EXHIBIT 10.59
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DEBTOR-IN-POSSESSION TRANSIT REVOLVING CREDIT AGREEMENT
Dated as of October 5, 2001
and
Amended and Restated as of March 8, 2002
among
RAILWORKS CORPORATION,
a Debtor and Debtor-in-Possession
as Borrower,
CERTAIN SUBSIDIARIES OF THE BORROWER,
as Debtors and Debtors-in-Possession,
as Guarantors,
THE LENDERS AND ISSUER PARTY HERETO,
and
CSFB GLOBAL OPPORTUNITIES ADVISERS, LLC,
as Administrative Agent
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TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS 3
Section 1.01 Definitions....................................................... 3
Section 1.02 Computation of Time Periods....................................... 20
Section 1.03 Accounting Terms; Certain Calculations............................ 20
Section 1.04 Certain Terms..................................................... 20
ARTICLE II THE LOANS AND LETTER OF CREDIT 20
Section 2.01 Loans and Letters of Credit....................................... 20
Section 2.02 Method of Borrowing and Issuance.................................. 21
Section 2.03 Funding of Borrowings............................................. 22
Section 2.04 Repayment......................................................... 23
Section 2.05 Prepayments....................................................... 23
Section 2.06 Notes............................................................. 23
Section 2.07 Reduction and Expiration of Commitments........................... 24
Section 2.08 Fees.............................................................. 24
Section 2.09 Interest.......................................................... 25
Section 2.10 Capital Adequacy.................................................. 25
Section 2.11 Increased Costs................................................... 25
Section 2.12 Payments and Computations......................................... 26
Section 2.13 Taxes............................................................. 27
Section 2.14 Sharing of Payments, Etc.......................................... 28
Section 2.15 Additional Provisions Relating to the Letter of Credit............ 28
ARTICLE III CONDITIONS 31
Section 3.01 Conditions Precedent to Initial Loans............................. 31
Section 3.02 Conditions Precedent to Each Loan and Issuance of Letter of
Credit. 33
Section 3.03 Conditions to Effectiveness....................................... 34
ARTICLE IV REPRESENTATIONS AND WARRANTIES 36
Section 4.01 Financial Condition............................................... 36
Section 4.02 No Changes or Restricted Payments................................. 36
Section 4.03 Organization; Existence; Compliance with Law...................... 36
Section 4.04 Power; Authorization; Enforceable Obligations..................... 37
Section 4.05 [Reserved.]....................................................... 37
Section 4.06 No Material Litigation............................................ 37
Section 4.07 No Default........................................................ 37
Section 4.08 Ownership of Property; Liens...................................... 38
Section 4.09 Intellectual Property............................................. 38
Section 4.10 No Burdensome Restrictions........................................ 38
Section 4.11 Taxes............................................................. 38
Section 4.12 ERISA............................................................. 38
Section 4.13 Governmental Regulations, Etc..................................... 40
Section 4.14 Subsidiaries and Guarantors....................................... 40
Section 4.15 Use of Proceeds................................................... 41
Section 4.16 Environmental Matters............................................. 42
Section 4.17 Disclosure........................................................ 42
Section 4.18 Bank Accounts..................................................... 43
Section 4.19 Insurance......................................................... 43
Section 4.20 Labor Matters..................................................... 43
ARTICLE V AFFIRMATIVE COVENANTS 44
Section 5.01 Financial Statements.............................................. 44
Section 5.02 Certificates; Other Information................................... 47
Section 5.03 Notices........................................................... 48
Section 5.04 Payment of Obligations............................................ 49
Section 5.05 Conduct of Business and Maintenance of Existence.................. 50
Section 5.06 Maintenance of Property; Insurance................................ 50
Section 5.07 Books and Records; Inspection of Property; Discussions............ 50
Section 5.08 Environmental Laws................................................ 51
