EXHIBIT 99.1
$400,000,000
BRIDGE CREDIT AGREEMENT
dated as of July 5, 2005,
by and among
▇▇▇▇, INC.,
and the Subsidiaries of ▇▇▇▇, Inc. party hereto,
as Borrowers
BANK OF AMERICA, N.A.,
WACHOVIA BANK, NATIONAL ASSOCIATION
and the other Lenders referred to herein,
and
BANK OF AMERICA, N.A.,
as Administrative Agent
BANC OF AMERICA SECURITIES LLC
and
WACHOVIA CAPITAL MARKETS, LLC
as Joint Lead Arrangers
BANC OF AMERICA SECURITIES LLC
as Sole Book Manager
TABLE OF CONTENTS
ARTICLE I DEFINITIONS ......................................................................... 1
Section 1.1 Definitions ......................................................... 1
Section 1.2 General ............................................................. 15
Section 1.3 Other Definitions and Provisions .................................... 15
ARTICLE II TERM LOAN ........................................................................... 15
Section 2.1 Term Loan ........................................................... 15
Section 2.2 Intentionally Omitted ............................................... 16
Section 2.3 Procedure for Making of Term Loan ................................... 16
Section 2.4 Repayment of Loans .................................................. 16
Section 2.5 Notes ............................................................... 18
Section 2.6 Mandatory Permanent Reduction of the Term Loan Commitments .......... 18
Section 2.7 Termination of Credit Facility ...................................... 18
ARTICLE III INTENTIONALLY OMITTED .............................................................. 20
ARTICLE IV GENERAL LOAN PROVISIONS ............................................................. 20
Section 4.1 Interest ............................................................ 20
Section 4.2 Notice and Manner of Conversion or Continuation of Loans ............ 23
Section 4.3 Continuation Fee .................................................... 23
Section 4.4 Manner of Payment ................................................... 23
Section 4.5 Crediting of Payments and Proceeds .................................. 24
Section 4.6 Adjustments ......................................................... 24
Section 4.7 Nature of Obligations of Lenders Regarding Extensions of Credit;
Assumption by the Administrative Agent .............................. 25
Section 4.8 Changed Circumstances ............................................... 25
Section 4.9 Indemnity ........................................................... 27
Section 4.10 Capital Requirements ................................................ 28
Section 4.11 Taxes ............................................................... 28
ARTICLE V CLOSING; CONDITIONS OF CLOSING AND BORROWING ......................................... 30
Section 5.1 Closing ............................................................. 30
Section 5.2 Conditions to Closing ............................................... 30
Section 5.3. Conditions to All Extensions of Credit .............................. 31
ARTICLE VI REPRESENTATIONS AND WARRANTIES OF THE BORROWERS ..................................... 31
Section 6.1 Representations and Warranties ...................................... 31
Section 6.2 Survival of Representations and Warranties, Etc...................... 40
ARTICLE VII FINANCIAL INFORMATION AND NOTICES .................................................. 40
Section 7.1 Financial Statements and Projections ................................ 40
Section 7.2 Officer's Compliance Certificate .................................... 41
Section 7.3 Accountants' Certificate ............................................ 41
Section 7.4 Other Reports ........................................................ 41
Section 7.5 Notice of Litigation and Other Matters ............................... 42
Section 7.6 Accuracy of Information .............................................. 43
ARTICLE VIII AFFIRMATIVE COVENANTS ............................................................. 43
Section 8.1 Preservation of Corporate Existence and Related Matters .............. 43
Section 8.2 Maintenance of Property .............................................. 43
Section 8.3 Insurance ............................................................ 43
Section 8 4 Accounting Methods and Financial Records ............................. 44
Section 8.5 Payment and Performance of Obligations ............................... 44
Section 8.6 Compliance With Laws and Approvals ................................... 44
Section 8.7 Environmental Laws ................................................... 44
Section 8.8 Compliance with ERISA ................................................ 45
Section 8.9 Compliance With Agreements ........................................... 45
Section 8.10 Visits and Inspections ............................................... 45
Section 8.11 Additional Subsidiaries .............................................. 45
Section 8.12 Use of Proceeds ...................................................... 45
ARTICLE IX FINANCIAL COVENANTS ................................................................. 46
Section 9.1 Leverage Ratio ....................................................... 46
Section 9.2 Fixed Charge Coverage Ratio .......................................... 46
Section 9.3 Modifications to Financial Covenants Following an Amendment of
the Existing Credit Agreement ........................................ 46
ARTICLE X NEGATIVE COVENANTS ................................................................... 47
Section 10.1 Limitations on Debt .................................................. 47
Section 10.2 Limitations on Liens ................................................. 48
Section 10.3 Limitations on Loans, Advances, Investments and Acquisitions ......... 49
Section 10.4 Limitations on Mergers and Liquidation ............................... 51
Section 10.5 Limitations on Sale of Assets ........................................ 52
Section 10.6 Limitations on Dividends and Distributions ........................... 52
Section 10.7 Limitations on Exchange and Issuance of Capital Stock ................ 53
Section 10.8 Transactions with Affiliates ......................................... 53
Section 10.9 Certain Accounting Changes; Organizational Documents ................. 53
Section 10.10 Amendments; Payments and Prepayments of Subordinated Debt ............ 53
Section 10.11 Restrictive Agreements ............................................... 54
Section 10.12 Nature of Business ................................................... 54
Section 10.13 Prepayment of Other Indebtedness, Etc................................. 54
ARTICLE XI DEFAULT AND REMEDIES ................................................................ 55
Section 11.1 Events of Default .................................................... 55
Section 11.2 Remedies ............................................................. 57
Section 11.3 Rights and Remedies Cumulative; Non-Waiver; etc....................... 58
ARTICLE XII THE ADMINISTRATIVE AGENT ........................................................... 58
Section 12.1 Appointment .......................................................... 58
Section 12.2 Delegation of Duties ................................................. 59
Section 12.3 Exculpatory Provisions .............................................. 59
Section 12.4 Reliance by the Administrative Agent ................................ 59
Section 12.5 Notice of Default ................................................... 60
Section 12.6 Non-Reliance on the Administrative Agent and Other Lenders .......... 60
Section 12.7 Indemnification ..................................................... 61
Section 12.8 The Administrative Agent in Its Individual Capacity ................. 61
Section 12.9 Resignation of the Administrative Agent; Successor
Administrative Agent ................................................ 61
Section 12.10 Other Agents ........................................................ 62
ARTICLE XIIII MISCELLANEOUS .................................................................... 62
Section 13.1 Notices ............................................................. 62
Section 13.2 Expenses; Indemnity ................................................. 63
Section 13.3 Set-off ............................................................. 64
Section 13.4 Governing Law ....................................................... 65
Section 13.5 Jurisdiction and Venue .............................................. 65
Section 13.6 Reversal of Payments ................................................ 65
Section 13.7 Injunctive Relief; Punitive Damages ................................. 66
Section 13.8 Accounting Matters .................................................. 66
Section 13.9 Successors and Assigns; Participations .............................. 66
Section 13.10 Amendments, Waivers and Consents .................................... 70
Section 13.11 Performance of Duties ............................................... 71
Section 13.12 All Powers Coupled with Interest .................................... 71
Section 13.13 Survival of Indemnities ............................................. 71
Section 13.14 Titles and Captions ................................................. 71
Section 13.15 Severability of Provisions .......................................... 71
Section 13.16 Counterparts ........................................................ 71
Section 13.17 Term of Agreement ................................................... 72
Section 13.18 Advice of Counsel ................................................... 72
Section 13.19 No Strict Construction .............................................. 72
Section 13.20 Inconsistencies with Other Documents; Independent Effect of
Covenants ........................................................... 72
EXHIBITS
Exhibit A - Form of Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Notice of Account Designation
Exhibit D - Form of Notice of Repayment
Exhibit E - Form of Notice of Conversion/Continuation
Exhibit F - Form of Officer's Compliance Certificate
Exhibit G - Form of Assignment and Acceptance
SCHEDULES
Schedule 2.1 Commitments and Applicable Percentages
Schedule 6.1(a) - Jurisdictions of Organization and Qualification
Schedule 6.l(b) - Subsidiaries and Capitalization
Schedule 6.l(f) - Ongoing Tax Audits
Schedule 6.l(i) - ERISA Plans
Schedule 6.1(l) - Material Contracts
Schedule 6.1(m) - Labor and Collective Bargaining Agreements
Schedule 6.l(t) - Debt and Guaranty Obligations
Schedule 6.l(u) - Litigation
Schedule 8.3 - Insurance
Schedule 10.2 - Existing Liens
Schedule 10.3 - Existing Investments
Schedule 10.8 - Transactions with Affiliates
Schedule 13.9 - Assignment Fee
EXECUTION COPY
BRIDGE CREDIT AGREEMENT, dated as of the 5th day of July, 2005, by and
among ▇▇▇▇, INC., a Delaware corporation (the "Company"), the Subsidiaries of
the Company listed on the signature pages hereto and each additional Subsidiary
of the Company which hereafter becomes a Borrower pursuant to Section 8.11
(collectively, the "Subsidiary Borrowers" and together with the Company, the
"Borrowers"), BANK OF AMERICA, N.A., WACHOVIA BANK, NATIONAL ASSOCIATION, and
such other lenders who are or may become a party to this Agreement, as Lenders,
and BANK OF AMERICA, N.A., in its capacity as administrative agent for the
Lenders (the "Administrative Agent").
STATEMENT OF PURPOSE
The Borrowers have requested, and, subject to the terms and conditions
hereof, the Lenders have agreed, to extend certain credit facilities to the
Borrowers.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, such parties
hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions.
The following terms when used in this Agreement shall have the meanings
assigned to them below:
"Acquired Assets" means, the assets used in the operation of the retail
department stores operating under the nameplates ▇▇▇▇▇'▇ and ▇▇▇▇▇▇▇▇'▇, as more
fully described by the defined term "Assets" in the Purchase Agreement.
"Add-On Term Loan" means that certain term loan facility to be documented
under the Existing Credit Agreement pursuant to an amendment thereto or
restatement thereof, the Net Cash Proceeds of which, together with the Net Cash
Proceeds of the Senior Notes and/or other similar financings or capital raising,
are expected to be sufficient to repay the Term Loan and all other Obligations
hereunder in full.
"Additional Debt" means, with respect to any Borrower or any Subsidiary
and to the extent not included as a liability on the consolidated balance sheet
of such Borrower or Subsidiary, in accordance with GAAP, any monetary obligation
(including, without limitation, all outstanding payment, recourse, repurchase,
hold harmless, indemnity or similar obligations) with respect to any Synthetic
Lease transaction, tax retention or off-balance sheet lease transaction, asset
securitization transaction (including any accounts receivable purchase facility)
or any other monetary obligation arising with respect to any other transaction
which does not appear on the balance sheet of such Borrower or Subsidiary, but
which (i) upon the insolvency or bankruptcy of such Borrower or Subsidiary would
be characterized as debt of such Borrower or Subsidiary or (ii) is the
functional equivalent of or takes the place of borrowing.
"Adjusted Debt" means the sum of (i) Funded Debt and (ii) the product of
(x) Rental Expense and (y) eight (8).
"Administrative Agent" means Bank of America, N.A., in its capacity as
Administrative Agent hereunder, and any successor thereto appointed pursuant to
Section 12.9.
"Administrative Agent's Office" means the office of the Administrative
Agent specified in or determined in accordance with the provisions of Section
13.1(c).
"Affiliate" means, with respect to any Person, any other Person (other
than a Borrower or a Subsidiary of a Borrower) which directly or indirectly
through one or more intermediaries, controls, or is controlled by, or is under
common control with, such first Person or any of its Subsidiaries. The term
"control" means (a) the power to vote five percent (5%) or more of the
securities or other equity interests of a Person having ordinary voting power,
or (b) the possession, directly or indirectly, of any other power to direct or
cause the direction of the management and policies of a Person, whether through
ownership of voting securities, by contract or otherwise.
"Agreement" means this Bridge Credit Agreement, as amended, restated,
supplemented or otherwise modified from time to time.
"Applicable Law" means all applicable provisions of constitutions, laws,
statutes, ordinances, rules, treaties, regulations, permits, licenses,
approvals, interpretations and orders of courts or Governmental Authorities and
all orders and decrees of all courts and arbitrators.
"Approved Fund" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Applicable Margin" shall have the meaning assigned thereto in Section
4.1(c).
"Assignment and Acceptance" shall have the meaning assigned thereto in
Section 13.9.
"Base Rate" means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest
in effect for such day as publicly announced from time to time by Bank of
America as its "prime rate." The "prime rate" is a rate set by Bank of America
based upon various factors including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced
rate. Any change in such rate announced by Bank of America shall take effect at
the opening of business on the day specified in the public announcement of such
change.
"Base Rate Loan" means any Loan bearing interest at a rate based upon the
Base Rate as provided in Section 4.1(a).
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"Benefited Lender" shall have the meaning assigned thereto in Section 4.6.
"Borrowers" shall have the meaning assigned thereto in the preamble
hereof.
"Business Day" means (a) for all purposes other than as set forth in
clause (b) below, any day other than a Saturday, Sunday or legal holiday on
which banks in Charlotte, North Carolina and New York, New York, are open for
the conduct of their commercial banking business, and (b) with respect to all
notices and determinations in connection with, and payments of principal and
interest on, any LIBOR Rate Loan, any day that is a Business Day described in
clause (a) and that is also a day for trading by and between banks in Dollar
deposits in the London interbank market.
"Calculation Date" shall have the meaning assigned thereto in Section
4.1(c).
"Capital Asset" means, with respect to the Borrowers and their
Subsidiaries, any asset that should, in accordance with GAAP, be classified and
accounted for as a capital asset on a Consolidated balance sheet of the
Borrowers and their Subsidiaries.
"Capital Lease" means any lease of any property by any of the Borrowers or
any of their Subsidiaries, as lessee, that should, in accordance with GAAP, be
classified and accounted for as a capital lease on a Consolidated balance sheet
of the Borrowers and their Subsidiaries.
"Cash Equivalents" shall have the meaning assigned thereto in Section
10.3(b).
"Change in Control" shall have the meaning assigned thereto in Section
11.1(h).
"Closing Date" means the date of this Agreement or such later Business Day
upon which each condition described in Section 5.2 shall be satisfied or waived
in all respects in a manner acceptable to the Administrative Agent, in its sole
discretion.
"Code" means the Internal Revenue Code of 1986, and the rules and
regulations thereunder, each as amended or modified from time to time.
"Company" shall have the meaning assigned thereto in the preamble hereof.
"Consolidated" means, when used with reference to financial statements or
financial statement items of the Borrowers and their Subsidiaries, such
statements or items on a consolidated basis in accordance with applicable
principles of consolidation under GAAP.
"Credit Facility" means the credit facility established hereunder.
"Debt" means, with respect to the Borrowers and their Subsidiaries at any
date and without duplication, the sum of the following calculated in accordance
with GAAP: (a) all Funded Debt, (b) all Additional Debt, (c) all obligations to
pay the deferred purchase price of property or services of any such Person
(including, without limitation, all obligations under non-competition
agreements), except trade payables arising in the ordinary course of business
not
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more than ninety (90) days past due, (d) all Debt of any other Person secured by
a Lien on any asset of any such Person, (e) all Guaranty Obligations of any such
Person, (f) all obligations, contingent or otherwise, of any such Person
relative to the face amount of letters of credit, whether or not drawn, and
banker's acceptances issued for the account of any such Person, (g) all
obligations of any such Person to redeem, repurchase, exchange, defease or
otherwise make payments in respect of capital stock or other securities or
partnership interests of such Person and (h) all net payment obligations
incurred by any such Person pursuant to Hedging Agreements.
"Debt Issuance" means the issuance by the Company or any Subsidiary of any
Debt or Additional Debt other than Debt and Additional Debt permitted under
Section 10.1(a)-(m).
"Default" means any of the events specified in Section 11.1 which with the
passage of time, the giving of notice or any other condition, would constitute
an Event of Default.
"Disposition" or "Dispose" means the sale, transfer, license, lease or
other disposition (including any Sale and Leaseback Transaction) of any property
by the Borrowers or any of their Subsidiaries (including the capital stock of
any Subsidiary), including any sale, assignment, transfer or other disposal,
with or without recourse, of any notes or accounts receivable or any rights and
claims associated therewith, but excluding (a) the sale, lease, license,
transfer or other disposition of property in the ordinary course of business of
the Borrowers and their Subsidiaries (other than sales of government contracts
that are required by law or by any government agency to be sold as a result of
an organizational conflict of interest), (b) the sale, lease, license, transfer
or other disposition of machinery and equipment no longer used or useful in the
conduct of business of the Borrowers and their Subsidiaries, (c) any sale,
lease, license, transfer or other disposition of property by any Borrower or any
Subsidiary of any Borrower, and (d) any sale, transfer or other disposition of
Cash Equivalents.
"Dollars" or "$" means, unless otherwise qualified, dollars in lawful
currency of the United States.
"EBITDA" means, for any period, the sum of the following determined on a
Consolidated basis, without duplication, for the Borrowers and their
Subsidiaries in accordance with GAAP: (a) Net Income for such period plus (b)
the sum of the following to the extent deducted in determining Net Income: (i)
income and franchise taxes, (ii) Interest Expense, and (iii) amortization,
depreciation, and other non-cash charges, including those related to the closing
of store locations less (c) interest income and any extraordinary gains.
"EBITDAR" means, for any period, the sum of the following determined on a
Consolidated basis, without duplication, for the Borrowers and their
Subsidiaries in accordance with GAAP: (a) EBITDA for such period plus (b) Rental
Expense.
"Eligible Assignee" means, (a) a Lender; (b) an Affiliate of a Lender; (c)
an Approved Fund; and (d) any other Person (other than a natural person)
approved by (i) the Administrative Agent, and (ii) unless an Event of Default
has occurred and is continuing, the Company (each such approval not to be
unreasonably withheld or delayed); provided that notwithstanding the
4
foregoing, "Eligible Assignee" shall not include a Borrower or any of such
Borrower's Affiliates or Subsidiaries.
"Employee Benefit Plan" means any employee benefit plan within the meaning
of Section 3(3) of ERISA which (a) is maintained for employees of any Borrower
or any ERISA Affiliate or (b) has at any time within the preceding six (6) years
been maintained for the employees of any Borrower or any current or former ERISA
Affiliate.
"Environmental Claims" means any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, accusations,
allegations, notices of noncompliance or violation, investigations (other than
internal reports prepared by any Person in the ordinary course of business and
not in response to any third party action or request of any kind) or proceedings
relating in any way to any actual or alleged violation of or liability under any
Environmental Law or relating to any permit issued, or any approval given, under
any such Environmental Law, including, without limitation, any and all claims by
Governmental Authorities for enforcement, cleanup, removal, response, remedial
or other actions or damages, contribution, indemnification cost recovery,
compensation or injunctive relief resulting from Hazardous Materials or arising
from alleged injury or threat of injury to human health or the environment.
"Environmental Laws" means any and all federal, foreign, state, provincial
and local laws, statutes, ordinances, rules, regulations, permits, licenses,
approvals, interpretations and orders of courts or Governmental Authorities,
relating to the protection of human health or the environment, including, but
not limited to, requirements pertaining to the manufacture, processing,
distribution, use, treatment, storage, disposal, transportation, handling,
reporting, licensing, permitting, investigation or remediation of Hazardous
Materials.
"Equity Issuance" means any issuance by the Borrowers or any Subsidiary to
any Person of shares of its capital stock, other than (a) any issuance of shares
of its capital stock pursuant to the exercise of options, warrants or other
purchase rights under any stock incentive plan, stock option plan, stock
purchase plan, stock grant plan or other equity-based compensation plan or
arrangement, (b) any issuance of shares of its capital stock pursuant to the
conversion of any debt securities to equity or the conversion of any class
equity securities to any other class of equity securities, (c) any issuance of
options or warrants relating to its capital stock, (d) any issuance by the
Borrowers of shares of their capital stock as consideration for an acquisition
permitted under Section 10.3 and (e) any issuance by a Subsidiary of shares of
its capital stock to the Borrowers or any Subsidiary. The term "Equity Issuance"
shall not be deemed to include any Disposition and vice versa.
"ERISA" means the Employee Retirement Income Security Act of 1974, and the
rules and regulations thereunder, each as amended, or modified from time to
time.
"ERISA Affiliate" means any Person who together with any Borrower is
treated as a single employer within the meaning of Section 414(b), (c), (m) or
(o) of the Code or Section 4001(b) of ERISA.
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"Escrow Letter" means that certain Escrow Letter, dated as of April 27,
2005, addressed to ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC from the Borrowers and the Lenders.
"Eurodollar Base Rate" has the meaning specified in the definition of
LIBOR Rate.
"Eurodollar Reserve Percentage" means, for any day during any Interest
Period, the reserve percentage (expressed as a decimal, carried out to five
decimal places) in effect on such day, whether or not applicable to any Lender,
under regulations issued from time to time by the FRB for determining the
maximum reserve requirement (including any emergency, supplemental or other
marginal reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities"). The LIBOR Rate for each outstanding
LIBOR Rate Loan shall be adjusted automatically as of the effective date of any
change in the Eurodollar Reserve Percentage.
"Event of Default" means any of the events specified in Section 11.1,
provided that any requirement for passage of time, giving of notice, or any
other condition, has been satisfied.
"Existing Credit Agreement" means the Credit Agreement, dated as of
October 28, 2004 (as amended, restated or otherwise modified from time to time
prior to the date hereof), among the Borrowers and the lenders party thereto.
"Extension of Credit" means, as to any Lender at any time, the making of
its portion of the Term Loan.
"FDIC" means the Federal Deposit Insurance Corporation, or any successor
thereto.
"Federal Funds Rate" means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day 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 (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of
America on such day on such transactions as determined by the Administrative
Agent.
"Fiscal Year" means the fiscal year of the Borrowers and their
Subsidiaries ending on the Saturday closest to January 31 (whether such Saturday
occurs in January or February).
"Fixed Charges" means, for any period, the sum of the following determined
on a Consolidated basis, without duplication, for the Borrowers and their
Subsidiaries in accordance with GAAP: (a) Interest Expense, (b) Rental Expense
and (c) cash dividends and distributions (excluding repurchases of the Company's
stock permitted pursuant to Section 10.6(d)).
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"Fixed Charge Coverage Ratio" means, as of the end of any fiscal quarter
of the Borrowers, the ratio of (a) EBITDAR for the period of four (4)
consecutive fiscal quarters ending on or immediately prior to such date to (b)
Fixed Charges for the period of four (4) consecutive fiscal quarters ending on
or immediately prior to such date.
"FRB" means the Board of Governors of the Federal Reserve System of the
United States.
"Fund" means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"Funded Debt" means all liabilities, obligations and indebtedness of the
Borrowers for borrowed money including, but not limited to, obligations
evidenced by bonds, debentures, notes or other similar instruments and all
obligations under Capital Leases.
"GAAP" means generally accepted accounting principles, as recognized by
the American Institute of Certified Public Accountants and the Financial
Accounting Standards Board, consistently applied and maintained on a consistent
basis for the Borrowers and their Subsidiaries throughout the period indicated
and (subject to Section 13.8) consistent with the prior financial practice of
the Borrowers and their Subsidiaries.
"Governmental Approvals" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.
"Governmental Authority" means any nation, province, state or political
subdivision thereof, and any government or any Person exercising executive,
legislative, regulatory or administrative functions of or pertaining to
government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
"Guaranty Obligation" means, with respect to the Borrowers and their
Subsidiaries, without duplication, any obligation, contingent or otherwise, of
any such Person pursuant to which such Person has directly or indirectly
guaranteed any Debt or other obligation of any other Person and, without
limiting the generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of any such Person (a) to purchase or pay (or advance
or supply funds for the purchase or payment of) such Debt or other obligation
(whether arising by virtue of partnership arrangements, by agreement to keep
well, to purchase assets, goods, securities or services, to take-or-pay, or to
maintain financial statement condition or otherwise) or (b) entered into for the
purpose of assuring in any other manner the obligee of such Debt or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided, that the term Guaranty
Obligation shall not include endorsements for collection or deposit in the
ordinary course of business.
"Hazardous Materials" means any substances or materials (a) which are or
become defined as hazardous wastes, hazardous substances, pollutants,
contaminants, chemical substances or mixtures or toxic substances under any
Environmental Law, (b) which are toxic,
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explosive, corrosive, flammable, infectious, radioactive, carcinogenic,
mutagenic or otherwise harmful to human health or the environment and are or
become regulated by any Governmental Authority, (c) the presence of which
require investigation or remediation under any Environmental Law or common law,
(d) the discharge or emission or release of which requires a permit or license
under any Environmental Law or other Governmental Approval, (e) which are deemed
to constitute a nuisance or a trespass which pose a health or safety hazard to
Persons or neighboring properties, (f) which consist of underground or
aboveground storage tanks, whether empty, filled or partially filled with any
substance, or (g) which contain, without limitation, asbestos, polychlorinated
biphenyls, urea formaldehyde foam insulation, petroleum hydrocarbons, petroleum
derived substances or waste, crude oil, nuclear fuel, natural gas or synthetic
gas.
"Hedging Agreement" means any agreement with respect to any Interest Rate
Contract, agreement, commodity swap, forward foreign exchange agreement,
currency swap agreement, cross-currency rate swap agreement, currency option
agreement or other agreement or arrangement designed to alter the risks of any
Person arising from fluctuations in rates, currency values or commodity prices,
all as amended, restated, supplemented or otherwise modified from time to time.
