance shall be due and payable in arrears on the three-month
anniversary of the beginning of such Interest Period. Interest on such LIBOR Bid
Rate Advance shall be computed on the basis of a 360-day year for the actual
number of days elapsed.
(d) Interest if No Notice of Selection of Interest Rate Basis. If the
---------------------------------------------------------
Borrower fails to give the Administrative Lender timely notice of its selection
of a LIBOR Basis or an Interest Period for a LIBOR Advance, or if for any reason
a determination of a LIBOR Basis for any Advance is not timely concluded due to
the fault of the Borrower, the Base Rate Basis shall apply to the applicable
Advance.
(e) Interest After an Event of Default. (i) After an Event of Default
----------------------------------
(other than an Event of Default specified in Section 8.1(f) or (g) hereof) and
during any continuance thereof, at the option of Determining Lenders, and (ii)
after an Event of Default specified in Section 8.1(f) or (g) hereof and during
any continuance thereof, automatically and without any action by the
Administrative Lender or any Lender, the Obligations shall bear interest at a
rate per annum equal to the Default Rate. Such interest shall be payable on the
earlier of demand or the Maturity Date, and shall accrue until the earlier of
(i) waiver or cure (to the satisfaction of the Determining Lenders) of the
applicable Event of Default, (ii) agreement by the Lenders to rescind the
charging of interest at the Default Rate, or (iii) payment in full of the
Obligations. The Lenders shall not be required to accelerate the maturity of the
Advances, to exercise any other rights or remedies under the Loan Documents, or
to give notice to the Borrower of the decision to charge interest at the Default
Rate. The Lenders will undertake to notify the Borrower, after the effective
date, of the decision to charge interest at the Default Rate.
Section 2.4 Fees.
----
(a) Commitment Fee. Subject to Section 11.9 hereof, the Borrower agrees
--------------
to pay to the Administrative Lender, for the ratable account of the Lenders, a
nonrefundable commitment fee (which commitment fee shall be payable in arrears
on each Quarterly Date and on the Maturity Date), based on the daily average
unused portion of the Commitment (subject to Section 11.9 hereof,
-25-
computed on the basis of a year of 360-day year for the actual number of days
elapsed, and for purposes of calculation of the commitment fee, Letters of
Credit outstanding from time to time will reduce the unused portion of the
Commitment and Bid Rate Advances outstanding from time to time shall not reduce
the unused portion of the Commitment) commencing on the Agreement Date, at the
following per annum percentages, applicable in the following situations:
Applicability Percentage
------------- ----------
(i) Category 1 - The Leverage Ratio is equal to or greater than 3.0 to 1 0.375%
----------
(ii) Category 2 - The Leverage Ratio is less than 3.0 to 1 but is equal to 0.300%
----------
or greater than 2.0 to 1
(iii) Category 3 - The Leverage Ratio is less than 2.0 to 1 but is greater 0.250%
----------
than or equal to 1.0 to 1
(iv) Category 4 - The Leverage Ratio is less than 1.0 to 1 0.200%
----------
Such fee shall be subject to reduction or increase, as applicable, and as set
forth in the table above, on a quarterly basis according to the performance of
the Borrower as tested by the Leverage Ratio; provided, that each adjustment in
such fee shall be effective as of the first day of the month immediately
following the month in which the Administrative Lender receives the financial
statements required pursuant to Section 6.1 or 6.2 hereof, as appropriate. If
financial statements of the Borrower (and corresponding Compliance Certificate
setting forth the Leverage Ratio) are not received by the Administrative Lender
by the date required pursuant to Section 6.1 or 6.2 hereof, as appropriate, the
commitment fee shall be determined pursuant to Category 1 above until such time
----------
as such financial statements and Compliance Certificate are received. For the
period from the Agreement Date to the date that an adjustment in such fee would
otherwise be made pursuant to the terms hereof, the commitment fee shall be
determined pursuant to Category 2 above.
----------
(b) Other Fees. Subject to Section 11.9 hereof, the Borrower agrees to
----------
pay to the Administrative Lender, for its account and not the account of the
Lenders, the fees provided for in the letter agreement ("Administrative Lender
---------------------
Fee Letter"), dated as of the Agreement Date, between the Borrower and the
----------
Administrative Lender on the date and in the amounts specified therein.
Section 2.5 Prepayment.
----------
(a) Voluntary Prepayments. The principal amount of any Base Rate Advance
---------------------
may be prepaid in full or in part at any time, without penalty and without
regard to the Payment Date for such Advance, upon two Business Days' prior
telephonic notice (to be promptly followed by written notice) by an Authorized
Signatory to the Administrative Lender. LIBOR Advances may be
-26-
voluntarily prepaid upon three Business Days' prior telephonic notice (to be
promptly followed by written notice) by an Authorized Signatory to the
Administrative Lender, but only so long as the Borrower concurrently reimburses
the Lenders in accordance with Section 2.9 hereof. Any notice of prepayment
shall be irrevocable.
(b) Mandatory Prepayment. On or before the date of any reduction of the
--------------------
Commitment pursuant to Section 2.6 hereof, the Borrower shall prepay outstanding
Advances in an amount necessary to reduce the sum of outstanding Advances and
Reimbursement Obligations to an amount not greater than the Commitment as so
reduced pursuant to Section 2.6 hereof.
(c) Mandatory Prepayments from Sales of Equity. Concurrently with the
------------------------------------------
receipt of Net Cash Proceeds from the sale or disposition by the Borrower or any
Subsidiary of any equity interest in any Venture, the Borrower shall prepay
Advances (which may not be made by means of a Refinancing Advance) in a
principal amount equal to such Net Cash Proceeds.
(d) Prepayments, Generally. With respect to mandatory prepayments, the
----------------------
Borrower shall first prepay all Base Rate Advances and shall thereafter prepay
LIBOR Advances. To the extent that any prepayment requires that a LIBOR Advance
be repaid on a date other than the last day of its Interest Period, the Borrower
shall reimburse each Lender in accordance with Section 2.9 hereof. Any
prepayment of a LIBOR Advance shall be accompanied by interest accrued on the
principal amount being prepaid. Any voluntary partial prepayment of a Base Rate
Advance shall be in a principal amount of $100,000 or an integral multiple
thereof.
Section 2.6 Reduction of Commitment.
-----------------------
(a) Voluntary Reduction. The Borrower shall have the right, upon not less
-------------------
than 10 Business Days' notice (provided no notice shall be required for a
termination in whole of the Commitment) by an Authorized Signatory to the
Administrative Lender (if telephonic, to be confirmed by telex or in writing on
or before the date of reduction or termination), which shall promptly notify the
Lenders, to terminate or reduce the Commitment, in whole or in part. Each
partial termination shall be in an aggregate amount which is at least $5,000,000
and which is an integral multiple of $100,000, and no voluntary reduction in the
Commitment shall cause any LIBOR Advance to be repaid prior to the last day of
its Interest Period.
(b) Mandatory Reduction. The Commitment shall be automatically reduced by
-------------------
the amount of Net Cash Proceeds received from the sale or disposition by the
Borrower or any Subsidiary of any equity interest in any Venture. On the
Maturity Date, the Commitment shall automatically reduce to zero.
(c) General Requirements. The Borrower shall reimburse each Lender for
--------------------
any loss or out-of-pocket expense incurred by each Lender in connection with any
prepayment pursuant to Section 2.5 hereof, as set forth in Section 2.9 hereof to
the extent applicable. The Borrower shall
-27-
not have any right to rescind any termination or reduction. Once reduced, the
Commitment may not be increased or reinstated.
Section 2.7 Non-Receipt of Funds by the Administrative Lender. Unless the
-------------------------------------------------
Administrative Lender shall have been notified by a Lender prior to the date of
any proposed Revolving Credit Advance (which notice shall be effective upon
receipt) that such Lender does not intend to make the proceeds of such Revolving
Credit Advance available to the Administrative Lender, the Administrative Lender
may assume that such Lender has made such proceeds available to the
Administrative Lender on such date, and the Administrative Lender may in
reliance upon such assumption (but shall not be required to) make available to
the Borrower a corresponding amount. If such corresponding amount is not in
fact made available to the Administrative Lender by such Lender, the
Administrative Lender shall be entitled to recover such amount on demand from
such Lender (or, if such Lender fails to pay such amount forthwith upon such
demand, from the Borrower) together with interest thereon in respect of each day
during the period commencing on the date such amount was available to the
Borrower and ending on (but excluding) the date the Administrative Lender
receives such amount from the Lender, with interest thereon at a per annum rate
equal to the lesser of (i) the Highest Lawful Rate or (ii) the Federal Funds
Rate. No Lender shall be liable for any other Lender's failure to fund a
Revolving Credit Advance hereunder.
Section 2.8 Payment of Principal of Advances. The Borrower agrees to
--------------------------------
pay the principal amount of the Advances to the Administrative Lender for the
account of the Lenders, as applicable, as follows:
(a) Base Rate Advances. The unpaid principal amount of the Base Rate
------------------
Advances shall be due and payable on the applicable Maturity Date.
(b) LIBOR Advances. The principal amount of each LIBOR Advance hereunder
--------------
shall be due and payable on its Payment Date, which principal payment may be
made by means of a Refinancing Advance.
(c) Bid Rate Advances. The principal amount of each Bid Rate Advance
-----------------
shall be due and payable on its Payment Date.
(d) Commitment Reduction. On the date of each reduction of the Commitment
--------------------
pursuant to Section 2.6 hereof, including the Maturity Date, the aggregate
amount of the Advances outstanding on such date of reduction in excess of the
Commitment as reduced minus all outstanding Reimbursement Obligations shall be
due and payable, which principal payment may not be made by means of Refinancing
Advances. On the Maturity Date, the Commitment shall be reduced to zero.
(e) Maturity Date. The principal amount of the Advances, all accrued
-------------
interest and fees thereon, and all other Obligations related thereto, shall be
due and payable in full on the Maturity Date.
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Section 2.9 Reimbursement. Whenever any Lender shall sustain or incur any
-------------
losses or reasonable out-of-pocket expenses in connection with (a) failure by
the Borrower to borrow any LIBOR Advance or Bid Rate Advance after having given
notice of its intention to borrow in accordance with Section 2.2 hereof (whether
by reason of the Borrower's election not to proceed or the non-fulfillment of
any of the conditions set forth in Article 3 hereof), (b) any prepayment for any
reason of any LIBOR Advance or Bid Rate Advance in whole or in part (including a
prepayment pursuant to Sections 2.5(c) and 9.3(b) hereof), or (c) any prepayment
of any LIBOR Advance that is not made on any date specified in a notice of
prepayment given by the Borrower, the Borrower agrees to pay to any such Lender,
upon its demand, an amount sufficient to compensate such Lender for all such
losses and out-of-pocket expenses, subject to Section 11.9 hereof. Such
Lender's good faith determination of the amount of such losses or out-of-pocket
expenses, calculated in its usual fashion, absent manifest error, shall be
binding and conclusive. Such losses shall include, without limiting the
generality of the foregoing, lost profits and reasonable expenses incurred by
such Lender in connection with the re-employment of funds prepaid, repaid,
converted or not borrowed, converted or paid, as the case may be. Upon request
of the Borrower, such Lender shall provide a certificate setting forth the
amount to be paid to it by the Borrower hereunder and calculations therefor.
Section 2.10 Manner of Payment.
-----------------
(a) Each payment (including prepayments) by the Borrower of the principal
of or interest on the Advances, fees, and any other amount owed under this
Agreement or any other Loan Document shall be made not later than 12:00 noon
(Dallas, Texas time) on the date specified for payment under this Agreement to
the Administrative Lender at the Administrative Lender's office, in lawful money
of the United States of America constituting immediately available funds.
(b) If any payment under this Agreement or any other Loan Document shall
be specified to be made upon a day which is not a Business Day, it shall be made
on the next succeeding day which is a Business Day, unless such Business Day
falls in another calendar month, in which case payment shall be made on the
preceding Business Day. Any extension of time shall in such case be included in
computing interest and fees, if any, in connection with such payment.
(c) The Borrower agrees to pay principal, interest, fees and all other
amounts due under the Loan Documents without deduction for set-off or
counterclaim or any deduction whatsoever.
(d) If some but less than all amounts due from the Borrower are received
by the Administrative Lender, the Administrative Lender shall apply such amounts
in the following order of priority: (i) to the payment of the Administrative
Lender's expenses incurred on behalf of the Lenders then due and payable, if
any; (ii) to the payment of all other fees then due and payable; (iii) to the
payment of interest then due and payable on the Advances and the Reimbursement
Obligations; (iv) to the payment of all other amounts not otherwise referred to
in this clause (d) then due and payable under the Loan Documents; and (v) to the
payment of principal then due and
-29-
payable on the Advances and the Reimbursement Obligations, and in the case of
any payments under any Subsidiary Guaranty, to pay any other obligations to any
Guarantied Party (as defined in the Subsidiary Guaranty) not covered in clauses
(i) through (iv) above, ratably among the Guarantied Parties in accordance with
the aggregate principal amount of Advances and Reimbursement Obligations and, in
the case of payments under any Subsidiary Guaranty, the obligations guaranteed
thereby, owed to each Guarantied Party.
(e) Except as otherwise provided in the last sentence of this Section
2.10(e), each payment by the Borrower in respect of obligations relating to the
Revolving Credit Advances and the Letters of Credit (whether for principal,
interest, fees or otherwise) shall, except as otherwise expressly provided
herein, be made to the Administrative Lender for the account of the Lenders pro
rata in accordance with their respective Specified Percentages. Except as
otherwise provided in the last sentence of this Section 2.10(e), each payment by
the Borrower in respect of obligations relating to the Bid Rate Advances shall
be made to the Administrative Lender for the account of the Lenders making such
Bid Rate Advances. Notwithstanding anything in this Section 2.10(e) or any
other provision of this Agreement or any other Loan Document to the contrary,
any payment by the Borrower in respect of any Advances after acceleration of the
Advances pursuant to Section 8.2 or any monies received by the Administrative
Lender as a result of the exercise of remedies under any Loan Documents after
acceleration of Advances pursuant to Section 8.2 shall be distributed pro rata
to each Lender based on the percentage that the outstanding Advances and
Reimbursement Obligations owed to such Lender bears to the aggregate Advances
and Reimbursement Obligations owed to all Lenders.
Section 2.11 LIBOR Lending Offices. Each Lender's initial LIBOR Lending
---------------------
Office is set forth opposite its name in Schedule 1 attached hereto. Each
----------
Lender shall have the right at any time and from time to time to designate a
different office of itself or of any Affiliate as such Lender's LIBOR Lending
Office, and to transfer any outstanding LIBOR Advance to such LIBOR Lending
Office. No such designation or transfer shall result in any liability on the
part of the Borrower for increased costs or expenses resulting solely from such
designation or transfer (except any such transfer which is made by a Lender
pursuant to Section 9.2 or 9.3 hereof, or otherwise for the purpose of complying
with Applicable Law). Increased costs for expenses resulting from a change in
law occurring subsequent to any such designation or transfer shall be deemed not
to result solely from such designation or transfer.
Section 2.12 Sharing of Payments. Any Lender obtaining a payment (whether
-------------------
voluntary or involuntary, due to the exercise of any right of set-off, or
otherwise) on account of its Revolving Credit Advances in excess of its
Specified Percentage of all payments made by the Borrower with respect to
Revolving Credit Advances shall purchase from each other Lender such
participation in the Revolving Credit Advances made by such other Lender as
shall be necessary to cause such purchasing Lender to share the excess payment
pro rata according to Specified Percentages with each other Lender; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from such purchasing Lender, the purchase shall be rescinded and the
purchase price restored to the extent of such recovery, but without interest.
The Borrower agrees that any Lender
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so purchasing a participation from another Lender pursuant to this Section, to
the fullest extent permitted by law, may exercise all its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Lender were the direct creditor of the Borrower in the amount of such
participation.
Section 2.13 Calculation of LIBOR Rate. The provisions of this Agreement
-------------------------
relating to calculation of the LIBOR Rate are included only for the purpose of
determining the rate of interest or other amounts to be paid hereunder that are
based upon such rate, it being understood that each Lender shall be entitled to
fund and maintain its funding of all or any part of a LIBOR Advance as it sees
fit.
Section 2.14 Booking Loans. Any Lender may make, carry or transfer
-------------
Advances at, to or for the account of any of its branch offices or the office of
any Affiliate.
Section 2.15 Taxes.
-----
(a) Any and all payments by the Borrower hereunder shall be made, in
accordance with Section 2.10, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges and
withholdings, and all liabilities with respect thereto, excluding, in the case
---------
of each Lender and the Administrative Lender, taxes imposed on, based upon or
measured by its overall net income, net worth or capital, and franchise taxes,
doing business taxes or minimum taxes imposed on it, (i) by the jurisdiction
under the laws of which such Lender or the Administrative Lender (as the case
may be) is organized and in which it has its applicable lending office or any
political subdivision thereof; (ii) by any other jurisdiction, or any political
subdivision thereof, other than those imposed by reason of (A) an asserted
relation of such jurisdiction to the transactions contemplated by this
Agreement, (B) the activities of the Borrower in such jurisdiction, or (C) the
activities in connection with the transactions contemplated by this Agreement of
a Lender or the Administrative Lender; (iii) by reason of failure by the Lender
or the Administrative Lender to comply with the requirements of paragraph (e) of
this Section 2.15; and (iv) in the case of any Lender, any Taxes in the nature
of transfer, stamp, recording or documentary taxes resulting from a transfer
(other than as a result of foreclosure) by such Lender of all or any portion of
its interest in this Agreement, the Notes or any other Loan Documents (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes"). If the Borrower shall be
-----
required by law to deduct any Taxes from or in respect of any sum payable
hereunder to any Lender or the Administrative Lender, (x) the sum payable shall
be increased as may be necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section
2.15) such Lender or the Administrative Lender (as the case may be) receives an
amount equal to the sum it would have received had no such deductions been made,
(y) the Borrower shall make such deductions and (z) the Borrower shall pay the
full amount deducted to the relevant taxation authority or other authority in
accordance with applicable law.
-31-
(b) In addition, the Borrower agrees to pay any and all stamp and
documentary taxes and any and all other excise and property taxes, charges and
similar levies (other than Taxes described in clause (iv) of the first sentence
of Section 2.15(a)) that arise from any payment made hereunder or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement or any other Loan Document (hereinafter referred to as "Other Taxes").