Section 5.09 Additional Guaranties and Stock Pledges........................... 52
Section 5.10 Ownership of Subsidiaries......................................... 52
Section 5.11 Application of Proceeds........................................... 52
Section 5.12 Compliance with Budgets........................................... 53
Section 5.13 Transit Payment Accounts; Payments................................ 53
Section 5.14 Payment of Taxes, Etc............................................. 54
Section 5.15 Collateral Documents.............................................. 54
ARTICLE VI NEGATIVE COVENANTS 54
Section 6.01 Indebtedness...................................................... 54
Section 6.02 Liens............................................................. 55
Section 6.03 Consolidation, Merger, Divestiture, etc........................... 55
Section 6.04 Acquisitions...................................................... 55
Section 6.05 Investments....................................................... 55
Section 6.06 Ownership of Equity Interests..................................... 55
Section 6.07 Fiscal Year....................................................... 55
Section 6.08 Restricted Payments............................................... 56
Section 6.09 Sale Leasebacks................................................... 56
Section 6.10 No Further Negative Pledges....................................... 56
Section 6.11 Limitations on Transactions with Affiliates....................... 56
Section 6.12 Payment of Other Indebtedness..................................... 56
Section 6.13 Investment Banking and Finder's Fees.............................. 57
Section 6.14 Maximum Capital Expenditures...................................... 57
Section 6.15 No Material Pleadings............................................. 57
Section 6.16 Modification of Contractual Obligations........................... 57
Section 6.17 Accounting Changes................................................ 58
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ARTICLE VII EVENTS OF DEFAULT 58
Section 7.01 Events of Default................................................. 58
Section 7.02 Acceleration; Remedies............................................ 61
ARTICLE VIII GUARANTY 62
Section 8.01 The Guarantee..................................................... 62
Section 8.02 Obligations Unconditional......................................... 62
Section 8.03 Reinstatement..................................................... 63
Section 8.04 Certain Additional Waivers........................................ 64
Section 8.05 Remedies.......................................................... 64
Section 8.06 Rights of Contribution............................................ 64
Section 8.07 Continuing Guarantee.............................................. 65
ARTICLE IX SECURITY 65
Section 9.01 Priority and Liens................................................ 65
ARTICLE X THE ADMINISTRATIVE AGENT 66
Section 10.01 Appointment....................................................... 66
Section 10.02 Delegation of Duties.............................................. 67
Section 10.03 Exculpatory Provisions............................................ 67
Section 10.04 Reliance On Communications........................................ 67
Section 10.05 Notice of Default................................................. 68
Section 10.06 Non-Reliance On Administrative Agent and Other Lenders............ 68
Section 10.07 Indemnification................................................... 69
Section 10.08 Administrative Agent In Its Individual Capacity................... 69
Section 10.09 Successor Administrative Agent.................................... 69
ARTICLE XI MISCELLANEOUS 70
Section 11.01 Notices........................................................... 70
Section 11.02 Right of Set-Off.................................................. 71
Section 11.03 Benefit of Agreement.............................................. 72
Section 11.04 No Waiver; Remedies Cumulative.................................... 74
Section 11.05 Payment of Expenses; Indemnification.............................. 74
Section 11.06 Amendments, Waivers and Consents.................................. 75
Section 11.07 Counterparts...................................................... 76
Section 11.08 Headings.......................................................... 76
Section 11.09 Survival.......................................................... 76
Section 11.10 Governing Law; Submission to Jurisdiction; Venue.................. 77
Section 11.11 Severability...................................................... 77
Section 11.12 Entirety.......................................................... 77
Section 11.13 Binding Effect; Termination....................................... 77