"Interest Expense" means, with respect to the Borrowers and their
Subsidiaries for any period, the gross interest expense (including, without
limitation, interest expense attributable to Capital Leases and all net payment
obligations pursuant to Hedging Agreements) of the Borrowers and their
Subsidiaries, all determined for such period on a Consolidated basis, without
duplication, in accordance with GAAP.
"Interest Period" shall have the meaning assigned thereto in Section
4.1(b).
"Interest Rate Contract" means any interest rate swap agreement, interest
rate cap agreement, interest rate floor agreement, interest rate collar
agreement, interest rate option or any other agreement regarding the hedging of
interest rate risk exposure executed in connection with hedging the interest
rate exposure of any Person and any confirming letter executed pursuant to such
agreement, all as amended, restated, supplemented or otherwise modified from
time to time.
"Joinder Agreement" means, collectively, each joinder agreement in form
and substance acceptable to the Administrative Agent executed in favor of the
Administrative Agent for the ratable benefit of itself and the Lenders.
"Lender" means each Person executing this Agreement as a Lender set forth
on the signature pages hereto, each Person that hereafter becomes a party to
this Agreement as a Lender pursuant to Section 13.9.
"Lending Office" means, with respect to any Lender, the office of such
Lender maintaining such Lender's Extensions of Credit.
"Leverage Ratio" shall have the meaning assigned thereto in Section 9.1.
8
"LIBOR Rate" means for any Interest Period with respect to any LIBOR Rate
Loan, a rate per annum determined by the Administrative Agent pursuant to the
following formula:
LIBOR Rate = Eurodollar Base Rate / 1.00 - Eurodollar Reserve Percentage
Where,
"Eurodollar Base Rate" means, for such Interest Period, the rate per
annum equal to the British Bankers Association LIBOR Rate ("BBA LIBOR"),
as published by Reuters (or other commercially available source providing
quotations of BBA LIBOR as designated by the Administrative Agent from
time to time) at approximately 11:00 a.m., London time, two Business Days
prior to the commencement of such Interest Period, for Dollar deposits
(for delivery on the first day of such Interest Period) with a term
equivalent to such Interest Period. If such rate is not available at such
time for any reason, then the "Eurodollar Base Rate" for such Interest
Period shall be the rate per annum determined by the Administrative Agent
to be the rate at which deposits in Dollars for delivery on the first day
of such Interest Period in same day funds in the approximate amount of the
LIBOR Rate Loan being made, continued or converted by Bank of America and
with a term equivalent to such Interest Period would be offered by Bank of
America's London Branch to major banks in the London interbank eurodollar
market at their request at approximately 11:00 a.m. (London time) two
Business Days prior to the commencement of such Interest Period.
"LIBOR Rate Loan" means any Loan bearing interest at a rate based upon the
LIBOR Rate as provided in Section 4.1(a).
"Lien" means, with respect to any asset, any mortgage, leasehold mortgage,
lien, pledge, charge, security interest, hypothecation or encumbrance of any
kind in respect of such asset. For the purposes of this Agreement, a Person
shall be deemed to own subject to a Lien any asset which it has acquired or
holds subject to the interest of a vendor or lessor under any conditional sale
agreement, Capital Lease or other title retention agreement relating to such
asset.
"Loan Documents" means, collectively, this Agreement, the Notes, each
Joinder Agreement and each other document, instrument, certificate and agreement
executed and delivered by the Borrowers or any of their Subsidiaries in
connection with any of the foregoing or otherwise referred to herein or
contemplated hereby (excluding any Hedging Agreement), all as may be amended,
restated, supplemented or otherwise modified from time to time.
"Loans" and "Loan" means the Term Loan or any component thereof.
"Material Adverse Effect" means a material adverse effect on (a) the
properties, business, prospects, operations or condition (financial or
otherwise) of (i) a Borrower or any of its Subsidiaries or (ii) the Acquired
Assets, or (b) the ability of a Borrower or any of its Subsidiaries to perform
its obligations under the Loan Documents or Material Contracts, in each case to
which it is a party.
9
"Material Contract" means (a) any contract or other agreement, written or
oral, of any Borrower or any of its Subsidiaries involving monetary liability of
or to any such Person in an amount in excess of $10,000,000 per annum, or (b)
any other contract or agreement, written or oral, of any Borrower or any of its
Subsidiaries the failure to comply with which could reasonably be expected to
have a Material Adverse Effect.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA to which any Borrower or any ERISA Affiliate is making, or
is accruing an obligation to make, or has accrued an obligation to make
contributions within the preceding six (6) years.
"Net Cash Proceeds" means the aggregate cash or Cash Equivalents proceeds
received by the Company or any Subsidiary in respect of any Disposition, Equity
Issuance or Debt Issuance, net of (a) direct costs, fees and expenses incurred
in connection therewith (including, without limitation, legal, accounting and
investment banking fees and expenses, and sales commissions), (b) taxes paid or
payable as a result thereof and (c) in the case of any Disposition, the amount
necessary to retire any Debt secured by a Lien permitted by Section 10.2 on the
related property; it being understood that "Net Cash Proceeds" shall include,
without limitation, any cash or Cash Equivalents received upon the sale or other
disposition of any consideration that is not cash or Cash Equivalents received
by the Company or any Subsidiary in any Disposition, Equity Issuance or Debt
Issuance.
"Net Income" means, with respect to the Borrowers and their Subsidiaries,
for any period of determination, the net income (or loss) of the Borrowers and
their Subsidiaries for such period, determined on a Consolidated basis in
accordance with GAAP; provided that there shall be excluded from Net Income (a)
the net income (or loss) of any Person (other than a Subsidiary which shall be
subject to clause (c) below), in which any Borrower or any of its Subsidiaries
has a joint interest with a third party, except to the extent such net income is
actually paid to such Borrower or any of its Subsidiaries by dividend or other
distribution during such period, (b) the net income (or loss) of any Person
accrued prior to the date it becomes a Subsidiary of such Person or is merged
into or consolidated with such Person or any of its Subsidiaries or that
Person's assets are acquired by such Person or any of its Subsidiaries except to
the extent included pursuant to the foregoing clause (a), (c) the net income (if
positive) of any Subsidiary to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary to any Borrower or any of
its Subsidiaries of such net income (i) is not at the time permitted by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute rule or governmental regulation applicable to such
Subsidiary or (ii) would be subject to any taxes payable on such dividends or
distributions.
"Net Worth" means the amount of assets shown on the Consolidated balance
sheet of the Borrowers and their Subsidiaries (including any items which would
be treated as intangibles under GAAP, including, but not limited to capitalized
interest, debt discount and expense, goodwill, patents, trademarks, copyrights,
licenses and franchises), less all liabilities of the Borrowers and their
Subsidiaries, all computed in accordance with GAAP, applied on a consistent
basis (such calculation shall exclude any non-cash increase or decrease to the
Prepaid Pension Asset account, as required by GAAP).
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"Notes" means the Notes made by the Borrowers payable to the order of each
Lender, substantially in the form of Exhibit A hereto, evidencing the Term Loan,
and any amendments, supplements and modifications thereto, any substitutes
therefor, and any replacements, restatements, renewals or extensions thereof, in
whole or in part; "Note" means any of such Notes.
"Notice of Account Designation" shall have the meaning assigned thereto in
Section 2.3(b).
"Notice of Borrowing" shall have the meaning assigned thereto in Section
2.3(a).
"Notice of Conversion/Continuation" shall have the meaning assigned
thereto in Section 4.2.
"Notice of Repayment" shall have the meaning assigned thereto in Section
2.4(c).
"Obligations" means, in each case, whether now in existence or hereafter
arising: (a) the principal of and interest on (including interest accruing after
the filing of any bankruptcy or similar petition) the Loans, (b) all existing or
future payment and other obligations owing by any Borrower under any Hedging
Agreement (which such Hedging Agreement is permitted hereunder) with any Person
that is a Lender hereunder at the time such Hedging Agreement is executed (all
such obligations with respect to any such Hedging Agreement, "Hedging
Obligations") and (c) all other fees and commissions (including attorneys'
fees), charges, indebtedness, loans, liabilities, financial accommodations,
obligations, covenants and duties owing by any Borrower or any of its
Subsidiaries to the Lenders or the Administrative Agent, in each case under or
in respect of this Agreement, any Note or any of the other Loan Documents of
every kind, nature and description, direct or indirect, absolute or contingent,
due or to become due, contractual or tortious, liquidated or unliquidated, and
whether or not evidenced by any note.
"Officer's Compliance Certificate" shall have the meaning assigned thereto
in Section 7.2.
"Operating Lease" shall mean, as to any Person as determined in accordance
with GAAP, any lease of property (whether real, personal or mixed) by such
Person as lessee which is not a Capital Lease.
"Other Taxes" shall have the meaning assigned thereto in Section 4.11(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
agency.
"Pension Plan" means any Employee Benefit Plan, other than a Multiemployer
Plan, which is subject to the provisions of Title IV of ERISA or Section 412 of
the Code and which (a) is maintained for the employees of any Borrower or any
ERISA Affiliates or (b) has at any time
11
within the preceding six (6) years been maintained for the employees of any
Borrower or any of its current or former ERISA Affiliates.
"Permitted Credit Card Receivables Acquisition" means the acquisition by
the Company or a Subsidiary of a pool of credit card receivables relating to the
Acquired Assets that Saks Incorporated sold to HSBC (formerly Household) in
2003; provided that (a) the aggregate value of such credit card receivables
shall not exceed $250 million, (b) the premium paid by the Company or such
Subsidiary in connection with such acquisition shall not exceed 20% and (c) the
initial acquisition of, and ongoing financing for, such pool of receivables is
provided through an increase to the Receivables Purchase Facility or any new
receivables financing program similar to the Receivables Purchase Facility, it
being understood that the premium for such acquisition may be funded through
cash on hand, borrowings under the Existing Credit Agreement or other sources of
liquidity permitted hereunder.
"Person" means an individual, corporation, limited liability company,
partnership, association, trust, business trust, joint venture, joint stock
company, pool, syndicate, sole proprietorship, unincorporated organization,
Governmental Authority or any other form of entity or group thereof.
"Prepaid Pension Asset" as of any date of determination, means the fair
value of the Pension Plans' assets plus unrecognized gains/losses, prior service
costs, and any unrecognized net obligation or asset from transitions in excess
of the projected benefit obligations, all determined in accordance with
Financial Accounting Standard No. 87-"Employer's Accounting for Pensions.
"Purchase Agreement" means that certain Asset Purchase Agreement
(including all schedules and exhibits thereto) between Saks Incorporated and the
Company dated on or about April 28, 2005.
"Receivables Purchase Facility" means the Amended and Restated Note
Purchase Agreement dated March 31, 2005 among the Company, The ▇▇▇▇ Center,
Inc., ▇▇ ▇▇▇▇ TRUST and Bank of America, N.A., as amended.
"Register" shall have the meaning assigned thereto in Section 13.9(d).
"Required Lenders" means, at any date, any combination of Lenders whose
Term Loan Commitments constitute more than fifty percent (50%) of the aggregate
principal amount of the Term Loan Commitments (or, if the Credit Facility has
been terminated pursuant to Section 11.2, any combination of Lenders holding
more than fifty percent (50%) of the aggregate outstanding Extensions of Credit;
provided that (a) if there are only two Lenders (counting, for these purposes,
affiliated Lenders as a single Lender) hereunder as of such date, Required
Lenders shall mean both such Lenders and (b) if there are more than two (2) but
less than six (6) Lenders (counting, for these purposes, affiliated Lenders as a
single Lender) hereunder as of such date, Required Lenders shall mean any
combination of Lenders whose Term Loan Commitments constitute more than
seventy-five percent (75%) of the aggregate principal amount of the Term Loan
Commitments (or, if the Credit Facility has been terminated pursuant to Section
11.2, any combination of
12
Lenders holding more than seventy-five percent (75%) of the aggregate
outstanding Extensions of Credit.
"Rental Expense" means payments made pursuant to all obligations of the
Borrowers and their Subsidiaries under leases of real property or personal
property, whether now existing or hereafter entered into.
"Responsible Officer" means any of the following: the chief executive
officer or chief financial officer of a Borrower or any other officer of a
Borrower reasonably acceptable to the Administrative Agent.
"Sale and Leaseback Transaction" means, with respect to the Borrowers or
any Subsidiary, any arrangement, directly or indirectly, with any Person whereby
the Borrowers or such Subsidiary shall sell or transfer any property, real or
personal, used or useful in its business, whether now owned or hereafter
acquired, and thereafter rent or lease such property or other property that it
intends to use for substantially the same purpose or purposes as the property
being sold or transferred.
"Senior Notes" means the unsecured senior notes to be issued in a private
placement by the Borrowers, the Net Cash Proceeds of which, together with the
Net Cash Proceeds of the Add-On Term Loan and/or other similar financings or
capital raising, are expected to be sufficient to repay the Term Loan and all
other Obligations hereunder in full.
"Series 1998 Revenue Bonds" means the ▇▇▇▇, Inc. Taxable Variable Rate
Demand Revenue Bonds, Series 1998, issued by ▇▇▇▇, Inc.
"Solvent" means, as to any Borrower and its Subsidiaries on a particular
date, that any such Person (a) has capital sufficient to carry on its business
and transactions and all business and transactions in which it is about to
engage and is able to pay its debts as they mature, (b) owns property having a
value, both at fair valuation and at present fair saleable value, greater than
the amount required to pay its probable liabilities (including contingencies),
and (c) does not believe that it will incur debts or liabilities beyond its
ability to pay such debts or liabilities as they mature.
"Subordinated Debt" means the collective reference to any Debt of any
Borrower or any Subsidiary subordinated in right and time of payment to the
Obligations and containing such other terms and conditions, in each case as are
satisfactory to the Required Lenders.
"Subsidiary" means as to any Person, any corporation, partnership, limited
liability company or other entity of which more than fifty percent (50%) of the
outstanding capital stock or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other managers of such
corporation, partnership, limited liability company or other entity is at the
time owned by or the management is otherwise controlled by such Person
(irrespective of whether, at the time, capital stock or other ownership
interests of any other class or classes of such corporation, partnership,
limited liability company or other entity shall have or might have voting power
by reason of the happening of any contingency). Unless otherwise
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qualified references to "Subsidiary" or "Subsidiaries" herein shall refer to
those of the Borrowers.
"Subsidiary Borrowers" shall have the meaning assigned thereto in the
preamble hereof.
"Synthetic Lease" means any synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing product
where such transaction is considered borrowed money indebtedness for tax
purposes but is classified as an Operating Lease in accordance with GAAP.
"Taxes" shall have the meaning assigned thereto in Section 4.11 (a).
"Term Loan" has the meaning specified in Section 2.1.
"Term Loan Commitment" means, as to each Lender, its obligation to make
its portion of the Term Loan to the Borrowers pursuant to Section 2.1 in the
principal amount set forth opposite such Lender's name on Schedule 2.1; provided
that, at any time after the funding of the Term Loan, the "Term Loan Commitment"
of any Lender shall be the outstanding principal amount of the Term Loan held by
such Lender. The aggregate principal amount of the Term Loan Commitments of all
of the Lenders as in effect on the Closing Date is FOUR HUNDRED MILLION DOLLARS
($400,000,000).
"Term Loan Commitment Percentage" means, as to any Lender at any time, the
ratio of (a) the amount of the Term Loan Commitment of such Lender to (b) the
aggregate amount of the Term Loan Commitments of all Lenders.
"Termination Date" means the earliest of the dates referred to in Section
2.7.
"Termination Event" means except for any such event or condition that
could not reasonably be expected to have a Material Adverse Effect: (a) a
"Reportable Event" described in Section 4043 of ERISA for which the notice
requirement has not been waived by the PBGC, or (b) the withdrawal of any
Borrower or any ERISA Affiliate from a Pension Plan during a plan year in which
it was a "substantial employer" as defined in Section 4001 (a)(2) of ERISA, or
(c) the termination of a Pension Plan, the filing of a notice of intent to
terminate a Pension Plan or the treatment of a Pension Plan amendment as a
termination, under Section 4041 of ERISA, if the plan assets are not sufficient
to pay all plan liabilities or (d) the institution of proceedings to terminate,
or the appointment of a trustee with respect to, any Pension Plan by the PBGC,
or (e) any other event or condition which would constitute grounds under Section
4042(a) of ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan, or (f) the imposition of a Lien pursuant to
Section 412 of the Code or Section 302 of ERISA, or (g) the partial or complete
withdrawal of any Borrower of any ERISA Affiliate from a Multiemployer Plan if
withdrawal liability is asserted by such Plan, or (h) any event or condition
which results in the reorganization or insolvency of a Multiemployer Plan under
Sections 4241 or 4245 of ERISA, or (i) any event or condition which results in
the termination of a Multiemployer Plan under Section 4041A of ERISA or the
institution by PBGC of proceedings to terminate a Multiemployer Plan under
Section 4042 of ERISA.
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"Transaction" means the acquisition by the Company of the Acquired Assets
pursuant to and in accordance with the terms of the Purchase Agreement.
"Transaction Documents" means the Purchase Agreement and all other
documents, agreements and instruments delivered in connection therewith (in each
case including schedules and exhibits thereto).
"United States" means the United States of America.
"Wholly-Owned" means, with respect to a Subsidiary, that all of the shares
of capital stock or other ownership interests of such Subsidiary are, directly
or indirectly, owned or controlled by any Borrower and/or one or more of its
Wholly-Owned Subsidiaries (except for directors' qualifying shares or other
shares required by Applicable Law to be owned by a Person other than such
Borrower).
Section 1.2 General.
Unless otherwise specified, a reference in this Agreement to a particular
article, section, subsection, Schedule or Exhibit is a reference to that
article, section, subsection, Schedule or Exhibit of this Agreement. Wherever
from the context it appears appropriate, each term stated in either the singular
or plural shall include the singular and plural, and pronouns stated in the
masculine, feminine or neuter gender shall include the masculine, the feminine
and the neuter. Any reference herein to "Eastern time" shall refer to the
applicable time of day in Charlotte, North Carolina.
Section 1.3 Other Definitions and Provisions.
(a) Use of Capitalized Terms. Unless otherwise defined therein, all
capitalized terms defined in this Agreement shall have the defined
meanings when used in this Agreement, the Notes and the other Loan
Documents or any certificate, report or other document made or delivered
pursuant to this Agreement.
(b) Miscellaneous. The words "hereof ", "herein" and "hereunder" and
words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this
Agreement.
ARTICLE II
TERM LOAN
Section 2.1 Term Loan.
Subject to the terms and conditions set forth herein, each Lender
severally agrees to make its portion of a term loan (the "Term Loan") to the
Borrowers in Dollars in a single advance on
15
the Closing Date in an amount not to exceed such Lender's Term Loan Commitment.
Amounts repaid on the Term Loan may not be reborrowed. The Term Loan may consist
of Base Rate Loans or LIBOR Rate Loans, as further provided herein, provided,
however, all Loans made on the Closing Date shall be made as Base Rate Loans.
Section 2.2 Intentionally Omitted.
Section 2.3 Procedure for Making of Term Loan.
(a) Request for Term Loan. The Borrowers shall give the
Administrative Agent irrevocable prior written notice substantially in the
form attached hereto as Exhibit B (a "Notice of Borrowing") not later than
11:00 a.m. (Eastern time) on the Closing Date of its intention to borrow
the Term Loan, specifying (A) the date of such borrowing, which shall be a
Business Day and (B) the amount of such borrowing, which shall be in a
whole multiple of $1,000,000. A Notice of Borrowing received after 11:00
a.m. (Eastern time) shall be deemed received on the next Business Day. The
Administrative Agent shall promptly notify the Lenders of such Notice of
Borrowing.
(b) Disbursement of Term Loan. Not later than 2:00 p.m. (Eastern
time) on the Closing Date, (i) each Lender will make available to the
Administrative Agent, for the account of the Borrowers, at the office of
the Administrative Agent in funds immediately available to the
Administrative Agent, such Lender's Term Loan Commitment Percentage of the
Term Loan. The Borrowers hereby irrevocably authorize the Administrative
Agent to disburse the proceeds of each borrowing requested pursuant to
this Section 2.3 in immediately available funds by crediting or wiring
such proceeds to the deposit account of the Company identified in the
notice substantially in the form of Exhibit C hereto (a "Notice of Account
Designation") delivered by the Borrowers to the Administrative Agent or as
may be otherwise agreed upon by the Borrowers and the Administrative
Agent. Subject to Section 4.7 hereof, the Administrative Agent shall not
be obligated to disburse the portion of the proceeds of the Term Loan to
the extent that any Lender has not made available to the Administrative
Agent its Term Loan Commitment Percentage of the Term Loan.
Section 2.4 Repayment of Loans.
(a) Repayment on Termination Date. The Borrowers hereby agree to
repay the outstanding principal amount of the Term Loan in full on the
Termination Date, together with all accrued but unpaid interest thereon.
(b) Mandatory Repayments.
(i) Dispositions and Involuntary Dispositions. The Borrowers
shall immediately prepay the Loans as hereafter provided in an
aggregate amount equal to 100% of the Net Cash Proceeds of each
Disposition (but not in excess of the amount necessary to prepay the
Loans in full) to the extent the aggregate amount of such Net Cash
Proceeds shall exceed $5,000,000 in connection with any one
16
Disposition or series of related Dispositions. Such prepayment shall
be applied as set forth in clause (iv) below.
(ii) Debt Issuances. Immediately upon receipt by the Company
or any Subsidiary of the Net Cash Proceeds of any Debt Issuance, the
Borrowers shall prepay the Loans as hereafter provided in an
aggregate amount equal to 100% of such Net Cash Proceeds (but not in
excess of the amount necessary to prepay the Loans in full), such
prepayment to be applied as set forth in clause (iv) below.
(iii) Equity Issuances. Immediately upon the receipt by the
Company or any Subsidiary of the Net Cash Proceeds of any Equity
Issuance, the Borrowers shall prepay the Loans in an aggregate
amount equal to 100% of such Net Cash Proceeds (but not in excess of
the amount necessary to prepay the Loans in full), such prepayment
to be applied as set forth in clause (iv) below.
(iv) Application of Payments. Prepayments shall be applied
first to Base Rate Loans and then to LIBOR Rate Loans in direct
order of Interest Period maturities. All prepayments under this
Section 2.4(b) shall be subject to Section 4.9, but otherwise
without premium or penalty, and shall be accompanied by interest on
the principal amount prepaid through the date of prepayment.
(c) Optional Repayments. The Borrowers may at any time and from time
to time repay the Loans, in whole or in part, upon at least three (3)
Business Days' irrevocable notice to the Administrative Agent with respect
to LIBOR Rate Loans and one (1) Business Day irrevocable notice with
respect to Base Rate Loans, substantially in the form attached hereto as
Exhibit D (a "Notice of Repayment") specifying the date and amount of
repayment and whether the repayment is of LIBOR Rate Loans, Base Rate
Loans or a combination thereof, and, if of a combination thereof, the
amount allocable to each. Upon receipt of such notice, the Administrative
Agent shall promptly notify each Lender. If any such notice is given, the
amount specified in such notice shall be due and payable on the date set
forth in such notice. Partial repayments shall be in an aggregate amount
of $3,000,000 or a whole multiple of $1,000,000 in excess thereof with
respect to Base Rate Loans, and $5,000,000 or a whole multiple of
$1,000,000 in excess thereof with respect to LIBOR Rate Loans. Each such
repayment shall be accompanied by any amount required to be paid pursuant
to Section 4.9 hereof.
(d) Limitation on Repayment of LIBOR Rate Loans. The Borrowers may
not repay any LIBOR Rate Loan on any day other than on the last day of the
Interest Period applicable thereto unless such repayment is accompanied by
any amount required to be paid pursuant to Section 4.9 hereof.
(e) Hedging Agreements. No repayment or prepayment pursuant to this
Section 2.4 shall affect any Borrower's obligations under any Hedging
Agreement.
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Section 2.5 Notes.
Except as otherwise provided in Section 13.9 (a)-(e), at the request of a
Lender, such Lender's Term Loan Commitment and the obligation of the Borrowers
to repay such Term Loan shall be evidenced by a separate Note executed by the
Borrowers payable to the order of such Lender.
Section 2.6 Mandatory Permanent Reduction of the Term Loan Commitments.
To the extent the Company or any Subsidiary receives Net Cash Proceeds
from a Disposition, Debt Issuance or Equity Issuance prior to the funding of the
Term Loan, the aggregate principal amount of the Term Loan Commitments shall be
permanently reduced Dollar for Dollar on the date of such receipt by the amount
of such Net Cash Proceeds that would otherwise be required to prepay the Loans
pursuant to Section 2.4(b). The amount of each partial permanent reduction shall
permanently reduce the Lenders' Term Loan Commitments to make the Term Loan pro
rata in accordance with their respective Term Loan Commitment Percentages.
Section 2.7 Termination of Credit Facility.
The Credit Facility shall terminate on the earliest of the date that is
364 days following the Closing Date, (b) the date the aggregate principal amount
of the Term Loan Commitments shall be permanently reduced to zero pursuant to
Section 2.6, (c) the date the Transaction has been consummated without use of
the Credit Facility and (d) the date of termination pursuant to Section 11.2(a).
Section 2.8 Intentionally Omitted.
Section 2.9 Joint and Several Liability of Borrowers.