-----------
(c) The Borrower will indemnify each Lender and the Administrative Lender
for the full amount of Taxes and Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this
Section 2.15) paid by such Lender or the Administrative Lender (as the case may
be) and all liabilities (including penalties, additions to tax, interest and
reasonable expenses) arising therefrom or with respect thereto whether or not
such Taxes or Other Taxes were correctly or legally asserted, other than
penalties, additions to tax, interest and expenses arising as a result of gross
negligence on the part of such Lender or the Administrative Lender, provided,
--------
however, that the Borrower shall have no obligation to indemnify such Lender or
-------
the Administrative Lender unless and until such Lender or the Administrative
Lender shall have delivered to the Borrower a certificate setting forth in
reasonable detail the basis of the Borrower's obligation to indemnify such
Lender or the Administrative Lender pursuant to this Section 2.15. This
indemnification shall be made within 30 days from the date such Lender or the
Administrative Lender (as the case may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes, the Borrower
will furnish to the Administrative Lender the original or a certified copy of a
receipt evidencing payment thereof. If no Taxes are payable in respect of any
payment hereunder, the Borrower will furnish to the Administrative Lender a
certificate from each appropriate taxing authority, or an opinion of counsel
acceptable to the Administrative Lender, in either case stating that such
payment is exempt from or not subject to Taxes, provided, however, that such
-------- -------
certificate or opinion need only be given if: (i) the Borrower makes any payment
from any account located outside the United States, or (ii) the payment is made
by a payor that is not a United States Person. For purposes of this Section 2.15
the terms "United States" and "United States Person" shall have the meanings set
------------- --------------------
forth in Section 7701 of the Code.
(e) Each Lender which is not a United States Person hereby agrees that:
(i) it shall, no later than the Agreement Date (or, in the case of a
Lender which becomes a party hereto pursuant to Section 11.6 after the
Agreement Date, the date upon which such Lender becomes a party hereto)
deliver to the Borrower through the Administrative Lender, with a copy to
the Administrative Lender:
(A) if any lending office is located in the United States of
America, two (2) accurate and complete signed originals of Internal
Revenue Service Form 4224 or any successor thereto ("Form 4224"),
---------
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(B) if any lending office is located outside the United States
of America, two (2) accurate and complete signed originals of Internal
Revenue Service Form 1001 or any successor thereto ("Form 1001").
---------
in each case indicating that such Lender is on the date of delivery thereof
entitled to receive payments of principal, interest and fees for the
account of such lending office or lending offices under this Agreement free
from withholding of United States Federal income tax;
(ii) if at any time such Lender changes its lending office or
lending offices or selects an additional lending office it shall, at the
same time or reasonably promptly thereafter but only to the extent the
forms previously delivered by it hereunder are no longer effective, deliver
to the Borrower through the Administrative Lender, with a copy to the
Administrative Lender, in replacement for the forms previously delivered by
it hereunder:
(A) if such changed or additional lending office is located in
the United States of America, two (2) accurate and complete signed
originals of Form 4224; or
(B) otherwise, two (2) accurate and complete signed originals
of Form 1001,
in each case indicating that such Lender is on the date of delivery thereof
entitled to receive payments of principal, interest and fees for the
account of such changed or additional lending office under this Agreement
free from withholding of United States Federal income tax;
(iii) it shall, before or promptly after the occurrence of any event
(including the passing of time but excluding any event mentioned in clause
(ii) above) requiring a change in the most recent Form 4224 or Form 1001
previously delivered by such Lender and if the delivery of the same be
lawful, deliver to the Borrower through the Administrative Lender with a
copy to the Administrative Lender, two (2) accurate and complete original
signed copies of Form 4224 or Form 1001 in replacement for the forms
previously delivered by such Lender;
(iv) it shall, promptly upon the request of the Borrower to that
effect, deliver to the Borrower such other forms or similar documentation
as may be required from time to time by any applicable law, treaty, rule or
regulation in order to establish such Lender's tax status for withholding
purposes; and
(v) it shall notify the Borrower within 30 days after any event
(including an amendment to, or a change in any applicable law or regulation
or in the written interpretation thereof by any regulatory authority or any
judicial authority, or by ruling applicable to such Lender of any
governmental authority charged with the interpretation or administration of
any law) shall occur that results in such Lender no longer being capable of
receiving payments without any deduction or withholding of United States
federal income tax.
-33-
(f) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained in
this Section 2.15 shall survive the payment in full of principal and interest
hereunder.
(g) Any Lender claiming any additional amounts payable pursuant to this
Section 2.15 shall use its reasonable best efforts (consistent with its internal
policy and legal and regulatory restrictions) to change the jurisdiction of its
lending office, if the making of such a change would avoid the need for, or
reduce the amount of, any such additional amounts which may thereafter accrue
and would not, in the reasonable judgment of such Lender, be materially
disadvantageous to such Lender.
(h) Each Lender (and the Administrative Lender with respect to payments to
the Administrative Lender for its own account) agrees that (i) it will take all
reasonable actions by all usual means to maintain all exemptions, if any,
available to it from United States withholding taxes (whether available by
treaty, existing administrative waiver, by virtue of the location of any
Lender's lending office) and (ii) otherwise cooperate with the Borrower to
minimize amounts payable by the Borrower under this Section 2.15; provided,
--------
however, the Lenders and the Administrative Lender shall not be obligated by
-------
reason of this Section 2.15(h) to contest the payment of any Taxes or Other
Taxes or to disclose any information regarding its tax affairs or tax
computations or reorder its tax or other affairs or tax or other planning.
Subject to the foregoing, to the extent the Borrower pays sums pursuant to this
Section 2.15 and the Lender or the Administrative Lender receives a refund of
any or all of such sums, such refund shall be applied to pay any amounts then
due and owing under this Agreement or, to the extent that no amounts are due and
owing under this Agreement at the time such refunds are received, the party
receiving such refund shall promptly pay over all such refunded sums to the
Borrower, provided that no Default or Event of Default is in existence at such
time.
Section 2.16 Letters of Credit.
-----------------
(a) The Letter of Credit Facility. The Borrower may request the Issuing
-----------------------------
Bank, on the terms and conditions hereinafter set forth, to issue, and the
Issuing Bank shall, if so requested, issue, letters of credit (the "Letters of
----------
Credit") for the account of the Borrower or any Subsidiary from time to time on
------
any Business Day from the date of the initial Advance until the Maturity Date in
an aggregate maximum amount (assuming compliance with all conditions to drawing)
not to exceed at any time outstanding the lesser of (i) $175,000,000 (the
"Letter of Credit Facility") and (ii) the sum of (A) the Commitment minus (B)
-------------------------- -----
the aggregate principal amount of Advances then outstanding. No Letter of Credit
(other than the Tax-Exempt Letters of Credit) shall be issued to support any
obligation of the Borrower or any Subsidiary in respect of debt for borrowed
money. No Letter of Credit (other than the Tax-Exempt Letters of Credit) shall
have an expiration date (including all rights of renewal) later than the earlier
of (i) ten days prior to the Maturity Date or (ii) one year after the date of
issuance thereof. Immediately upon the issuance of each Letter of Credit (or,
with respect to the Existing Letters of Credit, on the Agreement Date), the
Issuing Bank
-34-
shall be deemed to have sold and transferred to each Lender, and each Lender
shall be deemed to have purchased and received from the Issuing Bank, in each
case irrevocably and without any further action by any party, an undivided
interest and participation in such Letter of Credit, each drawing thereunder and
the obligations of the Borrower under this Agreement in respect thereof in an
amount equal to the product of (x) such Lender's Specified Percentage of the
Commitment times (y) the maximum amount available to be drawn under such Letter
of Credit (assuming compliance with all conditions to drawing). Within the
limits of the Letter of Credit Facility, and subject to the limits referred to
above, the Borrower may request the issuance of Letters of Credit under this
Section 2.16(a), repay any Advances resulting from drawings thereunder pursuant
to Section 2.16(c) and request the issuance of additional Letters of Credit
under this Section 2.16(a).
(b) Request for Issuance. Each Letter of Credit shall be issued upon
--------------------
notice, given not later than 11:00 a.m. (Dallas time) on the third Business Day
prior to the date of the proposed issuance of such Letter of Credit, by the
Borrower to the Issuing Bank, which shall give to the Administrative Lender and
each Lender prompt notice thereof by telex, telecopier or cable. Each Letter of
Credit shall be issued upon notice given in accordance with the terms of any
separate agreement between the Borrower (and, if such Letter of Credit is being
issued for the account of a Subsidiary, such Subsidiary) and the Issuing Bank in
form and substance reasonably satisfactory to the Borrower (and, if such Letter
of Credit is being issued for the account of a Subsidiary, such Subsidiary) and
the Issuing Bank providing for the issuance of Letters of Credit pursuant to
this Agreement and containing terms and conditions not inconsistent with this
Agreement (a "Letter of Credit Agreement"), provided that if any such terms and
-------------------------- --------
conditions are inconsistent with this Agreement, this Agreement shall control.
Each such notice of issuance of a Letter of Credit (a "Notice of Issuance")
------------------
shall be by telex, telecopier or cable, specifying therein, in the case of a
Letter of Credit, the requested (A) date of such issuance (which shall be a
Business Day), (B) maximum amount of such Letter of Credit, (C) expiration date
of such Letter of Credit, (D) name and address of the beneficiary of such Letter
of Credit, (E) form of such Letter of Credit and (F) such other information as
shall be required pursuant to the relevant Letter of Credit Agreement. If the
requested terms of such Letter of Credit are acceptable to the Issuing Bank in
its reasonable discretion, the Issuing Bank will, upon fulfillment of the
applicable conditions set forth in Article 3 hereof, make such Letter of Credit
available to the Borrower (or, if such Letter of Credit is being issued for the
account of a Subsidiary, to such Subsidiary) at its office referred to in
Section 11.1 or as otherwise agreed with the Borrower (or, if such Letter of
Credit is being issued for the account of a Subsidiary, to such Subsidiary) in
connection with such issuance.
(c) Drawing and Reimbursement. The payment by the Issuing Bank of a draft
-------------------------
drawn under any Letter of Credit shall constitute for all purposes of this
Agreement the making by the Issuing Bank of a Revolving Credit Advance, which
shall bear interest at the Base Rate Basis, in the amount of such draft (but
without any requirement for compliance with the conditions set forth in Article
3 hereof). In the event that a drawing under any Letter of Credit is not
reimbursed by the Borrower by 11:00 a.m. (Dallas time) on the first Business Day
after such drawing, the Issuing Bank shall promptly notify Administrative Lender
and each other Lender. Each such Lender shall, on the first Business Day
following such notification, make a Revolving Credit Advance (or if as a result
-35-
of any Debtor Relief Law the Lenders are prohibited from making a Revolving
Credit Advance, each Lender shall fund its participation purchased pursuant to
Section 2.16(a) by making such amount available to the Administrative Lender),
which shall bear interest at the Base Rate Basis, and shall be used to repay the
applicable portion of the Issuing Bank's Revolving Credit Advance with respect
to such Letter of Credit, in an amount equal to the amount of its participation
in such drawing for application to reimburse the Issuing Bank (but without any
requirement for compliance with the applicable conditions set forth in Article 3
hereof) and shall make available to the Administrative Lender for the account of
the Issuing Bank, by deposit at the Administrative Lender's office, in same day
funds, the amount of such Revolving Credit Advance (or such participation). In
the event that any Lender fails to make available to the Administrative Lender
for the account of the Issuing Bank the amount of such Revolving Credit Advance
(or such participation), the Issuing Bank shall be entitled to recover such
amount on demand from such Lender together with interest thereon at a rate per
annum equal to the lesser of (i) the Highest Lawful Rate or (ii) the Federal
Funds Rate.
(d) Increased Costs. If any change in any law or regulation or in the
---------------
interpretation thereof by any court or administrative or governmental authority
charged with the administration thereof shall either (i) impose, modify or deem
applicable any reserve, special deposit or similar requirement against letters
of credit or guarantees issued by, or assets held by, or deposits in or for the
account of, the Issuing Bank or any Lender or (ii) impose on the Issuing Bank or
any Lender or any corporation controlling the Issuing Bank or any Lender any
other condition regarding this Agreement or such Lender or any Letter of Credit,
and the result of any event referred to in the preceding clause (i) or (ii)
shall be to increase the cost to the Issuing Bank of issuing or maintaining any
Letter of Credit or to any Lender of purchasing any participation therein or
making any Revolving Credit Advance pursuant to Section 2.16(c), then, upon
demand by the Issuing Bank or such Lender, the Borrower shall, subject to
Section 11.9 hereof, pay to the Issuing Bank or such Lender, from time to time
as specified by the Issuing Bank or such Lender, additional amounts that shall
be sufficient to compensate the Issuing Bank or such Lender for such increased
cost. A certificate as to the amount of such increased cost, submitted to the
Borrower by the Issuing Bank or such Lender, shall include in reasonable detail
the basis for the demand for additional compensation and shall be conclusive and
binding for all purposes, absent manifest error. The obligations of the Borrower
under this Section 2.16(d) shall survive termination of this Agreement. The
Issuing Bank or any Lender claiming any additional compensation under this
Section 2.16(d) shall use reasonable efforts (consistent with legal and
regulatory restrictions) to reduce or eliminate any such additional compensation
which may thereafter accrue and which efforts would not, in the sole discretion
of the Issuing Bank or such Lender, be otherwise disadvantageous.
(e) Obligations Absolute. The obligations of the Borrower under this
--------------------
Agreement with respect to any Letter of Credit, any Letter of Credit Agreement
and any other agreement or instrument relating to any Letter of Credit or any
Advance pursuant to Section 2.16(c) shall be unconditional and irrevocable, and
shall be paid strictly in accordance with the terms of this Agreement, such
Letter of Credit Agreement and such other agreement or instrument under all
circumstances, including, without limitation, the following circumstances:
-36-
(i) any lack of validity or enforceability of this Agreement, any
other Loan Document, any Letter of Credit Agreement, any Letter of Credit
or any other agreement or instrument relating thereto (collectively, the
"L/C Related Documents");
---------------------
(ii) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations of the Borrower in respect
of the Letters of Credit or any Revolving Credit Advance pursuant to
Section 2.16(c) or any other amendment or waiver of or any consent to
departure from all or any of the L/C Related Documents;
(iii) the existence of any claim, set-off, defense or other right
that the Borrower may have at any time against any beneficiary or any
transferee of a Letter of Credit (or any Persons for whom any such
beneficiary or any such transferee may be acting), the Issuing Bank, any
Lender or any other Person, whether in connection with this Agreement, the
transactions contemplated hereby or by the L/C Related Documents or any
unrelated transaction;
(iv) any statement or any other document presented under a 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;
(v) payment by the Issuing Bank under a Letter of Credit against
presentation of a draft or certificate that does not comply with the terms
of the Letter of Credit, except for any payment made upon the Issuing
Bank's gross negligence or willful misconduct;
(vi) any exchange, release or non-perfection of any collateral, or
any release or amendment or waiver of or consent to departure from any
Subsidiary Guaranty or any other guarantee, for all or any of the
Obligations of the Borrower in respect of the Letters of Credit or any
Revolving Credit Advance pursuant to Section 2.16(c); or
(vii) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including, without limitation, any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, the Borrower or a guarantor, other than the Issuing's Bank
gross negligence or wilful misconduct.
(f) Compensation for Letters of Credit.
----------------------------------
(i) Credit Fees. Subject to Section 11.9 hereof, the Borrower shall
-----------
pay to the Administrative Lender for the account of each Lender a credit
fee (which shall be payable quarterly in arrears on each Quarterly Date and
on the Maturity Date) on the average daily amount available for drawing
under all outstanding Letters of Credit (computed, subject to Section 11.9
hereof, on the basis of a 360-day year for the actual number of days
elapsed) at the following per annum percentages, applicable in the
following situations:
-37-
Applicability Percentage
------------- ----------
(A) Category 1 - The Leverage Ratio is greater than or equal to 3.0 to 1.500%
1
(B) Category 2 - The Leverage Ratio is less than 3.0 to 1 but is 1.250%
greater than or equal to 2.0 to 1
(C) Category 3 - The Leverage Ratio is less than 2.0 to 1 but is 1.000%
greater than or equal to 1.0 to 1
(D) Category 4 - The Leverage Ratio is less than 1.0 to 1 0.750%
(ii) Adjustment of Credit Fee. The credit fee payable in respect of the
------------------------
Letters of Credit shall be subject to reduction or increase, as applicable and
as set forth in the table in (i) above, on a quarterly basis according to the
performance of the Borrower as tested by the Leverage Ratio. Any such increase
or reduction in such fee shall be effective on the date of receipt of the
financial statements required pursuant to Section 6.1 or 6.2 hereof. If such
financial statements are not received by the date required, the fee payable in
respect of the Letters of Credit shall be determined pursuant to Category 1
----------
above until such time as such financial statements are received.
(iii) Issuance Fee. Subject to Section 11.9 hereof, the Borrower
-------------
shall pay to the Administrative Lender for the sole account of the Issuing Bank
an issuance fee (which fee shall be payable quarterly in arrears on each
Quarterly Date and on the Maturity Date) equal to 0.125% per annum on the
average daily amount available for drawing under all outstanding Letters of
Credit, and computed, subject to Section 11.9 hereof, on the basis of a 360-day
year for the actual number of days elapsed.
(g) L/C Cash Collateral Account.
---------------------------
(i) Upon the occurrence of an Event of Default and demand by the
Administrative Lender pursuant to Section 8.2(c) (but in the case of an Event of
Default specified in Section 8.1(f) or (g) hereof, without any demand or taking
of any other action by the Administrative Lender or any Lender), the Borrower
will promptly pay to the Administrative Lender in immediately available funds an
amount equal to 102% of the maximum amount then available to be drawn under the
Letters of Credit then outstanding. Any amounts so received by the
Administrative Lender shall be deposited by the Administrative Lender in a
deposit account maintained by the Issuing Bank (the "L/C Cash Collateral
-------------------
Account").