Section 11.14 Confidentiality................................................... 78
Section 11.15 Source of Funds................................................... 79
Section 11.16 Conflict.......................................................... 79
Section 11.17 Limitation on Liability........................................... 79
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Section 11.18 No Novation, Etc.................................................. 80
SCHEDULES
Schedule I Commitments
Schedule II Existing Liens
Schedule III Equipment Sold
Schedule 4.02 No Changes
Schedule 4.08 Liens
Schedule 4.14(a) Subsidiaries
Schedule 4.14(b) Guarantors
Schedule 4.18 Bank Accounts
Schedule 11.01 Lenders' Addresses
EXHIBITS
Exhibit A-1 Form of Tranche A Note
Exhibit A-2 Form of Tranche B Note
Exhibit B Form of Notice of Borrowing
Exhibit C Form of Joinder Agreement
Exhibit D Form of Interim DIP Financing Order
Exhibit E Form of Compliance Certificate
Exhibit F Form of Assignment and Acceptance
Exhibit G Form of Letter of Credit
Exhibit H Form of Amendment Order
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DEBTOR-IN-POSSESSION TRANSIT REVOLVING CREDIT AGREEMENT, dated as of
October 5, 2001, and amended and restated as of March 8, 2002, by and among
RAILWORKS CORPORATION, a Delaware corporation, as a debtor and
debtor-in-possession under Chapter 11 of the Bankruptcy Code (as hereinafter
defined) (the "Borrower"), the lenders from time to time party hereto (each a
"Lender" and collectively, the "Lenders"), the Guarantors (as hereinafter
defined), CREDIT SUISSE FIRST BOSTON, NEW YORK BRANCH, as issuer (in such
capacity, the "Issuer"), and CSFB GLOBAL OPPORTUNITIES ADVISERS, LLC ("CSFB"),
as administrative agent (in such capacity, the "Administrative Agent"),
W I T N E S S E T H
WHEREAS, on September 20, 2001 (the "Filing Date"), the Borrower and
its Domestic Subsidiaries (as hereinafter defined) each filed a voluntary
petition for relief (collectively, the "Bankruptcy Cases") under Chapter 11 of
the Bankruptcy Code with the United States Bankruptcy Court for the District of
Maryland (Baltimore Division) (the "Bankruptcy Court"); and
WHEREAS, in connection with the filing of the Bankruptcy Cases, the
Borrower made a promissory note in favor of CSFB, as agent for one or more
financial institutions, in the aggregate principal amount of $10,000,000,
evidencing an emergency loan made in such amount by such financial institutions
to the Borrower (the "Emergency Loan"); and
WHEREAS, the Credit Parties (as hereinafter defined) continue to
operate their businesses pursuant to Sections 1107 and 1108 of the Bankruptcy
Code; and
WHEREAS, the Credit Parties have an immediate need for funds to
continue to operate their businesses and the Credit Parties have been unable to
obtain sufficient unsecured credit or to incur sufficient unsecured debt from
any other source sufficient to continue their business operations; and
WHEREAS, the Borrower has requested that the Lenders extend credit to
the Borrower through a post-petition financing facility in an aggregate
principal amount of up to $45,000,000; and
WHEREAS, the Credit Parties have agreed to secure their obligations
hereunder with first priority liens on and security interests in, subject to
specified exceptions, all of their respective real, personal and intangible
property (other than Excluded Assets (as hereinafter defined)), in accordance
with Sections 364(c) and 364(d) of the Bankruptcy Code; and
WHEREAS, pursuant to Section 364(c)(1) of the Bankruptcy Code, the
Credit Parties agree and acknowledge that their obligations arising hereunder
shall constitute allowed administrative expense claims in the Bankruptcy Cases,
having priority over all administrative expenses of the kind specified in
Sections 503(b) and 507(b) of the Bankruptcy Code, except the claims
specifically granted priority under the terms of this Agreement and the interim
and final orders relating thereto; and
WHEREAS, the Lenders have indicated their willingness to agree to lend
such amounts to the Borrower pursuant to Sections 364(c)(1), (2) and (3) and
Section 364(d)(1) of the Bankruptcy Code on the terms and conditions of this
Agreement; and
WHEREAS, on October 5, 2001, the Borrower, the guarantors from time to
time party thereto, the lenders named therein (the "Bank Lenders") and Bank of
America, N.A., as administrative agent, entered into that certain the
Debtor-in-Possession Financing Agreement (the "TP&S Revolving Credit
Agreement"), pursuant to which, among other things, the Bank Lenders provided a
secured super-priority revolving credit facility to the Borrower in an
aggregate principal amount not to exceed $35,000,000, for the purposes
specified therein; and
WHEREAS, on October 5, 2001, the Borrower, Travelers Casualty & Surety
Company of America and certain subsidiaries of the Borrower entered into that