(a) Each of the Borrowers is accepting joint and several liability
hereunder in consideration of the financial accommodation to be provided by the
Lenders under this Agreement, for the mutual benefit, directly and indirectly,
of each of the Borrowers and in consideration of the undertakings of each of the
Borrowers to accept joint and several liability for the obligations of each of
them.
(b) Each of the Borrowers jointly and severally hereby irrevocably and
unconditionally accepts, not merely as a surety but also as a co-debtor, joint
and several liability with the other Borrowers with respect to the payment and
performance of all of the Obligations arising under this Agreement and the other
Loan Documents, it being the intention of the parties hereto that all the
Obligations shall be the joint and several obligations of each of the Borrowers
without preferences or distinction among them.
(c) If and to the extent that any of the Borrowers shall fail to make any
payment with respect to any of the Obligations as and when due or to perform any
of the Obligations in accordance with the terms thereof, then in each such
event, the other Borrowers will make such payment with respect to, or perform,
such Obligation.
18
(d) The obligations of each Borrower under the provisions of this Section
2.9 constitute full recourse obligations of such Borrower, enforceable against
it to the full extent of its properties and assets.
(e) Except as otherwise expressly provided herein, to the extent permitted
by Applicable Law, each Borrower (in its capacity as a joint and several obligor
in respect of the obligations of the other Borrowers) hereby waives notice of
acceptance of its joint and several liability, notice of occurrence of any
Default or Event of Default (except to the extent notice is expressly required
to be given pursuant to the terms of this Agreement), or of any demand for any
payment under this Agreement, notice of any action at any time taken or omitted
by the Administrative Agent or the Lenders under or in respect of any of the
obligations hereunder, any requirement of diligence and, generally, all demands,
notices and other formalities of every kind in connection with this Agreement.
Each Borrower hereby assents to, and waives notice of, any extension or
postponement of the time for the payment of any of the Obligations, the
acceptance of any partial payment thereon, any waiver, consent or other action
or acquiescence by the Administrative Agent or the Lenders at any time or times
in respect of any default by the other Borrowers in the performance or
satisfaction of any term, covenant, condition or provision of this Agreement,
any and all other indulgences whatsoever by the Administrative Agent or the
Lenders in respect of any of the obligations hereunder, and the taking,
addition, substitution or release, in whole or in part, at any time or times, of
any security for any of such obligations or the addition, substitution or
release, in whole or in part, of the other Borrowers. Without limiting the
generality of the foregoing, each Borrower (in its capacity as a joint and
several obligor in respect of the obligations of the other Borrowers) assents to
any other action or delay in acting or any failure to act on the part of the
Administrative Agent or the Lenders, including, without limitation, any failure
strictly or diligently to assert any right or to pursue any remedy or to comply
fully with applicable laws or regulations thereunder which might, but for the
provisions of this Section 2.9, afford grounds for terminating, discharging or
relieving such Borrower, in whole or in part, from any of its obligations under
this Section 2.9, it being the intention of each Borrower that, so long as any
of the Obligations hereunder remain unsatisfied, the obligations of such
Borrower under this Section 2.9 shall not be discharged except by performance
and then only to the extent of such performance. The obligations of each
Borrower under this Section 2.9 shall not be diminished or rendered
unenforceable by any winding up, reorganization, arrangement, liquidation,
reconstruction or similar proceeding with respect to any Borrower or a Lender.
The joint and several liability of the Borrowers hereunder shall continue in
full force and effect notwithstanding any absorption, merger, amalgamation or
any other change whatsoever in the name, membership, constitution or place of
formation of any Borrower or any of the Lenders.
(f) The provisions of this Section 2.9 are made for the benefit of the
Lenders and their successors and assigns, and may be enforced by them from time
to time against any of the Borrowers as often as occasion therefor may arise and
without requirement on the part of the Lenders first to marshal any of its
claims or to exercise any of its rights against the other Borrowers or to
exhaust any remedies available to it against the other Borrowers or to resort to
any other source or means of obtaining payment of any of the Obligations
hereunder or to elect any other remedy. The provisions of this Section 2.9 shall
remain in effect until all the
19
Obligations shall have been paid in full or otherwise fully satisfied. If at any
time, any payment, or any part thereof, made in respect of any of the
Obligations is rescinded or must otherwise be restored or returned by the
Lenders upon the insolvency, bankruptcy or reorganization of any of the
Borrowers, or otherwise, the provisions of this Section 2.9 will forthwith be
reinstated and in effect as though such payment had not been made.
(g) Notwithstanding any provision to the contrary contained herein or in
any of the other Loan Documents, to the extent the obligations of any Borrower
shall be adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of such Borrower
hereunder shall be limited to the maximum amount that is permissible under
applicable law (whether federal or state and including, without limitation, the
Bankruptcy Code of the United States).
Section 2.10 Appointment of the Company.
Each of the Borrowers hereby appoints the Company to act as its agent for
all purposes under this Agreement (including, without limitation, with respect
to all matters related to the borrowing and repayment of Loans) and agrees that
(a) the Company may execute such documents on behalf of the other Borrowers as
the Company deems appropriate in its sole discretion and the Borrowers shall be
obligated by all of the terms of any such document executed on its behalf, (b)
any notice or communication delivered by the Administrative Agent or the Lender
to the Company shall be deemed delivered to the Borrowers and (c) the
Administrative Agent or the Lenders may accept, and be permitted to rely on, any
document, instrument or agreement executed by the Company on behalf of the
Borrowers.
ARTICLE III
INTENTIONALLY OMITTED.
ARTICLE IV
GENERAL LOAN PROVISIONS
Section 4.1 Interest.
(a) Interest Rate Options. Subject to the provisions of this Section
4.1, at the election of the Borrowers, Loans shall bear interest at (A)
the Base Rate plus the Applicable Margin or (B) the LIBOR Rate plus the
Applicable Margin (provided that the LIBOR Rate shall not be available
until three (3) Business Days after the Closing Date). The Borrowers shall
select the rate of interest and Interest Period, if any, applicable to any
Loan at the time a Notice of Borrowing is given or at the time a Notice of
Conversion/Continuation is given pursuant to Section 4.2. Any Loan or any
portion
20
thereof as to which the Borrowers have not duly specified an interest rate
as provided herein shall be deemed a Base Rate Loan.
(b) Interest Periods. In connection with each LIBOR Rate Loan, the
Borrowers, by giving notice at the times described in Section 4.1 (a),
shall elect an interest period (each, an "Interest Period") to be
applicable to such Loan, which Interest Period shall be a period of one
(1), two (2), three (3) or six (6) months with respect to each LIBOR Rate
Loan; provided that:
(i) the Interest Period shall commence on the date of advance
of or conversion to any LIBOR Rate Loan and, in the case of
immediately successive Interest Periods, each successive Interest
Period shall commence on the date on which the immediately preceding
Interest Period expires;
(ii) if any Interest Period would otherwise expire on a day
that is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day; provided, that if any Interest Period
with respect to a LIBOR Rate Loan would otherwise expire on a day
that is not a Business Day but is a day of the month after which no
further Business Day occurs in such month, such Interest Period
shall expire on the immediately preceding Business Day;
(iii) any Interest Period with respect to a LIBOR Rate Loan
that begins on the last Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the
last Business Day of the relevant calendar month at the end of such
Interest Period;
(iv) no Interest Period shall extend beyond the Termination
Date; and
(v) there shall be no more than ten (10) Interest Periods in
effect at any time.
(c) Applicable Margin. The Applicable Margin provided for in Section
4.1 (a) with respect to any Loan (the "Applicable Margin") shall be based
upon the table set forth below and shall be determined and adjusted
quarterly on the date (each a "Calculation Date") ten (10) Business Days
after the date by which the Borrowers are required to provide an Officer's
Compliance Certificate for the most recently ended fiscal quarter of the
Borrowers; provided, however, that (a) the initial Applicable Margin shall
be based on Pricing Level II (as shown below) and shall remain at Pricing
Level II until the first Calculation Date occurring after the Closing Date
and, thereafter the Pricing Level shall be determined by reference to the
Leverage Ratio as of the last day of the most recently ended fiscal
quarter of the Borrowers preceding the applicable Calculation Date, and
(b) if the Borrowers fail to provide the Officer's Compliance Certificate
as required by Section 7.2 for the most recently ended fiscal quarter of
the Borrowers preceding the applicable Calculation Date, the Applicable
Margin from such Calculation Date shall be based on Pricing Level I (as
shown below) until such time as an appropriate
21
Officer's Compliance Certificate is provided, at which time the Pricing
Level shall be determined by reference to the Leverage Ratio as of the
last day of the most recently ended fiscal quarter of the Borrowers
preceding such Calculation Date. The Applicable Margin shall be effective
from one Calculation Date until the next Calculation Date. Any adjustment
in the Applicable Margin shall be applicable to all Extensions of Credit
then existing or subsequently made or issued.
PRICING LEVEL LEVERAGE RATIO LIBOR RATE LOANS BASE RATE LOANS
------------- -------------- ---------------- ---------------
I Greater than or equal to 1.000% 0%
3.00 to 1.00
II Greater than or equal to 0.750% 0%
2.25 to 1.00, but less than
3. 00 to 1.00
III Less than 2.25 to 0.625% 0%
1.00
(d) Default Rate. Subject to Section 11.3, at the discretion of the
Administrative Agent or as directed by the Required Lenders, upon the
occurrence and during the continuance of an Event of Default, (i) the
Borrowers shall no longer have the option to request LIBOR Rate Loans,
(ii) all outstanding LIBOR Rate Loans shall bear interest at a rate per
annum of two percent (2%) in excess of the rate then applicable to LIBOR
Rate Loans until the end of the applicable Interest Period and thereafter
at a rate equal to two percent (2%) in excess of the rate then applicable
to Base Rate Loans, and (iii) all outstanding Base Rate Loans and other
Obligations arising hereunder or under any other Loan Document shall bear
interest at a rate per annum equal to two percent (2%) in excess of the
rate then applicable to Base Rate Loans or such other Obligations arising
hereunder or under any other Loan Document. Interest shall continue to
accrue on the Notes after the filing by or against any Borrower of any
petition seeking any relief in bankruptcy or under any act or law
pertaining to insolvency or debtor relief, whether state, federal or
foreign.
(e) Interest Payment and Computation. Interest on each Base Rate
Loan shall be payable in arrears on the last Business Day of each calendar
quarter commencing with the first such day to occur after the Closing
Date; and interest on each LIBOR Rate Loan shall be payable on the last
day of each Interest Period applicable thereto or, in the case of any
LIBOR Rate Loan having an Interest Period of six (6) months, every three
(3) months. Interest on LIBOR Rate Loans and all fees payable hereunder
shall be computed on the basis of a 360-day year and assessed for the
actual number of days elapsed and interest on Base Rate Loans shall be
computed on the basis of a 365/66-day year and assessed for the actual
number of days elapsed.
(f) Maximum Rate. In no contingency or event whatsoever shall the
aggregate of all amounts deemed interest hereunder or under any of the
Notes charged or collected pursuant to the terms of this Agreement or
pursuant to any of the Notes exceed the highest rate permissible under any
Applicable Law which a court of competent jurisdiction shall, in a final
determination, deem applicable hereto. In the event that such a court
determines that the Lenders have charged or received interest hereunder in
excess of the highest applicable rate, the rate in effect hereunder shall
automatically be reduced
22
to the maximum rate permitted by Applicable Law and the Lenders shall at
the Administrative Agent's option (i) promptly refund to the Borrowers any
interest received by the Lenders in excess of the maximum lawful rate or
(ii) apply such excess to the principal balance of the Obligations on a
pro rata basis. It is the intent hereof that the Borrowers not pay or
contract to pay, and that neither the Administrative Agent nor any Lender
receive or contract to receive, directly or indirectly in any manner
whatsoever, interest in excess of that which may be paid by the Borrowers
under Applicable Law.
Section 4.2 Notice and Manner of Conversion or Continuation of Loans.
Provided that no Default or Event of Default has occurred and is then
continuing, the Borrowers shall have the option to (a) convert at any time
following the third Business Day after the Closing Date all or any portion of
any outstanding Base Rate Loans in a principal amount equal to $5,000,000 or any
whole multiple of $1,000,000 in excess thereof into one or more LIBOR Rate Loans
and (b) upon the expiration of any Interest Period, (i) convert all or any part
of its outstanding LIBOR Rate Loans in a principal amount equal to $3,000,000 or
a whole multiple of $1,000,000 in excess thereof into Base Rate Loans or (ii)
continue such LIBOR Rate Loans as LIBOR Rate Loans. Whenever the Borrowers
desire to convert or continue Loans as provided above, the Borrowers shall give
the Administrative Agent irrevocable prior written notice in the form attached
as Exhibit E (a "Notice of Conversion/Continuation") not later than 11:00 a.m.
(Eastern time) three (3) Business Days before the day on which a proposed
conversion or continuation of such Loan is to be effective specifying (A) the
Loans to be converted or continued, and, in the case of any LIBOR Rate Loan to
be converted or continued, the last day of the Interest Period therefor, (B) the
effective date of such conversion or continuation (which shall be a Business
Day), (C) the principal amount of such Loans to be converted or continued, and
(D) the Interest Period to be applicable to such converted or continued LIBOR
Rate Loan. The Administrative Agent shall promptly notify the Lenders of such
Notice of Conversion/Continuation.
Section 4.3 Continuation Fee.
The Borrowers shall on the 180th day following the Closing Date pay to the
Administrative Agent, for the account of the Lenders, on a pro-rata basis based
upon their respective Term Loan Commitment Percentages, a non-refundable
continuation fee equal to 0.150% of the aggregate principal amount of Loans
outstanding on such date.
Section 4.4 Manner of Payment.
Each payment by the Borrowers on account of the principal of or interest
on the Loans or of any fee, commission or other amounts payable to the Lenders
under this Agreement or any Note shall be made not later than 1:00 p.m. (Eastern
time) on the date specified for payment under this Agreement to the
Administrative Agent at the Administrative Agent's Office for the account of the
Lenders pro rata in accordance with their respective Term Loan Commitment, in
Dollars, in immediately available funds and shall be made without any set-off,
counterclaim or deduction whatsoever. Any payment received after such time but
before 2:00 p.m. (Eastern time) on such day shall be deemed a payment on such
date for the purposes of Section 11.1, but
23
for all other purposes shall be deemed to have been made on the next succeeding
Business Day. Any payment received after 2:00 p.m. (Eastern time) shall be
deemed to have been made on the next succeeding Business Day for all purposes.
Upon receipt by the Administrative Agent of each such payment, the
Administrative Agent shall distribute to each Lender at its address for notices
set forth herein its pro rata share of such payment in accordance with such
Lender's Term Loan Commitment, with respect to Extensions of Credit and shall
wire advice of the amount of such credit to each Lender. Each payment to the
Administrative Agent of Administrative Agent's fees or expenses shall be made
for the account of the Administrative Agent and any amount payable to any Lender
under Sections 4.3, 4.8, 4.9, 4.10, 4.11 or 13.2 shall be paid to the
Administrative Agent for the account of the applicable Lender. Subject to
Section 4.1(b)(ii) if any payment under this Agreement or any Note 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 and such extension of time shall
in such case be included in computing any interest if payable along with such
payment.
Section 4.5 Crediting of Payments and Proceeds.
In the event that the Borrowers shall fail to pay any of the Obligations
when due and the Obligations have been accelerated pursuant to Section 11.2, all
payments received by the Lenders upon the Notes and the other Obligations and
all net proceeds from the enforcement of the Obligations shall be applied: (a)
first to all expenses then due and payable by the Borrowers hereunder and under
the other Loan Documents, (b) then to all indemnity obligations then due and
payable by the Borrowers hereunder and under the other Loan Documents, (c) then
to all Administrative Agent's fees then due and payable, (d) then to all other
fees then due and payable, (e) then to accrued and unpaid interest on the Term
Loans, (e) then to the principal amount of the Term Loans and any Hedging
Obligations (including any termination payments and any accrued and unpaid
interest thereon) pro rata in accordance with all such amounts due.
Section 4.6 Adjustments.
If any Lender (a "Benefited Lender") shall at any time receive any payment
of all or part of the Obligations owing to it, or interest thereon, or if any
Lender shall at any time receive any collateral in respect to the Obligations
owing to it (whether voluntarily or involuntarily, by set-off or otherwise)
(other than pursuant to Sections 4.8, 4.9, 4.10, 4.11 or 13.2 hereof) in a
greater proportion than any such payment to and collateral received by any other
Lender, if any, in respect of the similar Obligations owing to such other
Lender, or interest thereon, such Benefited Lender shall purchase for cash from
the other Lenders such portion of each such other Lender's Extensions of Credit,
or shall provide such other Lenders with the benefits of any such collateral, or
the proceeds thereof, as shall be necessary to cause such Benefited Lender to
share the excess payment or benefits of such collateral or proceeds ratably with
each of the Lenders; provided, that if all or any portion of such excess payment
or benefits is thereafter recovered from such Benefited Lender, such purchase
shall be rescinded, and the purchase price and benefits returned to the extent
of such recovery, but without interest. The Borrowers agree that each Lender so
purchasing a portion of another Lender's Extensions of Credit may exercise all
rights of payment (including, without limitation, rights of set-off) with
respect to such portion as fully as if such Lender were the direct holder of
such portion.
24
Section 4.7 Nature of Obligations of Lenders Regarding Extensions of
Credit; Assumption by the Administrative Agent.
The obligations of the Lenders under this Agreement to make the Loans are
several and are not joint or joint and several. Unless the Administrative Agent
shall have received notice from a Lender prior to the proposed borrowing date
that such Lender will not make available to the Administrative Agent such
Lender's ratable portion of the amount to be borrowed on such date (which notice
shall not release such Lender of its obligations hereunder), the Administrative
Agent may assume that such Lender has made such portion available to the
Administrative Agent on the proposed borrowing date in accordance with Sections
2.3(b) and the Administrative Agent may, in reliance upon such assumption, make
available to the Borrowers on such date a corresponding amount. If such amount
is made available to the Administrative Agent on a date after such borrowing
date, such Lender shall pay to the Administrative Agent on demand an amount,
until paid, equal to the product of (a) the amount not made available by such
Lender in accordance with the terms hereof, times (b) the daily average Federal
Funds Rate during such period as determined by the Administrative Agent, times
(c) a fraction the numerator of which is the number of days that elapse from and
including such borrowing date to the date on which such amount not made
available by such Lender in accordance with the terms hereof shall have become
immediately available to the Administrative Agent and the denominator of which
is 360. A certificate of the Administrative Agent with respect to any amounts
owing under this Section 4.7 shall be conclusive, absent manifest error. If such
Lender's Term Loan Commitment Percentage of such borrowing is not made available
to the Administrative Agent by such Lender within three (3) Business Days after
such borrowing date, the Administrative Agent shall be entitled to recover such
amount made available by the Administrative Agent with interest thereon at the
rate per annum applicable to Base Rate Loans hereunder, on demand, from the
Borrowers. The failure of any Lender to make available its Term Loan Commitment
Percentage of any Loan requested by the Borrowers shall not relieve it or any
other Lender of its obligation, if any, hereunder to make its Term Loan
Commitment Percentage of such Loan available on the borrowing date, but no
Lender shall be responsible for the failure of any other Lender to make its Term
Loan Commitment Percentage of such Loan available on the borrowing date.
Notwithstanding anything set forth herein to the contrary, any Lender that fails
to make available its Term Loan Commitment Percentage of any Loan shall not (a)
have any voting or consent rights under or with respect to any Loan Document or
(b) constitute a "Lender" (or be included in the calculation of Required Lenders
hereunder) for any voting or consent rights under or with respect to any Loan
Document.
Section 4.8 Changed Circumstances.
(a) Circumstances Affecting LIBOR Rate Availability. If with respect
to any Interest Period the Administrative Agent or any Lender (after
consultation with the Administrative Agent) shall determine that, by
reason of circumstances affecting the foreign exchange and interbank
markets generally, deposits in eurodollars, in the applicable amounts are
not being quoted or offered for such Interest Period in a manner necessary
to determine the applicable LIBOR Rate, then the Administrative Agent
shall forthwith give notice thereof to the Company. Thereafter, until the
Administrative Agent
25
notifies the Company that such circumstances no longer exist, the
obligation of the Lenders to make LIBOR Rate Loans and the right of the
Borrowers to convert any Loan to or continue any Loan as a LIBOR Rate Loan
shall be suspended, and the Borrowers shall repay in full (or cause to be
repaid in full) the then outstanding principal amount of each such LIBOR
Rate Loan together with accrued interest thereon, on the last day of the
then current Interest Period applicable to such LIBOR Rate Loan or convert
the then outstanding principal amount of each such LIBOR Rate Loan to a
Base Rate Loan as of the last day of such Interest Period.
(b) Laws Affecting LIBOR Rate Availability. If, after the date
hereof, the introduction of, or any change in, any Applicable Law or any
change in the interpretation or administration thereof by any Governmental
Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any of the
Lenders (or any of their respective Lending Offices) with any request or
directive (whether or not having the force of law) of any such
Governmental Authority, central bank or comparable agency, shall make it
unlawful or impossible for any of the Lenders (or any of their respective
Lending Offices) to honor its obligations hereunder to make or maintain
any LIBOR Rate Loan, such Lender shall promptly give notice thereof to the
Administrative Agent and the Administrative Agent shall promptly give
notice to the Company and the other Lenders. Thereafter, until the
Administrative Agent notifies the Company that such circumstances no
longer exist, (i) the obligations of the Lenders to make LIBOR Rate Loans
and the right of the Borrowers to convert any Loan or continue any Loan as
a LIBOR Rate Loan shall be suspended and thereafter the Borrowers may
select only Base Rate Loans hereunder, and (ii) if any of the Lenders may
not lawfully continue to maintain a LIBOR Rate Loan to the end of the then
current Interest Period applicable thereto as a LIBOR Rate Loan, the
applicable LIBOR Rate Loan shall immediately be converted to a Base Rate
Loan for the remainder of such Interest Period.
(c) Increased Costs. If, after the date hereof, the introduction of,
or any change in, any Applicable Law, or in the interpretation or
administration thereof by any Governmental Authority, central bank or
comparable agency charged with the interpretation or administration
thereof, or compliance by any of the Lenders (or any of their respective
Lending Offices) with any request or directive (whether or not having the
force of law) of such Governmental Authority, central bank or comparable
agency:
(i) shall (except as provided in Section 4.11(e)) subject any
of the Lenders (or any of their respective Lending Offices) to any
tax, duty or other charge with respect to any Note or shall change
the basis of taxation of payments to any of the Lenders (or any of
their respective Lending Offices) of the principal of or interest on
any Note or any other amounts due under this Agreement in respect
thereof (except for changes in the rate of franchise tax or tax on
the overall net income of any of the Lenders or any of their
respective Lending Offices imposed by the jurisdiction in which such
Lender is organized or is or should be qualified to do business or
such Lending Office is located); provided that the Borrowers shall
not be obligated to pay any amounts pursuant to this
26
Section 4.8(c)(i) to the extent that such amounts are duplicative of
any amounts paid by the Borrowers pursuant to Section 4.11; or
(ii) shall impose, modify or deem applicable any reserve
(including, without limitation, any reserve imposed by the Board of
Governors of the Federal Reserve System), special deposit, insurance
or capital or similar requirement against assets of, deposits with
or for the account of, or credit extended by any of the Lenders (or
any of their respective Lending Offices) or shall impose on any of
the Lenders (or any of their respective Lending Offices) or the
foreign exchange and interbank markets any other condition affecting
any Note; and the result of any of the foregoing events described in
clause (i) or (ii) above is to increase the costs to any of the
Lenders of maintaining any LIBOR Rate Loan or to reduce the yield or
amount of any sum received or receivable by any of the Lenders under
this Agreement or under the Notes in respect of a LIBOR Rate Loan,
then such Lender shall promptly notify the Administrative Agent, and
the Administrative Agent shall promptly notify the Company of such
fact and demand compensation therefor and, within fifteen (15) days
after such notice by the Administrative Agent, the Borrowers shall
pay to such Lender such additional amount or amounts as will
compensate such Lender or Lenders for such increased cost or
reduction. The Administrative Agent will promptly notify the Company
of any event of which it has knowledge which will entitle such
Lender to compensation pursuant to this Section 4.8(c); provided,
that the Administrative Agent shall incur no liability whatsoever to
the Lenders or the Borrowers in the event it fails to do so. The
amount of such compensation shall be determined, in the applicable
Lender's sole discretion, based upon the assumption that such Lender
funded its Term Loan Commitment Percentage of the LIBOR Rate Loans
in the London interbank market and using any reasonable attribution
or averaging methods which such Lender deems appropriate and
practical. A certificate of such Lender setting forth the basis for
determining such amount or amounts necessary to compensate such
Lender shall be forwarded to the Company through the Administrative
Agent and shall be conclusively presumed to be correct save for
manifest error.
Section 4.9 Indemnity.
The Borrowers hereby indemnify each of the Lenders against any loss or
expense which may arise or be attributable to each Lender's obtaining,
liquidating or employing deposits or other funds acquired to effect, fund or
maintain any LIBOR Rate Loan (a) as a consequence of any failure by the
Borrowers to make any payment when due of any amount due hereunder in connection
with a LIBOR Rate Loan, (b) due to any failure of the Borrowers to borrow,
continue or convert on a date specified therefor in a Notice of Borrowing or
Notice of Conversion/Continuation or (c) due to any payment, prepayment or
conversion of any LIBOR Rate Loan on a date other than the last day of the
Interest Period therefor. The amount of such loss or expense shall be
determined, in the applicable Lender's sole discretion, based upon the
assumption that such Lender funded its Term Loan Commitment Percentage of the
LIBOR Rate Loans in the London interbank market and using any reasonable
attribution or averaging methods which such Lender deems appropriate and
practical. A certificate of such Lender
27
setting forth the basis for determining such amount or amounts necessary to
compensate such Lender shall be forwarded to the Company through the
Administrative Agent and shall be conclusively presumed to be correct save for
manifest error.