-------
(ii) As security for the payment of all Reimbursement Obligations and for
any other Obligations, the Borrower hereby grants, conveys, assigns, pledges,
sets over and transfers to the Administrative Lender (for the benefit of the
Issuing Bank and Lenders), and
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creates in the Administrative Lender's favor (for the benefit of the Issuing
Bank and Lenders) a Lien in, all money, instruments and securities at any time
held in or acquired in connection with the L/C Cash Collateral Account, together
with all proceeds thereof. The L/C Cash Collateral Account shall be under the
sole dominion and control of the Administrative Lender and the Borrower shall
have no right to withdraw or to cause the Administrative Lender to withdraw any
funds deposited in the L/C Cash Collateral Account. At any time and from time to
time, upon the Administrative Lender's request, the Borrower promptly shall
execute and deliver any and all such further instruments and documents,
including UCC financing statements, as may be necessary, appropriate or
desirable in the Administrative Lender's judgment to obtain the full benefits
(including perfection and priority) of the security interest created or intended
to be created by this paragraph (ii) and of the rights and powers herein
granted. The Borrower shall not create or suffer to exist any Lien on any
amounts or investments held in the L/C Cash Collateral Account other than the
Lien granted under this paragraph (ii) and Liens arising by operation of Law and
not by contract which secure amounts not yet due and payable.
(iii) The Administrative Lender shall (A) apply any funds in the L/C Cash
Collateral Account on account of Reimbursement Obligations when the same become
due and payable if and to the extent that the Borrower shall fail directly to
pay such Reimbursement Obligations and (B) after the Maturity Date, apply any
proceeds remaining in the L/C Cash Collateral Account first to pay any unpaid
-----
Obligations then outstanding hereunder and then to refund any remaining amount
----
to the Borrower.
(iv) The Borrower, no more than once in any calendar month, may direct
the Administrative Lender to invest the funds held in the L/C Cash Collateral
Account (so long as the aggregate amount of such funds exceeds any relevant
minimum investment requirement) in (A) direct obligations of the United States
or any agency thereof, or obligations guaranteed by the United States or any
agency thereof and (B) one or more other types of investments permitted by the
Determining Lenders, in each case with such maturities as the Borrower, with the
consent of the Determining Lenders, may specify, pending application of such
funds on account of Reimbursement Obligations or on account of other
Obligations, as the case may be. In the absence of any such direction from the
Borrower, the Administrative Lender shall invest the funds held in the L/C Cash
Collateral Account (so long as the aggregate amount of such funds exceeds any
relevant minimum investment requirement) in one or more types of investments
with the consent of the Determining Lenders with such maturities as the
Borrower, with the consent of the Determining Lenders, may specify, pending
application of such funds on account of Reimbursement Obligations or on account
of other Obligations, as the case may be. All such investments shall be made in
the Administrative Lender's name for the account of the Lenders. The Borrower
recognizes that any losses or taxes with respect to such investments shall be
borne solely by the Borrower, and the Borrower agrees to hold the Administrative
Lender and the Lenders harmless from any and all such losses and taxes.
Administrative Lender may liquidate any investment held in the L/C Cash
Collateral Account in order to
-39-
apply the proceeds of such investment on account of the Reimbursement
Obligations (or on account of any other Obligation then due and payable, as
the case may be) without regard to whether such investment has matured and
without liability for any penalty or other fee incurred (with respect to
which the Borrower hereby agrees to reimburse the Administrative Lender) as
a result of such application.
(v) The Borrower shall pay to the Administrative Lender the fees
customarily charged by the Issuing Bank with respect to the maintenance of
accounts similar to the L/C Cash Collateral Account.
ARTICLE 3
Conditions Precedent
--------------------
Section 3.1 Conditions Precedent to the Initial Advance and the Letters of
--------------------------------------------------------------
Credit. The obligation of each Lender to make the initial Advance and the
------
obligation of the Issuing Bank to issue the initial Letter of Credit is subject
to (i) receipt by the Administrative Lender of each of the following, in form
and substance satisfactory to each Lender, with a copy (except for the Notes)
for each Lender and (ii) satisfaction of the following conditions, except as
otherwise waived by each Lender:
(a) A loan certificate of the Borrower certifying as to the accuracy of
its representations and warranties in the Loan Documents, certifying that no
Default has occurred, and including a certificate of incumbency with respect to
each Authorized Signatory, and including (i) a copy of the Articles of
Incorporation of the Borrower, certified to be true, complete and correct by the
secretary of state of its state of incorporation, (ii) a copy of the By-Laws of
the Borrower, as in effect on the Agreement Date, (iii) a copy of the
resolutions of the Borrower authorizing it to execute, deliver and perform this
Agreement, the Notes and the other Loan Documents to which it is a party, and
(iv) a copy of a certificate of good standing and a certificate of existence for
its state of incorporation and each state in which it is qualified to do
business;
(b) A certificate of an officer acceptable to the Lenders of each
Subsidiary, certifying as to the incumbency of the officers signing the Loan
Documents to which it is a party, and including (i) a copy of its Articles of
Incorporation (or other similar organizational document), certified as true,
complete and correct by the secretary of state of its state of incorporation or
organization, (ii) a copy of its By-Laws (or other similar governance document),
as in effect on the Agreement Date, (iii) a copy of the resolutions authorizing
it to execute, deliver and perform the Loan Documents to which it is a party,
and (iv) a copy of a certificate of good standing and a certificate of existence
for its state of incorporation or organization and each state in which it is
qualified to do business;
(c) duly executed Revolving Credit Notes, payable to the order of each
Lender and in an amount for each Lender equal to its Specified Percentage of the
Commitment;
-40-
(d) duly executed Bid Rate Notes, payable to the order of each Lender;
(e) opinions of counsel to the Borrower and its Subsidiaries addressed to
the Lenders and in form and substance satisfactory to the Lenders, dated the
Agreement Date, and covering the matters set forth in Xxxxxxxx 0.0(x), (x), (x),
(x), (x), (x), (x), (x), (x) and (p) and such other matters incident to the
transactions contemplated hereby as the Administrative Lender or Special Counsel
may reasonably request;
(f) reimbursement for the Administrative Lender for Special Counsel's
reasonable fees and expenses rendered as of the date set forth in the invoice of
Special Counsel;
(g) a duly executed and completed Subsidiary Guaranty, dated as of the
Agreement Date;
(h) payment in full of all accrued and outstanding obligations under the
Existing Credit Agreement (other than contingent obligations in respect of the
Existing Letters of Credit) whereupon all obligations of the Borrower (excluding
those obligations which expressly survive termination of the Existing Credit
Agreement) and the lenders under the Existing Credit Agreement (including with
respect to such lenders, without limitation, the Existing Letters of Credit)
shall terminate;
(i) all outstanding obligations owed by the Borrower under the Existing
Credit Agreement shall have been previously or shall be simultaneously paid in
full and all collateral therefor shall be released;
(j) the holders of the Prudential Borrower Notes, the Prudential Assumed
Notes and the Senior Notes and the Lenders shall have entered into a Second
Amended and Restated Intercreditor Agreement with respect thereto in form and
substance satisfactory to the Lenders; and
(k) in form and substance satisfactory to the Lenders and Special Counsel,
such other documents, instruments, reports and certificates as the
Administrative Lender or any Lender may reasonably require prior to execution of
this Agreement.
Section 3.2 Conditions Precedent to All Advances and Letters of Credit.
----------------------------------------------------------
The obligation of each Lender to make each Advance hereunder (including the
initial Advance) and the obligation of the Issuing Bank to issue each Letter of
Credit (including the initial Letter of Credit) is subject to fulfillment of the
following conditions immediately prior to or contemporaneously with each such
Advance or issuance:
(a) With respect to Advances (other than Refinancing Advances) and each
issuance of a Letter of Credit, all of the representations and warranties of the
Borrower under this Agreement, which, pursuant to Section 4.2 hereof, are made
at and as of the time of such Advance or issuance, shall be true and correct at
such time in all material respects, both before and after giving effect to the
application of the proceeds of the Advance or issuance;
-41-
(b) The incumbency of the Authorized Signatories shall be as stated in the
certificate of incumbency delivered in the Borrower's loan certificate pursuant
to Section 3.1(a) or as subsequently modified and reflected in a certificate of
incumbency delivered to the Administrative Lender. The Lenders may, without
waiving this condition, consider it fulfilled and a representation by the
Borrower made to such effect if no written notice to the contrary, dated on or
before the date of such Advance or issuance, is received by the Administrative
Lender from the Borrower prior to the making of such Advance or issuance;
(c) There shall not exist a Default hereunder, with respect to Advances
(other than Refinancing Advances) and with respect to issuance of each Letter of
Credit, or an Event of Default, with respect to any Refinancing Advance, and,
with respect to each Advance (other than a Refinancing Advance) and with respect
to issuance of each Letter of Credit, the Administrative Lender shall have
received written or telephonic certification thereof by an Authorized Signatory
(which certification, if telephonic, shall be followed promptly by written
certification);
(d) The aggregate Advances and amount available for draws under Letters of
Credit, after giving effect to such proposed Advance or Letter of Credit, shall
not exceed the maximum principal amount then permitted to be outstanding
hereunder; and
(e) The Administrative Lender shall have received all such other
certificates, reports, statements, opinions of counsel or other documents as the
Administrative Lender or any Lender may reasonably request.
Notwithstanding the above, the obligation of each Lender to make a
Revolving Credit Advance pursuant to Section 2.16(c) (or fund its participation
in respect of Letters of Credit pursuant to Section 2.16(c)) shall be absolute
and unconditional and shall not be affected by any circumstances, including,
without limitation, (i) the occurrence of any Default or Event of Default, or
(ii) the failure of the Borrower to satisfy any condition set forth in this
Section 3.2; provided, however, the conditions precedent set forth in Sections
-------- -------
3.1 and 3.2 hereof with respect to the Letter of Credit for which such Revolving
Credit Advance is made (or participation funded) shall have been satisfied in
full at the time of issuance of such Letter of Credit.
Each request by the Borrower to the Administrative Lender or the Issuing
Bank, as appropriate, for an Advance or the issuance of a Letter of Credit shall
constitute a representation and warranty by the Borrower as of the date of the
making of such Advance or the issuance of such Letter of Credit that all the
conditions contained in this Section 3.2 have been satisfied.
-42-
ARTICLE 4
Representations and Warranties
------------------------------
Section 4.1 Representations and Warranties. The Borrower hereby represents
------------------------------
and warrants to each Lender as follows:
(a) Organization; Power; Qualification. As of the Agreement Date, the
----------------------------------
respective jurisdiction of organization and percentage ownership by the Borrower
or another Subsidiary of the Subsidiaries listed on Schedule 4 are true and
----------
correct. Each of the Borrower and its Subsidiaries is duly organized, validly
existing and in good standing under the laws of its state of organization. Each
of the Borrower and its Subsidiaries has the legal power and authority to own
its properties and to carry on its business as now being and hereafter proposed
to be conducted. Each of the Borrower and its Subsidiaries is duly qualified, in
good standing and authorized to do business in each jurisdiction in which the
character of its properties or the nature of its business requires such
qualification or authorization except where the failure to be so qualified or
authorized would not have a Material Adverse Effect.
(b) Authorization. The Borrower has corporate power and has taken all
-------------
necessary corporate action to authorize it to borrow hereunder. Each of the
Borrower and its Subsidiaries has legal power and has taken all necessary legal
action to execute, deliver and perform the Loan Documents to which it is a party
in accordance with the terms thereof, and to consummate the transactions
contemplated thereby. Each Loan Document has been duly executed and delivered by
the Borrower or the Subsidiary executing it. Each of the Loan Documents to which
the Borrower and its Subsidiary are party is a legal, valid and binding
respective obligation of the Borrower or the Subsidiary, as applicable,
enforceable in accordance with its terms, subject, to enforcement of remedies,
to the following qualifications: (i) equitable principles generally, and (ii)
Debtor Relief Laws (insofar as any such law relates to the bankruptcy,
insolvency or similar event of the Borrower or any Subsidiary).
(c) Compliance with Other Loan Documents and Contemplated Transactions.
------------------------------------------------------------------
The execution, delivery and performance by the Borrower and its Subsidiaries of
the Loan Documents to which they are respectively a party, and the consummation
of the transactions contemplated thereby, do not and will not (i) require any
consent or approval not already obtained, (ii) violate any Applicable Law, (iii)
conflict with, result in a breach of, or constitute a default under the articles
of incorporation, partnership agreement, trust agreement or by-laws, as
appropriate, of the Borrower or any Subsidiary, or under any Necessary
Authorization, indenture, agreement or other instrument, to which the Borrower
or any Subsidiary is a party or by which they or their respective properties may
be bound, or (iv) result in or require the creation or imposition of any Lien
upon or with respect to any property now owned or hereafter acquired by the
Borrower or any Subsidiary, except Permitted Liens.
-43-
(d) Business. The Borrower and its Subsidiaries are engaged solely in the
--------
business of manufacturing, mining, producing, transporting and selling
construction and construction related materials, including but not limited to
natural (sand and gravel) and manufactured aggregates, cement, concrete,
concrete products, clay and cement bricks, and concrete blocks; producing,
transporting and selling specialty products produced as by-products of such
construction and construction related materials; acquiring, developing and
selling real-estate; maintaining, owning, managing and operating aircraft;
acquiring, disposing, storing, treating, processing and recycling combustible
waste materials; producing and selling a broad range of carbon steel products
from recycled steel; recycling waste products; and acquiring, owning, disposing,
conducting and operating trades, services and businesses related and/or similar
to any of the foregoing; provided, however, Subsidiaries of the Borrower may
engage in Securitizations permitted by Section 7.4(a)(ii) hereof and activities
related to such Securitizations, provided that any such Subsidiary that engages
in such Securitizations shall engage in no other business.
(e) Licenses, etc. All Necessary Authorizations, which if not obtained
--------------
could be reasonably expected to have a Material Adverse Effect, have been duly
obtained, and are in full force and effect without any known conflict with the
rights of others and free from any unduly burdensome restrictions. The Borrower
and its Subsidiaries are and will continue to be in compliance in all material
respects with all provisions thereof. No circumstance exists which might impair
the utility of the Necessary Authorization or the right to renew such Necessary
Authorization the effect of which would have a Material Adverse Effect. No
Necessary Authorization, which if suspended, canceled or revoked could
reasonably be expected to have a Material Adverse Effect, is the subject of any
pending or, to the best of the Borrower's knowledge, threatened challenge,
suspension, cancellation or revocation.
(f) Compliance with Law. The Borrower and its Subsidiaries are in
-------------------
compliance in all respects with all Applicable Laws, except where the failure to
so comply would not have a Material Adverse Effect. The Borrower and its
Subsidiaries have duly and timely filed all reports, statements and filings that
are required to be filed by any of them with any Governmental Authority, and are
in all material respects in compliance therewith, including without limitation
the rules and regulations of any Governmental Authority relating to the
operation of the Borrower's and each Subsidiary's business. The Borrower and
its Subsidiaries have obtained all appropriate approvals and consents of, and
has made all filings with, the Governmental Authorities in connection with the
operation of the Borrower's and each Subsidiary's business.
(g) Title to Properties. The Borrower and its Subsidiaries have good and
-------------------
indefeasible title to, or a valid leasehold interest in, all of their material
assets. None of their assets are subject to any Liens, except Permitted Liens.
No financing statement or other Lien filing (except relating to Permitted Liens)
is on file in any state or jurisdiction that names the Borrower or any of its
Subsidiaries as debtor or covers (or purports to cover) any assets of the
Borrower or any of its Subsidiaries. The Borrower and its Subsidiaries have not
signed any such financing statement or filing, nor any security agreement
authorizing any Person to file any such financing statement or filing.
-44-
(h) Litigation. Except as reflected on Schedule 3 hereto, there is no
---------- ----------
action, suit or proceeding pending against, or, to the best of the Borrower's
knowledge, threatened against the Borrower, or in any other manner relating
directly and adversely to the Borrower or any of its Subsidiaries, or any of
their properties, in any court or before any arbitrator of any kind or before or
by any governmental body in which the amount claimed (in excess of applicable
insurance) exceeds $1,000,000.
(i) Taxes. All federal, state and other tax returns of the Borrower and
-----
its Subsidiaries required by law to be filed have been duly filed and all
federal, state and other taxes, assessments and other governmental charges or
levies upon the Borrower, its Subsidiaries or any of their respective
properties, income, profits and assets, which are due and payable, have been
paid, unless the same are being diligently contested in good faith by
appropriate proceedings, with adequate reserves established therefor, and no
Lien (other than a Permitted Lien) has attached and no foreclosure, distraint,
sale or similar proceedings have been commenced. The charges, accruals and
reserves on the books of the Borrower and its Subsidiaries in respect of their
respective taxes are, in the judgment of the Borrower, adequate.
(j) Financial Statements; Material Liabilities. The Borrower has
--- ------------------------------------------
furnished or caused to be furnished to the Lenders copies of its fiscal years
1997 and 1998 financial statements, which are prepared in good faith and
complete in all material respects and present fairly in accordance with GAAP the
financial position of the Borrower and its Subsidiaries as at such dates and the
results of operations for the periods then ended. The Borrower and its
Subsidiaries taken as a whole have no material liabilities, contingent or
otherwise, nor material losses, except as set forth in the May 31, 1998
financial statements.
(k) No Adverse Change. Since May 31, 1998, no event or circumstances has
-----------------
occurred or arisen that could have a Material Adverse Effect.