certain Transit Debtor-in-Possession Bond Facility (the "Bond Credit
Agreement"), pursuant to which, among other things, Travelers (as hereinafter
defined) provided a facility for the issuance of surety bonds in an aggregate
principal amount of up to $100,000,000 for the purposes specified therein; and
WHEREAS, on October 5, 2001, the Borrower, the lenders from time to
time party thereto (the "Bond Support Lenders"), the guarantors from time to
time party thereto, any issuer of letters of credit party thereto and CSFB, as
administrative agent, entered into that certain Debtor-in-Possession Bond
Support Credit Agreement (the "Bond Support Credit Agreement"), pursuant to
which, among other things, the Bond Support Lenders provided a super-priority
(a) term loan facility and (b) letter of credit facility, in an aggregate
principal amount of up to $40,000,000 for the purposes specified therein; and
WHEREAS, on October 5, 2001, the Borrower, the Lenders, the guarantors
named therein, and the Administrative Agent entered into that certain
Debtor-in-Possession Transit Revolving Credit Agreement (the "Original Transit
Credit Agreement"); and
WHEREAS, each of the parties to the Original Transit Credit Agreement
and the Issuer desire to amend the Original Transit Credit Agreement and to
restate the Original Transit Credit Agreement in its entirety;
NOW, THEREFORE, in consideration of the premises and the covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree that the Original Transit Credit Agreement is amended and restated
in its entirety as follows:
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ARTICLE I
DEFINITIONS
Section 1.01 Definitions.
As used in this Agreement, the following terms shall have the meanings
specified below unless the context otherwise requires:
"Acquisition" means any transaction in which any Credit Party directly
or indirectly (a) acquires any Property with which an ongoing business is
conducted or is to be conducted, (b) acquires all or substantially all of the
assets of any Person or division thereof, whether through a purchase of assets,
merger or otherwise, (c) acquires (in one transaction or as the most recent
transaction in a series of transactions) control of at least a majority of the
Voting Stock of a corporation, other than the acquisition of Voting Stock of a
wholly-owned Subsidiary solely in connection with the organization and
capitalization of that Subsidiary by such Credit Party, or (d) acquires control
of more than 50% ownership interest in any Person.
"Administrative Agent" has the meaning specified in the preamble
hereto.
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such Person. For purposes of this definition, "control"
when used with respect to any Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agreement" means this Debtor-in-Possession Transit Revolving Credit
Agreement, together with all Exhibits and Schedules hereto, as the same may be
amended, supplemented, restated or otherwise modified from time to time.
"AIG" means American International Group.
"Amendment Order" means the order entered by the Bankruptcy Court on
February 4, 2002, authorizing and approving this Amended and Restated
Debtor-In-Possession Transit Revolving Credit Agreement and the transactions
contemplated hereby, which order shall be substantially in the form of Exhibit
H and shall otherwise be in form and substance satisfactory to the Lenders and
the Administrative Agent.
"Bank Administrative Agent" means the "Administrative Agent" under the
TP&S Revolving Credit Agreement and any successor thereto.
"Bank Lenders" has the meaning specified in the recitals hereto.
"Bankruptcy Cases" has the meaning specified in the recitals hereto.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
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"Bankruptcy Court" has the meaning specified in the recitals hereto.
"Bond Credit Agreement" has the meaning specified in the recitals
hereto.
"Bond Support Administrative Agent" means the "Administrative Agent"
under the Bond Support Credit Agreement and any successor thereto.
"Bond Support Credit Agreement" has the meaning specified in the
recitals hereto.
"Bond Support Lenders" has the meaning specified in the recitals
hereto.
"Borrower" has the meaning specified in the preamble hereto.
"Borrowing" means Loans made on the same date.
"Business Day" means a day other than a Saturday, Sunday or other day
on which commercial banks in Baltimore, Maryland or New York, New York are
authorized or required by law to close.
"Business Plan" has the meaning set forth in Section 5.01(d)(vi).
"Businesses" has the meaning specified in Section 4.16(a).
"Capital Expenditures" means, as applied to any Person for any period,
any capital expenditures of such Person determined in accordance with GAAP for
such period.