Section 4.10 Capital Requirements.
If either (a) the introduction of, or any change in, or in the
interpretation of, any Applicable Law or (b) compliance with any guideline or
request from any central bank or comparable agency or other Governmental
Authority (whether or not having the force of law), has or would have the effect
of reducing the rate of return on the capital of, or has affected or would
affect the amount of capital required to be maintained by, any Lender or any
corporation controlling such Lender as a consequence of, or with reference to
the Term Loan Commitments and other commitments of this type, below the rate
which such Lender or such other corporation could have achieved but for such
introduction, change or compliance, then within five (5) Business Days after
written demand by any such Lender, the Borrowers shall pay to such Lender from
time to time as specified by such Lender additional amounts sufficient to
compensate such Lender or other corporation for such reduction. A certificate as
to such amounts submitted to the Company and the Administrative Agent by such
Lender, shall, in the absence of manifest error, be presumed to be correct and
binding for all purposes.
Section 4.11 Taxes.
(a) Payments Free and Clear. Except as otherwise provided in Section
4.11(e), any and all payments by any Borrower hereunder or under the Notes
shall be made free and clear of and without deduction for any and all
present or future taxes, levies, imposts, deductions, charges or
withholding, and all liabilities with respect thereto excluding, (i) in
the case of each Lender and the Administrative Agent, income and franchise
taxes imposed by the jurisdiction under the laws of which such Lender or
the Administrative Agent (as the case may be) is organized or is or should
be qualified to do business or any political subdivision thereof and (ii)
in the case of each Lender, income and franchise taxes imposed by the
jurisdiction of such Lender's Lending Office or any political subdivision
thereof (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being hereinafter referred to as
"Taxes"). If the Borrowers shall be required by law to deduct or withhold
any Taxes from or in respect of any sum payable hereunder or under any
Note to any Lender or the Administrative Agent, (A) except as otherwise
provided in Section 4.11(e), the sum payable shall be increased as may be
necessary so that after making all required deductions or withholdings
(including deductions or withholdings applicable to additional sums
payable under this Section 4.11) such Lender or the Administrative Agent
(as the case may be) receives an amount equal to the amount such party
would have received had no such deductions or withholdings been made, (B)
the Borrowers shall make such deductions or withholdings, (C) the
Borrowers shall pay the full amount deducted to the relevant taxing
authority or other authority in accordance with Applicable Law, and (D)
the Borrowers shall deliver to the Administrative Agent and such Lender
evidence of such payment to the relevant taxing authority or other
Governmental Authority in the manner provided in Section 4.11(d).
28
(b) Stamp and Other Taxes. In addition, the Borrowers shall pay any
present or future stamp, registration, recordation or documentary taxes or
any other similar fees or charges or excise or property taxes, levies of
the United States or any state or political subdivision thereof or any
applicable foreign jurisdiction which arise from any payment made
hereunder or from the execution, delivery or registration of, or otherwise
with respect to, this Agreement, the Loans, or the other Loan Documents,
or the perfection of any rights or security interest in respect thereof
(hereinafter referred to as "Other Taxes").
(c) Indemnity. Except as otherwise provided in Section 4.11(e), the
Borrowers shall indemnify each Lender and the Administrative Agent for the
full amount of Taxes and Other Taxes (including, without limitation, any
Taxes and Other Taxes imposed by any jurisdiction on amounts payable under
this Section 4.11) paid by such Lender or the Administrative Agent (as the
case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto, whether or not such
Taxes or Other Taxes were correctly or legally asserted. Such
indemnification shall be made within thirty (30) days from the date such
Lender or the Administrative Agent (as the case may be) makes written
demand therefor.
(d) Evidence of Payment. Within thirty (30) days after the date of
any payment of Taxes or Other Taxes, the Borrowers shall furnish to the
Administrative Agent and the applicable Lender, at its address referred to
in Section 13.1, the original or a certified copy of a receipt evidencing
payment thereof or other evidence of payment satisfactory to the
Administrative Agent.
(e) Delivery of Tax Forms. To the extent required by Applicable Law
to reduce or eliminate withholding or payment of taxes, each Lender and
the Administrative Agent shall deliver to the Company, with a copy to the
Administrative Agent, on the Closing Date or concurrently with the
delivery of the relevant Assignment and Acceptance, as applicable, (i) two
United States Internal Revenue Service Forms W-9, Forms W-8ECI or Forms
W-8BEN, as applicable (or successor forms) properly completed and
certifying in each case that such Lender is entitled to a complete
exemption from withholding or deduction for or on account of any United
States federal income taxes, and (ii) an Internal Revenue Service Form
W-8BEN or W-8ECI or successor applicable form, as the case may be, to
establish an exemption from United States backup withholding taxes. Each
such Lender further agrees to deliver to the Company, with a copy to the
Administrative Agent, as applicable, two Form W-9, Form W-8BEN or W-8ECI,
or successor applicable forms or manner of certification, as the case may
be, on or before the date that any such form expires or becomes obsolete
or after the occurrence of any event requiring a change in the most recent
form previously delivered by it to the Company, certifying in the case of
a Form W-9, Form W-8BEN or W-8ECI (or successor forms) that such Lender is
entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes (unless in any such
case an event (including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery
would otherwise be required which renders such forms inapplicable or the
exemption to which such forms
29
relate unavailable and such Lender notifies the Company and the
Administrative Agent that it is not entitled to receive payments without
deduction or withholding of United States federal income taxes) and, in
the case of a Form W-9, Form W-8BEN or W-8ECI, establishing an exemption
from United States backup withholding tax. Notwithstanding anything in any
Loan Document to the contrary, the Borrowers shall not be required to pay
additional amounts to any Lender or the Administrative Agent under Section
4.11 or Section 4.8(c), (i) if such Lender or the Administrative Agent
fails to comply with the requirements of this Section 4.11(e), other than
to the extent that such failure is due to a change in law occurring after
the date on which such Lender or the Administrative Agent became a party
to this Agreement or (ii) that are the result of such Lender's or the
Administrative Agent's gross negligence or willful misconduct, as
applicable.
(f) Survival. Without prejudice to the survival of any other
agreement of any Borrower hereunder, the agreements and obligations of the
Borrowers contained in this Section 4.11 shall survive the payment in full
of the Obligations and the termination of the Term Loan Commitments.
ARTICLE V
CLOSING; CONDITIONS OF CLOSING AND BORROWING
Section 5.1 Closing.
The closing shall be deemed to occur at the offices of ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇,
PLLC at 10:00 a.m. on the Closing Date, or on such other place, date and time as
the parties hereto shall mutually agree.
Section 5.2 Conditions to Closing.
The obligation of the Lenders to close this Agreement is subject to the
satisfaction of each of the following conditions:
(a) Executed Escrow Letter. The Escrow Letter shall have been duly
authorized, executed and delivered to ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC by the
parties thereto and shall be in full force and effect.
(b) Satisfaction of Conditions in Escrow Letter. On or before August
27, 2005, the satisfaction of each of the conditions set forth in the
Escrow Letter, and the release from escrow of the Lenders' signature pages
to this Agreement pursuant to the terms of the Escrow Letter, shall have
occurred.
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Section 5.3. Conditions to All Extensions of Credit.
The obligations of the Lenders to make the initial Extension of Credit and
to convert or continue any Loan are subject to the satisfaction of the following
conditions precedent on the relevant borrowing, continuation, conversion,
issuance or extension date:
(a) Continuation of Representations and Warranties. The
representations and warranties contained in Article VI shall be true and
correct on and as of such borrowing, continuation, conversion, issuance or
extension date with the same effect as if made on and as of such date;
except for any representation and warranty made as of an earlier date,
which representation and warranty shall remain true and correct as of such
earlier date.
(b) No Existing Default. No Default or Event of Default shall have
occurred and be continuing on the borrowing, continuation or conversion
date with respect to such Loan or after giving effect to the Loans to be
made, continued or converted on such date.
(c) Notices. The Administrative Agent shall have received a Notice
of Borrowing or Notice of Conversion/Continuation, as applicable, from the
Borrowers in accordance with Section 2.3(a) or Section 4.2.
(d) Additional Documents. The Administrative Agent shall have
received each additional document, instrument, legal opinion or other item
reasonably requested by it.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF THE BORROWERS
Section 6.1 Representations and Warranties.
To induce the Administrative Agent and Lenders to enter into this
Agreement and to induce the Lenders to make Extensions of Credit, the Borrowers
hereby represent and warrant to the Administrative Agent and Lenders both before
and after giving effect to the transactions contemplated hereunder that:
(a) Organization; Power; Qualification. Each of the Borrowers and
their Subsidiaries is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
formation, has the power and authority to own its properties and to carry
on its business as now being and hereafter proposed to be conducted and is
duly 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 and authorization. The jurisdictions in which the
Borrowers and their
31
Subsidiaries are organized and qualified to do business as of the Closing
Date are described on Schedule 6.1 (a).
(b) Ownership. Each Subsidiary of any Borrower as of the Closing
Date is listed on Schedule 6.1(b). As of the Closing Date, the
capitalization of the Borrowers and their Subsidiaries consists of the
number of shares, authorized, issued and outstanding, of such classes and
series, with or without par value, described on Schedule 6.1(b). All
outstanding shares have been duly authorized and validly issued and are
fully paid and nonassessable, with no personal liability attaching to the
ownership thereof, and not subject to any preemptive or similar rights.
The shareholders of the Subsidiaries of each Borrower and the number of
shares owned by each as of the Closing Date are described on Schedule
6.1(b). As of the Closing Date, there are no outstanding stock purchase
warrants, subscriptions, options, securities, instruments or other rights
of any type or nature, which are convertible into Debt or which are
exchangeable for or otherwise provide for or permit the issuance of
capital stock of the Borrowers or their Subsidiaries in an amount which in
the aggregate for any Borrower or Subsidiary exceeds twenty (20%) percent
of the issued and outstanding capital stock of such Borrower or
Subsidiary.
(c) Authorization of Agreement, Loan Documents and Borrowing. Each
of the Borrowers and their Subsidiaries has the right, power and authority
and has taken all necessary corporate and other action to authorize the
execution, delivery and performance of this Agreement and each of the
other Loan Documents to which it is a party in accordance with their
respective terms. This Agreement and each of the other Loan Documents have
been duly executed and delivered by the duly authorized officers of each
Borrower and each of its Subsidiaries party thereto, and each such
document constitutes the legal, valid and binding obligation of each
Borrower or its Subsidiary party thereto, enforceable in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar state or federal debtor
relief laws from time to time in effect which affect the enforcement of
creditors' rights in general and the availability of equitable remedies.
(d) Compliance of Agreement, Loan Documents and Borrowing with Laws,
Etc. The execution, delivery and performance by the Borrowers and their
Subsidiaries of the Loan Documents to which each such Person is a party,
in accordance with their respective terms, the Extensions of Credit
hereunder and the transactions contemplated hereby do not and will not, by
the passage of time, the giving of notice or otherwise, (i) require any
Governmental Approval or violate any Applicable Law relating to the
Borrowers or any of their Subsidiaries, (ii) conflict with, result in a
breach of or constitute a default under the articles of incorporation,
bylaws or other organizational documents of any Borrower or any of its
Subsidiaries or any indenture, agreement or other instrument to which such
Person is a party or by which any of its properties may be bound or any
Governmental Approval relating to such Person, (iii) result in or require
the creation or imposition of any Lien upon or with respect to any
property now owned or hereafter acquired by such Person other than Liens
arising under the Loan Documents or (iv) require any consent or
authorization of, filing with, or other act in respect of, an arbitrator
or Governmental Authority and no consent of any other Person is required
in
32
connection with the execution, delivery, performance, validity or
enforceability of this Agreement.
(e) Compliance with Law; Governmental Approvals. Except in each case
where the failure to so comply could not reasonably be expected to have a
Material Adverse Effect, each of the Borrowers and its Subsidiaries (i)
has all Governmental Approvals required by any Applicable Law for it to
conduct its business, each of which is in full force and effect, is final
and not subject to review on appeal and is not the subject of any pending
or, to the best of its knowledge, threatened attack by direct or
collateral proceeding, (ii) is in compliance with each Governmental
Approval applicable to it and in compliance with all other Applicable Laws
relating to it or any of its respective properties and (iii) has timely
filed all material reports, documents and other materials required to be
filed by it under all Applicable Laws with any Governmental Authority and
has retained all material records and documents required to be retained by
it under Applicable Law.
(f) Tax Returns and Payments. Each of the Borrowers and its
Subsidiaries has duly filed or caused to be filed all federal, state,
local and other tax returns required by Applicable Law to be filed, and
has paid, or made adequate provision for the payment of, all federal,
state, local and other taxes, assessments and governmental charges or
levies upon it and its property, income, profits and assets which are due
and payable. Such returns accurately reflect in all material respects all
liability for taxes of the Borrowers and their Subsidiaries for the
periods covered thereby. Except as set forth on Schedule 6.1(f), there is
no ongoing audit or examination or, to the knowledge of any Borrower,
other investigation by any Governmental Authority of the tax liability of
any Borrower and its Subsidiaries. No Governmental Authority has asserted
any Lien or other claim against any Borrower or any Subsidiary thereof
with respect to unpaid taxes which has not been discharged or resolved.
The charges, accruals and reserves on the books of the Borrowers and any
of their Subsidiaries in respect of federal, state, local and other taxes
for all Fiscal Years and portions thereof since the organization of each
Borrower and any of its Subsidiaries are in the judgment of the Borrowers
adequate, and such Borrower does not anticipate any additional taxes or
assessments for any of such years.
(g) Intellectual Property Matters. Each of the Borrowers and its
Subsidiaries owns or possesses rights to use all franchises, licenses,
copyrights, copyright applications, patents, patent rights or licenses,
patent applications, trademarks, trademark rights, service ▇▇▇▇, service
▇▇▇▇ rights, trade names, trade name rights, copyrights and rights with
respect to the foregoing which are required to conduct its business. No
event has occurred which permits, or after notice or lapse of time or both
would permit, the revocation or termination of any such rights, and
neither the Borrowers nor any Subsidiaries thereof are liable to any
Person for infringement under Applicable Law with respect to any such
rights as a result of its business operations.
33
(h) Environmental Matters.
(i) To the best of each Borrower's knowledge, the properties
owned, leased or operated by any Borrower and its Subsidiaries now
or in the past do not contain, and have not previously contained,
any Hazardous Materials in amounts or concentrations which (A)
constitute or constituted a violation of applicable Environmental
Laws or (B) could give rise to liability under applicable
Environmental Laws;
(ii) To the best of each Borrower's knowledge, each Borrower,
each Subsidiary and such properties and all operations conducted in
connection therewith are in compliance, and have been in compliance,
with all applicable Environmental Laws, and there is no
contamination at, under or about such properties or such operations
which could interfere with the continued operation of such
properties or impair the fair saleable value thereof;
(iii) No Borrower or any Subsidiary thereof has received any
notice of violation, alleged violation, non-compliance, liability or
potential liability regarding environmental matters, Hazardous
Materials, or compliance with Environmental Laws, nor does any
Borrower or any Subsidiary thereof have knowledge or reason to
believe that any such notice will be received or is being
threatened;
(iv) To the best of each Borrower's knowledge, Hazardous
Materials have not been transported or disposed of to or from the
properties owned, leased or operated by any Borrower and its
Subsidiaries in violation of, or in a manner or to a location which
could give rise to liability under, Environmental Laws, nor have any
Hazardous Materials been generated, treated, stored or disposed of
at, on or under any of such properties in violation of, or in a
manner that could give rise to liability under, any applicable
Environmental Laws;
(v) No judicial proceedings or governmental or administrative
action is pending, or, to the knowledge of any Borrower, threatened,
under any Environmental Law to which any Borrower or any Subsidiary
thereof is or will be named as a potentially responsible party with
respect to such properties or operations conducted in connection
therewith, nor are there any consent decrees or other decrees,
consent orders, administrative orders or other orders, or other
administrative or judicial requirements outstanding under any
Environmental Law with respect to any Borrower, any Subsidiary or
such properties or such operations; and
(vi) To the best of each Borrower's knowledge, there has been
no release or threat of release of Hazardous Materials at or from
properties owned, leased or operated by any Borrower or any
Subsidiary, now or in the past, in violation of or in amounts or in
a manner that could give rise to liability under Environmental Laws.
34
(i) ERISA.
(i) As of the Closing Date, no Borrower or any ERISA Affiliate
maintains or contributes to, or has any obligation under, any
Employee Benefit Plans other than those identified on Schedule
6.1(i);
(ii) Each Borrower and each ERISA Affiliate is in material
compliance with all applicable provisions of ERISA and the
regulations and published interpretations thereunder with respect to
all Employee Benefit Plans except for any required amendments for
which the remedial amendment period as defined in Section 401(b) of
the Code has not yet expired and except where a failure to so comply
could not reasonably be expected to have a Material Adverse Effect.
Each Employee Benefit Plan that is intended to be qualified under
Section 401(a) of the Code has been determined by the Internal
Revenue Service to be so qualified, and each trust related to such
plan has been determined to be exempt under Section 501 (a) of the
Code except for such plans that have not yet received determination
letters but for which the remedial amendment period for submitting a
determination letter has not yet expired. No liability has been
incurred by any Borrower or any ERISA Affiliate which remains
unsatisfied for any taxes or penalties with respect to any Employee
Benefit Plan or any Multiemployer Plan except for a liability that
could not reasonably be expected to have a Material Adverse Effect;
(iii) As of the Closing Date, no Pension Plan has been
terminated, nor has any accumulated funding deficiency (as defined
in Section 412 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
with respect to any Pension Plan, nor has any Borrower or any ERISA
Affiliate failed to make any contributions or to pay any amounts due
and owing as required by Section 412 of the Code, Section 302 of
ERISA or the terms of any Pension Plan prior to the due dates of
such contributions under Section 412 of the Code or Section 302 of
ERISA, nor has there been any event requiring any disclosure under
Section 4041(c)(3)(C) or 4063(a) of ERISA with respect to any
Pension Plan;
(iv) Except where the failure of any of the following
representations to be correct in all material respects could not
reasonably be expected to have a Material Adverse Effect, no
Borrower or any ERISA Affiliate has: (A) engaged in a nonexempt
prohibited transaction described in Section 406 of the ERISA or
Section 4975 of the Code, (B) incurred any liability to the PBGC
which remains outstanding other than the payment of premiums and
there are no premium payments which are due and unpaid, (C) failed
to make a required contribution or payment to a Multiemployer Plan,
or (D) failed to make a required installment or other required
payment under Section 412 of the Code;
35
(v) No Termination Event has occurred or is reasonably
expected to occur; and
(vi) Except where the failure of any of the following
representations to be correct in all material respects could not
reasonably be expected to have a Material Adverse Effect, no
proceeding, claim (other than a benefits claim in the ordinary
course of business), lawsuit and/or investigation is existing or, to
the best knowledge of any Borrower after due inquiry, threatened
concerning or involving any (A) employee welfare benefit plan (as
defined in Section 3(1) of ERISA) currently maintained or
contributed to by any Borrower or any ERISA Affiliate, (B) Pension
Plan or (C) Multiemployer Plan.
(j) Margin Stock. No Borrower or any Subsidiary thereof is engaged
principally or as one of its activities in the business of extending
credit for the purpose of "purchasing" or "carrying" any "margin stock"
(as each such term is defined or used, directly or indirectly, in
Regulation U of the Board of Governors of the Federal Reserve System). No
part of the proceeds of any of the Loans will be used for purchasing or
carrying margin stock or for any purpose which violates, or which would be
inconsistent with, the provisions of Regulation T, U or X of such Board of
Governors.
(k) Government Regulation. No Borrower or any Subsidiary thereof is
an "investment company" or a company "controlled" by an "investment
company" (as each such term is defined or used in the Investment Company
Act of 1940, as amended) and no Borrower or any Subsidiary thereof is, or
after giving effect to the transactions contemplated by this Agreement
will be, subject to regulation under the Public Utility Holding Company
Act of 1935 or the Interstate Commerce Act, each as amended, or any other
Applicable Law which limits its ability to incur or consummate the
transactions contemplated hereby.
(l) Material Contracts. Schedule 6.1(l) sets forth a complete and
accurate list of all Material Contracts of any Borrower and its
Subsidiaries in effect as of the Closing Date not listed on any other
Schedule hereto; other than as set forth in Schedule 6.1(l), each such
Material Contract is, and after giving effect to the consummation of the
transactions contemplated by the Loan Documents will be, in full force and
effect in accordance with the terms thereof. No Borrower or any Subsidiary
(nor, to the knowledge of any Borrower, any other party thereto) is in
breach of or in default under any Material Contract in any material
respect.
(m) Employee Relations. Each Borrower and its Subsidiaries has a
stable work force in place and is not, as of the Closing Date, party to
any collective bargaining agreement nor has any labor union been
recognized as the representative of its employees except as set forth on
Schedule 6.1(m). No Borrower knows of any pending, threatened or
contemplated strikes, work stoppage or other collective labor disputes
involving its employees or those of its Subsidiaries.
36
(n) Burdensome Provisions. No Borrower or any Subsidiary thereof is
a party to any indenture, agreement, lease or other instrument, or subject
to any corporate or partnership restriction, Governmental Approval or
Applicable Law which is so unusual or burdensome as in the foreseeable
future could be reasonably expected to have a Material Adverse Effect. The
Borrowers and their Subsidiaries do not presently anticipate that future
expenditures needed to meet the provisions of any statutes, orders, rules
or regulations of a Governmental Authority will be so burdensome as to
have a Material Adverse Effect. No Subsidiary is party to any agreement or
instrument or otherwise subject to any restriction or encumbrance that
restricts or limits its ability to make dividend payments or other
distributions in respect of its capital stock to its parent Borrower or
any Subsidiary or to transfer any of its assets or properties to its
parent Borrower or any other Subsidiary in each case other than existing
under or by reason of the Loan Documents or Applicable Law.
(o) Financial Statements. The audited Consolidated balance sheet of
the Borrowers and their Subsidiaries as of January 29, 2005 and the
related audited statements of income and retained earnings and cash flows
for the Fiscal Year then ended, copies of which have been furnished to the
Administrative Agent and each Lender, are complete and correct and fairly
present on a Consolidated basis the assets, liabilities and financial
position of the Borrowers and their Subsidiaries as at such dates, and the
results of the operations and changes of financial position for the
periods then ended (other than customary year-end adjustments for
unaudited financial statements). All such financial statements, including
the related schedules and notes thereto, have been prepared in accordance
with GAAP. The Borrowers and their Subsidiaries have no Debt, obligation
or other unusual forward or long-term commitment which is not fairly
reflected in the foregoing financial statements or in the notes thereto.
(p) No Material Adverse Change. Since January 29, 2005, there has
been no material adverse change in the properties, business, operations,
prospects, or condition (financial or otherwise) of the Borrowers and
their Subsidiaries and no event has occurred or condition arisen that
could reasonably be expected to have a Material Adverse Effect.
(q) Solvency. As of the Closing Date and after giving effect to each
Extension of Credit made hereunder, each Borrower and each of its
Subsidiaries will be Solvent.
(r) Titles to Properties. Each Borrower and its Subsidiaries has
such title to the real property owned or leased by it as is necessary or
desirable to the conduct of its business and valid and legal title to all
of its personal property and assets, including, but not limited to, those
reflected on the balance sheets of the Borrowers and their Subsidiaries
delivered pursuant to Section 6.1(o), except those which have been
disposed of by such Borrower or its Subsidiaries subsequent to such date
which dispositions have been in the ordinary course of business or as
otherwise expressly permitted hereunder.
37
(s) Liens. None of the properties and assets of any Borrower or any
Subsidiary thereof is subject to any Lien, except Liens permitted pursuant
to Section 10.2. No financing statement under the Uniform Commercial Code
of any state which names any Borrower or any Subsidiary thereof or any of
their respective trade names or divisions as debtor and which has not been
terminated, has been filed in any state or other jurisdiction and no
Borrower or any Subsidiary thereof has signed any such financing statement
or any security agreement authorizing any secured party thereunder to file
any such financing statement, except to perfect those Liens permitted by
Section 10.2 hereof.
(t) Debt and Guaranty Obligations. Schedule 6.1(t) is a complete and
correct listing of all Debt and Guaranty Obligations of each Borrower and
its Subsidiaries as of the Closing Date in excess of $1,000,000. Each
Borrower and its Subsidiaries have performed and are in compliance with
all of the terms of such Debt and Guaranty Obligations and all instruments
and agreements relating thereto, and no default or event of default, or
event or condition which with notice or lapse of time or both would
constitute such a default or event of default on the part of any Borrower
or any of its Subsidiaries exists with respect to any such Debt or
Guaranty Obligation.
(u) Litigation. Except for matters existing on the Closing Date and
set forth on Schedule 6.1(u), there are no actions, suits or proceedings
pending nor, to the knowledge of any Borrower, threatened against or in
any other way relating adversely to or affecting any Borrower or any
Subsidiary thereof or any of their respective properties in any court or
before any arbitrator of any kind or before or by any Governmental
Authority except for any such actions, suits or proceedings which
individually and in the aggregate could not reasonably be expected to have
a Material Adverse Effect.