(l) ERISA. None of the Borrower or its Controlled Group maintains or
-----
contributes to any Plan other than those disclosed to the Administrative Lender
in writing. Each such Plan (other than any Multiemployer Plan) is in compliance
in all material respects with the applicable provisions of ERISA, the Code, and
any other applicable Federal or state law, rule or regulation. With respect to
each Plan (other than any Multiemployer Plan) of the Borrower and each member of
its Controlled Group, all reports required under ERISA or any other Applicable
Law to be filed with any governmental authority, the failure of which to file
could reasonably result in liability of the Borrower or any member of its
Controlled Group in excess of $100,000, have been duly filed. All such reports
are true and correct in all material respects as of the date given. No Plan of
the Borrower or any member of its Controlled Group has been terminated under
Section 4041(c) of ERISA nor has any accumulated funding deficiency (as defined
in Section 412(a) of the Code) been incurred (without regard to any waiver
granted under Section 412 of the Code), nor has any funding waiver from the
Internal Revenue Service been received or requested the result of which could
reasonably be expected to have a Material Adverse Effect. None of the Borrower
or any member
-45-
of its Controlled Group has failed to make any contribution or pay any amount
due or owing as required under the terms of any such Plan, or by Section 412 of
the Code or Section 302 of ERISA by the due date under Section 412 of the Code
and Section 302 of ERISA the result of which could reasonably be expected to
have a Material Adverse Effect. There has been no ERISA Event or any event
requiring disclosure under Section 4041(c)(3)(C) or 4063(a) of ERISA with
respect to any Plan or its related trust of the Borrower or any member of its
Controlled Group since the effective date of ERISA. The present value of the
benefit liabilities, as defined in Title IV of ERISA, of each Plan subject to
Title IV of ERISA (other than a Multiemployer Plan) of the Borrower and each
member of its Controlled Group does not exceed by more than $100,000 the present
value of the assets of each such Plan as of the most recent valuation date using
each such Plan's actuarial assumptions at such date. There are no pending, or to
the best of the Borrower's knowledge threatened, claims, lawsuits or actions
(other than routine claims for benefits in the ordinary course) asserted or
instituted against, and neither the Borrower nor any member of its Controlled
Group has knowledge of any threatened litigation or claims against, the assets
of any Plan or its related trust or against any fiduciary of a Plan with respect
to the operation of such Plan the result of which could reasonably be expected
to have a Material Adverse Effect. None of the Borrower or, to the best of the
Borrower's knowledge, any member of its Controlled Group has engaged in any
prohibited transactions, within the meaning of Section 406 of ERISA or Section
4975 of the Code, in connection with any Plan the result of which could
reasonably be expected to have a Material Adverse Effect. None of the Borrower
or any member of its Controlled Group has withdrawn from any Multiemployer Plan
except as described in writing to the Administrative Lender prior to the
Agreement Date, nor has incurred or reasonably expects to incur (A) any
liability under Title IV of ERISA (other than premiums due under Section 4007 of
ERISA to the PBGC), (B) any withdrawal liability (and no event has occurred
which with the giving of notice under Section 4219 of ERISA would result in such
liability) under Section 4201 of ERISA as a result of a complete or partial
withdrawal (within the meaning of Section 4203 or 4205 of ERISA) from a
Multiemployer Plan, or (C) any liability under Section 4062 of ERISA to the PBGC
or to a trustee appointed under Section 4042 of ERISA. None of the Borrower, any
member of its Controlled Group, or any organization to which the Borrower or any
member of its Controlled Group is a successor or parent corporation within the
meaning of ERISA Section 4069(b), has engaged in a transaction within the
meaning of ERISA Section 4069 the result of which could reasonably be expected
to have a Material Adverse Effect. None of the Borrower or any member of its
Controlled Group maintains or has established any Plan, which is a material
welfare benefit plan within the meaning of Section 3(1) of ERISA and which
provides for continuing benefits or coverage for any participant or any
beneficiary of any participant after such participant's termination of
employment, except as may be required by the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA") and the regulations thereunder.
Each of Borrower and its Controlled Group which maintains a Plan which is a
welfare benefit plan within the meaning of Section 3(1) of ERISA has complied in
all material respects with any applicable notice and continuation requirements
of COBRA and the regulations thereunder. None of the Borrower or any member of
its Controlled Group maintains, has established, or has ever participated in a
multiemployer welfare benefit arrangement within the meaning of Section 3(40)(A)
of ERISA.
-46-
(m) Compliance with Regulations T, U and X. The Borrower is not 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 within the
meaning of Regulations T, U and X of the Board of Governors of the Federal
Reserve System. No more than 25% of the assets of the Borrower and its
Subsidiaries consist of margin stock. None of the Borrower and its Subsidiaries
nor any agent acting on their behalf, have taken or will knowingly take any
action which might cause this Agreement or any other Loan Documents to violate
any regulation of the Board of Governors of the Federal Reserve System or to
violate the Securities Exchange Act of 1934, in each case as in effect now or as
the same may hereafter be in effect. Neither the making of the Advances nor the
use of the proceeds thereof will violate, or be inconsistent with, the
provisions of Regulations T, U or X of said Board of Governors.
(n) Governmental Regulation. The Borrower and its Subsidiaries are not
-----------------------
required to obtain any Necessary Authorization that has not already been
obtained from, or effect any material filing or registration that has not
already been effected with, any Governmental Authority in connection with the
execution and delivery of this Agreement or any other Loan Document, or the
performance thereof (other than any enforcement of remedies by the
Administrative Lender on behalf of the Lenders) in accordance with their
respective terms, including any borrowings hereunder.
(o) Absence of Default. The Borrower and its Subsidiaries are in
------------------
compliance in all material respects with all of the provisions of their articles
of incorporation and by-laws, and no event has occurred or failed to occur,
which has not been remedied or waived, the occurrence or non-occurrence of which
constitutes, or which with the passage of time or giving of notice or both would
constitute, (i) a Default or an Event of Default or (ii) a default by the
Borrower or any of its Subsidiaries under any indenture, agreement or other
instrument, or any judgment, decree or order to which the Borrower or any of its
Subsidiaries or by which they or any of their material properties is bound.
(p) Investment Company Act. The Borrower is not required to register
----------------------
under the provisions of the Investment Company Act of 1940, as amended. Neither
the entering into or performance by the Borrower of this Agreement nor the
issuance of the Notes violates any provision of such act or requires any
consent, approval, or authorization of, or registration with, the Securities and
Exchange Commission or any other governmental or public body of authority
pursuant to any provisions of such act.
(q) Environmental Matters. Each of the Borrower and its Subsidiaries is
---------------------
in compliance with all Applicable Environmental Laws in effect in each
jurisdiction where it is presently doing business or has done business, and in
which the failure so to comply could have a Material Adverse Effect. Neither the
Borrower nor any of the Subsidiaries is subject to any liability under any
Applicable Environmental Laws that, in the aggregate, could have a Material
Adverse Effect. Neither the Borrower nor any Subsidiary has received any (a)
notice from any Governmental Authority by which any of its present or
previously-owned or leased real properties has been
-47-
designated, listed, or identified in any manner by any Governmental Authority
charged with administering or enforcing any Applicable Environmental Law as a
Hazardous Substance disposal or removal site, "Super Fund" clean-up site, or
candidate for removal or closure pursuant to any Applicable Environmental Law,
(b) notice of any Lien arising under or in connection with any Applicable
Environmental Law that has attached to any revenues of, or to, any of its owned
or leased real properties, or (c) summons, citation, notice, directive, letter,
or other communication, written or oral, from any Governmental Authority
concerning any intentional or unintentional action or omission by the Borrower
or such Subsidiary in connection with its ownership or leasing of any real
property resulting in the releasing, spilling, leaking, pumping, pouring,
emitting, emptying, dumping, or otherwise disposing of any Hazardous Substance
into the environment resulting in any material violation of an Applicable
Environmental Law, in each case in (a), (b) and (c) immediately preceding where
the effect of which could have a Material Adverse Effect.
(r) Certain Fees. No broker's, finder's or other fee or commission will
------------
be payable by the Borrower (other than to the Lenders hereunder) with respect to
the making of the Commitment or the Advances hereunder or the issuance of any
Letters of Credit. The Borrower agrees to indemnify and hold harmless the
Administrative Lender and each Lender from and against any claims, demand,
liability, proceedings, costs or expenses asserted with respect to or arising in
connection with any such fees or commissions.
(s) Necessary Authorizations. No event has occurred which permits (or
------------------------
with the passage of time would permit) the revocation or termination of any
Necessary Authorization, or which could result in the imposition of any
restriction thereon of such a nature that could reasonably be expected to have a
Material Adverse Effect.
(t) Patents, Etc. The Borrower and its Subsidiaries have obtained all
------------
patents, trademarks, service-marks, trade names, copyrights, licenses and other
rights, free from burdensome restrictions, that are necessary for the operation
of their business as presently conducted and as proposed to be conducted.
Nothing has come to the attention of the Borrower or any of its Subsidiaries to
the effect that (i) any process, method, part or other material presently
contemplated to be employed by the Borrower or any Subsidiary may infringe any
patent, trademark, service-xxxx, trade name, copyright, license or other right
owned by any other Person, or (ii) there is pending or overtly threatened any
claim or litigation against or affecting the Borrower or any Subsidiary
contesting its right to sell or use any such process, method, part or other
material.
(u) Disclosure. Neither this Agreement nor any other document,
----------
certificate or statement which has been furnished to any Lender by or on behalf
of the Borrower or any Subsidiary in connection herewith contained any untrue
statement of a material fact or omitted to state a material fact necessary in
order to make the statement contained herein and therein not misleading at the
time it was furnished. There is no fact known to the Borrower and not known to
the public generally that could reasonably be expected to materially adversely
affect the assets or business of the Borrower and its Subsidiaries, or in the
future could reasonably be expected (so far as the Borrower can now foresee) to
have a Material Adverse Effect, which has not been set forth in this Agreement
or in the
-48-
documents, certificates and statements furnished to the Lenders by or on behalf
of the Borrower prior to the date hereof in connection with the transaction
contemplated hereby.
(v) Solvency. The Borrower is, and Borrower and its Subsidiaries on a
--------
consolidated basis are, Solvent.
(w) Common Enterprise. The Borrower and its Subsidiaries are engaged in
-----------------
the businesses set forth in Section 4.1(d) hereof. These operations require
financing on a basis such that the credit supplied can be made available from
time to time to the Borrower and various of the Subsidiaries, as required for
the continued successful operation of the Borrower and its Subsidiaries as a
whole. The Borrower and its Subsidiaries expect to derive benefit (and the
boards of directors of the Borrower and its Subsidiaries have determined that
the Borrower and the Subsidiaries may reasonably be expected to derive benefit),
directly or indirectly, from the credit extended by Lenders hereunder, both in
their separate capacities and as members of the group of companies, since the
successful operation and condition of the Borrower and its Subsidiaries is
dependent on the continued successful performance of the functions of the group
as a whole.
(x) Year 2000 Compliance. The Borrower has (a) initiated a review and
--------------------
assessment of all areas within its and each of its Subsidiaries' business and
operations (including those affected by its suppliers and vendors) that could be
adversely affected by the "Year 2000 Problem" (that is, the risk that computer
applications used by the Borrower or any of its Subsidiaries (or its suppliers
and vendors) may be unable to recognize and perform properly date-sensitive
functions involving certain dates prior to and any date after December 31,
1999), (b) developed a plan and timeline for addressing the Year 2000 Problem on
a timely basis, and (c) to date, implemented that plan in accordance with that
timetable. The Borrower reasonably believes that all computer applications
(including, based on representations from its suppliers and vendors, those of
its suppliers and vendors) that are material to its or any of its Subsidiaries'
business and operations will on a timely basis be able to perform properly date-
sensitive functions for all dates before and after January 1, 2000 (that is, be
"Year 2000 Compliant"), except to the extent that a failure to do so could not
-------------------
reasonably be expected to have a Material Adverse Effect.
Section 4.2 Survival of Representations and Warranties, etc. All
-----------------------------------------------
representations and warranties made under this Agreement and the other Loan
Documents shall be deemed to be made at and as of the Agreement Date and at and
as of the date of each Advance and each Letter of Credit, and each shall be true
and correct when made, except to the extent (a) previously fulfilled in
accordance with the terms hereof, (b) applicable to a specific date or otherwise
subsequently inapplicable, or (c) previously waived in writing by the
Determining Lenders with respect to any particular factual circumstance. All
such representations and warranties shall survive, and not be waived by, the
execution hereof by any Lender, any investigation or inquiry by any Lender, or
by the making of any Advance under this Agreement.
-49-
ARTICLE 5
General Covenants
-----------------
So long as any of the Obligations are outstanding and unpaid or the
Commitment is outstanding (whether or not the conditions to borrowing have been
or can be fulfilled):
Section 5.1 Preservation of Existence and Similar Matters. The Borrower
---------------------------------------------
shall, and shall cause each Subsidiary to:
(a) preserve and maintain, or timely obtain and thereafter preserve and
maintain, its existence, rights, franchises, licenses, authorizations, consents,
privileges and all other Necessary Authorizations from federal, state and local
governmental bodies and any tribunal (regulatory or otherwise), the loss of
which could have a Material Adverse Effect; and
(b) qualify and remain qualified and authorized to do business in each
jurisdiction in which the character of its properties or the nature of its
business requires such qualification or authorization, unless the failure to do
so could not have a Material Adverse Effect.
Section 5.2 Business; Compliance with Applicable Law. The Borrower and
----------------------------------------
its Subsidiaries shall (a) engage solely in the businesses set forth in Section
4.1(d) hereof, and (b) comply in all material respects with the requirements of
all Applicable Law, including, without limitation, all Applicable Environmental
Laws.
Section 5.3 Maintenance of Properties. The Borrower shall, and shall
-------------------------
cause each Subsidiary to, maintain or cause to be maintained all its properties
(whether owned or held under lease) in reasonably good repair, working order and
condition, taken as a whole, and from time to time make or cause to be made all
appropriate repairs, renewals, replacements, additions, betterments and
improvements thereto.
Section 5.4 Accounting Methods and Financial Records. The Borrower shall,
----------------------------------------
with respect to its consolidated financial statements, maintain a system of
accounting established and administered in accordance with GAAP, keep adequate
records and books of account in which complete entries will be made and all
transactions reflected in accordance with GAAP, and keep accurate and complete
records of its respective assets. The Borrower and each of its Subsidiaries
shall maintain a fiscal year ending on May 31.
Section 5.5 Insurance. The Borrower shall, and shall cause each
---------
Subsidiary to, maintain insurance from responsible companies in such amounts and
against such risks as shall be customary and usual in the industry for companies
of similar size and capability, including, without limitation, business
interruption coverage.
-50-
Section 5.6 Payment of Taxes and Claims. The Borrower shall, and shall
---------------------------
cause each Subsidiary to, pay and discharge all taxes, assessments and
governmental charges or levies imposed upon it or its income or properties prior
to the date on which penalties attach thereto, and all lawful material claims
for labor, materials and supplies which, if unpaid, might become a Lien upon any
of its properties; except that no such tax, assessment, charge, levy or claim
need be paid which is being diligently contested in good faith by appropriate
proceedings and for which adequate reserves shall have been set aside on the
appropriate books, but only so long as no Lien (other than a Permitted Lien)
shall attach with respect thereto and no foreclosure, distraint, sale or similar
proceedings shall have been commenced. The Borrower shall, and shall cause each
Subsidiary to, timely file all information returns required by federal, state or
local tax authorities.
Section 5.7 Visits and Inspections. The Borrower shall, and shall cause
----------------------
each Subsidiary to, promptly permit representatives of the Administrative Lender
or any Lender from time to time to (a) visit and inspect the properties of the
Borrower and Subsidiary as often as the Administrative Lender or any Lender
shall reasonably deem advisable, (b) inspect and make extracts from and copies
of the Borrower's and each Subsidiary's books and records, and (c) discuss with
the Borrower's and each Subsidiary's directors, officers, employees and auditors
its business, assets, liabilities, financial positions, results of operations
and business prospects; provided, however, any information obtained by the
Administrative Lender or any Lender shall be handled pursuant to the
confidentiality provisions of Section 11.14 hereof. Prior to the occurrence of
an Event of Default, all such visits and inspections shall be conducted during
normal business hours. Following the occurrence and during the continuance of an
Event of Default, such visits and inspections shall be conducted at any time
requested by the Administrative Lender or any Lender.
Section 5.8 Payment of Indebtedness. Subject to Section 5.6 hereof, the
-----------------------
Borrower shall, and shall cause each Subsidiary to, pay its Indebtedness when
and as the same becomes due, other than amounts (other than the Obligations)
duly and diligently disputed in good faith.
Section 5.9 Use of Proceeds. The Borrower shall use the proceeds of
---------------
Advances to refinance the indebtedness under the Existing Credit Agreement which
is outstanding on the Agreement Date and for working capital and for other
general corporate purposes, including acquisitions and Treasury Stock Purchases.
Section 5.10 Indemnity.
---------
(A) THE BORROWER AGREES TO DEFEND, PROTECT, INDEMNIFY AND HOLD HARMLESS
THE ADMINISTRATIVE LENDER, EACH LENDER, EACH OF THEIR RESPECTIVE AFFILIATES, AND
EACH OF THEIR RESPECTIVE (INCLUDING SUCH AFFILIATES') OFFICERS, DIRECTORS,
EMPLOYEES, AGENTS, ATTORNEYS, SHAREHOLDERS AND CONSULTANTS (INCLUDING, WITHOUT
LIMITATION, THOSE RETAINED IN CONNECTION WITH THE SATISFACTION OR ATTEMPTED
SATISFACTION OF ANY OF THE CONDITIONS SET FORTH HEREIN) OF EACH OF THE FOREGOING
(COLLECTIVELY, "INDEMNITEES") FROM AND AGAINST ANY
-----------
-51-
AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS,
JUDGMENTS, SUITS, CLAIMS, COSTS, EXPENSES AND DISBURSEMENTS OF ANY KIND OR
NATURE WHATSOEVER (INCLUDING, WITHOUT LIMITATION, THE FEES AND DISBURSEMENTS OF
COUNSEL FOR SUCH INDEMNITEES IN CONNECTION WITH ANY INVESTIGATIVE,
ADMINISTRATIVE OR JUDICIAL PROCEEDING, WHETHER OR NOT SUCH INDEMNITEES SHALL BE
DESIGNATED A PARTY THERETO), IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST SUCH
INDEMNITEES (WHETHER DIRECT, INDIRECT OR CONSEQUENTIAL AND WHETHER BASED ON ANY
FEDERAL, STATE, OR LOCAL LAWS AND REGULATIONS, UNDER COMMON LAW OR AT EQUITABLE
CAUSE, OR ON CONTRACT, TORT OR OTHERWISE, ARISING FROM OR CONNECTED WITH THE
PAST, PRESENT OR FUTURE OPERATIONS OF THE BORROWER OR ITS PREDECESSORS IN
INTEREST, OR THE PAST, PRESENT OR FUTURE ENVIRONMENTAL CONDITION OF PROPERTY OF
THE BORROWER OR ANY SUBSIDIARY OR THE VIOLATION OR ASSERTED VIOLATION BY THE
BORROWER OR ANY SUBSIDIARY OF ANY APPLICABLE LAW, INCLUDING ANY APPLICABLE
ENVIRONMENTAL LAW), IN ANY MANNER RELATING TO OR ARISING OUT OF THIS AGREEMENT,
THE LOAN DOCUMENTS, OR ANY ACT, EVENT OR TRANSACTION OR ALLEGED ACT, EVENT OR
TRANSACTION RELATING OR ATTENDANT THERETO, THE MAKING OF ANY PARTICIPATIONS IN
THE ADVANCES AND THE MANAGEMENT OF THE ADVANCES, INCLUDING IN CONNECTION WITH,
OR AS A RESULT, IN WHOLE OR IN PART, OF ANY NEGLIGENCE OF ADMINISTRATIVE LENDER
OR ANY LENDER (OTHER THAN THOSE MATTERS RAISED EXCLUSIVELY BY A PARTICIPANT
AGAINST THE ADMINISTRATIVE LENDER OR ANY LENDER AND NOT THE BORROWER), OR THE
USE OR INTENDED USE OF THE PROCEEDS OF THE ADVANCES HEREUNDER, OR IN CONNECTION
WITH ANY INVESTIGATION OF ANY POTENTIAL MATTER COVERED HEREBY, BUT EXCLUDING (I)
ANY CLAIM OR LIABILITY FROM AN INDEMNITEE THAT ARISES AS THE RESULT OF THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY SUCH INDEMNITEE, AS FINALLY JUDICIALLY
DETERMINED BY A COURT OF COMPETENT JURISDICTION, AND (II) MATTERS RAISED BY ONE
LENDER AGAINST ANOTHER LENDER OR BY ANY SHAREHOLDERS OF A LENDER AGAINST A
LENDER OR ITS MANAGEMENT (COLLECTIVELY, "INDEMNIFIED MATTERS"). TO THE EXTENT
-------------------
THAT ANY INDEMNIFIED MATTER INVOLVES ONE OR MORE INDEMNITEES, SUCH INDEMNITEES
SHALL USE THE SAME LEGAL COUNSEL UNLESS ANY INDEMNITEE IN ITS REASONABLE
DISCRETION DETERMINES THAT CONFLICTS EXIST OR MAY ARISE IN CONNECTION WITH SUCH
REPRESENTATION.