"Capital Lease" means, as applied to any Person, any lease of any
Property by that Person as lessee which, in accordance with GAAP, is or should
be accounted for as a capital lease on the balance sheet of that Person.
"Capital Lease Obligation" means the capital lease obligations
relating to a Capital Lease determined in accordance with GAAP.
"Capital Stock" means (a) in the case of a corporation, capital stock,
(b) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (c) in the case of a partnership, partnership interests (whether
general or limited), (d) in the case of a limited liability company, membership
interests and (e) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Carve-Out" has the meaning specified in Section 9.01(a).
"Cash Equivalents" means (a) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than twelve months from the date of acquisition, (b) U.S. Dollar denominated
time deposits and certificates of deposit of (i) any Lender or (ii) any
domestic commercial bank of recognized standing (y) having capital and surplus
in excess of $500,000,000 and (z) whose
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short-term commercial paper rating from S&P is at least A-1 or the equivalent
thereof or from ▇▇▇▇▇'▇ is at least P-1 or the equivalent thereof (any such
bank being an "Approved Bank"), in each case with maturities of not more than
270 days from the date of acquisition, (c) commercial paper and variable or
fixed rate notes issued by any Approved Bank (or by the parent company thereof)
or any variable rate notes issued by, or guaranteed by, any domestic
corporation rated A-1 (or the equivalent thereof) or better by S&P or P-1 (or
the equivalent thereof) or better by Moody's and maturing within six months of
the date of acquisition, (d) repurchase agreements entered into by a Person
with a bank or trust company (including any of the Lenders) or recognized
securities dealer having capital and surplus in excess of $500,000,000 for
direct obligations issued by or fully guaranteed by the United States of
America in which such Person shall have a perfected first priority security
interest (subject to no other Liens) and having, on the date of purchase
thereof, a fair market value of at least 100% of the amount of the repurchase
obligations, (e) obligations of any State of the United States or any political
subdivision thereof, the interest with respect to which is exempt from federal
income taxation under Section 103 of the Internal Revenue Code, having a long
term rating of at least AA- or Aa-3 by S&P or Moody's, respectively, and
maturing within three years from the date of acquisition thereof, (f)
Investments in municipal auction preferred stock (i) rated AAA (or the
equivalent thereof) or better by S&P or Aaa (or the equivalent thereof) or
better by Moody's and (ii) with dividends that reset at least once every 365
days, (g) Investments, classified in accordance with GAAP as current assets, in
money market investment programs registered under the Investment Company Act of
1940, as amended, which are administered by reputable financial institutions
having capital of at least $100,000,000 and the portfolios of which are limited
to Investments of the character described in the foregoing subdivisions (a)
through (f), and (h) other Investments deemed to be cash equivalents in
accordance with GAAP.
"Cass County Contract" means that certain agreement, dated as of
September 21, 1999, by and among Neosho Construction Company, Incorporated and
the Texas Department of Transportation, Cass County, which has been bonded by
Reliance (Travelers), bond number B2968607 and which has an estimated loss of
$1,132,000 as determined by the Borrower's management.
"Change of Control" means the occurrence of either of the following
events: (a) any "person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act), other than a trustee or other fiduciary holding securities
under an employee benefit plan of the Borrower, a corporation owned directly or
indirectly by the stockholders of the Borrower or any of their respective
Affiliates, becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Borrower
representing 50% or more of the total voting power represented by the
Borrower's then outstanding securities that vote generally in the election of
directors; or (b) during any period of two consecutive years, individuals who
at the beginning of such period constitute the Borrower's Board of Directors
and any new directors whose election by the Borrower's Board of Directors or
nomination for election by the Borrower's stockholders was approved by a vote
or a majority of the directors then still in office who either were directors
at the beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority of the
Borrower's Board of Directors.
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"Closing Date" means the date on which the conditions specified in
Sections 3.01 and 3.02 are satisfied (or waived in accordance with Section
11.06).
"Collateral" means the Property subject to the security interests and
liens granted to the Administrative Agent under this Agreement and the other
Credit Documents.