(v) Absence of Defaults. No event has occurred or is continuing
which constitutes a Default or an Event of Default, or which constitutes,
or which with the passage of time or giving of notice or both would
constitute, a default or event of default by any Borrower or any
Subsidiary thereof under any Material Contract or judgment, decree or
order to which such Borrower or its Subsidiaries is a party or by which
such Borrower or its Subsidiaries or any of their respective properties
may be bound or which would require such Borrower or its Subsidiaries to
make any payment thereunder prior to the scheduled maturity date therefor.
(w) Senior Debt Status. The Obligations of the Borrowers and each of
their Subsidiaries under this Agreement and each of the other Loan
Documents ranks and shall continue to rank at least senior in priority of
payment to all Subordinated Debt of each such Person and is designated as
"Senior Indebtedness" under all instruments and documents, now or in the
future, relating to all Subordinated Debt and all senior unsecured Debt of
such Person.
(x) Accuracy and Completeness of Information. All written
information, reports and other papers and data produced by or on behalf of
each Borrower or any Subsidiary thereof (other than financial projections,
which shall be subject to the standard set forth in Section 7.1(c)) and
furnished to the Lenders were, at the time the same were
38
so furnished, complete and correct in all material respects to the extent
necessary to give the recipient a true and accurate knowledge of the
subject matter. No document furnished or written statement made to the
Administrative Agent or the Lenders by any Borrower or any Subsidiary
thereof in connection with the negotiation, preparation or execution of
this Agreement or any of the Loan Documents contains or will contain any
untrue statement of a fact material to the creditworthiness of each
Borrower or its Subsidiaries or omits or will omit to state a fact
necessary in order to make the statements contained therein not
misleading. No Borrower is aware of any facts which it has not disclosed
in writing to the Administrative Agent having a Material Adverse Effect,
or insofar as such Borrower can now foresee, which could reasonably be
expected to have a Material Adverse Effect.
(y) Consummation of Transaction.
(a) Consummation. The Transaction has been consummated
contemporaneously with the funding of the Term Loan on the Closing
Date.
(b) The Purchase Agreement and other Transaction Documents.
The Lenders have received copies of the executed Purchase Agreement
and other Transaction Documents, certified by an appropriate officer
of the Company to be true and correct as of the Closing Date. As
compared to the drafts of the Purchase Agreement and other
Transaction Documents delivered to the Lenders on April 27, 2005,
the Purchase Agreement and such other Transaction Documents have not
been altered, amended or otherwise changed or supplemented in any
respect that is material to the repayment of Term Loan and the
Notes, nor has any condition therein been waived in any respect that
is material to the repayment of the Term Loan and the Notes, in each
case without the prior written consent of the Lenders. The
Transaction has been consummated in accordance with the terms of the
Purchase Agreement in all material respects and in material
compliance with Applicable Law.
(c) Consents.
(i) Governmental and Third Party Approvals. The
Borrowers have obtained all necessary approvals,
authorizations and consents (including, but not limited to,
▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ clearance) of any Person and of all
Governmental Authorities and courts having jurisdiction with
respect to the Transaction and the other transactions
contemplated by this Agreement and the other Loan Documents.
(ii) No Injunction, Etc. No action, proceeding,
investigation, regulation or legislation has been instituted,
threatened or proposed before any Governmental Authority to
enjoin, restrain, or prohibit, or to obtain substantial
damages in respect of, or which is related to or arises out of
this Agreement or the other Loan Documents or the consummation
of the Transaction or the transactions contemplated hereby or
thereby.
39
Section 6.2 Survival of Representations and Warranties, Etc.
All representations and warranties set forth in this Article VI and all
representations and warranties contained in any certificate, or any of the Loan
Documents (including, but not limited to, any such representation or warranty
made in or in connection with any amendment thereto) shall constitute
representations and warranties made under this Agreement. All representations
and warranties made under this Agreement shall be made or deemed to be made at
and as of the Closing Date (except those that are expressly made as of a
specific date), shall survive the Closing Date and shall not be waived by the
execution and delivery of this Agreement, any investigation made by or on behalf
of the Lenders or any borrowing hereunder.
ARTICLE VII
FINANCIAL INFORMATION AND NOTICES
Until all the Obligations have been paid and satisfied in full and the
Term Loan Commitments terminated, unless consent has been obtained in the manner
set forth in Section 13.10 hereof, the Company will furnish or cause to be
furnished to the Administrative Agent at the Administrative Agent's Office at
the address set forth in Section 13.1 and to the Lenders at their respective
addresses as set forth in the Register and/or provided to the Administrative
Agent from time to time, or such other office as may be designated by the
Administrative Agent and Lenders from time to time:
Section 7.1 Financial Statements and Projections.
(a) Quarterly Financial Statements. As soon as practicable and in
any event within sixty (60) days after the end of each of the first three
(3) fiscal quarters of each Fiscal Year, an unaudited Consolidated balance
sheet of the Borrowers and their Subsidiaries as of the close of such
fiscal quarter and an unaudited Consolidated statement of income for the
fiscal quarter then ended, together with statements of retained earnings
and cash flows for the portion of the Fiscal Year then ended, including
the notes thereto, all in reasonable detail setting forth in comparative
form the corresponding figures as of the end of and for the corresponding
period in the preceding Fiscal Year and prepared by the Company in
accordance with GAAP and, if applicable, containing disclosure of the
effect on the financial position or results of operations of any change in
the application of accounting principles and practices during the period,
and certified by the chief financial officer of the Company to present
fairly in all material respects the financial condition of the Borrowers
and their Subsidiaries on a Consolidated basis as of their respective
dates and the results of operations of the Borrowers and their
Subsidiaries for the respective periods then ended, subject to normal year
end adjustments.
(b) Annual Financial Statements. As soon as practicable and in any
event within ninety (90) days after the end of each Fiscal Year, an
audited Consolidated balance sheet of the Borrowers and their Subsidiaries
as of the close of such Fiscal Year
40
and audited Consolidated statements of income, retained earnings and cash
flows for the Fiscal Year then ended, including the notes thereto, all in
reasonable detail setting forth in comparative form the corresponding
figures as of the end of and for the preceding Fiscal Year and prepared in
accordance with GAAP and, if applicable, containing disclosure of the
effect on the financial position or results of operations of any change in
the application of accounting principles and practices during the year, to
be accompanied by a report thereon by an independent certified public
accounting firm, reasonably acceptable to the Administrative Agent, that
is not qualified with respect to scope limitations imposed by any Borrower
or any of its Subsidiaries or with respect to accounting principles
followed by any Borrower or any of its Subsidiaries not in accordance with
GAAP.
(c) Annual Business Plan and Financial Projections. As soon as
practicable and in any event prior to the end of the first fiscal quarter
of each Fiscal Year, a business plan of the Borrowers and their
Subsidiaries for such Fiscal Year, such plan to be prepared in accordance
with GAAP and to include, on a quarterly basis, the following: a quarterly
operating and capital budget, a projected income statement, statement of
cash flows and balance sheet and a report containing management's
discussion and analysis of such projections, accompanied by a certificate
from the chief financial officer of the Company to the effect that, to the
best of such officer's knowledge, such projections are good faith
estimates (utilizing reasonable assumptions) of the financial condition
and operations of the Borrowers and their Subsidiaries for such four (4)
quarter period.
Section 7.2 Officer's Compliance Certificate.
At each time financial statements are delivered pursuant to Sections 7.1
(a) or (b) and at such other times as the Administrative Agent shall reasonably
request, a certificate of the chief financial officer or the treasurer of the
Company in the form of Exhibit F attached hereto (an "Officer's Compliance
Certificate").
Section 7.3 Accountants' Certificate.
At each time financial statements are delivered pursuant to Section
7.1(b), a certificate of the independent public accountants certifying such
financial statements addressed to the Administrative Agent for the benefit of
the Lenders stating that in making the examination necessary for the
certification of such financial statements, they obtained no knowledge of any
Default or Event of Default or, if such is not the case, specifying such Default
or Event of Default and its nature and period of existence.
Section 7.4 Other Reports.
Such information regarding the operations, business affairs and financial
condition of any Borrower or any of its Subsidiaries as the Administrative Agent
or any Lender may reasonably request.
41
Section 7.5 Notice of Litigation and Other Matters.
Prompt (but in no event later than ten (10) days after an officer of any
Borrower obtains knowledge thereof) telephonic and written notice of:
(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 against or involving any Borrower or any
Subsidiary thereof or any of their respective properties, assets or
businesses which involves an amount in excess of $5,000,000 individually
or $10,000,000 in the aggregate;
(b) any notice of any violation received by any Borrower or any
Subsidiary thereof from any Governmental Authority including, without
limitation, any notice of violation of Environmental Laws involving an
amount in excess of $5,000,000 individually or in the aggregate;
(c) any labor controversy that has resulted in, or threatens to
result in, a strike or other work action against any Borrower or any
Subsidiary thereof at any material business location of any Borrower or
any Subsidiary;
(d) any attachment, judgment, lien, levy or order exceeding
$1,000,000 that may be assessed against any Borrower or any Subsidiary
thereof;
(e) (i) any Default or Event of Default, (ii) the occurrence or
existence of any event or circumstance that foreseeably will become a
Default or Event of Default or (iii) any event which constitutes or which
with the passage of time or giving of notice or both would constitute a
default or event of default under any Material Contract to which any
Borrower or any of its Subsidiaries is a party or by which any Borrower or
any Subsidiary thereof or any of their respective properties may be bound
if such default or event of default shall have a Material Adverse Effect
on any Borrower or any Subsidiary;
(f) (i) any unfavorable determination letter from the Internal
Revenue Service regarding the qualification of an Employee Benefit Plan
under Section 401 (a) of the Code (along with a copy thereof), (ii) all
notices received by any Borrower or any ERISA Affiliate of the PBGC's
intent to terminate any Pension Plan or to have a trustee appointed to
administer any Pension Plan, (iii) all notices received by any Borrower or
any ERISA Affiliate from a Multiemployer Plan sponsor concerning the
imposition or amount of withdrawal liability pursuant to Section 4202 of
ERISA and (iv) any Borrower obtaining knowledge or reason to know that any
Borrower or any ERISA Affiliate has filed or intends to file a notice of
intent to terminate any Pension Plan under a distress termination within
the meaning of Section 4041(c) of ERISA; and
(g) any event which makes any of the representations set forth in
Section 6.1 inaccurate in any material respect.
42
Section 7.6 Accuracy of Information.
All written information, reports, statements and other papers and data
furnished by or on behalf of any Borrower to the Administrative Agent or any
Lender whether pursuant to this Article VII or any other provision of this
Agreement shall be, at the time the same is so furnished, in compliance with the
representations and warranties set forth in Section 6.1(x).
ARTICLE VIII
AFFIRMATIVE COVENANTS
Until all of the Obligations have been paid and satisfied in full and the
Term Loan Commitments terminated, unless consent has been obtained in the manner
provided for in Section 13.10, each Borrower will, and will cause each of its
Subsidiaries to:
Section 8.1 Preservation of Corporate Existence and Related Matters.
Except as permitted by Section 10.4, preserve and maintain its separate
corporate existence and all rights, franchises, licenses and privileges
necessary to the conduct of its business, and qualify and remain qualified as a
foreign corporation and authorized to do business in each jurisdiction where the
nature and scope of its activities require it to so qualify under Applicable
Law.
Section 8.2 Maintenance of Property.
Protect and preserve all properties useful in and material to its
business, including copyrights, patents, trade names, service marks and
trademarks; maintain in good working order and condition all buildings,
equipment and other tangible real and personal property; and from time to time
make or cause to be made all renewals, replacements and additions to such
property necessary for the conduct of its business, so that the business carried
on in connection therewith may be conducted in a commercially reasonable matter.
Section 8.3 Insurance.
Maintain insurance with financially sound and reputable insurance
companies against such risks and in such amounts as are customarily maintained
by similar businesses and as may be required by Applicable Law, and on the
Closing Date and from time to time thereafter deliver to the Administrative
Agent upon its request a detailed list of the insurance then in effect, stating
the names of the insurance companies, the amounts and rates of the insurance,
the dates of the expiration thereof and the properties and risks covered
thereby. As of the Closing Date, the Borrowers maintain the insurance described
on Schedule 8.3.
43
Section 8.4 Accounting Methods and Financial Records.
Maintain a system of accounting, and keep such books, records and accounts
(which shall be true and complete in all material respects) as may be required
or as may be necessary to permit the preparation of financial statements in
accordance with GAAP and in compliance with the regulations of any Governmental
Authority having jurisdiction over it or any of its properties.
Section 8.5 Payment and Performance of Obligations.
Pay and perform all Obligations under this Agreement and the other Loan
Documents, and pay or perform (a) all taxes, assessments and other governmental
charges that may be levied or assessed upon it or any of its property, and (b)
all other indebtedness, obligations and liabilities in accordance with customary
trade practices; provided, that any Borrower or such Subsidiary may contest any
item described in clauses (a) or (b) of this Section 8.5 in good faith so long
as adequate reserves are maintained with respect thereto in accordance with
GAAP.
Section 8.6 Compliance With Laws and Approvals.
Observe and remain in compliance in all material respects with all
Applicable Laws and maintain in full force and effect all Governmental
Approvals, in each case applicable to the conduct of its business.
Section 8.7 Environmental Laws.
In addition to and without limiting the generality of Section 8.6, (a)
comply with, and ensure such compliance in all material respects by all tenants
and subtenants with all applicable Environmental Laws and obtain and comply with
and maintain, and ensure that all tenants and subtenants, if any, obtain and
comply with and maintain, any and all licenses, approvals, notifications,
registrations or permits required by applicable Environmental Laws, (b) conduct
and complete all investigations, studies, sampling and testing, and all
remedial, removal and other actions required under Environmental Laws, and
promptly comply with all lawful orders and directives of any Governmental
Authority regarding Environmental Laws, unless such lawful orders and directives
are being contested in good faith and by appropriate proceedings and for which
adequate reserves are maintained to the extent required by GAAP, and (c) defend,
indemnify and hold harmless the Administrative Agent and the Lenders, and their
respective parents, Subsidiaries, Affiliates, employees, agents, officers and
directors, from and against any claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature known or
unknown, contingent or otherwise, arising out of, or in any way relating to the
presence of Hazardous Materials, or the violation of, noncompliance with or
liability under any Environmental Laws applicable to the operations of any
Borrower or any such Subsidiary, or any orders, requirements or demands of
Governmental Authorities related thereto, including, without limitation,
reasonable attorney's and consultant's fees, investigation and laboratory fees,
response costs, court costs and litigation expenses, except to the extent that
any of the foregoing directly result from the gross negligence or willful
misconduct of the party seeking indemnification therefor.
44
Section 8.8 Compliance with ERISA.
In addition to and without limiting the generality of Section 8.6, (a)
except where the failure to so comply could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect, (i) comply
with all material applicable provisions of ERISA and the regulations and
published interpretations thereunder with respect to all Employee Benefit Plans,
(ii) not take any action or fail to take action the result of which could be a
liability to the PBGC or to a Multiemployer Plan, (iii) not participate in any
prohibited transaction that could result in any civil penalty under ERISA or tax
under the Code and (iv) operate each Employee Benefit Plan in such a manner that
will not incur any tax liability under Section 4980B of the Code or any
liability to any qualified beneficiary as defined in Section 4980B of the Code
and (b) furnish to the Administrative Agent upon the Administrative Agent's
request such additional information about any Employee Benefit Plan as may be
reasonably requested by the Administrative Agent.
Section 8.9 Compliance With Agreements.
Comply in all material respects with each term, condition and provision of
all material leases, agreements and other instruments entered into in the
conduct of its business including, without limitation, any Material Contract.
Section 8.10 Visits and Inspections.
Permit representatives of the Administrative Agent or any Lender, from
time to time, during normal business hours, to visit and inspect its properties;
inspect, audit and make extracts from its books, records and files, including,
but not limited to, management letters prepared by independent accountants; and
discuss with its principal officers, and its independent accountants, its
business, assets, liabilities, financial condition, results of operations and
business prospects.
Section 8.11 Additional Subsidiaries.
Notify the Administrative Agent within ten (10) days of the creation or
acquisition of any Subsidiary of any Borrower, which is created or acquired
after the Closing Date and which engages in any business operations or owns
assets with a fair market value in excess of $5,000,000, and promptly thereafter
(and in any event within thirty (30) days following the creation or acquisition
of such Subsidiary) cause to be executed and delivered to the Administrative
Agent (a) a duly executed Joinder Agreement and (b) favorable legal opinions
addressed to the Administrative Agent and Lenders in form and substance
satisfactory thereto with respect to such Joinder Agreement and such other
documents and closing certificates as may be requested by the Administrative
Agent.
Section 8.12 Use of Proceeds.
Use the proceeds of the Extensions of Credit (a) to pay a portion of the
purchase price for the Transaction and (b) to pay related fees and expenses.
45
Section 8.13 Further Assurances.
Make, execute and deliver all such additional and further acts, things,
deeds and instruments as the Administrative Agent or the Required Lenders
(through the Administrative Agent) may reasonably require to document and
consummate the transactions contemplated hereby and to vest completely in and
insure the Administrative Agent and the Lenders their respective rights under
this Agreement, the Notes and the other Loan Documents.
Section 8.14 Take-Out Financing.
Use commercially reasonable efforts to obtain, on or before the date that
is 90 days from the Closing Date, Net Cash Proceeds of (i) the Senior Notes,
(ii) the Add-On Term Loan and/or (iii) other similar financings or capital
raising in an aggregate amount sufficient to repay the Term Loan and all other
Obligations hereunder in full.
ARTICLE IX
FINANCIAL COVENANTS
Until all of the Obligations have been paid and satisfied in full and the
Term Loan Commitments terminated, unless consent has been obtained in the manner
set forth in Section 13.10 hereof, the Borrowers and their Subsidiaries on a
Consolidated basis will not:
Section 9.1 Leverage Ratio.
As of any fiscal quarter end, permit the ratio of (a) Adjusted Debt on
such date to (b) EBITDAR for the period of four (4) consecutive fiscal quarters
ending on or immediately prior to such date (the "Leverage Ratio") to be greater
than 3.75 to 1.0.
Section 9.2 Fixed Charge Coverage Ratio.
As of the end of any fiscal quarter, permit the Fixed Charge Coverage
Ratio to be less than 2.00 to 1.0.
Section 9.3 Modifications to Financial Covenants Following an Amendment of
the Existing Credit Agreement.
If, in connection with any amendment to or restatement of the
Existing Credit Agreement, the financial covenants set forth in Article IX
of the Existing Credit Agreement, the related definitions and/or the
related financial covenant levels are amended or otherwise modified, then,
to the extent any Obligations under this Agreement remain outstanding, (a)
the financial covenants set forth in Article IX of this Agreement, the
related definitions and the related financial covenant levels shall be
deemed amended, automatically and without further action, to correspond
exactly to such modified provisions of the Existing Credit
46
Agreement and (ii) the Borrowers shall cooperate fully and in good faith
with the Lenders to promptly amend this Agreement accordingly to further
evidence such modifications.
ARTICLE X
NEGATIVE COVENANTS
Until all of the Obligations have been paid and satisfied in full and
the Term Loan Commitments terminated, unless consent has been obtained in the
manner set forth in Section 13.10, each of the Borrowers has not and will not
and will not permit any of its Subsidiaries to:
Section 10.1 Limitations on Debt.
Create, incur, assume or suffer to exist any Debt or Additional Debt
except:
(a) the Obligations (excluding Hedging Obligations permitted
pursuant to Section 10.1(b));
(b) Debt incurred in connection with a Hedging Agreement which is
non- speculative and entered into in the ordinary course of a Borrower's
business.
(c) Debt (for the purposes hereof, specifically including the full
amount of the Receivables Purchase Facility as of the Closing Date)
existing on the Closing Date and not otherwise permitted under this
Section 10.1, as set forth on Schedule 6.1(t), and the renewal,
refinancing, extension and replacement thereof (but not the increase in
the aggregate principal amount, except that the maximum principal amount
of the Company's Receivables Purchase Facility may be increased by an
amount equal to the amount of any reduction in the principal amount of the
Company's Series 1998 Revenue Bonds resulting from any payments or
prepayments thereof made by the Company following the date hereof);
(d) Debt of the Borrowers and their Subsidiaries incurred in
connection with Capitalized Leases in an aggregate amount not to exceed
$85,000,000 on any date of determination;
(e) purchase money Debt of the Borrowers and their Subsidiaries in
an aggregate amount not to exceed $50,000,000 on any date of
determination;
(f) Guaranty Obligations in favor of the Administrative Agent for
the benefit of the Administrative Agent and the Lenders;
(g) Guaranty Obligations with respect to Debt permitted pursuant to
subsections (a) through (e) of this Section 10.1;
47
(h) Guaranty Obligations of the Company consisting of guarantees of
operating leases for store locations entered into by any other Borrower in
the ordinary course of its business;
(i) Debt with respect to trade letter of credit facilities in an
aggregate amount not to exceed $100,000,000 on any date of determination
(which amount shall include the amount set forth on Item 5 of Schedule 6.1
(t));
(j) Guaranty Obligations with respect to Debt permitted pursuant to
subsection (i) of this Section 10.1;
(k) Debt of up to $380,000,000 outstanding under the revolving
credit facility evidenced by the Existing Credit Agreement;
(l) additional Debt in an aggregate amount not to exceed $25,000,000
on any date of determination;
(m) Debt incurred under an increase to the Receivables Purchase
Facility or any new receivables financing program similar to the
Receivables Purchase Facility in connection with the Permitted Credit Card
Receivables Acquisition; and
(n) Debt or Additional Debt incurred in connection with the Add-On
Term Loan, the Senior Notes and or other financings not provided for
above, so long as (i) the Borrowers comply in all respects with the
mandatory prepayment provisions of Section 2.4(b)(ii) in connection with
the incurrence thereof and (ii) to the extent any Loans remaining
outstanding after such incurrence and such required mandatory prepayment,
the loan documentation with respect to such Debt or Additional Debt shall
not contain covenants, mandatory prepayments or default provisions that
are more restrictive than the covenants, mandatory prepayments and default
provisions contained herein.
provided, that no agreement or instrument with respect to Debt permitted
to be incurred by this Section shall restrict, limit or otherwise encumber (by
covenant or otherwise) the ability of any Subsidiary of any Borrower to make any
payment to such Borrower or any of its Subsidiaries (in the form of dividends,
intercompany advances or otherwise) for the purpose of enabling such Borrower to
pay the Obligations.
Section 10.2 Limitations on Liens.
Create, incur, assume or suffer to exist, any Lien on or with respect to
any of its assets or properties (including, without limitation, shares of
capital stock or other ownership interests), real or personal, whether now owned
or hereafter acquired, except:
(a) Liens for taxes, assessments and other governmental charges or
levies (excluding any Lien imposed pursuant to any of the provisions of
ERISA or Environmental Laws) not yet due or as to which the period of
grace (not to exceed thirty (30) days), if any, related thereto has not
expired or which are being contested in good
48
faith and by appropriate proceedings and for which adequate reserves are
maintained to the extent required by GAAP;
(b) the claims of materialmen, contractors, mechanics, carriers,
warehousemen, processors or landlords for labor, materials, supplies or
rentals incurred in the ordinary course of business, (i) which are not
overdue for a period of more than thirty (30) days or (ii) which are being
contested in good faith and by appropriate proceedings;
(c) Liens consisting of deposits or pledges made in the ordinary
course of business in connection with, or to secure payment of,
obligations under workers' compensation, unemployment insurance or similar
legislation;
(d) Liens constituting encumbrances in the nature of zoning
restrictions, easements and rights or restrictions of record on the use of
real property, which in the aggregate are not substantial in amount and
which do not, in any case, detract from the value of such property or
impair the use thereof in the ordinary conduct of business;
(e) Liens of the Administrative Agent for the benefit of the
Administrative Agent and the Lenders;
(f) Liens not otherwise permitted by this Section 10.2 and in
existence on the Closing Date and described on Schedule 10.2;
(g) Liens securing Debt permitted under Sections 10.1(d) and (e);
provided that (i) such Liens shall be created substantially simultaneously
with the acquisition or lease of the related asset, (ii) such Liens do not
at any time encumber any property other than the property financed by such
Debt, (iii) the amount of Debt secured thereby is not increased and (iv)
the principal amount of Debt secured by any such Lien shall at no time
exceed one hundred percent (100%) of the original purchase price or lease
payment amount of such property at the time it was acquired; and
(h) Liens securing Debt permitted under Section 10.1(m) in
connection with the Permitted Credit Card Receivables Acquisition;
provided such Liens are on the related receivables (and related property)
only.
Section 10.3 Limitations on Loans, Advances, Investments and Acquisitions.