(b) In addition, the Borrower shall periodically, upon request, reimburse
each Indemnitee for its reasonable legal and other actual expenses (including
the cost of any investigation and preparation) incurred in connection with any
Indemnified Matter. If for any reason the foregoing indemnification is
unavailable to any Indemnitee or insufficient to hold any Indemnitee harmless
-52-
with respect to Indemnified Matters, then the Borrower shall contribute to the
amount paid or payable by such Indemnitee as a result of such loss, claim,
damage or liability in such proportion as is appropriate to reflect not only the
relative benefits received by the Borrower and the Borrower's stockholders on
the one hand and such Indemnitee on the other hand but also the relative fault
of the Borrower and such Indemnitee, as well as any other relevant equitable
considerations. The reimbursement, indemnity and contribution obligations under
this Section shall be in addition to any liability which the Borrower may
otherwise have, shall extend upon the same terms and conditions to each
Indemnitee, and shall be binding upon and inure to the benefit of any
successors, assigns, heirs and personal representatives of the Borrower, the
Administrative Lender, the Lenders and all other Indemnitees. This Section 5.10
shall survive any termination of this Agreement and payment of the Obligations.
Section 5.11 Year 2000 Compliance. The Borrower will promptly notify the
--------------------
Administrative Lender in the event the Borrower discovers or determines that any
computer application (including those of its suppliers and vendors) that is
material to its or any of its Subsidiaries' business and operations will not be
Year 2000 Compliant, except to the extent that such failure could not reasonably
be expected to have a Material Adverse Effect.
ARTICLE 6
Information Covenants
---------------------
So long as any of the Obligations are outstanding and unpaid or any
Commitment is outstanding (whether or not the conditions to borrowing have been
or can be fulfilled), the Borrower shall furnish or cause to be furnished to
each Lender:
Section 6.1 Quarterly Financial Statements and Information. Within 60
----------------------------------------------
days after the end of each fiscal quarter (other than the last fiscal quarter of
each fiscal year), (i) a consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such quarter and the related consolidated
statement of income and consolidated statement of changes in cash for such
quarter and for the elapsed portion of the year ended with the last day of such
quarter and (ii) a consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such quarter and the related consolidated
statement of income and consolidated statement of changes in cash for such
quarter and for the elapsed portion of the year ended with the last day of such
quarter, with the Borrower's investment in any Ventures being accounted for in
accordance with the equity method of accounting, all of which shall be certified
by the president, chief financial officer or chief accounting officer of the
Borrower, to be, in his or her opinion, complete and correct in all material
respects and to present fairly, in accordance with GAAP (except to the extent
that the Borrower's investment in any Ventures is accounted for according to the
equity method of accounting), the financial position and results of operations
of the Borrower and its Subsidiaries as at the end of and for such period, and
for the elapsed portion of the year ended with the last day of such period,
subject only to normal year-end adjustments.
-53-
Section 6.2 Annual Financial Statements and Information; Certificate of No
--------------------------------------------------------------
Default.
-------
(a) Within 105 days after the end of each fiscal year, a copy of (i) the
consolidated balance sheets of the Borrower and its Subsidiaries, as of the end
of the current and prior fiscal years and (ii) consolidated statements of
earnings, consolidated statements of changes in shareholders' equity, and
consolidated statements of changes in cash as of and through the end of such
fiscal year, all of which consolidated statements are (A) prepared in accordance
with GAAP and (B) certified by independent certified public accountants
acceptable to the Lenders (the Lenders agree that Ernst & Young & Co. is
acceptable to the Lenders), whose opinion shall be in scope and substance in
accordance with generally accepted auditing standards and shall be unqualified.
(b) Within 105 days after the end of each fiscal year, a copy of (i) the
consolidated balance sheets of the Borrower and its Subsidiaries, as of the end
of the current and prior fiscal years and (ii) consolidated statements of
earnings, consolidated statements of changes in shareholder's equity, and
consolidated statements of changes in cash as of and through the end of such
fiscal year, all of which statements (A) will account for the Borrower's
investment in any Ventures according to the equity method of accounting and (B)
shall be certified by the president, chief financial officer or chief accounting
officer of the Borrower to be, in his or her opinion, complete and correct in
all material respects and to present fairly, in accordance with GAAP (except to
the extent that the Borrower's investment in any Ventures is accounted for
according to the equity method of accounting), the financial position and
results of operations of the Borrower and its Subsidiaries as at the end of each
such fiscal year.
(c) Simultaneously with the delivery of the statements required by this
Section 6.2, a letter from the Borrower's public accountants certifying that no
Default was detected during the examination of the Borrower and its
Subsidiaries, and authorizing the Borrower to deliver such financial statements
and opinion thereon to the Administrative Lender and Lenders pursuant to this
Agreement.
(d) As soon as available, but in any event within 105 days following the
end of each fiscal year, a copy of an annual consolidated operating budget of
the Borrower and its Subsidiaries for the succeeding fiscal year.
Section 6.3 Compliance Certificates. At the time financial statements are
-----------------------
furnished pursuant to Sections 6.1 and 6.2 hereof, a Compliance Certificate:
(a) setting forth at the end of such period, certifications and
arithmetical calculations required to establish whether the Borrower and its
Subsidiaries were in compliance with the requirements of Sections 7.1, 7.6, 7.9,
7.10, 7.11 and 7.12 hereof, which shall be substantially in the form of Exhibit
-------
D hereto;
-
-54-
(b) setting forth the aggregate amount of outstanding Advances and
Reimbursement Obligations and certifying as to compliance herewith; and
(c) stating that, to the best of his or her knowledge after due inquiry,
no Default has occurred as at the end of such period, or if a Default has
occurred, disclosing each such Default and its nature, when it occurred, whether
it is continuing and the steps being taken with respect to such Default.
Section 6.4 Copies of Other Reports and Notices.
-----------------------------------
(a) Promptly upon their becoming available, a copy of (i) all material
reports or letters submitted to the Borrower or any Subsidiary by accountants in
connection with any annual, interim or special audit, including without
limitation any report prepared in connection with the annual audit referred to
in Section 6.2 hereof, and, if requested by the Administrative Lender, any other
comment letter submitted to management in connection with any such audit, (ii)
each financial statement, report, notice or proxy statement sent by the Borrower
or any Subsidiary to stockholders generally, (iii) each regular, periodic or
other report and any registration statement (other than statements on Form S-8)
or prospectus (or material written communication in respect of any thereof)
filed by the Borrower or any Subsidiary with any securities exchange, with the
Securities and Exchange Commission or any successor agency, and (iv) all press
releases concerning material financial aspects of the Borrower or any
Subsidiary;
(b) Promptly upon becoming aware that (i) the holder(s) of any note(s) or
other evidence of indebtedness or other security of the Borrower or any
Subsidiary in excess of $500,000 in the aggregate has given notice or taken any
action with respect to a breach, failure to perform, claimed default or event of
default thereunder, (ii) any party to any Capitalized Lease Obligations has
given notice or taken any action with respect to a breach, failure to perform,
claimed default or event of default thereunder, (iii) any occurrence or non-
occurrence of any event which constitutes or which with the passage of time or
giving of notice or both could constitute a material breach by the Borrower or
any Subsidiary under any material agreement or instrument other than this
Agreement to which the Borrower or any Subsidiary is a party or by which any of
their properties may be bound, or (iv) any event, circumstance or condition
which could reasonably be expected to have a Material Adverse Effect, a written
notice specifying the details thereof (or the nature of any claimed default or
event of default) and what action is being taken or is proposed to be taken with
respect thereto;
(c) Promptly upon receipt thereof, information with respect to and copies
of any notices received from any Governmental Authority relating to any order,
ruling, law, information or policy that relates to a breach of or noncompliance
with Applicable Laws, or might result in the payment of money by the Borrower or
any Subsidiary in an amount of $5,000,000 or more in the aggregate, or otherwise
have a Material Adverse Effect, or result in the loss or suspension of any
Necessary Authorization;
-55-
(d) Promptly upon receipt from any governmental agency, or any government,
political subdivision or other entity, any material notice, correspondence,
hearing, proceeding or order regarding or affecting the Borrower, any
Subsidiary, or any of their properties or businesses; and
(e) From time to time and promptly upon each request, such data,
certificates, reports, statements, opinions of counsel, documents or further
information regarding the assets, business, liabilities, financial position,
projections, results of operations or business prospects of the Borrower and its
Subsidiaries, as the Administrative Lender or any Lender may reasonably request.
Section 6.5 Notice of Litigation, Default and Other Matters. Prompt
-----------------------------------------------
notice of the following events after the Borrower has knowledge or notice
thereof:
(a) The commencement of all proceedings and investigations by or before
any Governmental Authority, and all actions and proceedings in any court or
before any arbitrator involving claims for damages (including punitive damages)
in excess of $5,000,000 in the aggregate (after deducting the amount with
respect to the Borrower or any Subsidiary is insured), against or in any other
way relating directly to the Borrower, any Subsidiary, or any of their
properties or businesses;
(b) Promptly upon the happening of any condition or event which
constitutes a Default, a written notice specifying the nature and period of
existence thereof and what action is being taken or is proposed to be taken with
respect thereto; and
(c) Any material adverse change with respect to the business, assets,
liabilities, financial position, results of operations or prospective business
of the Borrower or any Subsidiary, other than changes in the ordinary course of
business which have not had and are not likely to have a Material Adverse
Effect.
Section 6.6 ERISA Reporting Requirements.
----------------------------
(a) Promptly and in any event (i) within 30 days after the Borrower or any
member of its Controlled Group knows or has reason to know that any ERISA Event
described in clause (a) of the definition of ERISA Event or any event described
in Section 4063(a) of ERISA with respect to any Plan of the Borrower or any
member of its Controlled Group has occurred, and (ii) within 10 days after the
Borrower or any member of its Controlled Group knows or has reason to know that
any other ERISA Event with respect to any Plan of the Borrower or any member of
its Controlled Group has occurred or a request for a minimum funding waiver
under Section 412 of the Code with respect to any Plan of the Borrower or any
member of its Controlled Group, a written notice describing such event and
describing what action is being taken or is proposed to be taken with respect
thereto, together with a copy of any notice of event that is given to the PBGC;
(b) Promptly and in any event within three Business Days after receipt
thereof by the Borrower or any member of its Controlled Group from the PBGC,
copies of each notice received
-56-
by the Borrower or any member of its Controlled Group of the PBGC's intention to
terminate any Plan or to have a trustee appointed to administer any Plan;
(c) Promptly and in any event within 30 days after the filing thereof by
the Borrower or any member of its Controlled Group with the United States
Department of Labor or the Internal Revenue Service, copies of each annual
report (including Schedule B thereto, if applicable) with respect to each Plan
of which Borrower or any member of its Controlled Group is the "plan sponsor";
(d) Promptly, and in any event within 10 Business Days after receipt
thereof, a copy of any correspondence the Borrower or any member of its
Controlled Group receives from the Plan Sponsor (as defined by Section
4001(a)(10) of ERISA) of any Plan concerning potential withdrawal liability
pursuant to Section 4219 or 4202 of ERISA, and a statement from the chief
financial officer of the Borrower or such member of its Controlled Group setting
forth details as to the events giving rise to such potential withdrawal
liability and the action which the Borrower or such member of its Controlled
Group is taking or proposes to take with respect thereto;
(e) Notification within 30 days of any material increases in the benefits
of any existing Plan which is not a Multiemployer Plan, or the establishment of
any new Plans, or the commencement of contributions to any Plan to which the
Borrower or any member of its Controlled Group was not previously contributing
which would in either case result in a material liability to the Borrower;
(f) Notification within three Business Days after the Borrower or any
member of its Controlled Group knows or has reason to know that the Borrower or
any such member of its Controlled Group has filed or intends to file a notice of
intent to terminate any Plan under a distress termination within the meaning of
Section 4041(c) of ERISA and a copy of such notice; and
(g) Promptly after receipt of written notice of commencement thereof,
notice of all actions, suits and proceedings before any court or governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, affecting the Borrower or any member of its Controlled Group with
respect to any Plan, except those which, in the aggregate, if adversely
determined could not have a Material Adverse Effect.
ARTICLE 7
Negative Covenants
------------------
So long as any of the Obligations are outstanding and unpaid or the
Commitment is outstanding (whether or not the conditions to borrowing have been
or can be fulfilled):
-57-
Section 7.1 Indebtedness. The Borrower shall not, and shall not permit
------------
Subsidiary to, create, assume, incur or otherwise become or remain obligated in
respect of, or permit to be outstanding, or suffer to exist any Indebtedness,
except:
(a) Indebtedness under the Loan Documents;
(b) Accounts payable incurred in the ordinary course of business;
(c) Guaranties to the extent permitted under Section 7.5 hereof;
(d) Capitalized Lease Obligations and Indebtedness incurred to purchase
assets in the ordinary course of business, together with Guaranties permitted
pursuant to Section 7.5(f) hereof, not to exceed in aggregate amount 5% of Net
Worth at any time of determination;
(e) Indebtedness existing on the Agreement Date which is described on
Schedule 6 hereto, including renewals (but no increases) thereof;
----------
(f) Subordinated Debt;
(g) Indebtedness under the Prudential Borrower Notes and the Prudential
Assumed Notes;
(h) Indebtedness under the Senior Notes;
(i) Unsecured Indebtedness of the Borrower not otherwise permitted under
this Section 7.1 in an aggregate principal amount outstanding not to exceed 25%
of Net Worth at any time, provided that (A) immediately prior thereto and after
the occurrence thereof there shall be no Default or Event of Default, the
covenants, terms (excluding interest rate and fees) and provisions with respect
to such Indebtedness are no more restrictive than the terms of this Agreement
and the other Loan Documents and (B) no such Indebtedness shall have an original
maturity date earlier than 180 days after the Maturity Date;
(j) Indebtedness of the Borrower in respect of tax-exempt financing not to
exceed $150,000,000 in aggregate principal amount outstanding at any time;
(k) Indebtedness in respect of the Convertible Subordinated Debentures;
(l) Securitization Indebtedness incurred in respect of Securitizations
permitted pursuant to Section 7.4(a)(ii) hereof and any repurchase obligations
related to such Securitizations;
(m) Indebtedness of the Borrower in respect of Interest Rate Protection
Agreements; and
-58-
(n) Indebtedness in respect of intercompany loans between and among any of
the Borrower, any Guarantor and/or TXI Receivables Corporation, each of which
such loans shall be evidenced by a promissory note, provided that obligations
pursuant to such Indebtedness is subordinate to any Obligations under any of the
Loan Documents in form and substance satisfactory to the Administrative Lender.
Section 7.2 Liens. The Borrower shall not, and shall not permit any
-----
Subsidiary to, create, assume, incur, permit or suffer to exist, directly or
indirectly, any Lien on any of its assets, whether now owned or hereafter
acquired, except Permitted Liens. Other than in respect of the Prudential
Borrower Notes, the Prudential Assumed Notes, the Senior Notes and the
Securitization Indebtedness, the Borrower shall not, and shall not permit any
Subsidiary to, enter into a, or be subject to, a Negative Pledge Agreement;
provided that any such permitted Negative Pledge Agreement with respect to the
Securitization Indebtedness shall relate only to the assets pledged, purchased
or acquired which are the subject of a Securitization permitted by Section
7.4(a) hereof.
Section 7.3 Investments. The Borrower shall not, and shall not permit any
-----------
Subsidiary to, make any Investment, except that the Borrower may purchase or
otherwise acquire and own:
(a) Marketable, direct obligations of, or guaranteed by, the United States
of America or any agency thereof and maturing in three years or less of the date
of purchase;
(b) U.S. corporate debt obligations and certificates of deposits, bankers'
acceptances repurchase agreements, remarketed certificates of participations and
loan participations of domestic banks, variable rate demand notes and Eurodollar
time deposits, each maturing not more than 1 year from the date of creation,
issuance or purchase, and having a rating of P-1/A-1 or Baa3/BBB- or equivalent
by Xxxxx'x Investors Service, Inc. or Standard & Poor's Ratings Group, a
division of XxXxxx-Xxxx, Inc., a New York corporation, respectively;
(c) Investments in one or more Subsidiaries or Persons which become
Subsidiaries that (i)(A) are subject to the provisions hereof, and (B) are or
immediately become party to the Subsidiary Guaranty or (C) the Investment in
which does not exceed $2,000 or (ii) have been formed for the sole purpose of
engaging in (A) a Securitization permitted by Section 7.4(a) hereof or (B) the
issuance of the Convertible Trust Preferred Securities, the Investment in the
Convertible Subordinated Debentures and only those other activities necessary or
incidental thereto;
(d) Accounts receivable that arise in the ordinary course of business and
are payable on standard terms or which have been converted to a note receivable;
(e) Shares of any money-market mutual or similar fund listed on Schedule 7
----------
or any institutional grade money market fund of Fidelity, Federated or Dreyfus,
or that is otherwise acceptable to the Determining Lenders;
-59-
(f) Investments in existence on the Agreement Date which are described on
Schedule 5 hereto;
----------
(g) Venture Investments to the extent permitted pursuant to Section 7.6
hereof;
(h) Investments which are Acquisitions permitted pursuant to Section 7.15
hereof;
(i) Investment in the Convertible Subordinated Debentures;
(j) Investments in residual interests in any Securitization permitted
pursuant to Section 7.4(a)(ii) hereof; and
(k) Investments not otherwise permitted pursuant to this Section 7.3, but
only to the extent permitted pursuant to Section 7.6 hereof.
Section 7.4 Liquidation, Merger, New Subsidiaries. The Borrower shall
-------------------------------------
not, and shall not permit any Subsidiary to, at any time:
(a) liquidate or dissolve itself (or suffer any liquidation or
dissolution) or otherwise wind up; or sell, lease, abandon, transfer or
otherwise dispose of all or any part of its assets, properties or business,
other than (i) assets sold in the ordinary course of business and (ii) sales
or pledges of Accounts or interests in Accounts pursuant to Securitizations
which would generate up to $125,000,000 in aggregate net proceeds during the
term of this Agreement; or
(b) enter into any merger or consolidation other than in respect of an
Acquisition permitted pursuant to Section 7.15 hereof.
Section 7.5 Guaranties. The Borrower shall not, and shall not permit any
----------
Subsidiary to, at any time make or issue any Guaranty, or assume, be obligated
with respect to, or permit to be outstanding any Guaranty, of any obligation of
any other Person except (a) the Subsidiary Guaranty, (b) the endorsement in the
ordinary course of business of negotiable instruments for deposit or collection,
(c) Guaranties in respect of the Prudential Borrower Notes, the Prudential
Assumed Notes and the Senior Notes, (d) the Preferred Securities Guarantee, (e)
Guaranties in respect of Indebtedness otherwise permitted pursuant to Section
7.1 hereof, and (f) other Guaranties, not to exceed, together with the
Indebtedness permitted pursuant to Section 7.1(d) hereof, in aggregate amount 5%
of Net Worth at any time of determination.
Section 7.6 Treasury Stock Purchases, Venture Investments and Other
-------------------------------------------------------
Investments. The Borrower shall not, and shall not permit any Subsidiary to,
-----------
directly or indirectly (a) make any Treasury Stock Purchases in an aggregate
amount for all Treasury Stock Purchases made after the Agreement Date in excess
of 10% of Net Worth at any time outstanding or (b) make, acquire or own any
Venture Investments and other Investments not otherwise permitted pursuant to
clauses (a) through (j) of Section 7.3 hereof in an aggregate amount, together
with all Treasury Stock Purchases,
-60-
Venture Investments, and such other Investments (excluding that portion of all
such other Investments which are made with capital stock of the Borrower,
provided that to the extent that capital stock of the Borrower is used to make
an Investment in a Person which is not an Acquisition, (i) the Person in which
such Investment is made shall be in the business described in Section 4.1(d)
hereof and (ii) if the aggregate consideration for any such Investment exceeds
37,750,000, the Lenders shall have received written notice thereof at least 15
Business Days prior to the date of such Investment) made after the Agreement
Date, in excess of 20% of Net Worth at any time; provided, however,
notwithstanding the immediately preceding clause to the contrary, the Borrower
shall make no Treasury Stock Purchase, Venture Investment or other Investment
unless there shall exist no Default prior to or after giving effect to any
such proposed Treasury Stock Purchase, Venture Investment or other Investment.
Section 7.7 Affiliate Transactions. The Borrower shall not, and shall not
----------------------
permit any Subsidiary to, at any time engage in any transaction with an
Affiliate, nor make an assignment or other transfer of any of its assets or
properties to any Affiliate, on terms materially less advantageous to the
Borrower or Subsidiary than would be the case if such transaction had been
effected with a non-Affiliate (other than advances to employees in the ordinary
course of business).
Section 7.8 Compliance with ERISA. The Borrower shall not, and shall not
---------------------
permit any Subsidiary to, directly or indirectly, or permit any member of its
Controlled Group to directly or indirectly, (a) terminate any Plan so as to
result in any material (in the opinion of the Determining Lenders) liability to
the Borrower or any member of its Controlled Group taken as a whole, (b) permit
to exist any ERISA Event, or any other event or condition which presents the
risk of a material (in the opinion of the Determining Lenders) liability of the
Borrower or any member of its Controlled Group taken as a whole, (c) make a
complete or partial withdrawal (within the meaning of Section 4201 of ERISA)
from any Multiemployer Plan so as to result in any material (in the opinion of
the Determining Lenders) liability to the Borrower or any member of its
Controlled Group taken as a whole, (d) enter into any new Plan or modify any
existing Plan so as to increase its obligations thereunder except in the
ordinary course of business consistent with past practice which could result in
any material (in the opinion of the Determining Lenders) liability to the
Borrower or any member of its Controlled Group taken as a whole, or (e) permit
the present value of all benefit liabilities, as defined in Title IV of ERISA,
under each Plan of the Borrower or any member of its Controlled Group (using the
actuarial assumptions utilized by each such Plan) to exceed the fair market
value of Plan assets allocable to such benefits, all determined as of the most
recent valuation date for each such Plan, by $100,000.
Section 7.9 Leverage Ratio. The Borrower shall not permit the Leverage
--------------
Ratio to exceed 3.50 to 1 at the end of any fiscal quarter.
Section 7.10 Fixed Charge Coverage Ratio. The Borrower shall not permit
---------------------------
the Fixed Charge Coverage Ratio to be less than 2.00 to 1 at the end of any
fiscal quarter.
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Section 7.11 Capitalization Ratio. The Borrower shall not permit the
--------------------
Capitalization Ratio to exceed 0.60 to 1 at the end of any fiscal quarter.
Section 7.12 Sale and Leaseback. The Borrower shall not, and shall not
------------------
permit any Subsidiary to, enter into any arrangement whereby it sells or
transfers any of its assets, and thereafter rents or leases such assets.
Section 7.13 Sale or Discount of Receivables. The Borrower shall not, and
-------------------------------
shall not permit any Subsidiary to, directly or indirectly sell, with or without
recourse, for discount or otherwise, any notes or accounts receivable (other
than in respect of Securitizations to the extent permitted pursuant to Section
7.4(a)(ii) hereof).
Section 7.14 Subordinated Debt.
-----------------
(a) The Borrower shall not, and shall not permit any Subsidiary to,
prepay, pay, redeem, purchase in any manner, or make any payment in respect of,
or transfer any property in payment of or as security for the payment of, or
establish any sinking fund, reserve or analogous fund for the redemption,
retirement, prepayment or repayment of, any principal of, interest on, or any
fees or other amounts related to, any Subordinated Debt; provided, however,
notwithstanding the immediately preceding, the Borrower and any Subsidiary may
make any regularly scheduled payments of interest on Subordinated Debt unless
there shall exist a Default or Event of Default immediately prior to or after
giving effect to any such proposed payment of interest.
(b) The Borrower shall not, and shall not permit any Subsidiary to,
directly or indirectly, amend, modify, supplement, waive compliance with, or
assent to noncompliance with, any term, provision or condition of any of the
documents governing or evidencing the Subordinated Debt, which (i) the Lenders
deem material (including, without limitation, relating to events of default,
acceleration rights, interest rates, maturity date, subordination and covenants)
or (ii) places any further restrictions on the Borrower or any Subsidiary, or
increases the obligations of the Borrower or any Subsidiary thereunder, or
confers on the holders thereof any additional rights.
Section 7.15 Acquisitions. The Borrower shall not, and shall not permit
------------
any Subsidiary to, make any Acquisitions; provided, however, if immediately
prior to and after giving effect to the proposed Acquisition there shall not
exist a Default or Event of Default and the Borrower or any such Subsidiary
may make Acquisitions so long as (a) such Acquisition shall not be opposed by
the board of the directors of the Person being acquired, (b) if the aggregate
consideration for any Acquisition (including any Indebtedness or Operating
Leases assumed in connection therewith) exceeds $75,000,000, (i) the Lenders
shall have received written notice at least 15 Business Days prior to the date
of such Acquisition, and (ii) the Administrative Lender shall have received at
least 10 Business Days prior to the date of such Acquisition a Compliance
Certificate setting forth the covenant calculations both immediately prior to
and after giving effect to the proposed Acquisition, (c) the assets, property or
business acquired shall be in the business described in Section 4.1(d) hereof,
and (d) if such Acquisition results in a Subsidiary, (i) such Subsidiary shall
have executed
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and delivered a Subsidiary Guaranty of the Obligations and (ii) the Lenders
shall have received such board resolutions, officer's certificates
and opinions of counsel as the Administrative Lender shall reasonably request in
connection with the actions described in clause (d)(i) above.
ARTICLE 8
Default
-------
Section 8.1 Events of Default. Each of the following shall constitute an
-----------------
Event of Default, whatever the reason for such event, and whether voluntary,
involuntary, or effected by operation of law or pursuant to any judgment or
order of any court or any order, rule or regulation of any governmental or non-
governmental body:
(a) Any representation or warranty made under any Loan Document shall
prove to have been incorrect or misleading in any material respect when made
or deemed to have been made;
(b) The Borrower shall default in the payment of (i) any interest under
any Note or any fees payable hereunder or any other costs, fees, expenses or
other amounts payable hereunder or under the Loan Documents, when due, which
Default is not cured within one Business Day from the date such payment became
due by payment of such late amount, or (ii) any principal under any of the
Notes when due;
(c) The Borrower or any Subsidiary shall default in the performance or
observance of any agreement or covenant contained in Section 2.5(c), 5.1, 5.9,
6.6 or Article 7 hereof;
(d) The Borrower or any Subsidiary shall default in the performance or
observance of any other agreement or covenant contained in this Agreement not
specifically referred to elsewhere in this Section 8.1, and such default shall
not be cured within a period of 30 days after the earlier of notice from the
Administrative Lender thereof or actual notice thereof by the Borrower or such
Subsidiary;
(e) There shall occur any default or breach in the performance or
observance of any agreement or covenant (after the expiration of any applicable
grace period) in any of the Loan Documents (other than this Agreement);
(f) There shall be commenced an involuntary proceeding or an involuntary
petition shall be filed in a court having competent jurisdiction seeking (i)
relief in respect of the Borrower or any Subsidiary, or a substantial part of
the property or the assets of the Borrower or such Subsidiary, under Title 11 of
the United States Code, as now constituted or hereafter amended, or any other
applicable Federal, state or foreign bankruptcy law or similar law, (ii) the
appointment of a receiver, liquidator, assignee, trustee, custodian,
sequestrator or similar official of the Borrower or any Subsidiary, or of any
substantial part of their respective properties, or (iii) the winding-up or
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liquidation of the affairs of the Borrower or any Subsidiary, and any such
proceeding or petition shall continue unstayed and in effect for a period of
sixty consecutive days;
(g) The Borrower or any Subsidiary shall (i) file a petition, answer or
consent seeking relief under Title 11 of the United States Code, as now
constituted or hereafter amended, or any other applicable Federal or state
bankruptcy law or other similar law, (ii) consent to the institution of
proceedings thereunder or to the filing of any such petition or to the
appointment or taking of possession of a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Borrower or
any Subsidiary or of any substantial part of their respective properties, (iii)
file an answer admitting the material allegations filed against it in any such
proceeding, (iv) make a general assignment for the benefit of creditors, (v)
become unable, admit in writing its inability, or fail generally, to pay its
debts as they become due, or the Borrower or any Subsidiary shall take any
action in furtherance of any such action;
(h) A final judgment or judgments shall be entered by any court against
the Borrower or any Subsidiary for the payment of money which exceeds $50,000
in the aggregate, or a warrant of attachment or execution or similar process
shall be issued or levied against property of the Borrower or any Subsidiary
which, together with all other such property of the Borrower and its
Subsidiaries subject to other such process, exceeds in value $50,000 in the
aggregate, and if such judgment or award is not insured or, within 30 days
after the entry, issue or levy thereof, such judgment, warrant or process shall
not have been paid or discharged or stayed pending appeal, or if, after the
expiration of any such stay, such judgment, warrant or process shall not have
been paid or discharged;
(i) With respect to any Plan of the Borrower or any member of its
Controlled Group: (i) the Borrower, any such member, or any other party-in-
interest or disqualified person shall engage in transactions which in the
aggregate would reasonably result in a direct or indirect liability to the
Borrower or any member of its Controlled Group in excess of $1,000,000 under
Section 409 or 502 of ERISA or Section 4975 of the Code; (ii) the Borrower or
any member of its Controlled Group shall incur any accumulated funding
deficiency, as defined in Section 412 of the Code, in the aggregate in excess of
$1,000,000, or request a funding waiver from the Internal Revenue Service for
contributions in the aggregate in excess of $1,000,000; (iii) the Borrower or
any member of its Controlled Group shall incur any withdrawal liability in the
aggregate in excess of $1,000,000 as a result of a complete or partial
withdrawal within the meaning of Section 4203 or 4205 of ERISA, or any other
liability with respect to a Plan in excess of $1,000,000, unless the amount of
such liability has been funded within the Plan or pursuant to one or more
insurance contracts; (iv) the Borrower or any member of its Controlled Group
shall fail to make a required contribution by the due date under Section 412 of
the Code or Section 302 of ERISA which would result in the imposition of a lien
under Section 412 of the Code or Section 302 of ERISA; (v) the Borrower, any
member of its Controlled Group or any Plan sponsor shall notify the PBGC of an
intent to terminate, or the PBGC shall institute proceedings to terminate, or
the PBGC shall institute proceedings to terminate, any Plan subject to Title IV
of ERISA; (vi) a Reportable Event shall occur with respect to a Plan subject to
Title IV of ERISA, and within 15 days after the reporting of such Reportable
Event to the Administrative Lender, the Administrative Lender shall have
notified the Borrower in
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writing that the Determining Lenders have made a determination that, on the
basis of such Reportable Event, there are reasonable grounds for the termination
of such Plan by the PBGC or for the appointment by the appropriate United States
District Court of a trustee to administer such Plan and as a result thereof an
Event of Default shall have occurred hereunder; (vii) a trustee shall be
appointed by a court of competent jurisdiction to administer any Plan or the
assets thereof; (viii) the benefits of any Plan shall be increased, or the
Borrower or any member of its Controlled Group shall begin to maintain, or begin
to contribute to, any Plan, without the prior written consent of the Determining
Lenders; or (ix) any ERISA Event with respect to a Plan subject to Title IV of
ERISA shall have occurred, and 30 days thereafter (A) such ERISA Event, other
than such event described in clause (f) of the definition of ERISA Event herein,
(if correctable) shall not have been corrected and (B) the then present value of
such Plan's benefit liabilities, as defined in Title IV of ERISA, shall exceed
the then current value of assets accumulated in such Plan; provided, however,
that the events listed in subsections (v) through (ix) shall constitute Events
of Default only if, as of the date thereof or any subsequent date, the amount of
liability that the Borrower or any member of its Controlled Group reasonably is
likely to incur in the aggregate under Section 4062, 4063, 4064, 4219 or 4023 of
ERISA or any other provision of law with respect to all such Plans, computed by
the actuary of the Plan taking into account any applicable rules and regulations
of the PBGC at such time, and based on the actuarial assumptions used by the
Plan, resulting from or otherwise associated with such event exceeds $1,000,000;
(j) All or any material portion of the Loan Documents shall be the subject
of any proceeding instituted by any Person other than a Lender (except in
connection with any Lender's exercise of any remedies under the Loan Documents),
or there shall exist any litigation or threatened litigation with respect to any
of the Loan Documents, or any Person shall challenge in any manner whatsoever
the validity or enforceability of all or any portion of the Loan Documents;
(k) The Borrower or any Subsidiary shall default in the payment when due
with respect to any Indebtedness in an aggregate amount of $1,000,000 or more
beyond any grace period provided with respect thereto, or shall default in the
performance of any agreement or instrument under which such Indebtedness is
created or evidenced beyond any applicable grace period (or any event thereunder
shall occur and be continuing), if the effect of such default or event is to
permit or cause the holder of such Indebtedness (or a trustee on behalf of any
such holder) to (i) cause such Indebtedness to become due prior to its date of
maturity or (ii) require the Borrower or any of its Subsidiaries to purchase or
redeem such Indebtedness;
(l) Any material Necessary Authorization shall be revoked; or there shall
occur a material default under any material Necessary Authorization by the
Borrower or any Subsidiary beyond any applicable grace period; or any
proceedings shall in any way be brought by any Person to challenge the validity
or enforceability of any material Necessary Authorization or seeking the
revocation, suspension or cancellation of such material Necessary Authorization
and such proceeding is not contested in good faith by appropriate proceedings;
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(m) Any provision of any Loan Document shall for any reason cease to be
valid and binding on or enforceable against any party to it (other than the
Administrative Lender or any Lender) in all material respects, or any such party
shall so state in writing;
(n) A Change of Control shall occur; or
(o) The Borrower or any Subsidiary shall default in the payment when due
of any obligations in respect of the Convertible Trust Preferred Securities
or the Convertible Subordinated Debentures (other than a valid extension of any
interest payment period with respect thereto), or the Borrower or any Subsidiary
shall default in the performance of any agreement or instrument governing the
Convertible Trust Preferred Securities or the Convertible Subordinated
Debentures or under which the Convertible Trust Preferred Securities or the
Convertible Subordinated Debentures are created or evidenced beyond any
applicable grace period (or any event thereunder shall occur and be continuing),
if the effect of such default or event is to permit or cause the holders of the
Convertible Trust Preferred Securities or the Convertible Subordinated
Debentures (or trustee on behalf of any such holder) to (i) cause any obligation
in respect of the Convertible Trust Preferred Securities or the Convertible
Subordinated Debentures to become due prior to its maturity date or the date
otherwise established for such obligation to be satisfied, (ii) require the
Borrower or any of its Subsidiaries to prepay, purchase or redeem the
Convertible Trust Preferred Securities or (iii) require any payment to be made
under the Preferred Securities Guarantees.