Purchase, own, invest in or otherwise acquire, directly or indirectly, any
capital stock, interests in any partnership or joint venture (including, without
limitation, the creation or capitalization of any Subsidiary), evidence of Debt
or other obligation or security, substantially all or a portion of the business
or assets of any other Person or any other investment or interest whatsoever in
any other Person, or make or permit to exist, directly or indirectly, any loans,
advances or extensions of credit to, or any investment in cash or by delivery of
property in, any Person except:
49
(a) investments in (i) Subsidiaries existing on the Closing Date,
(ii) in Subsidiaries formed or acquired after the Closing Date so long as
the Borrowers and their Subsidiaries comply with the applicable provisions
of Section 8.11 and the other terms and provisions of this Agreement and
(iii) the other loans, advances and investments described on Schedule 10.3
existing on the Closing Date;
(b) investments in (i) marketable direct obligations issued or
unconditionally guaranteed by the United States of America or any agency
or instrumentality thereof or by the Federal Home Loan Mortgage
Corporation, Government National Mortgage Association, Federal Farm Credit
Bank, Federal Home Loan Mortgage Corp., Federal Housing Administration,
Student Loan Marketing Association or the Tennessee Valley Authority,
maturing within ten (10) years from the date of acquisition thereof, (ii)
obligations of state and local governments or agencies thereof (including
variable rate demand notes and auction rate securities), maturing or
resetting within three (3) years from the date of acquisition thereof,
(iii) commercial paper maturing no more than two hundred seventy (270)
days from the date of creation thereof and currently having a rating of
"A-2" or better from Standard & Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. or a rating of "P2" or better from ▇▇▇▇▇'▇
Investors Service, Inc., (iv) certificates of deposit maturing no more
than one year from the date of creation thereof issued by commercial banks
incorporated under the laws of the United States of America, each having
combined capital, surplus and undivided profits of not less than
$500,000,000 and having a rating of "A" or better by a nationally
recognized rating agency; provided, that the aggregate amount invested in
such certificates of deposit shall not at any time exceed $10,000,000 for
any one such certificate of deposit and $25,000,000 for any one such bank,
(v) money market mutual funds, maturing within one year from the date of
acquisition thereof, provided that the asset value of the issue shall
exceed $1,000,000,000, (vi) corporate notes (including variable rate
demand notes, auction rate securities and Eurodollar notes) issued by a
corporation (except an Affiliate of Borrowers) organized under the laws of
any State of the United States of America or the District of Columbia and
rated at least A-2 by Standard & Poor's Ratings Services or at least A by
▇▇▇▇▇'▇ Investors Service, Inc., (vii) repurchase obligations with a term
of not more than thirty (30) days for underlying securities of the types
described in clause (i) above entered into with any financial institution
having combined capital and surplus and undivided profits of not less than
$500,000,000, (viii) repurchase agreements and reverse repurchase
agreements relating to marketable direct obligations issued or
unconditionally guaranteed by the United States of America or issued by
any governmental agency thereof and backed by the full faith and credit of
the United States of America, in each case maturing within one year or
less from the date of acquisition (provided that the terms of such
agreements comply with the guidelines set forth in the Federal Financial
Agreements of Depository Institutions with Securities Dealers and Others,
as adopted by the Comptroller of the Currency on October 31, 1985), (ix)
time deposits maturing no more than thirty (30) days from the date of
creation thereof with commercial banks or savings banks or savings and
loan associations each having membership either in the FDIC or the
deposits of which are insured by the FDIC and in amounts not exceeding the
maximum amounts of insurance thereunder, and (x) investments in money
market funds
50
and mutual funds which invest substantially all of their assets in
securities of the types described in clauses (i) through (ix) above
(collectively, "Cash Equivalents").
(c) investments in the form of (x) the Transaction, (y) the
Permitted Credit Card Receivables Acquisition or (z) during the term of
this Agreement, a single acquisition of all or substantially all of the
business or a line of business (whether by the acquisition of capital
stock, assets or any combination thereof) of any other Person, if (i) no
Default or Event of Default then exists or would be created thereby, (ii)
the Borrowers have delivered to the Administrative Agent a certificate of
a Responsible Officer (on behalf of the Borrowers) demonstrating pro forma
compliance with the covenants contained in Article IX both before and
after giving effect to such acquisition, and (iii) the aggregate
consideration (including cash and non-cash consideration, whether in the
form of earned-out payments or other deferred payments) and any assumption
of liabilities does not exceed $25,000,000 for such acquisition, without
the prior written consent of the Required Lenders;
(d) Hedging Agreements permitted pursuant to Section 10.1;
(e) purchases of assets in the ordinary course of business;
(f) investments consisting of extensions of credit in the nature of
accounts receivable or notes receivable arising from the grant of trade
credit in the ordinary course of business, and investments received in
satisfaction or partial satisfaction thereof from financially troubled
account debtors to the extent reasonably necessary to prevent loss; and
(g) other investments not exceeding $50,000,000 in the aggregate in
any Fiscal Year of the Borrowers.
Section 10.4 Limitations on Mergers and Liquidation.
Merge, consolidate or enter into any similar combination with any other
Person or liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution) except:
(a) any Subsidiary of any Borrower may merge with the Company, such
Borrower or any other Subsidiary of such Borrower; provided that in any
merger involving the Company or a Borrower, the Company or such Borrower
shall be the surviving entity;
(b) any Wholly-Owned Subsidiary of any Borrower may merge into the
Person such Wholly-Owned Subsidiary was formed to acquire in connection
with an acquisition permitted by Section 10.3(c); and
(c) any Wholly-Owned Subsidiary of any Borrower may wind-up into
such Borrower or any other Wholly-Owned Subsidiary of such Borrower.
51
Section 10.5 Limitations on Sale of Assets.
Convey, sell, lease, assign, transfer or otherwise dispose of any of its
property, business or assets (including, without limitation, the sale of any
receivables and leasehold interests and any Sale and Leaseback Transaction or
similar transaction), whether now owned or hereafter acquired except:
(a) the sale of inventory in the ordinary course of business;
(b) the sale of obsolete assets no longer used or usable in the
business of any Borrower or any of its Subsidiaries;
(c) the transfer of assets to any Borrower or any Wholly-Owned
Subsidiary of any Borrower pursuant to Section 10.4(c);
(d) the sale or discount without recourse of accounts receivable
arising in the ordinary course of business in connection with the
compromise or collection thereof;
(e) the disposition of any Hedging Agreement;
(f) any Sale and Leaseback Transaction with respect to construction
of new store locations of the Borrowers in the ordinary course of the
Borrowers' business; and
(g) any other sale of any asset not otherwise permitted by this
Section 10.5; provided that the aggregate amount of all sales permitted by
this paragraph (f) does not exceed five percent (5%) of such Borrower's
Net Worth in any Fiscal Year.
Section 10.6 Limitations on Dividends and Distributions.
Declare or pay any dividends upon any of its capital stock or any other
ownership interests; purchase, redeem, retire or otherwise acquire, directly or
indirectly, any shares of its capital stock or other ownership interests, or
make any distribution of cash, property or assets among the holders of shares of
its capital stock or other ownership interests, or make any change in its
capital structure; provided that:
(a) any Borrower or any Subsidiary may pay dividends in shares of
its own capital stock;
(b) any Subsidiary may pay cash dividends to a Borrower;
(c) any Borrower or any Subsidiary may pay any other dividends or
distributions not otherwise permitted by this Section 10.6; provided that
the aggregate of all dividends and distributions permitted by this
paragraph (c) during any Fiscal Year shall not exceed five percent (5%) of
the Net Worth of such Borrower or such Subsidiary for such Fiscal Year;
and
52
(d) the Company may purchase, redeem, retire or otherwise acquire,
directly or indirectly shares of its capital stock in an amount not to
exceed (i) $75,000,000 in the aggregate during any consecutive twelve (12)
month period and (ii) $250,000,000 in the aggregate during the term of
this Agreement (provided that no Default or Event of Default shall have
occurred and be continuing both before and after giving effect to such
purchase, redemption, retirement or acquisition).
Section 10.7 Limitations on Exchange and Issuance of Capital Stock.
Issue, sell or otherwise dispose of any class or series of capital stock
that, by its terms or by the terms of any security into which it is convertible
or exchangeable, is, or upon the happening of an event or passage of time would
be, (a) convertible or exchangeable into Debt or (b) required to be redeemed or
repurchased, including at the option of the holder, in whole or in part, or has,
or upon the happening of an event or passage of time would have, a redemption or
similar payment due.
Section 10.8 Transactions with Affiliates.
Except for transactions permitted by Sections 10.3, 10.6, 10.7, and loans
and advances not exceeding $10,000,000 in the aggregate at any one time
outstanding to officers and employees of Borrowers for the purchase of a
residence in connection with the relocation of such officers and employees and
those transactions existing on the Closing Date and identified on Schedule 10.8
directly or indirectly (a) make any loan or advance to, or purchase or assume
any note or other obligation to or from, any of its officers, directors,
shareholders or other Affiliates, or to or from any member of the immediate
family of any of its officers, directors, shareholders or other Affiliates, or
subcontract any operations to any of its Affiliates or (b) enter into, or be a
party to, any other transaction not described in clause (a) above with any of
its Affiliates, except pursuant to the reasonable requirements of its business
and upon fair and reasonable terms that are fully disclosed to and approved in
writing by the Required Lenders prior to the consummation thereof and are no
less favorable to it than it would obtain in a comparable arm's length
transaction with a Person not its Affiliate.
Section 10.9 Certain Accounting Changes; Organizational Documents.
(a) Change their Fiscal Year end, or make any change in their
accounting treatment and reporting practices except as required or
permitted by GAAP or (b) amend, modify or change its articles of
incorporation (or corporate charter or other similar organizational
documents) or amend, modify or change its bylaws (or other similar
documents) in any manner adverse in any respect to the rights or interests
of the Lenders.
Section 10.10 Amendments; Payments and Prepayments of Subordinated Debt.
Amend or modify (or permit the modification or amendment of) any of the
terms or provisions of any Subordinated Debt, or cancel or forgive, make any
voluntary or optional payment or prepayment on, or redeem or acquire for value
(including without limitation by way
53
of depositing with any trustee with respect thereto money or securities before
due for the purpose of paying when due) any Subordinated Debt.
Section 10.11 Restrictive Agreements.
(a) Enter into any Debt which contains any negative pledge on assets
or any covenants more restrictive than the provisions of Articles VIII, IX
and X hereof, or which restricts, limits or otherwise encumbers its
ability to incur Liens on or with respect to any of its assets or
properties other than the assets or properties securing such Debt.
(b) Enter into or permit to exist any agreement which impairs or
limits the ability of any Subsidiary of a Borrower to pay dividends to
such Borrower.
Section 10.12 Nature of Business.
Substantively alter the character or conduct of the business conducted by
any Borrower and its Subsidiaries as of the Closing Date.
Section 10.13 Prepayment of Other Indebtedness, Etc.
(a) amend or modify any of the terms of any Debt or Additional Debt
of the Borrowers or any Subsidiary (other than (i) Debt under the Loan
Documents and (ii) so long as the revised terms, taken as a whole, are not
inconsistent with the terms of this Agreement or materially more adverse
to the Borrowers and their Subsidiaries than the terms of this Agreement,
amendments to the Existing Credit Agreement to facilitate the Add-On Term
Loan, permit the Transaction and otherwise incorporate the transactions
contemplated in this Agreement) if such amendment or modification would
add or change any terms in a manner materially adverse to the Borrowers or
such Subsidiary, or shorten the final maturity or average life to maturity
or require any payment to be made sooner than originally scheduled or
increase the interest rate applicable thereto; and
(b) make (or give any notice with respect thereto) any voluntary,
optional or other non-scheduled payment, prepayment, redemption,
acquisition for value (including without limitation, by way of depositing
money or securities with the trustee with respect thereto before due for
the purpose of paying when due), refund, refinance or exchange of any Debt
or Additional Debt of the Borrowers or any Subsidiary (other than Debt
under the Loan Documents, the Existing Credit Agreement, the Receivables
Purchase Facility and any receivables financing program similar to the
Receivables Purchase Facility), in each case, whether or not mandatory.
54
ARTICLE XI
DEFAULT AND REMEDIES
Section 11.1 Events of Default.
Each of the following shall constitute an Event of Default, whatever the
reason for such event and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment or order of any court
or any order, rule or regulation of any Governmental Authority or otherwise:
(a) Default in Payment of Principal of Loans. The Borrowers shall
default in any payment of principal of any Loan or Note when and as due
(whether at maturity, by reason of acceleration or otherwise).
(b) Other Payment Default. The Borrowers shall default in the
payment when and as due (whether at maturity, by reason of acceleration or
otherwise) of interest on any Loan or Note or the payment of any other
Obligation.
(c) Misrepresentation. Any representation or warranty made or deemed
to be made by the Borrowers or any of their Subsidiaries under this
Agreement, any other Loan Document or any amendment hereto or thereto,
shall at any time prove to have been incorrect or misleading in any
material respect when made or deemed made.
(d) Default in Performance of Certain Covenants. The Borrowers shall
default in the performance or observance of any covenant or agreement
contained in Sections 7.1, 7.2 or 7.5(e)(i) or Articles IX or X of this
Agreement.
(e) Default in Performance of Other Covenants and Conditions. The
Borrowers or any of their Subsidiaries shall default in the performance or
observance of any term, covenant, condition or agreement contained in this
Agreement (other than as specifically provided for otherwise in this
Section 11.1) or any other Loan Document (other than as specifically
provided for otherwise in this Section 11.1) and such default shall
continue for a period of thirty (30) days after written notice thereof has
been given to the Company by the Administrative Agent.
(f) Hedging Agreement. The Borrowers shall default in the
performance or observance of any terms, covenant, condition or agreement
(after giving effect to any applicable grace or cure period) under any
Hedging Agreement representing an aggregate liability to the Borrowers in
excess of $1,000,000 and such default causes the termination of such
Hedging Agreement or permits any counterparty to such Hedging Agreement to
terminate any such Hedging Agreement.
(g) Debt Cross-Default. The Borrowers or any of their Subsidiaries
shall (i) default in the payment of any Debt (other than the Notes) the
aggregate outstanding amount of which Debt is in excess of $10,000,000
beyond the period of grace if any,
55
provided in the instrument or agreement under which such Debt was created,
or (ii) default in the observance or performance of any other agreement or
condition relating to any Debt (other than the Notes) the aggregate
outstanding amount of which Debt is in excess of $10,000,000 or contained
in any instrument or agreement evidencing, securing or relating thereto or
any other event shall occur or condition exist, the effect of which
default or other event or condition is to cause, or to permit the holder
or holders of such Debt (or a trustee or agent on behalf of such holder or
holders) to cause, with the giving of notice if required, any such Debt to
become due prior to its stated maturity (any applicable grace period
having expired).
(h) Change in Control. Any person or group of persons (within the
meaning of Section 13(d) of the Securities Exchange Act of 1934, as
amended) other than ▇▇▇▇ ▇▇▇▇ and/or members of the Belk family (and any
trusts of which he and/or any of such family members are beneficiaries and
any other Persons of which he or any of such family members is the
beneficial equityholder) shall obtain ownership or control in one or more
series of transactions of more than fifty-one percent (51%) of the common
stock or fifty-one percent (51%) of the voting power of the Company
entitled to vote in the election of members of the board of directors of
the Company or there shall have occurred under any indenture or other
instrument evidencing any Debt in excess of $1,000,000 any "change in
control" (as defined in such indenture or other evidence of Debt)
obligating any Borrower to repurchase, redeem or repay all or any part of
the Debt or capital stock provided for therein (any such event, a "Change
in Control").
(i) Voluntary Bankruptcy Proceeding. Any Borrower or any Subsidiary
thereof shall (i) commence a voluntary case under the federal bankruptcy
laws (as now or hereafter in effect), (ii) file a petition seeking to take
advantage of any other laws, domestic or foreign, relating to bankruptcy,
insolvency, reorganization, winding up or composition for adjustment of
debts, (iii) consent to or fail to contest in a timely and appropriate
manner any petition filed against it in an involuntary case under such
bankruptcy laws or other laws, (iv) apply for or consent to, or fail to
contest in a timely and appropriate manner, the appointment of, or the
taking of possession by, a receiver, custodian, trustee, or liquidator of
itself or of a substantial part of its property, domestic or foreign, (v)
admit in writing its inability to pay its debts as they become due, (vi)
make a general assignment for the benefit of creditors, or (vii) take any
corporate action for the purpose of authorizing any of the foregoing.
(j) Involuntary Bankruptcy Proceeding. A case or other proceeding
shall be commenced against any Borrower or any Subsidiary thereof in any
court of competent jurisdiction seeking (i) relief under the federal
bankruptcy laws (as now or hereafter in effect) or under any other laws,
domestic or foreign, relating to bankruptcy, insolvency, reorganization,
winding up or adjustment of debts, or (ii) the appointment of a trustee,
receiver, custodian, liquidator or the like for any Borrower or any
Subsidiary thereof or for all or any substantial part of their respective
assets, domestic or foreign, and such case or proceeding shall continue
without dismissal or stay for a period of ninety (90) consecutive days, or
an order granting the relief requested in such case or proceeding
56
(including, but not limited to, an order for relief under such federal
bankruptcy laws) shall be entered.
(k) Failure of Agreements. Any provision of this Agreement or any
provision of any other Loan Document shall for any reason cease to be
valid and binding on any Borrower or Subsidiary party thereto or any such
Person shall so state in writing, other than in accordance with the
express terms hereof or thereof.
(l) Termination Event. The occurrence of any of the following
events: (i) any Borrower or any ERISA Affiliate fails to make full payment
when due of all amounts which, under the provisions of any Pension Plan or
Section 412 of the Code, any Borrower or any ERISA Affiliate is required
to pay as contributions thereto, (ii) an accumulated funding deficiency in
excess of $2,000,000 occurs or exists, whether or not waived, with respect
to any Pension Plan, (iii) a Termination Event or (iv) any Borrower or any
ERISA Affiliate as employers under one or more Multiemployer Plans makes a
complete or partial withdrawal from any such Multiemployer Plan and the
plan sponsor of such Multiemployer Plans notifies such withdrawing
employer that such employer has incurred a withdrawal liability requiring
payments in an amount exceeding $2,000,000.
(m) Judgment. A judgment or order for the payment of money which
causes the aggregate amount of all such judgments to exceed $10,000,000 in
any Fiscal Year shall be entered against any Borrower or any of its
Subsidiaries by any court and such judgment or order shall continue
without discharge or stay for a period of thirty (30) days.
(n) Environmental. Any one or more Environmental Claims shall have
been asserted against any Borrower or any of its Subsidiaries; such
Borrower or Subsidiary would be reasonable likely to incur liability as a
result thereof; and such liability would be reasonably likely,
individually or in the aggregate, to have a Material Adverse Effect.
Section 11.2 Remedies.
Upon the occurrence of an Event of Default, with the consent of the
Required Lenders, the Administrative Agent may, or upon the request of the
Required Lenders, the Administrative Agent shall, by notice to the Company:
(a) Acceleration; Termination of Facilities. Declare the principal
of and interest on the Loans and the Notes at the time outstanding, and
all other amounts owed to the Lenders and to the Administrative Agent
under this Agreement or any of the other Loan Documents and all other
Obligations (other than Hedging Obligations), to be forthwith due and
payable, whereupon the same shall immediately become due and payable
without presentment, demand, protest or other notice of any kind, all of
which are expressly waived, anything in this Agreement or the other Loan
Documents to the contrary notwithstanding, and terminate the Credit
Facility and any right of the Borrowers to request borrowings thereunder;
provided, that upon the occurrence of an Event of Default specified in
Section 11.1(j) or (k), the Credit Facility shall be
57
automatically terminated and all Obligations (other than Hedging
Obligations) shall automatically become due and payable without
presentment, demand, protest or other notice of any kind, all of which are
expressly waived, anything in this Agreement or in any other Loan Document
to the contrary notwithstanding.
(b) Rights of Collection. Exercise on behalf of the Lenders all of
its other rights and remedies under this Agreement, the other Loan
Documents and Applicable Law, in order to satisfy all of the Borrowers'
Obligations.
Section 11.3 Rights and Remedies Cumulative; Non-Waiver; etc.
The enumeration of the rights and remedies of the Administrative Agent and
the Lenders set forth in this Agreement is not intended to be exhaustive and the
exercise by the Administrative Agent and the Lenders of any right or remedy
shall not preclude the exercise of any other rights or remedies, all of which
shall be cumulative, and shall be in addition to any other right or remedy given
hereunder or under the other Loan Documents or that may now or hereafter exist
at law or in equity or by suit or otherwise. No delay or failure to take action
on the part of the Administrative Agent or any Lender in exercising any right,
power or privilege shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power or privilege preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
or shall be construed to be a waiver of any Event of Default. No course of
dealing between any Borrower, the Administrative Agent and the Lenders or their
respective agents or employees shall be effective to change, modify or discharge
any provision of this Agreement or any of the other Loan Documents or to
constitute a waiver of any Event of Default.
ARTICLE XII
THE ADMINISTRATIVE AGENT
Section 12.1 Appointment.
Each of the Lenders hereby irrevocably designates and appoints Bank of
America, N. A. as Administrative Agent of such Lender under this Agreement and
the other Loan Documents for the term hereof and each such Lender irrevocably
authorizes Bank of America, N.A. as Administrative Agent for such Lender, to
take such action on its behalf under the provisions of this Agreement and the
other Loan Documents and to exercise such powers and perform such duties as are
expressly delegated to the Administrative Agent by the terms of this Agreement
and such other Loan Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in
this Agreement or such other Loan Documents, the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein and
therein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or the other Loan Documents or otherwise exist
against the Administrative Agent. Any reference to the Administrative Agent in
this Article XII shall be
58
deemed to refer to the Administrative Agent solely in its capacity as
Administrative Agent and not in its capacity as a Lender.
Section 12.2 Delegation of Duties.
The Administrative Agent may execute any of its respective duties under
this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Administrative Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by the Administrative Agent with reasonable care.
Section 12.3 Exculpatory Provisions.
Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact, Subsidiaries or Affiliates shall be (a)
liable for any action lawfully taken or omitted to be taken by it or such Person
under or in connection with this Agreement or the other Loan Documents (except
for actions occasioned solely by its or such Person's own gross negligence or
willful misconduct), or (b) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by any Borrower or
any of its Subsidiaries or any officer thereof contained in this Agreement or
the other Loan Documents or in any certificate, report, statement or other
document referred to or provided for in, or received by the Administrative Agent
under or in connection with, this Agreement or the other Loan Documents or for
the value, validity, effectiveness, genuineness, enforceability or sufficiency
of this Agreement or the other Loan Documents or for any failure of any Borrower
or any of its Subsidiaries to perform its obligations hereunder or thereunder.
The Administrative Agent shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement, or to inspect the
properties, books or records of the Borrowers or any of their Subsidiaries.
Section 12.4 Reliance by the Administrative Agent.
The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to the Borrowers), independent accountants and other experts
selected by the Administrative Agent. The Administrative Agent may deem and
treat the payee of any Note as the owner thereof for all purposes unless such
Note shall have been transferred in accordance with Section 13.9. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement and the other Loan Documents unless it shall first
receive such advice or concurrence of the Required Lenders (or, when expressly
required hereby or by the relevant other Loan Documents, all the Lenders) as it
deems appropriate or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action except for its own gross
negligence or willful misconduct. The Administrative Agent shall in all cases be
fully
59
protected in acting, or in refraining from acting, under this Agreement and the
Notes in accordance with a request of the Required Lenders (or, when expressly
required hereby, all the Lenders), and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Notes.
Section 12.5 Notice of Default.
The Administrative Agent shall not be deemed to have knowledge or notice
of the occurrence of any Default or Event of Default unless it has received
notice from a Lender or any Borrower referring to this Agreement, describing
such Default or Event of Default and stating that such notice is a "notice of
default". In the event that the Administrative Agent receives such a notice, it
shall promptly give notice thereof to the Lenders. The Administrative Agent
shall take such action with respect to such Default or Event of Default as shall
be reasonably directed by the Required Lenders (or, when expressly required
hereby, all the Lenders); provided that unless and until the Administrative
Agent shall have received such directions, the Administrative Agent may (but
shall not be obligated to) take such action, or refrain from taking such action,
with respect to such Default or Event of Default as it shall deem advisable in
the best interests of the Lenders, except to the extent that other provisions of
this Agreement expressly require that any such action be taken or not be taken
only with the consent and authorization or the request of the Lenders or
Required Lenders, as applicable.
Section 12.6 Non-Reliance on the Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative Agent
nor any of its respective officers, directors, employees, agents,
attorneys-in-fact, Subsidiaries or Affiliates has made any representations or
warranties to it and that no act by the Administrative Agent hereafter taken,
including any review of the affairs of the Borrowers or any of their
Subsidiaries, shall be deemed to constitute any representation or warranty by
the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent that it has, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrowers and their Subsidiaries and made
its own decision to make its Loans hereunder and enter into this Agreement. Each
Lender also represents that it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigation as
it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Borrowers and their
Subsidiaries. Except for notices, reports and other documents expressly required
to be furnished to the Lenders by the Administrative Agent hereunder or by the
other Loan Documents, the Administrative Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, financial and other condition or
creditworthiness of the Borrowers or any of their Subsidiaries which may come
into the possession of the Administrative Agent or
60
any of its respective officers, directors, employees, agents, attorneys-in-fact,
Subsidiaries or Affiliates.
Section 12.7 Indemnification.