Section 8.2 Remedies. If an Event of Default shall have occurred and
--------
shall be continuing:
(a) With the exception of an Event of Default specified in Section 8.1(f)
or (g) hereof, the Administrative Lender shall, upon the direction of the
Determining Lenders, terminate the commitment to make Advances and issue Letters
of Credit and/or declare the principal of and interest on the Advances and all
Obligations and other amounts owed under the Loan Documents to be forthwith due
and payable without presentment, demand, protest or notice of any kind, all of
which are hereby expressly waived, anything in the Loan Documents to the
contrary notwithstanding.
(b) Upon the occurrence of an Event of Default specified in Section 8.1(f)
or (g) hereof, such principal, interest and other amounts shall thereupon and
concurrently therewith become due and payable and the commitment to make
Advances and issue Letters of Credit shall forthwith terminate, all without any
action by the Administrative Lender, any Lender or any holders of the Notes and
without presentment, demand, protest or other notice of any kind, all of which
are expressly waived, anything in the Loan Documents to the contrary
notwithstanding.
(c) If any Letter of Credit shall be then outstanding, the Administrative
Lender may (or, upon the direction of the Determining Lenders, shall) demand
upon the Borrower to, and forthwith upon such demand (but in the case of an
Event of Default specified in Section 8.1(f) or (g) hereof, without any demand
or taking of any other action by the Administrative Lender or any Lender), the
Borrower shall, pay to the Administrative Lender in same day funds at the office
of the
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Administrative Lender in such demand for deposit in the L/C Cash Collateral
Account, an amount equal to 102% of the maximum amount available to be drawn
under the Letters of Credit then outstanding.
(d) Subject to the terms and provisions of the Loan Documents, the
Administrative Lender and the Lenders may exercise all of the post-default
rights granted to them under the Loan Documents or under Applicable Law.
(e) The rights and remedies of the Administrative Lender and the Lenders
hereunder shall be cumulative, and not exclusive.
ARTICLE 9
Changes in Circumstances
------------------------
Section 9.1 LIBOR Basis Determination Inadequate. If with respect to any
------------------------------------
proposed LIBOR Advance for any Interest Period, any Lender determines that (i)
deposits in dollars (in the applicable amount) are not being offered to that
Lender in the relevant market for such Interest Period or (ii) the LIBOR Basis
for such proposed LIBOR Advance does not adequately cover the cost to such
Lender of making and maintaining such proposed LIBOR Advance for such Interest
Period, such Lender shall forthwith give notice thereof to the Borrower,
whereupon until such Lender notifies the Borrower that the circumstances giving
rise to such situation no longer exist, the obligation of such Lender to make
LIBOR Advances shall be suspended.
Section 9.2 Illegality. If any applicable law, rule or regulation, or any
----------
change therein or adoption thereof, or interpretation or administration thereof
by any governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof, or compliance by any Lender (or
its LIBOR Lending Office) with any request or directive (whether or not having
the force of law) of any such authority, central bank or comparable agency,
shall make it unlawful or impossible for such Lender (or its LIBOR Lending
Office) to make, maintain or fund its LIBOR Advances or Bid Rate Advances, such
Lender shall so notify the Borrower and the Administrative Lender. Before
giving any notice to the Borrower pursuant to this Section, the notifying Lender
shall designate a different LIBOR Lending Office or other lending office if such
designation will avoid the need for giving such notice and will not, in the sole
judgment of the Lender, be materially disadvantageous to the Lender. Upon
receipt of such notice, notwithstanding anything contained in Article 2 hereof,
the Borrower shall repay in full the then outstanding principal amount of each
LIBOR Advance or Bid Rate Advance owing to the notifying Lender, together with
accrued interest thereon, on either (a) the last day of the Interest Period
applicable to such Advance, if the Lender may lawfully continue to maintain and
fund such Advance to such day, or (b) immediately, if the Lender may not
lawfully continue to fund and maintain such Advance to such day. Concurrently
with repaying each affected LIBOR Advance owing to such Lender, notwithstanding
anything contained in Article 2 hereof, the Borrower shall borrow a Base Rate
Advance from such Lender,
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and such Lender shall make such Base Rate Advance, in an amount such that the
outstanding principal amount of the Advances owing to such Lender shall equal
the outstanding principal amount of the Advances owing immediately prior to
such repayment, and such Base Rate Advance shall be payable on the same date
or dates as the affected LIBOR Advances of such Lender would have otherwise
been due and payable but for this Section 9.2.
Section 9.3 Increased Costs.
---------------
(a) If any applicable law, rule or regulation, or any change in or
adoption of any law, rule or regulation, or any interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof or compliance by any Lender
(or its LIBOR Lending Office) with any request or directive (whether or not
having the force of law) of any such authority, central bank or compatible
agency:
(i) shall subject a Lender (or its LIBOR Lending Office) to any Tax
(net of any tax benefit engendered thereby) with respect to its LIBOR
Advances, Bid Rate Advances or its obligation to make such Advances, or
shall change the basis of taxation of payments to a Lender (or to its LIBOR
Lending Office) of the principal of or interest on its LIBOR Advances, Bid
Rate Advances or in respect of any other amounts due under this Agreement,
as the case may be, or its obligation to make such Advances (except for
changes in the rate of tax on the overall net income, net worth or capital
of the Lender and franchise taxes, doing business taxes or minimum taxes
imposed upon such Lender); or
(ii) shall impose, modify or deem applicable any reserve (including,
without limitation, any imposed by the Board of Governors of the Federal
Reserve System), special deposit or similar requirement against assets of,
deposits with or for the account of, or credit extended by, a Lender's
LIBOR Lending Office or shall impose on the Lender (or its LIBOR Lending
Office) or on the United States market for certificates of deposit or the
London interbank market any other condition affecting its LIBOR Advances or
Bid Rate Advances or its obligation to make such Advances;
and the result of any of the foregoing is to increase the cost to a Lender (or
its LIBOR Lending Office) of making or maintaining any LIBOR Advances or Bid
Rate Advances, or to reduce the amount of any sum received or receivable by a
Lender (or its LIBOR Lending Office) with respect thereto, by an amount deemed
by a Lender to be material, then, within 15 days after demand by a Lender, the
Borrower agrees to pay to such Lender such additional amount as will compensate
such Lender for such increased costs or reduced amounts, subject to Section 11.9
hereof. The affected Lender will as soon as practicable notify the Borrower of
any event of which it has knowledge, occurring after the date hereof, which will
entitle such Lender to compensation pursuant to this Section and will designate
a different LIBOR Lending Office or other lending office if such designation
will avoid the need for, or reduce the amount of, such compensation and will
not, in the sole judgment of the affected Lender made in good faith, be
disadvantageous to such Lender.
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(b) A certificate of any Lender claiming compensation under this Section
and setting forth the additional amounts to be paid to it hereunder and
calculations therefor shall be conclusive in the absence of manifest error. In
determining such amount, a Lender may use any reasonable averaging and
attribution methods. If a Lender demands compensation under this Section, the
Borrower may at any time, upon at least five Business Days' prior notice to the
Lender, after reimbursement to the Lender by the Borrower in accordance with
this Section of all costs incurred, prepay in full the then outstanding LIBOR
Advances or Bid Rate Advances of the Lender, together with accrued interest
thereon to the date of prepayment, along with any reimbursement required under
Section 2.9 hereof. Concurrently with prepaying such LIBOR Advances, the
Borrower shall borrow a Base Rate Advance from the Lender, and the Lender shall
make such Base Rate Advance, in an amount such that the outstanding principal
amount of the Advances owing to such Lender shall equal the outstanding
principal amount of the Advances owing immediately prior to such prepayment, and
such Base Rate Advance shall be payable on the same date or dates as the LIBOR
Advances of such Lender would have otherwise been due and payable but for this
Section 9.3.
Section 9.4 Base Rate Advances Rather than LIBOR Advances. If notice has
---------------------------------------------
been given pursuant to Section 9.1, 9.2 or 9.3 hereof suspending the obligation
of a Lender to make LIBOR Advances, or requiring LIBOR Advances of a Lender to
be repaid or prepaid, then, unless and until the Lender notifies the Borrower
that the circumstances giving rise to such repayment no longer apply, all
Advances which would otherwise be made by such Lender as LIBOR Advances shall be
made instead as Base Rate Advances, which shall be payable on the same date or
dates as the LIBOR Advances made by the other Lenders.
Section 9.5 Capital Adequacy. If either (a) the introduction of or any
----------------
change in or in the interpretation of any law, rule or regulation or (b)
compliance by a Lender with any law, rule or regulation or any guideline or
request from any central bank or other governmental authority (whether or not
having the force of law) affects or would affect the amount of capital required
or expected to be maintained by a Lender or any corporation controlling such
Lender, and such Lender determines that the amount of such capital is increased
by or based upon the existence of such Lender's Commitment or Advances hereunder
and other commitments or advances of such Lender of this type, then, upon demand
by such Lender, subject to Section 11.9, the Borrower shall immediately pay to
such Lender, from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender with respect to such circumstances, to the
extent that such Lender reasonably determines in good faith such increase in
capital to be allocable to the existence of such Lender's Commitment hereunder.
A certificate as to such amounts submitted to the Borrower by a Lender
hereunder, shall, in the absence of manifest error, be conclusive and binding
for all purposes.
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ARTICLE 10
Agreement Among Lenders
-----------------------
Section 10.1 Agreement Among Lenders. The Lenders agree among themselves
-----------------------
that:
(a) Administrative Lender. Each Lender hereby appoints the Administrative
---------------------
Lender as its nominee in its name and on its behalf, to receive all documents
and items to be furnished hereunder; to act as nominee for and on behalf of all
Lenders under the Loan Documents; to, except as otherwise expressly set forth
herein, take such action as may be requested by the Determining Lenders,
provided that, unless and until the Administrative Lender shall have received
such requests, the Administrative Lender may take such administrative action, or
refrain from taking such administrative action, as it may deem advisable and in
the best interests of the Lenders; to arrange the means whereby the proceeds of
the Advances of the Lenders are to be made available to the Borrower; to
distribute promptly to each Lender information, requests and documents received
from the Borrower, and each payment (in like funds received) with respect to any
of such Lender's Advances, fee or other amount; and to deliver to the Borrower
requests, demands, approvals and consents received from the Lenders.
Administrative Lender agrees to promptly distribute to each Lender, at such
Lender's address set forth below information, requests, documents and payments
received from the Borrower. The Administrative Lender shall have no trustee or
other fiduciary relationship in respect of any Lender by reason of this
Agreement or any other Loan Document. The duties of the Administrative Lender
are mechanical and administrative in nature.
(b) Replacement of Administrative Lender. Should the Administrative Lender
------------------------------------
or any successor Administrative Lender ever cease to be a Lender hereunder, or
should the Administrative Lender or any successor Administrative Lender ever
resign as Administrative Lender, or should the Administrative Lender or any
successor Administrative Lender ever be removed with cause by the Determining
Lenders, then the Lender appointed by the other Lenders shall forthwith become
the Administrative Lender, and the Borrower and the Lenders shall execute such
documents as any Lender may reasonably request to reflect such change. Any
resignation or removal of the Administrative Lender or any successor
Administrative Lender shall become effective upon the appointment by the Lenders
of a successor Administrative Lender; provided, however, that if the Lenders
fail for any reason to appoint a successor within 60 days after such removal or
resignation, the Administrative Lender or any successor Administrative Lender
(as the case may be) shall thereafter have no obligation to act as
Administrative Lender hereunder. Notwithstanding any Administrative Lender's
resignation or removal hereunder, the provisions of this Article shall continue
to inure to its benefit as to any actions taken or omitted to be taken by it
while it was the Administrative Lender hereunder.
(c) Expenses. Each Lender shall pay its pro rata share, based on its
--------
Specified Percentage, of any expenses paid by the Administrative Lender directly
and solely in connection with any of the Loan Documents if Administrative Lender
does not receive reimbursement therefor from other sources within 60 days after
the date incurred, unless payment of such fees is being diligently
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disputed by such Lender or the Borrower in good faith. Any amount so paid by the
Lenders to the Administrative Lender shall be returned by the Administrative
Lender pro rata to each paying Lender to the extent later paid by the Borrower
or any other Person on the Borrower's behalf to the Administrative Lender.
(d) Delegation of Duties. The Administrative Lender may execute any of its
--------------------
duties hereunder by or through officers, directors, employees, attorneys or
agents, and shall be entitled to (and shall be protected in relying upon) advice
of counsel concerning all matters pertaining to its duties hereunder.
(e) Reliance by Administrative Lender. The Administrative Lender and its
---------------------------------
officers, directors, employees, attorneys and agents shall be entitled to rely
and shall be fully protected in relying on any writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telex or teletype
message, statement, order, or other document or conversation reasonably believed
by it or them in good faith to be genuine and correct and to have been signed or
made by the proper Person and, with respect to legal matters, upon opinions of
counsel selected the Administrative Lender. The Administrative Lender may, in
its reasonable judgment, deem and treat the payee of any Note as the owner
thereof for all purposes hereof.
(f) Limitation of Administrative Lender's Liability. Neither the
-----------------------------------------------
Administrative Lender nor any of its officers, directors, employees, attorneys
or agents shall be liable for any action taken or omitted to be taken by it or
them hereunder in good faith and believed by it or them to be within the
discretion or power conferred to it or them by the Loan Documents or be
responsible for the consequences of any error of judgment, except for its or
their own gross negligence or wilful misconduct. Except as aforesaid, the
Administrative Lender shall be under no duty to enforce any rights with respect
to any of the Advances, or any security therefor. The Administrative Lender
shall not be compelled to do any act hereunder or to take any action towards the
execution or enforcement of the powers hereby created or to prosecute or defend
any suit in respect hereof, unless indemnified to its satisfaction against loss,
cost, liability and expense. The Administrative Lender shall not be responsible
in any manner to any Lender for the effectiveness, enforceability, genuineness,
validity or due execution of any of the Loan Documents, or for any
representation, warranty, document, certificate, report or statement made herein
or furnished in connection with any Loan Documents, or be under any obligation
to any Lender to ascertain or to inquire as to the performance or observation of
any of the terms, covenants or conditions of any Loan Documents on the part of
the Borrower. TO THE EXTENT NOT REIMBURSED BY THE BORROWER, EACH LENDER HEREBY
JOINTLY AND SEVERALLY INDEMNIFIES AND HOLDS HARMLESS THE ADMINISTRATIVE LENDER,
PRO RATA ACCORDING TO ITS SPECIFIED PERCENTAGE, FROM AND AGAINST ANY AND ALL
LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS,
COSTS, EXPENSES AND/OR DISBURSEMENTS OF ANY KIND OR NATURE WHATSOEVER WHICH MAY
BE IMPOSED ON, ASSERTED AGAINST, OR INCURRED BY THE ADMINISTRATIVE LENDER (IN
ITS CAPACITY AS ADMINISTRATIVE LENDER AND NOT AS A LENDER) IN ANY WAY WITH
RESPECT TO ANY LOAN DOCUMENTS OR ANY
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ACTION TAKEN OR OMITTED BY THE ADMINISTRATIVE LENDER IN ITS CAPACITY AS
ADMINISTRATIVE LENDER AND NOT AS A LENDER UNDER THE LOAN DOCUMENTS (INCLUDING
ANY NEGLIGENT ACTION OF THE ADMINISTRATIVE LENDER), EXCEPT TO THE EXTENT THE
SAME RESULT FROM GROSS NEGLIGENCE OR WILFUL MISCONDUCT BY THE ADMINISTRATIVE
LENDER.
(g) Liability Among Lenders. No Lender shall incur any liability (other
-----------------------
than the sharing of expenses and other matters specifically set forth herein and
in the other Loan Documents) to any other Lender, except for acts or omissions
in bad faith.
(h) Rights as Lender. With respect to its commitment hereunder, the
----------------
Advances made by it and Note issued to it, the Administrative Lender shall have
the same rights as a Lender and may exercise the same as though it were not the
Administrative Lender, and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include the Administrative Lender in its individual
capacity. The Administrative Lender or any Lender may accept deposits from, act
as trustee under indentures of, and generally engage in any kind of business
with, the Borrower and any of its Affiliates, and any Person who may do business
with or own securities of the Borrower or any of its Affiliates, all as if the
Administrative Lender were not the Administrative Lender hereunder and without
any duty to account therefor to the Lenders.
Section 10.2 Lender Credit Decision. Each Lender acknowledges that it
----------------------
has, independently and without reliance upon the Administrative Lender or any
other Lender and based upon the financial statements referred to in Sections
4.1(j), 6.1 and 6.2 hereof, and such other documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and without
reliance upon the Administrative Lender or any other Lender and based upon such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and the other Loan Documents.
Section 10.3 Benefits of Article. None of the provisions of this Article
-------------------
shall inure to the benefit of any Person other than Lenders; consequently, no
Person shall be entitled to rely upon, or to raise as a defense, in any manner
whatsoever, the failure of the Administrative Lender or any Lender to comply
with such provisions.
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ARTICLE 11
Miscellaneous
-------------
Section 11.1 Notices.
-------
(a) All notices and other communications under this Agreement shall be in
writing and shall be deemed to have been given on the date personally delivered
or sent by telecopy (answerback received), or three days after deposit in the
mail, designated as certified mail, return receipt requested, postage-prepaid,
or one day after being entrusted to a reputable commercial overnight delivery
service, or one day after being delivered to the telegraph office or sent out by
telex addressed to the party to which such notice is directed at its address
determined as provided in this Section. All notices and other communications
under this Agreement shall be given to the parties hereto at the following
addresses:
(i) If to the Borrower, at:
Texas Industries, Inc.
0000 Xxxx Xxxxxxxxxxx Xxxx
Xxxxxx, Xxxxx 00000
Attn: Treasurer
with a copy to:
Texas Industries, Inc.
0000 Xxxx Xxxxxxxxxxx Xxxx
Xxxxxx, Xxxxx 00000
Attn: Vice President-General Counsel
(ii) If to the Administrative Lender, at:
NationsBank, N.A.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Attn: Xxx Xxxxx, Senior Vice President
(iii) If to a Lender, at its address shown below its name on the
signature pages hereof, or if applicable, set forth in its Assignment
Agreement.
(b) Any party hereto may change the address to which notices shall be
directed by giving 10 days' written notice of such change to the other parties.
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Section 11.2 Expenses. The Borrower shall promptly pay:
--------
(a) all reasonable out-of-pocket expenses of the Administrative Lender in
connection with the preparation, negotiation, execution and delivery of this
Agreement and the other Loan Documents, the transactions contemplated hereunder
and thereunder, and the making of Advances and the issuance of Letters of Credit
hereunder, including without limitation the reasonable fees and disbursements of
Special Counsel;
(b) all reasonable out-of-pocket expenses and attorneys' fees of the
Administrative Lender in connection with the administration of the transactions
contemplated in this Agreement and the other Loan Documents and the preparation,
negotiation, execution and delivery of any waiver, amendment or consent by the
Lenders relating to this Agreement or the other Loan Documents; and
(c) all costs, out-of-pocket expenses and attorneys' fees of the
Administrative Lender and each Lender (including reasonable allocated costs of
in-house counsel of any Lender) incurred for enforcement, collection,
restructuring, refinancing and "work-out", or otherwise incurred in obtaining
performance under the Loan Documents, and all costs and out-of-pocket expenses
of collection if default is made in the payment of the Notes, which in each case
shall include without limitation fees and expenses of consultants, counsel for
the Administrative Lender and any Lender, and administrative fees for the
Administrative Lender.
Section 11.3 Waivers. The rights and remedies of the Lenders under this
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Agreement and the other Loan Documents shall be cumulative and not exclusive of
any rights or remedies which they would otherwise have. No failure or delay by
the Administrative Lender or any Lender in exercising any right shall operate as
a waiver of such right. The Lenders expressly reserve the right to require
strict compliance with the terms of this Agreement in connection with any
funding of a request for an Advance and the Issuing Bank expressly reserves the
right to require strict compliance with the terms of this Agreement in
connection with any issuance of a Letter of Credit. In the event that any
Lender decides to fund an Advance or the Issuing Bank decides to issue a Letter
of Credit at a time when the Borrower is not in strict compliance with the terms
of this Agreement, such decision by such Lender shall not be deemed to
constitute an undertaking by the Lender to fund any further requests for
Advances or by the Issuing Bank to issue any additional Letters of Credit or
preclude the Lenders from exercising any rights available under the Loan
Documents or at law or equity. Any waiver or indulgence granted by the Lenders
shall not constitute a modification of this Agreement, except to the extent
expressly provided in such waiver or indulgence, or constitute a course of
dealing by the Lenders at variance with the terms of the Agreement such as to
require further notice by the Lenders of the Lenders' intent to require strict
adherence to the terms of the Agreement in the future. Any such actions shall
not in any way affect the ability of the Administrative Lender or the Lenders,
in their discretion, to exercise any rights available to them under this
Agreement or under any other agreement, whether or not the Administrative Lender
or any of the Lenders are a party thereto, relating to the Borrower.
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Section 11.4 Determination by the Lenders Conclusive and Binding. Any
---------------------------------------------------
material determination required or expressly permitted to be made by the
Administrative Lender or any Lender under this Agreement shall be made in its
reasonable judgment and in good faith, and shall when made, absent manifest
error, be conclusive and binding on all parties.
Section 11.5 Set-Off. 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 an Event of Default, each Lender and any subsequent holder of any
Note, and any assignee or participant in any Note is hereby authorized by the
Borrower at any time or from time to time, without notice to the Borrower or any
other Person, any such notice being hereby expressly waived, to set-off,
appropriate and apply any deposits (general or special (except trust and escrow
accounts), time or demand, including without limitation Indebtedness evidenced
by certificates of deposit, in each case whether matured or unmatured) and any
other Indebtedness at any time held or owing by such Lender or holder to or for
the credit or the account of the Borrower, against and on account of the
Obligations and other liabilities of the Borrower to such Lender or holder,
irrespective of whether or not (a) the Lender or holder shall have made any
demand hereunder, or (b) the Lender or holder shall have declared the principal
of and interest on the Advances and other amounts due hereunder to be due and
payable as permitted by Section 8.2 and although such obligations and
liabilities, or any of them, shall be contingent or unmatured. Any sums
obtained by any Lender or by any assignee, participant or subsequent holder of
any Note shall be subject to pro rata treatment of all Obligations and other
liabilities hereunder.
Section 11.6 Assignment.
----------
(a) The Borrower may not assign or transfer any of its rights or
obligations hereunder or under the other Loan Documents without the prior
written consent of the Lenders.
(b) No Lender shall be entitled to assign its interest in this Agreement,
its Notes or its Advances, except as hereinafter set forth.
(c) A Lender may at any time sell participations in all or any part of its
Advances (collectively, "Participations") to any banks or other financial
--------------
institutions ("Participants") provided that such Participation shall not confer
------------
on any Person (other than the parties hereto) any right to vote on, approve or
sign amendments or waivers, or any other independent benefit or any legal or
equitable right, remedy or other claim under this Agreement or any other Loan
Documents, other than the right to vote on, approve, or sign amendments or
waivers or consents with respect to items that would result in (i) any increase
in the commitment of any Participant; or (ii)(A) the extension of the date of
maturity of, or (B) the extension of the due date for any payment of principal,
interest or fees respecting, or (C) the reduction of the amount of any
installment of principal or interest on or the change or reduction of any
mandatory reduction required hereunder, or (D) a reduction of the rate of
interest on, the Advances, the Letters of Credit, or the Reimbursement
Obligations, or change in Applicable Margin; or (iii) the release of security
for or guaranty of the Obligations; or (iv) the reduction of any fees payable
hereunder. Notwithstanding the foregoing, the Borrower agrees that
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the Participants shall be entitled to the benefits of Article 9 and Section 11.5
hereof as though they were Lenders and the Lenders may provide copies of all
financial information received from the Borrower to such Participants. To the
fullest extent it may effectively do so under Applicable Law, the Borrower
agrees that any Participant may exercise any and all rights of banker's lien,
set-off and counterclaim with respect to this Participation as fully as if such
Participant were the holder of the Advances in the amount of its Participation.
Any Lender selling a Participation hereunder shall give prompt notice thereof to
the Borrower and the Administrative Lender.
(d) Each Lender may assign to one or more Eligible Assignees its rights
and obligations under this Agreement and the other Loan Documents; provided,
--------
however, that (i) each such assignment shall be of a constant, and not a
-------
varying, percentage of the Lender's rights and obligations under this Agreement
(excluding, however, any Bid Rate Advances), (ii) the amount of such assigning
Lender's portion of the Commitment, Advances and Reimbursement Obligations being
assigned pursuant to each such assignment (determined as of the date of the
assignment with respect to such assignment) shall in no event be less than the
lesser of (A) $10,000,000, or (B) the applicable Lender's portion of the
Commitment, (iii) the applicable Lender, Administrative Lender and applicable
Eligible Assignee shall execute and deliver to the Administrative Lender an
Assignment and Acceptance Agreement (an "Assignment Agreement") in substantially
--------------------
the form of Exhibit E hereto, together with the Notes subject to such
---------
assignment, (iv) the Eligible Assignee or the Lender executing the Assignment,
as the case may be, shall deliver to the Administrative Lender a processing fee
of $3,500, and (v) unless waived by the Borrower, the Administrative Lender
shall give the Borrower notice of any proposed assignment no later than 10 days
prior to any assignment by any Lender. Upon such execution, delivery and
acceptance from and after the effective date specified in each Assignment, which
effective date shall be at least three Business Days after the execution
thereof, (A) the Eligible Assignee thereunder shall be party hereto and, to the
extent that rights and obligations hereunder have been assigned to it pursuant
to such Assignment, have the rights and obligations of a Lender hereunder and
(B) the applicable Lender shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment, relinquish such
rights and be released from such obligations under this Agreement, except those
rights that expressly survive termination of this Agreement.
(e) Notwithstanding anything in clause (d) above to the contrary, any
Lender may assign and pledge all or any portion of its Advances and Notes to any
Federal Reserve Bank as collateral security pursuant to Regulation A of F.R.S.
Board and any Operating Circular issued by such Federal Reserve Bank; provided,
however, that no such assignment under this clause (e) shall release the
assignor Lender from its obligations hereunder.
(f) Upon its receipt of an Assignment Agreement executed by a Lender and
an Eligible Assignee, and any Note subject to such assignment, the Borrower
shall, within three Business Days after its receipt of such Assignment
Agreement, at its own expense, execute and deliver to the Administrative Lender
in exchange for the surrendered Note a new Note to the order of such Eligible
Assignee in an amount equal to the portion of the Advances, Reimbursement
Obligations and Commitment assigned to it pursuant to such Assignment Agreement
and a new Note to the order of
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the assigning Lender in an amount equal to the portion of the Advances and
Commitment retained by it hereunder. Such new Notes shall be in an aggregate
principal amount equal to the aggregate principal amount of such surrendered
Note, shall be dated the effective date of such Assignment Agreement and shall
otherwise be in substantially the form of Exhibit A hereto.
---------
(g) Any Lender may, in connection with any assignment or participation or
proposed assignment or participation pursuant to this Section 11.6, disclose to
the Eligible Assignee or Participant or proposed Eligible Assignee or
Participant, any information relating to the Borrower furnished to such Lender
by or on behalf of the Borrower.
(h) Except as specifically set forth in this Section 11.6, nothing in this
Agreement or any other Loan Documents, expressed or implied, is intended to or
shall confer on any Person other than the respective parties hereto and thereto
and their successors and assignees permitted hereunder and thereunder any
benefit or any legal or equitable right, remedy or other claim under this
Agreement or any other Loan documents.
(i) Notwithstanding anything in this Section 11.6 to the contrary, no
Eligible Assignee or Participant shall be entitled to receive any greater
payment under Section 2.15 or Section 9.3 than such assigning or participating
Lender would have been entitled to receive with respect to the interest assigned
or participated to such Eligible Assignee or Participant.
Section 11.7 Counterparts. This Agreement may be executed in any number
------------
of counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
Section 11.8 Severability. Any provision of this Agreement which is for
------------
any reason prohibited or found or held invalid or unenforceable by any court or
governmental agency shall be ineffective to the extent of such prohibition or
invalidity or unenforceability without invalidating the remaining provisions
hereof in such jurisdiction or affecting the validity or enforceability of such
provision in any other jurisdiction.
Section 11.9 Interest and Charges. It is not the intention of any
--------------------
parties to this Agreement to make an agreement in violation of the laws of any
applicable jurisdiction relating to usury. Regardless of any provision in any
Loan Documents, no Lender shall ever be entitled to receive, collect or apply,
as interest on the Obligations, any amount in excess of the Maximum Amount. If
any Lender or participant ever receives, collects or applies, as interest, any
such excess, such amount which would be excessive interest shall be deemed a
partial repayment of principal and treated hereunder as such; and if principal
is paid in full, any remaining excess shall be paid to the Borrower. In
determining whether or not the interest paid or payable, under any specific
contingency, exceeds the Maximum Amount, the Borrower and the Lenders shall, to
the maximum extent permitted under Applicable Law, (a) characterize any
nonprincipal payment as an expense, fee or premium rather than as interest, (b)
exclude voluntary prepayments and the effect thereof, and (c) amortize, prorate,
allocate and spread in equal parts, the total amount of interest throughout the
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entire contemplated term of the Obligations so that the interest rate is uniform
throughout the entire term of the Obligations; provided, however, that if the
Obligations are paid and performed in full prior to the end of the full
contemplated term thereof, and if the interest received for the actual period of
existence thereof exceeds the Maximum Amount, the Lenders shall refund to the
Borrower the amount of such excess or credit the amount of such excess against
the total principal amount of the Obligations owing, and, in such event, the
Lenders shall not be subject to any penalties provided by any laws for
contracting for, charging or receiving interest in excess of the Maximum Amount.
This Section shall control every other provision of all agreements pertaining to
the transactions contemplated by or contained in the Loan Documents.
Section 11.10 Headings. Headings used in this Agreement are for
--------
convenience only and shall not be used in connection with the interpretation of
any provision hereof.
Section 11.11 Amendment and Waiver. The provisions of this Agreement or
--------------------
any other Loan Document may not be amended, modified or waived except by the
written agreement of the Borrower and the Determining Lenders; provided,
however, that no such amendment, modification or waiver shall be made (a)
without the consent of all Lenders, if it would (i) increase the Commitment or
the Specified Percentage of any Lender, or (ii) extend the date of maturity of,
extend the due date for any payment of principal or interest on, reduce the
amount of any installment of principal or interest on, or reduce the rate of
interest on, any Advance, the Reimbursement Obligations or other amount owing
under any Loan Documents, or (iii) release any security for or guaranty of the
Obligations (except pursuant to this Agreement), or (iv) reduce the fees payable
hereunder, or (v) revise this Section 11.11, or (vi) waive the date for payment
of any of the Obligations, or (vii) amend the definition of Determining Lenders
or otherwise alter the percentage of Lenders necessary to take action under any
of the Loan Documents; (b) without the consent of the Administrative Lender, if
it would alter the rights, duties or obligations of the Administrative Lender;
or (c) without the consent of the Issuing Bank, if it would alter the rights,
duties or obligations of the Issuing Bank. Neither this Agreement nor any term
hereof may be amended orally, nor may any provision hereof be waived orally but
only by an instrument in writing signed by the Administrative Lender and, in the
case of an amendment, by the Borrower.
Section 11.12 Exception to Covenants. Neither the Borrower nor any
----------------------
Subsidiary shall be deemed to be permitted to take any action or fail to take
any action which is permitted as an exception to any of the covenants contained
herein or which is within the permissible limits of any of the covenants
contained herein if such action or omission would result in the breach of any
other covenant contained herein.
Section 11.13 No Liability of Issuing Bank. The Borrower assumes all
----------------------------
risks of the acts or omissions of any beneficiary or transferee of any Letter of
Credit with respect to its use of such Letter of Credit. Neither the Issuing
Bank nor any Lender nor any of their respective officers or directors shall be
liable or responsible for: (a) the use that may be made of any Letter of Credit
or any acts or omissions of any beneficiary or transferee in connection
therewith; (b) the validity, sufficiency or genuineness of documents, or of any
endorsement thereon, even if such documents
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should prove to be in any or all respects invalid, insufficient, fraudulent or
forged; (c) payment by the Issuing Bank against presentation of documents that
do not comply with the terms of a Letter of Credit, including failure of any
documents to bear any reference or adequate reference to the Letter of Credit,
except for any payment made upon the Issuing Bank's gross negligence or willful
misconduct; or (d) any other circumstances whatsoever in making or failing to
make payment under any Letter of Credit, except that the Borrower shall have a
------
claim against the Issuing Bank, and the Issuing Bank shall be liable to the
Borrower, to the extent of any direct, but not consequential, damages suffered
by the Borrower that the Borrower proves were caused by (i) the Issuing Bank's
willful misconduct or gross negligence in determining whether documents
presented under any Letter of Credit comply with the terms of the Letter of
Credit or (ii) the Issuing Bank's willful failure to make lawful payment under a
Letter of Credit after the presentation to it of a draft and certificates
strictly complying with the terms and conditions of the Letter of Credit. In
furtherance and not in limitation of the foregoing, the Issuing Bank may accept
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary.
Section 11.14 Confidentiality. Each Lender and the Administrative Lender
---------------
agrees (on behalf of itself and each of its affiliates, directors, officers,
employees and representatives) to use reasonable precautions to keep
confidential, in accordance with customary procedures for handling confidential
information of this nature and in accordance with safe and sound banking
practices, any non-public information supplied to it by the Borrower pursuant to
this Agreement which is identified by the Borrower as being confidential at the
time the same is delivered to the Lenders or the Administrative Lender, provided
that nothing herein shall limit the disclosure of any such information (a) to
the extent required by statute, rule, regulation or judicial process, (b) to
counsel for any Lender or the Administrative Lender, (c) to bank examiners,
auditors or accountants of any Lender, (d) to the Administrative Lender, any
other Lender or any affiliate of any Lender, or any other officer, director,
employee, agent or advisor of any Lender or any affiliate of any Lender, (e) in
connection with any litigation to which any one or more of Lenders is a party,
(f) to the extent necessary in connection with the exercise of any remedy under
this Agreement or any other Loan Document; provided, further, that, unless
specifically prohibited by Applicable Law or court order, each Lender shall,
prior to disclosure thereof, notify the Borrower of any request for disclosure
of any such not-public information (i) by any governmental agency or
representative thereof (other than any such request in connection with an
examination of such Lender's financial condition by such governmental agency) or
(ii) pursuant to legal process, or (g) to any assignee or participant (or
prospective assignee or participant) so long as such assignee or participant (or
prospective assignee or participant) agrees to handle such information
confidentially.
Section 11.15 No Duties of Co-Agents. The Borrower and the Lenders
----------------------
acknowledge that the Co-Agents have no duties, responsibilities or liabilities
in their capacities as Co-Agents hereunder.
Section 11.16 GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
-------------
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
-00-
XXX XXXX XX XXX XXXXX XX XXXXX (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS)
AND THE UNITED STATES OF AMERICA; PROVIDED, HOWEVER, IT IS AGREED THAT THE
PROVISIONS OF CHAPTER 346 OF THE TEXAS FINANCE CODE, AS AMENDED, SHALL NOT APPLY
TO THE ADVANCES, THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS. WITHOUT EXCLUDING
ANY OTHER JURISDICTION, THE BORROWER AGREES THAT THE STATE AND FEDERAL COURTS OF
TEXAS LOCATED IN DALLAS, TEXAS SHALL HAVE JURISDICTION OVER PROCEEDINGS IN
CONNECTION WITH THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS. THIS AGREEMENT AND
THE OTHER LOAN DOCUMENTS ARE PERFORMABLE IN DALLAS COUNTY, TEXAS.
Section 11.17 WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE
--------------------
ADMINISTRATIVE LENDER AND THE LENDERS HEREBY KNOWINGLY VOLUNTARILY, IRREVOCABLY
AND INTENTIONALLY WAIVE, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR CLAIM ARISING OUT OF OR RELATED TO
ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY. THIS
PROVISION IS A MATERIAL INDUCEMENT TO EACH LENDER ENTERING INTO THIS AGREEMENT
AND MAKING ANY ADVANCES HEREUNDER.
Section 11.18 ENTIRE AGREEMENT. THIS WRITTEN AGREEMENT, TOGETHER WITH THE
----------------
OTHER LOAN DOCUMENTS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.
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REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
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IN WITNESS WHEREOF, this Credit Agreement is executed as of the date first
set forth above.
TEXAS INDUSTRIES, INC.
By: ____________________________
Xxxxxxx X. Xxxxx
Treasurer
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