The Lenders agree to indemnify the Administrative Agent in its capacity as
such and (to the extent not reimbursed by the Borrowers and without limiting the
obligation of the Borrowers to do so), ratably according to the respective
amounts of their Term Loan Commitment Percentages from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Term
Loan) be imposed on, incurred by or asserted against the Administrative Agent in
its capacity as such in any way relating to or arising out of this Agreement or
the other Loan Documents, or any documents, reports or other information
provided to the Administrative Agent or any Lender or contemplated by or
referred to herein or therein or the transactions contemplated hereby or thereby
or any action taken or omitted by the Administrative Agent under or in
connection with any of the foregoing; provided that no Lender shall be liable
for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting solely from the Administrative Agent's bad faith, gross negligence or
willful misconduct. The agreements in this Section 12.7 shall survive the
payment of the Term Loan and all other amounts payable hereunder and the
termination of this Agreement.
Section 12.8 The Administrative Agent in Its Individual Capacity.
The Administrative Agent and its respective Subsidiaries and Affiliates
may make loans to, accept deposits from and generally engage in any kind of
business with the Borrowers as though the Administrative Agent were not the
Administrative Agent hereunder. With respect to any Loans made or renewed by it
and any Note issued to it, the Administrative Agent shall have the same rights
and powers under this Agreement and the other Loan Documents as any Lender and
may exercise the same as though it were not the Administrative Agent, and the
terms "Lender" and "Lenders" shall include the Administrative Agent in its
individual capacity.
Section 12.9 Resignation of the Administrative Agent; Successor
Administrative Agent.
Subject to the appointment and acceptance of a successor as provided
below, the Administrative Agent may resign at any time by giving notice thereof
to the Lenders and the Company. Upon any such resignation, the Required Lenders
shall have the right to appoint a successor Administrative Agent, which
successor shall have minimum capital and surplus of at least $500,000,000. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders and shall have accepted such appointment within thirty (30) days after
the Administrative Agent's giving of notice of resignation, then the
Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which successor shall have minimum capital and surplus of
at least $500,000,000. Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor Administrative Agent, such successor
Administrative Agent shall thereupon succeed to and become vested with all
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent
61
shall be discharged from its duties and obligations hereunder. After any
retiring Administrative Agent's resignation hereunder as Administrative Agent,
the provisions of this Section 12.9 shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
Administrative Agent.
Section 12.10 Other Agents.
None of the Lenders identified on the facing page, in the introductory
paragraph or on the signature pages to this Agreement as a Syndication Agent or
Documentation Agent, if any, shall have any right, power, obligation, liability,
responsibility or duty under this Agreement other than those applicable to all
Lenders as such. Without limiting the foregoing, none of the Lenders so
identified shall have or be deemed to have any fiduciary relationship with any
Lender. Each Lender acknowledges that it has not relied, and will not rely, on
any of the Lenders so identified in deciding to enter into this Agreement or in
taking or not taking action hereunder.
ARTICLE XIIII
MISCELLANEOUS
Section 13.1 Notices.
(a) Method of Communication. Except as otherwise provided in this
Agreement, all notices and communications hereunder shall be in writing
(for purposes hereof, the term "writing" shall include information in
electronic format such as electronic mail and internet web pages), or by
telephone subsequently confirmed in writing. Any notice shall be effective
if: (i) delivered by hand delivery (ii) sent via electronic mail, provided
that the party sending such electronic mail does not receive notice that
such electronic mail has failed to reach the Person or Persons to whom
such notice is to be given, (iii) posting on an internet web page
accessible by the Person or Persons to whom the notice is to be given,
immediately following notice of such posting by electronic mail, (iv)
telecopy, (v) recognized overnight courier service or (vi) certified mail,
return receipt requested, and shall be presumed to be received by a party
hereto (a) on the date of delivery if delivered by hand or sent by
electronic mail as provided in (ii) above, posting on an internet web page
as provided in (iii) above, telecopy, (b) on the next Business Day if sent
by recognized overnight courier service and (c) on the third Business Day
following the date sent by certified mail, return receipt requested. A
telephonic notice to the Administrative Agent as understood by the
Administrative Agent will be deemed to be the controlling and proper
notice in the event of a discrepancy with or failure to receive a
confirming written notice.
(b) Addresses for Notices. Notices to any party shall be sent to it
at the following addresses, or any other address as to which all the other
parties are notified in writing.
If to the Borrowers: ▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Chief Financial Officer
Telephone No.: (▇▇▇)▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇)▇▇▇-▇▇▇▇
With copies to: ▇▇▇▇ Stores Services, Inc.
Legal Department
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: General Counsel
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to Bank of America, N.A.
as Administrative Agent: Bank of America, N.A.
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
Telephone No.:(▇▇▇)▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇)▇▇▇-▇▇▇▇
With copies to: ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇)▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇)▇▇▇-▇▇▇▇
If to any Lender: To the address set forth in the
Register.
(c) Administrative Agent's Office. The Administrative Agent hereby
designates its office located at the address set forth above, or any
subsequent office which shall have been specified for such purpose by
written notice to the Company and Lenders, as the Administrative Agent's
Office referred to herein, to which payments due are to be made and at
which Loans will be disbursed.
Section 13.2 Expenses; Indemnity.
The Borrowers will (a) pay all reasonable out-of-pocket expenses
(including, without limitation, all costs of electronic or internet distribution
of any information hereunder) of the Administrative Agent and Wachovia Bank,
National Association in connection with (i) the preparation, execution and
delivery of this Agreement and each other Loan Document, whenever the same shall
be executed and delivered, including without limitation all out-of-pocket
63
syndication and due diligence expenses and reasonable fees and disbursements of
counsel for the Administrative Agent and Wachovia Bank, National Association and
(ii) the preparation, execution and delivery of any waiver, amendment or consent
by the Administrative Agent or the Lenders relating to this Agreement or any
other Loan Document, including without limitation reasonable fees and
disbursements of counsel for the Administrative Agent, (b) pay all reasonable
out-of-pocket expenses of the Administrative Agent and each Lender actually
incurred in connection with the administration and enforcement of any rights and
remedies of the Administrative Agent and Lenders under the Credit Facility,
including, without limitation, in connection with any workout, restructuring,
bankruptcy or other similar proceeding, enforcing any Obligations of, or
collecting any payments due from, any Borrower or by reason of an Event of
Default; consulting with appraisers, accountants, engineers, attorneys and other
Persons concerning the nature, scope or value of any right or remedy of the
Administrative Agent or any Lender hereunder or under any other Loan Document or
any factual matters in connection therewith, which expenses shall include
without limitation the reasonable fees and disbursements of such Persons, and
(c) defend, indemnify and hold harmless the Administrative Agent and the
Lenders, and their respective parents, Subsidiaries, Affiliates, employees,
agents, officers and directors, from and against any losses, penalties, fines,
liabilities, settlements, damages, costs and expenses, suffered by any such
Person in connection with any claim (including, without limitation, any
Environmental Claims), investigation, litigation or other proceeding (whether or
not the Administrative Agent or any Lender is a party thereto, and whether or
not any such claim, investigation, litigation or other proceeding is brought or
otherwise instituted by any Borrower or any third party) and the prosecution and
defense thereof, arising out of or in any way connected with the Loans, this
Agreement, any other Loan Document or any documents, reports or other
information provided to the Administrative Agent or any Lender or contemplated
by or referred herein or therein or the transactions contemplated hereby or
thereby, including, without limitation, reasonable attorney's and consultant's
fees, except to the extent that any of the foregoing directly result from the
gross negligence or willful misconduct of the party seeking indemnification
therefor.
Section 13.3 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 and after the occurrence
of any Event of Default and during the continuance thereof, the Lenders and any
assignee or participant of a Lender in accordance with Section 13.9 are hereby
authorized by the Borrowers at any time or from time to time, without notice to
the Borrowers or to any other Person, any such notice being hereby expressly
waived, to set off and to appropriate and to apply any and all deposits (general
or special, time or demand, including, but not limited to, indebtedness
evidenced by certificates of deposit, whether matured or unmatured) and any
other indebtedness at any time held or owing by the Lenders, or any such
assignee or participant to or for the credit or the account of any Borrower
against and on account of the Obligations irrespective of whether or not (a) the
Lenders shall have made any demand under this Agreement or any of the other Loan
Documents or (b) the Administrative Agent shall have declared any or all of the
Obligations to be due and payable as permitted by Section 11.2 and although such
Obligations shall be contingent or unmatured. Notwithstanding the preceding
sentence, each Lender agrees to notify the Company and the Administrative Agent
64
after any such set-off and application, provided that the failure to give such
notice shall not affect the validity of such set-off and application.
Section 13.4 Governing Law.
This Agreement, the Notes and the other Loan Documents, unless otherwise
expressly set forth therein, shall be governed by, construed and enforced in
accordance with the laws of the State of North Carolina, without reference to
the conflicts or choice of law principles thereof.
Section 13.5 Jurisdiction and Venue.
(a) Jurisdiction. The Borrowers hereby irrevocably consent to the
personal jurisdiction of the state and federal courts located in
Mecklenburg County, North Carolina (and any courts from which an appeal
from any of such courts must or may be taken), in any action, claim or
other proceeding arising out of any dispute in connection with this
Agreement, the Notes and the other Loan Documents, any rights or
obligations hereunder or thereunder, or the performance of such rights and
obligations. The Borrowers hereby irrevocably consent to the service of a
summons and complaint and other process in any action, claim or proceeding
brought by the Administrative Agent or any Lender in connection with this
Agreement, the Notes or the other Loan Documents, any rights or
obligations hereunder or thereunder, or the performance of such rights and
obligations, on behalf of itself or its property, in the manner specified
in Section 13.1. Nothing in this Section 13.5 shall affect the right of
the Administrative Agent or any Lender to serve legal process in any other
manner permitted by Applicable Law or affect the right of the
Administrative Agent or any Lender to bring any action or proceeding
against any Borrower or its properties in the courts of any other
jurisdictions.
(b) Venue. The Borrowers hereby irrevocably waive any objection they
may have now or in the future to the laying of venue in the aforesaid
jurisdiction in any action, claim or other proceeding arising out of or in
connection with this Agreement, any other Loan Document or the rights and
obligations of the parties hereunder or thereunder. The Borrowers
irrevocably waive, in connection with such action, claim or proceeding,
any plea or claim that the action, claim or other proceeding has been
brought in an inconvenient forum.
Section 13.6 Reversal of Payments.
To the extent any Borrower makes a payment or payments to the
Administrative Agent for the ratable benefit of the Lenders or the
Administrative Agent receives any payment or proceeds of the collateral which
payments or proceeds or any part thereof are subsequently invalidated, declared
to be fraudulent or preferential, set aside and/or required to be repaid to a
trustee, receiver or any other party under any bankruptcy law, state or federal
law, common law or equitable cause, then, to the extent of such payment or
proceeds repaid, the Obligations or part thereof intended to be satisfied shall
be revived and continued in full force and effect as if such payment or proceeds
had not been received by the Administrative Agent.
65
Section 13.7 Injunctive Relief; Punitive Damages.
(a) The Borrowers recognize that, in the event a Borrower fails to
perform, observe or discharge any of its obligations or liabilities under
this Agreement, any remedy of law may prove to be inadequate relief to the
Lenders. Therefore, the Borrowers agree that the Lenders, at the Lenders'
option, shall be entitled to temporary and permanent injunctive relief in
any such case without the necessity of proving actual damages.
(b) The Administrative Agent, the Lenders and the Company (on behalf
of itself and its Subsidiaries) hereby agree that no such Person shall
have a remedy of punitive or exemplary damages against any other party to
a Loan Document and each such Person hereby waives any right or claim to
punitive or exemplary damages that they may now have or may arise in the
future in connection with any dispute, whether such dispute is resolved
through arbitration or judicially.
Section 13.8 Accounting Matters.
Except as otherwise expressly provided herein, all terms of an accounting
or financial nature shall be construed in accordance with GAAP, as in effect
from time to time, provided that, if the Borrowers notify the Administrative
Agent that the Borrowers request an amendment to any provision hereof to
eliminate the effect of any change occurring after the date hereof in GAAP or in
the application thereof on the operation of such provision (or if the
Administrative Agent notifies the Company that the Required Lenders request an
amendment to any provision hereof for such purpose), regardless of whether any
such notice is given before or after such change in GAAP or in the application
thereof, then such provision shall be interpreted on the basis of GAAP as in
effect and applied immediately before such change shall have become effective
until such notice shall have been withdrawn or such provision amended in
accordance therewith.
Section 13.9 Successors and Assigns; Participations.
(a) Benefit of Agreement. This Agreement shall be binding upon and
inure to the benefit of the Borrowers, the Administrative Agent and the
Lenders, all future holders of the Notes, and their respective successors
and assigns, except that the Borrowers shall not assign or transfer any of
their rights or obligations under this Agreement without the prior written
consent of each Lender.
(b) Assignment by Lenders. Each Lender may, in the ordinary course
of its business and in accordance with Applicable Law, sell or assign to
any Lender or any Affiliate of a Lender and with the consent of the
Company (so long as no Default or Event of Default has occurred and is
continuing) and the consent of the Administrative Agent, which consents
shall not be unreasonably withheld or delayed, assign to one or more other
Eligible Assignees all or a portion of its interests, rights and
obligations under this Agreement and the other Loan Documents (including,
without limitation, all or a
66
portion of the Extensions of Credit at the time owing to it and the Notes
held by it); provided that:
(i) each such assignment shall be of a constant, and not a
varying, percentage of all the assigning Lender's rights and
obligations under this Agreement;
(ii) if less than all of the assigning Lender's Term Loan
Commitment is to be assigned, the Term Loan Commitment so assigned
shall not be less than $1,000,000;
(iii) the assignee shall have delivered to the Administrative
Agent all United States Internal Revenue Service Forms required
pursuant to Section 4.11(e) and all of the parties to each such
assignment shall execute and deliver to the Administrative Agent,
for its acceptance and recording in the Register, an Assignment and
Acceptance substantially in the form of Exhibit G attached hereto
(an "Assignment and Acceptance"), together with any Note or Notes
subject to such assignment;
(iv) where consent of the Company to an assignment to a
assignee is required hereunder, the Company shall be deemed to have
given its consent five (5) Business Days after the date written
notice thereof has been delivered by the assigning Lender (through
the Administrative Agent) unless such consent is expressly refused
by the Company prior to such fifth (5th) Business Day;
(v) such assignment shall not, without the consent of the
Company, require any Borrower to file a registration statement with
the Securities and Exchange Commission or apply to or qualify the
Loans or the Notes under the blue sky laws of any state; and
(vi) the assigning Lender shall pay to the Administrative
Agent an assignment fee in the amount as set forth in Schedule 13.9
upon the execution by such Lender of the Assignment and Acceptance;
provided that no such fee shall be payable upon any assignment by a
Lender to an Affiliate thereof.
Upon such execution, delivery, acceptance and recording, from and after
the effective date specified in each Assignment and Acceptance, which effective
date shall be at least five (5) Business Days after the execution thereof
(unless otherwise agreed to by the Administrative Agent), (A) the assignee
thereunder shall be a party hereto and, to the extent provided in such
Assignment and Acceptance, have the rights and obligations of a Lender hereby
and (B) the Lender thereunder shall, to the extent provided in such assignment,
be released from its obligations under this Agreement.
(c) Rights and Duties Upon Assignment. By executing and delivering
an Assignment and Acceptance, the assigning Lender thereunder and the
assignee
67
thereunder confirm to and agree with each other and the other parties
hereto as set forth in such Assignment and Acceptance.
(d) Register. The Administrative Agent shall maintain a copy of each
Assignment and Acceptance delivered to it and a register for the
recordation of the name and address of each Lender, the amount of the Term
Loan Commitment with respect to each Lender from time to time and the
amount of Extensions of Credit with respect to each Lender from time to
time (the "Register"). The entries in the Register shall be conclusive, in
the absence of manifest error, and the Borrowers, the Administrative Agent
and the Lenders may treat each person whose name is recorded in the
Register as a Lender hereunder for all purposes of this Agreement. The
Register shall be available for inspection by the Company or any Lender at
any reasonable time and from time to time upon reasonable prior notice.
(e) Issuance of New Notes. Upon its receipt of an Assignment and
Acceptance executed by an assigning Lender and an Eligible Assignee
together with any Note or Notes (if applicable) subject to such assignment
and (if applicable) the written consent to such assignment, the
Administrative Agent shall, if such Assignment and Acceptance has been
completed and is substantially in the form of Exhibit G:
(i) accept such Assignment and Acceptance;
(ii) record the information contained therein in the
Register;
(iii) give prompt notice thereof to the Lenders and the
Company; and
(iv) promptly deliver a copy of such Assignment and
Acceptance to the Company.
Within five (5) Business Days after receipt of notice, the Borrowers shall
execute and deliver to the Administrative Agent, in exchange for the surrendered
Note or Notes, a new Note or Notes to the order of such Eligible Assignee (to
the extent requested thereby) in amounts equal to the Term Loan Commitment
assumed by it pursuant to such Assignment and Acceptance and a new Note or Notes
to the order of the assigning Lender (to the extent requested thereby) in an
amount equal to the Term Loan Commitment retained by it hereunder. Such new Note
or Notes shall be in an aggregate principal amount equal to the aggregate
principal amount of such surrendered Note or Notes, shall be dated the effective
date of such Assignment and Acceptance and shall otherwise be in substantially
the form of the assigned Notes delivered to the assigning Lender. Each
surrendered Note or Notes shall be canceled and returned to the Company.
(f) Participations. Each Lender may, without notice to and without
the consent of the Borrowers (except that the Borrowers' consent may be
required in accordance with the last paragraph of this clause (f)) or the
Administrative Agent, in the ordinary course of its commercial banking
business and in accordance with Applicable Law, sell participations to one
or more banks or other entities in all or a portion of its
68
rights and obligations under this Agreement (including, without
limitation, all or a portion of its Extensions of Credit and the Notes
held by it); provided that:
(i) each such participation shall be in an amount not less
than $1,000,000;
(ii) such Lender's obligations under this Agreement
(including, without limitation, its Term Loan Commitment) shall
remain unchanged;
(iii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations;
(iv) such Lender shall remain the holder of the Notes held by
it for all purposes of this Agreement;
(v) the Borrowers, the Administrative Agent and the other
Lenders shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under this
Agreement;
(vi) such Lender shall not permit such participant the right
to approve any waivers, amendments or other modifications to this
Agreement or any other Loan Document other than waivers, amendments
or modifications which would reduce the principal of or the interest
rate on any Loan, extend the term or increase the amount of the Term
Loan Commitment, reduce the amount of any fees to which such
participant is entitled or extend any scheduled payment date for
principal of any Loan; and
(vii) any such disposition shall not, without the consent of
the Company, require any Borrower to file a registration statement
with the Securities and Exchange Commission to apply to qualify the
Loans or the Notes under the blue sky law of any state.
The Borrowers agree that each participant shall be entitled to the
benefits of Section 4.7, Section 4.8, Section 4.9, Section 4.10, Section 4.11
and Section 13.2 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to paragraph (b) of this Section 13.9; provided
that a participant shall not be entitled to receive any greater payment under
Section 4.7, Section 4.8, Section 4.9, Section 4.10, and Section 4.11 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such participant, unless the sale of the participation to
such participant is made with the Borrowers' prior written consent and such
participant shall have delivered to the Administrative Agent all United States
Internal Revenue Service Forms required pursuant to Section 4.11(e).
(g) Disclosure of Information; Confidentiality. The Administrative
Agent and the Lenders shall hold all non-public information with respect
to the Borrowers obtained pursuant to the Loan Documents (or any Hedging
Agreement with a Lender or the Administrative Agent) in accordance with
their customary procedures for handling
69
confidential information; provided, that the Administrative Agent and each
of the institutions identified on the cover page hereof as "Co-Lead
Arrangers" may disclose information relating to this Agreement to Gold
Sheets and other similar bank trade publications, such information to
consist of deal terms and other information customarily found in such
publications and provided further, that the Administrative Agent or any
Lender may disclose any such information to the extent such disclosure is
(i) required by law or requested or required pursuant to any legal
process, (ii) requested by, or required to be disclosed to, any rating
agency, or regulatory or similar authority (including, without limitation,
the National Association of Insurance Commissioners), (iii) used in any
suit, action or proceeding for the purpose of defending itself, reducing
its liability or protecting any of its claims, rights, remedies or
interests under or in connection with the Loan Documents (or any Hedging
Agreement with a Lender or the Administrative Agent) or (iv) otherwise
consented to by the Company. The Administrative Agent or any Lender may,
in connection with any sale, proposed sale, assignment, proposed
assignment, participation or proposed participation pursuant to this
Section 13.9, disclose to the assignee, participant, proposed assignee,
proposed participant or to any direct or indirect contractual counterparty
in swap agreements or such contractual counterparty's professional
advisor, any information relating to the Borrowers furnished to such
Lender by or on behalf of the Borrowers; provided, that prior to any such
disclosure, each such assignee, proposed assignee, participant, proposed
participant or professional advisor shall agree to be bound by the
provisions of this Section 13.9(g).
(h) Certain Pledges or Assignments. Any Lender may at any time
pledge or assign a security interest in all or any portion of its rights
under this Agreement or any other Loan Document to secure obligations of
such Lender, including without limitation any pledge or assignment to
secure obligations to a Federal Reserve Bank; provided that no such pledge
or assignment of a security interest shall release a Lender form any of
its obligations hereunder or substitute such pledgee or assignee for such
Lender as a party hereto.
Section 13.10 Amendments, Waivers and Consents.
Except as set forth below or as specifically provided in any Loan
Document, any term, covenant, agreement or condition of this Agreement or any of
the other Loan Documents may be amended or waived by the Lenders, and any
consent given by the Lenders, if, but only if, such amendment, waiver or consent
is in writing signed by the Required Lenders (or by the Administrative Agent
with the consent of the Required Lenders) and delivered to the Administrative
Agent and, in the case of an amendment, signed by the Borrowers; provided, that
no amendment, waiver or consent shall (a) increase the aggregate Term Loan
Commitments or increase the amount of the Loans, (b) reduce the rate of interest
or fees payable on any Loan, (c) reduce or forgive the principal amount of any
Loan, (d) extend the originally scheduled time or times of payment of the
principal of any Loan or the time or times of payment of interest on any Loan or
any fee or commission with respect thereto, (e) permit any subordination of the
principal or interest on any Loan, (f) release any Borrower from the Obligations
(other than Hedging Obligations) hereunder, (g) permit any assignment (other
than as specifically permitted or contemplated in this Agreement) of any of a
Borrower's rights and obligations hereunder or (h)
70
amend the provisions of this Section 13.10 or the definition of Required
Lenders, in each case without the prior written consent of each Lender. In
addition, no amendment, waiver or consent to the provisions of Article XII shall
be made without the written consent of the Administrative Agent.
Section 13.11 Performance of Duties.
The Borrowers' obligations under this Agreement and each of the other Loan
Documents shall be performed by the Borrowers at their sole cost and expense.
Section 13.12 All Powers Coupled with Interest.
All powers of attorney and other authorizations granted to the Lenders,
the Administrative Agent and any Persons designated by the Administrative Agent
or any Lender pursuant to any provisions of this Agreement or any of the other
Loan Documents shall be deemed coupled with an interest and shall be irrevocable
so long as any of the Obligations remain unpaid or unsatisfied, any of the Term
Loan Commitments remain in effect or the Credit Facility has not been
terminated.
Section 13.13 Survival of Indemnities.
Notwithstanding any termination of this Agreement, the indemnities to
which the Administrative Agent and the Lenders are entitled under the provisions
of this Article XIII and any other provision of this Agreement and the other
Loan Documents shall continue in full force and effect and shall protect the
Administrative Agent and the Lenders against events arising after such
termination as well as before.
Section 13.14 Titles and Captions.
Titles and captions of Articles, Sections and subsections in, and the
table of contents of, this Agreement are for convenience only, and neither limit
nor amplify the provisions of this Agreement.
Section 13.15 Severability of Provisions.
Any provision of this Agreement or any other Loan Document which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective only to the extent of such prohibition or unenforceability
without invalidating the remainder of such provision or the remaining provisions
hereof or thereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
Section 13.16 Counterparts.
This Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an
71
original and shall be binding upon all parties, their successors and assigns,
and all of which taken together shall constitute one and the same agreement.
Section 13.17 Term of Agreement.
This Agreement shall remain in effect from the Closing Date through and
including the date upon which all Obligations arising hereunder or under any
other Loan Document shall have been indefeasibly and irrevocably paid and
satisfied in full and all Term Loan Commitments have been terminated. No
termination of this Agreement shall affect the rights and obligations of the
parties hereto arising prior to such termination or in respect of any provision
of this Agreement which survives such termination.
Section 13.18 Advice of Counsel.
Each of the parties represents to each other party hereto that it has
discussed this Agreement with its counsel.
Section 13.19 No Strict Construction.
The parties hereto have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties hereto and no presumption or burden of proof shall arise favoring
or disfavoring any party by virtue of the authorship of any provisions of this
Agreement.
Section 13.20 Inconsistencies with Other Documents: Independent Effect of
Covenants.
(a) In the event there is a conflict or inconsistency between this
Agreement and any other Loan Document, the terms of this Agreement shall
control.
(b) The Borrowers expressly acknowledge and agree that each covenant
contained in Articles VIII, IX, or X hereof shall be given independent
effect. Accordingly, the Borrowers shall not engage in any transaction or
other act otherwise prohibited under any covenant contained in Articles
VIII, IX, or X if, before or after giving effect to such transaction or
act, the Borrowers shall or would be in breach of any other covenant
contained in Articles VIII, IX, or X.
[Signature pages to follow]
72
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed under seal by their duly authorized officers, all as of the day and
year first written above.
[CORPORATE SEAL] ▇▇▇▇, INC., as a Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
BELK ADMINISTRATION COMPANY, as a
Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
BELK INTERNATIONAL, INC., as a Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
▇▇▇▇ STORES SERVICES, INC., as a Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
▇▇▇▇-▇▇▇▇▇▇▇ COMPANY, GREENVILLE,
SOUTH CAROLINA, as a Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
[Signature Pages Continue]
SIGNATURE PAGE TO
BRIDGE CREDIT AGREEMENT
▇▇▇▇, INC.
THE ▇▇▇▇ CENTER, INC., as a Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
UNITED ELECTRONIC SERVICES, INC., as a
Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
BELK ACCOUNTS RECEIVABLE LLC, as a
Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
▇▇▇▇ STORES OF VIRGINIA LLC, as a
Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
BELK GIFT CARD COMPANY LLC, as a
Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
[Signature Pages Continue]
SIGNATURE PAGE TO
BRIDGE CREDIT AGREEMENT
▇▇▇▇, INC.
BELK MERCHANDISING, LLC, as a Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
BELK TEXAS HOLDINGS LLC, as a Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
BELK TEXAS LP, as a Borrower
By: ▇▇▇▇, Inc., its General Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
SIGNATURE PAGE TO
BRIDGE CREDIT AGREEMENT
▇▇▇▇, INC.
BANK OF AMERICA, N.A., as Administrative
Agent and Lender
BY: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
SIGNATURE PAGE TO
BRIDGE CREDIT AGREEMENT
▇▇▇▇, INC.
WACHOVIA BANK, NATIONAL ASSOCIATION
as Lender
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Director
SIGNATURE PAGE TO
BRIDGE CREDIT AGREEMENT
▇▇▇▇, INC.
EXHIBIT A
to the
Bridge Credit Agreement
dated as of July 5, 2005
by and among
▇▇▇▇, INC.,
the Subsidiaries of ▇▇▇▇, Inc. party thereto,
as Borrowers,
the Lenders party thereto,
BANK OF AMERICA, N.A.,
as Administrative Agent,
BANC OF AMERICA SECURITIES LLC,
and
WACHOVIA CAPITAL MARKETS, LLC,
as Joint Lead Arrangers
and
BANC OF AMERICA SECURITIES LLC,
as Sole Book Manager
FORM OF TERM NOTE
TERM NOTE
$____________ __________ ___, ____________
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇, INC., a corporation organized
under the laws of Delaware (the "Company"), and the Subsidiaries of the Company
listed on the signature pages hereto (each a "Borrower" and together, the
"Borrowers") hereby jointly and severally promise to pay to the order
of ___________________________________________________, (the "Lender"), at the
place and times provided in the Credit Agreement referred to below, the
principal sum of ________________________ DOLLARS ($______________) or, if less,
the principal amount of all Term Loans made by the Lender from time to time
pursuant to that certain Bridge Credit Agreement, dated as of July 5, 2005 (as
amended, restated or otherwise modified, the "Credit Agreement") by and among
the Borrowers, the Lenders who are or may become a party thereto (collectively,
the "Lenders") and Bank of America, N.A., as Administrative Agent. Capitalized
terms used herein and not defined herein shall have the meanings assigned
thereto in the Credit Agreement.
The unpaid principal amount of this Term Note from time to time
outstanding is subject to mandatory repayment from time to time as provided in
the Credit Agreement and shall bear interest as provided in Section 4.1 of the
Credit Agreement. All payments of principal and interest on this Term Note shall
be payable in lawful currency of the United States of America in immediately
available funds to the account designated in the Credit Agreement.
This Term Note is entitled to the benefits of, and evidences Obligations
incurred under, the Credit Agreement, to which reference is made for a statement
of the terms and conditions on which the Borrowers are permitted and required to
make prepayments and repayments of principal of the Obligations evidenced by
this Term Note and on which such Obligations may be declared to be immediately
due and payable.
THIS TERM NOTE SHALL BE GOVERNED, CONSTRUED AND ENFORCED IN ACCORDANCE
WITH THE LAWS OF NORTH CAROLINA, WITHOUT REFERENCE TO THE CONFLICTS OR CHOICE OF
LAW PRINCIPLES THEREOF.
The Debt evidenced by this Term Note is senior in right of payment to all
Subordinated Debt referred to in the Credit Agreement.
The Borrowers hereby waive all requirements as to diligence, presentment,
demand of payment, protest and (except as required by the Credit Agreement)
notice of any kind with respect to this Term Note.
[Signature Pages Follow]
IN WITNESS WHEREOF, the undersigned have executed this Term Note under
seal as of the day and year first above written.
[CORPORATE SEAL] ▇▇▇▇, INC., as a Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
▇▇▇▇ ADMINISTRATION COMPANY, as a Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
BELK INTERNATIONAL, INC., as a Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
▇▇▇▇ STORES SERVICES, INC., as a Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
▇▇▇▇-▇▇▇▇▇▇▇ COMPANY, GREENVILLE,
SOUTH CAROLINA, as a Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
THE ▇▇▇▇ CENTER, INC, as a Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
UNITED ELECTRONIC SERVICES, INC., as a
Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
BELK ACCOUNTS RECEIVABLE LLC, as a Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
▇▇▇▇ STORES OF VIRGINIA LLC, as a Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
BELK GIFT CARD COMPANY LLC, as a Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
BELK MERCHANDISING, LLC, as a Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
BELK TEXAS HOLDINGS LLC, as a Borrower
By: _________________________________________
Name: ___________________________________
Title: __________________________________
BELK TEXAS LP, as a Borrower
By: ▇▇▇▇, Inc., its General Partner
By: _________________________________________
Name: ___________________________________
Title: __________________________________
EXHIBIT B
to the
Bridge Credit Agreement
dated as of July 5, 2005
by and among
▇▇▇▇, INC.,
the Subsidiaries of ▇▇▇▇, Inc. party thereto,
as Borrowers,
the Lenders party thereto,
BANK OF AMERICA, N.A.,
as Administrative Agent,
BANC OF AMERICA SECURITIES LLC,
and
WACHOVIA CAPITAL MARKETS, LLC,
as Joint Lead Arrangers
and
BANC OF AMERICA SECURITIES LLC,
as Sole Book Manager
FORM OF NOTICE OF BORROWING
NOTICE OF BORROWING
Dated as of: ______
Bank of America, N.A.,
as Administrative Agent
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
Ladies and Gentlemen:
This irrevocable Notice of Borrowing is delivered to you pursuant to the
Bridge Credit Agreement dated as of July 5, 2005 (as amended, restated or
otherwise modified, the "Credit Agreement"), by and among ▇▇▇▇, Inc., a Delaware
corporation (the "Company"), the Subsidiaries of the Company listed on the
signature pages thereto (each a "Borrower" and together, the "Borrowers"), the
lenders party thereto (the "Lenders") and Wachovia Bank, National Association,
as Administrative Agent.
1. The Borrowers hereby request that the Lenders make a Term Loan to the
Borrowers in the aggregate principal amount of $______________________.
(Complete with an amount in accordance with Section 2.3(a) of the Credit
Agreement.)
2. The Borrowers hereby request that such Loan be made on the following
Business Day:________________________________. (Complete with a Business Day in
accordance with Section 2.3(a) of the Credit Agreement).
3. The Borrowers hereby request that the Term Loan bear interest at the
following interest rate, plus the Applicable Margin, as set forth below:
INTEREST PERIOD TERMINATION DATE FOR
COMPONENT (LIBOR INTEREST PERIOD
OF LOAN INTEREST RATE RATE ONLY) (IF APPLICABLE)
--------- ------------------- --------------- --------------------
[Base Rate or LIBOR
Rate]
4. All of the conditions applicable to the Loan requested herein as set
forth in the Credit Agreement have been satisfied as of the date hereof and will
remain satisfied to the date of such Loan.
5. Capitalized terms used herein and not defined herein shall have the
meanings assigned thereto in the Credit Agreement.
[Signature Page Follows]
IN WITNESS WHEREOF, the undersigned has executed this Notice of Borrowing
as of the ______day of_____________,______.
▇▇▇▇, INC., on behalf of itself and the other
Borrowers
By: ______________________________________________
Name:_________________________________________
Title:
EXHIBIT C
to the
Bridge Credit Agreement
dated as of July 5, 2005
by and among
▇▇▇▇, INC.,
the Subsidiaries of ▇▇▇▇, Inc. party thereto,
as Borrowers,
the Lenders party thereto,
BANK OF AMERICA, N.A.,
as Administrative Agent,
BANC OF AMERICA SECURITIES LLC,
and
WACHOVIA CAPITAL MARKETS, LLC,
as Joint Lead Arrangers
and
BANC OF AMERICA SECURITIES LLC,
as Sole Book Manager
FORM OF NOTICE OF ACCOUNT DESIGNATION
NOTICE OF ACCOUNT DESIGNATION
Dated as of:________________
Bank of America, N.A.,
as Administrative Agent
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
Ladies and Gentlemen:
This Notice of Account Designation is delivered to you under Section
2.3(b) of the Bridge Credit Agreement dated as of July 5, 2005 (as amended,
restated or otherwise modified, the "Credit Agreement"), by and among ▇▇▇▇,
Inc., a Delaware corporation (the "Company"), the Subsidiaries of the Company
listed on the signature pages thereto (each a "Borrower" and together, the
"Borrowers"), the lenders party thereto (the "Lenders") and Bank of America,
N.A., as Administrative Agent.
1. The Administrative Agent is hereby authorized to disburse all Loan
proceeds into the following account(s):
_________________________________________
ABA Routing Number: _____________________
Account Number: _________________________
2. This authorization shall remain in effect until revoked or until a
subsequent Notice of Account Designation is provided to the Administrative
Agent.
3. Capitalized terms used herein and not defined herein shall have the
meanings assigned thereto in the Credit Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Notice of Account
Designation as of the ___________ day of ____________, 2005.
▇▇▇▇, INC., on behalf of itself and the other
Borrowers
By: _________________________________________________
Name: ___________________________________________
Title: __________________________________________
EXHIBIT D
to the
Bridge Credit Agreement
dated as of July 5, 2005
by and among
▇▇▇▇, INC.,
the Subsidiaries of ▇▇▇▇, Inc. party thereto,
as Borrowers,
the Lenders party thereto,
BANK OF AMERICA, N.A.,
as Administrative Agent,
BANC OF AMERICA SECURITIES LLC,
and
WACHOVIA CAPITAL MARKETS, LLC,
as Joint Lead Arrangers
and
BANC OF AMERICA SECURITIES LLC,
as Sole Book Manager
FORM OF NOTICE OF REPAYMENT
NOTICE OF REPAYMENT
Dated as of: ______
Bank of America, N.A.,
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
Ladies and Gentlemen:
This irrevocable Notice of Repayment is delivered to you under Section
2.4(c) of the Bridge Credit Agreement dated as of July 5, 2005 (as amended,
restated or otherwise modified, the "Credit Agreement"), by and among ▇▇▇▇,
Inc., a Delaware corporation (the "Company"), the Subsidiaries of the Company
listed on the signature pages thereto (each a "Borrower" and together, the
"Borrowers"), the lenders party thereto (the "Lenders") and Bank of America,
N.A., as Administrative Agent.
1. The Borrowers hereby provide notice to the Administrative Agent that
they shall repay the following [Base Rate Loans] and/or [LIBOR Rate
Loans]:__________________________________________. (Complete with an amount in
accordance with Section 2.4 of the Credit Agreement.)
2. The Loan to be prepaid is a Term Loan.
3. The Borrowers shall repay the Term Loan on the following Business Day:
______________________. (Complete with a Business Day at least one (1) Business
Day subsequent to the date of this Notice of Repayment with respect to any Base
Rate Loan and three (3) Business Days subsequent to date of this Notice of
Repayment with respect to any LIBOR Rate Loan.)
4. Capitalized terms used herein and not defined herein shall have the
meanings assigned thereto in the Credit Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Notice of Repayment
as of the ________ day of ____________, ________.
▇▇▇▇, INC., on behalf of itself and the other
Borrowers
By: _______________________________________________
Name: _________________________________________
Title: ________________________________________
EXHIBIT E
to the
Bridge Credit Agreement
dated as of July 5, 2005
by and among
▇▇▇▇, INC.,
the Subsidiaries of ▇▇▇▇, Inc. party thereto,
as Borrowers,
the Lenders party thereto,
BANK OF AMERICA, N.A.,
as Administrative Agent,
BANC OF AMERICA SECURITIES LLC,
and
WACHOVIA CAPITAL MARKETS, LLC,
as Joint Lead Arrangers
and
BANC OF AMERICA SECURITIES LLC,
as Sole Book Manager
FORM OF NOTICE OF CONVERSION/CONTINUATION
NOTICE OF CONVERSION/CONTINUATION
Dated as of: _______________
Bank of America, N.A.,
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
Ladies and Gentlemen:
This irrevocable Notice of Conversion/Continuation (the "Notice") is
delivered to you under Section 4.2 of the Bridge Credit Agreement dated as of
July 5, 2005 (as amended, restated or otherwise modified, the "Credit
Agreement"), by and among ▇▇▇▇, Inc., a Delaware corporation (the "Company"),
the Subsidiaries of the Company listed on the signature pages thereto (each a
"Borrower" and together, the "Borrowers"), the lenders party thereto (the
"Lenders") and Bank of America, N.A., as Administrative Agent.
1. This Notice is Submitted for the purpose of: (Check one and complete
applicable information in accordance with the Credit Agreement.)
[ ] Converting all or a portion of a Base Rate Loan into a LIBOR
Rate Loan
(a) The aggregate outstanding principal balance of such Loan is
$_________________.
(b) The principal amount of such Loan to be converted is
$_________________.
(c) The requested effective date of the conversion of such Loan is
__________________.
(d) The requested Interest Period applicable to the converted Loan
is _______________.
[ ] Converting a portion of libor Rate Loan into a Base Rate Loan
(a) The aggregate outstanding principal balance of such Loan is
$ ________________.
(b) The last day of the current Interest Period for such Loan is
__________________.
(c) The principal amount of such Loan to be converted is
$ __________________.
(d) The requested effective date of the conversion of such Loan is
__________________.
[ ] Continuing all or a portion of a LIBOR Rate Loan as a LIBOR
Rate Loan
(a) The aggregate outstanding principal balance of such Loan is
$ ________________.
(b) The last day of the current Interest Period for such Loan is
__________________.
(c) The principal amount of such Loan to be continued is
$ ________________.
(d) The requested effective date of the continuation of such Loan
is _______________.
(e) The requested Interest Period applicable to the continued Loan
is _______________.
2. All of the conditions applicable to the conversion or continuation
of the Loan requested herein as set forth in the Credit Agreement have been
satisfied or waived as of the date hereof and will remain satisfied or waived to
the date of such Loan.
3. Capitalized terms used herein and not defined herein shall have the
meanings assigned thereto in the Credit Agreement.
[Signature Page Follows]
IN WITNESS WHEREOF, the undersigned has executed this Notice of
Conversion/Continuation as of the _____________ day of ________________, ______.
▇▇▇▇, INC., on behalf of itself and the other
Borrowers
By: _________________________________________
Name: ___________________________________
Title: __________________________________
EXHIBIT F
to the
Bridge Credit Agreement
dated as of July 5, 2005
by and among
▇▇▇▇, INC.,
the Subsidiaries of ▇▇▇▇, Inc. party thereto,
as Borrowers,
the Lenders party thereto,
BANK OF AMERICA, N.A.,
as Administrative Agent,
BANC OF AMERICA SECURITIES LLC,
and
WACHOVIA CAPITAL MARKETS, LLC,
as Joint Lead Arrangers
and
BANC OF AMERICA SECURITIES LLC,
as Sole Book Manager
FORM OF OFFICER'S COMPLIANCE CERTIFICATE
OFFICER'S COMPLIANCE CERTIFICATE
The undersigned, on behalf of ▇▇▇▇, Inc. (the "Company"), and on behalf of
the Subsidiaries of the Company listed on the signature pages to the Credit
Agreement referred to below (each a "Borrower" and together, the "Borrowers"),
hereby certifies to the Administrative Agent and the Lenders, each as defined in
the Credit Agreement referred to below, as follows:
1. This Certificate is delivered to you pursuant to Section 7.2 of the
Bridge Credit Agreement dated as of July 5, 2005 (as amended, restated or
otherwise modified, the "Credit Agreement"), by and among the Borrowers, the
lenders party thereto (the "Lenders") and Bank of America, N.A., as
Administrative Agent (the "Administrative Agent"). Capitalized terms used herein
and not defined herein shall have the meanings assigned thereto in the Credit
Agreement.
2. I have reviewed the financial statements of the Borrowers and their
Subsidiaries dated as of ___________ and for the _______________ period[s] then
ended and such statements fairly present in all material respects the financial
condition of the Borrowers and their Subsidiaries as of the dates indicated and
the results of their operations and cash flows for the period[s] indicated.
3. I have reviewed the terms of the Credit Agreement, and the related Loan
Documents and have made, or caused to be made under my supervision, a review in
reasonable detail of the transactions and the condition of the Borrowers and
their Subsidiaries during the accounting period covered by the financial
statements referred to in Paragraph 2 above. Such review has not disclosed the
existence during or at the end of such accounting period of any condition or
event that constitutes a Default or an Event of Default, nor do I have any
knowledge of the existence of any such condition or event as at the date of this
Certificate [except, if such condition or event existed or exists, describe the
nature and period of existence thereof and what action the Borrower has taken,
is taking and proposes to take with respect thereto].
4. The Applicable Margin and calculations determining such figure are set
forth on the attached Schedule 1 and the Borrower and its Subsidiaries are in
compliance with the financial covenants contained in Article IX of the Credit
Agreement as shown on such Schedule 1 and the Borrowers and their Subsidiaries
are in compliance with the other covenants and restrictions contained in the
Credit Agreement.
[Signature Page Follows]
WITNESS the following signature as of the_________________day of
_______________,________.
▇▇▇▇, INC., on behalf of itself and the other
Borrowers
By: _____________________________________________
Name: _______________________________________
Title: ______________________________________
Schedule 1
to
Officer's Compliance Certificate
[TO BE PROVIDED BY BORROWER IN FORM ACCEPTABLE TO ADMINISTRATIVE AGENT]
EXHIBIT G
to the
Bridge Credit Agreement
dated as of July 5, 2005
by and among
▇▇▇▇, INC.,
the Subsidiaries of ▇▇▇▇, Inc. party thereto,
as Borrowers,
the Lenders party thereto,
BANK OF AMERICA, N.A.,
as Administrative Agent,
BANC OF AMERICA SECURITIES LLC,
and
WACHOVIA CAPITAL MARKETS, LLC,
as Joint Lead Arrangers
and
BANC OF AMERICA SECURITIES LLC,
as Sole Book Manager
FORM OF ASSIGNMENT AND ACCEPTANCE
ASSIGNMENT AND ACCEPTANCE
Dated as of: __________
Reference is made to the Bridge Credit Agreement dated as of July 5, 2005
(as amended, restated, supplemented or otherwise modified, the "Credit
Agreement") by and among ▇▇▇▇, Inc., a corporation organized under the laws of
the state of Delaware (the "Company") and the subsidiaries of the Company who
are or may become party thereto (together with the Company, the "Borrowers"),
the lenders who are or may become party thereto (collectively, the "Lenders")
and Bank of America, N.A., as Administrative Agent. Capitalized terms used
herein without definition shall have the same meanings herein as in the Credit
Agreement.
____________________________(the "Assignor") and ___________________(each
an "Assignee", and collectively, the "Assignees") agree as follows:
SECTION 1. The Assignor hereby sells and assigns to each Assignee, and the
Assignee hereby purchases and assumes from the Assignor, as of the Effective
Date (as defined below), a percentage interest in and to the Assignor's
interest, rights and obligations with respect to its Term Loan Commitment and
Term Loans and, from and after the Effective Date, all of the Assignor's
corresponding interests, rights and obligations under the Credit Agreement and
other Loan Documents, such that the Term Loan Commitment and Term Loan
Commitment Percentage of the Assignees and the Assignor as of the Effective Date
shall be as set forth on Schedule 2 attached hereto. This Assignment and
Acceptance is entered pursuant to, and authorized by Section 13.9 of the Credit
Agreement.
SECTION 2. The Assignor (a) represents that, as of the date hereof, its
Term Loan Commitment Percentage and Term Loans (unreduced by any assignments
thereof which have not yet become effective) under the Credit Agreement are as
set forth on Schedule 1 attached hereto (b) makes no representation or warranty
and assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or any other
Loan Document or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement or any other instrument or document
furnished pursuant thereto, other than that the Assignor is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (c) makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of any of the Borrowers or their Subsidiaries or the performance or observance
by the Borrowers or their Subsidiaries of any of their obligations under the
Credit Agreement or any other instrument or document furnished or executed
pursuant thereto; and (d) to the extent either the Assignor or Assignee requests
a Note or Notes, attaches the applicable Note(s) delivered to it under the
Credit Agreement and requests that the Borrowers exchange such Note(s) for new
Notes payable to each of the Assignor and the Assignee as follows:
Term Loan Note
Payable to the Order of: Principal Amount of Note:
_______________________ $ ___________
_______________________ $ ___________
SECTION 3. The Assignee (a) represents and warrants that it is legally
authorized to enter into this Assignment and Acceptance; (b) confirms that it
has received a copy of the Credit Agreement, together with copies of the most
recent financial statements delivered pursuant to Section 7.1 thereof and such
other documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into this Assignment and Acceptance; (c)
agrees that it will, independently and without reliance upon the Assignor or any
other Lender or Administrative Agent and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under the Credit Agreement; (d)
confirms that it is an Eligible Assignee; (e) appoints and authorizes
Administrative Agent to take such action as agent on its behalf and to exercise
such powers under the Credit Agreement and the other Loan Documents as are
delegated to such Administrative Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; (f) agrees that it will perform in
accordance with their terms all the obligations which by the terms of the Credit
Agreement and the other Loan Documents are required to be performed by it as a
Lender; and (g) agrees that any information disclosed by or on behalf of the
Borrowers and any information obtained pursuant to the provisions of, or in
connection with, the Credit Agreement shall be used solely for purposes of the
Credit Agreement and not in any other manner, and, if such information is not
otherwise in the public domain, shall not be disclosed to any other Person
except in accordance with the provisions of Section 13.9(g) of the Credit
Agreement.
SECTION 4. The effective date for this Assignment and Acceptance shall be
____________________, ________(the "Effective Date"). Following the execution of
this Assignment and Acceptance, it will be delivered with copies of all tax
forms required pursuant to Section 4.11(e) of the Credit Agreement, if
applicable, to the Administrative Agent for consent by the Borrowers and the
Administrative Agent, if required under Section 13.9 of the Credit Agreement and
acceptance and recording in the Register.
SECTION 5. Upon such consents, acceptance, recording and delivery of tax
forms, if applicable, from and after the Effective Date, (a) the Assignee shall
be a party to the Credit Agreement and the other Loan Documents to which Lenders
are parties and, to the extent provided in this Assignment and Acceptance, have
the rights and obligations of a Lender under each such agreement, and (b) the
Assignor shall, to the extent provided in this Assignment and Acceptance,
relinquish its rights (except, with respect to any assignment of all of the
Assignor's interest, rights and obligations with respect to its Extensions of
Credit under the Credit Agreement, indemnification and reimbursement rights
relating to the periods during which such Assignor was a Lender party to the
Credit Agreement) and be released from its obligations under the Credit
Agreement and the other Loan Documents.
SECTION 6. Upon such consents, acceptance, recording and delivery of tax
forms, if applicable, from and after the Effective Date, the Administrative
Agent shall make all payments in respect of the interest assigned hereby
(including payments of principal, interest, fees and other amounts) to the
Assignee. The Assignor and Assignee shall make all appropriate adjustments in
payments for periods prior to the Effective Date or with respect to the making
of this assignment directly between themselves.
SECTION 7. THIS ASSIGNMENT AND ACCEPTANCE SHALL BE DEEMED TO BE A CONTRACT
UNDER SEAL AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NORTH CAROLINA, WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.
SECTION 8. This Assignment and Acceptance may be executed in separate
counterparts, each of which when executed and delivered is an original but all
of which taken together constitute one and the same instrument.
[SIGNATURE PAGES FOLLOW]
ASSIGNOR:
[____________________]
By: ___________________________________________
Name: _____________________________________
Title: ____________________________________
Wiring Instructions:
Bank of America, N.A.
[BANK OF AMERICA WIRING INSTRUCTIONS]
[SIGNATURE PAGES CONTINUE]
ASSIGNEES:
_______________________________
By: ___________________________
By: ___________________________________________
Name: _____________________________________
Title: ____________________________________
[SIGNATURE PAGES CONTINUE]
To the Extent Required by the Credit Agreement, Acknowledged and Consented to on
behalf of the Borrowers:
▇▇▇▇, INC.
By: ___________________________________________
Name: _____________________________________
Title: ____________________________________
[SIGNATURE PAGES CONTINUE]
To the Extent Required by the Credit Agreement, Consented to and Accepted:
BANK OF AMERICA, N.A., as Administrative Agent
By: ___________________________________________
Name: _____________________________________
Title: ____________________________________
Schedule 1
Lender Term Loan Commitment($) Term Loan Commitment Percentage (%)
------ ----------------------- -----------------------------------
$ ___________ ____________ %
Schedule 2
Lender Term Loan Commitment($) Term Loan Commitment Percentage (%)
------ ----------------------- -----------------------------------
$ ___________ ____________ %
$ ___________ ____________ %
TOTALS $ ___________ ____________ %