"Collateral Documents" means the Pledge Agreement, the Security
Agreement and any other document or instrument executed and delivered by a
Person granting a Lien on any of its property to secure payment of the
Obligations.
"Commitment" means, with respect to any Lender, the sum of such
Lender's Tranche A Commitment and Tranche B Commitment.
"Consolidated Capital Expenditures" means, for any period for the
Consolidated Group, capital expenditures determined on a consolidated basis in
accordance with GAAP for such period.
"Consolidated Group" means the Borrower and its consolidated
subsidiaries as determined in accordance with GAAP.
"Consultant" has the meaning specified in Section 5.07(d).
"Contractual Obligation" means, as to any Credit Party, any provision
of any security issued by such Credit Party or of any material agreement,
instrument or undertaking to which such Credit Party is a party or by which it
or any of its property is bound.
"Credit Documents" means, collectively, this Agreement, the Notes,
each Joinder Agreement, the Collateral Documents, the Letter of Credit
Documents, and all other related agreements and documents issued or delivered
hereunder or thereunder or pursuant hereto or thereto.
"Credit Party" means any of the Borrower and the Guarantors.
"Crisis Manager" has the meaning specified in Section 5.07(e).
"CSFB" has the meaning specified in the preamble hereto.
"Default" means any event, act or condition which with notice or lapse
of time, or both, would constitute an Event of Default.
"DIP Financing Order" means the Interim DIP Financing Order, the Final
DIP Financing Order or the Amendment Order, as applicable.
"Divestiture" means any transaction by which any member of the Transit
Group sells, leases, transfers or otherwise disposes of (a) any Property or (b)
the Capital Stock of a member of the Transit Group, in each case other than (i)
the sale of inventory in the ordinary course of business, (ii) the sale, lease,
transfer or other disposition of plant, property and equipment which is no
longer used or useful in the business of the members of the Transit Group, (iii)
the sale,
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lease, transfer or other disposition of plant, property and equipment to the
extent that the Net Cash Proceeds thereof are (A) deposited into a cash
collateral account maintained by the Administrative Agent and (B) reinvested in
similar property of at least equal collateral value within six (6) months of
the date of such sale, lease, transfer or other disposition (and such
reinvested amounts shall constitute Capital Expenditures for purposes of this
Agreement), and (iv) the sale, lease, transfer or other disposition of Property
or Capital Stock of a member of the Transit Group to a Domestic Credit Party.
"Dollars" and "$" means dollars in lawful currency of the United
States of America.
"Domestic Credit Party" means any Credit Party that is incorporated or
organized under the laws of any State of the United States or the District of
Columbia.
"Domestic Subsidiary" means any Subsidiary that is incorporated or
organized under the laws of any State of the United States or the District of
Columbia.
"Effective Date" has the meaning specified in Section 3.03.
"Emergency Loan" has the meaning specified in the recitals hereto.
"Environmental Laws" means any and all lawful and applicable federal,
state, local and foreign statutes, laws, regulations, ordinances, rules,
judgments, orders, decrees, permits, concessions, grants, franchises, licenses,
agreements or other governmental restrictions relating to the environment or to
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes
into the environment including, without limitation, ambient air, surface water,
ground water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes.
"Equity Transaction" means, with respect to any Credit Party, any
issuance of shares of its Capital Stock, other than (a) an issuance by a
Guarantor to a Domestic Credit Party, (b) an issuance in connection with a
conversion of debt securities to equity, (c) an issuance in connection with the
exercise by a present or former employee, officer or director under a stock
incentive plan, stock option plan or other equity-based compensation plan or
arrangement or (d) an issuance needed to qualify directors under applicable law.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations thereunder, all as the same may be in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
"ERISA Affiliate" means an entity which is under common control with
any Credit Party or any of its Subsidiaries within the meaning of Section
4001(a)(14) of ERISA, or is a member of a group which includes any Credit Party
or any of its Subsidiaries and which is treated as a single employer under
Sections 414(b) or (c) of the Internal Revenue Code.
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"ERISA Event" means (a) with respect to any Plan, the occurrence of a
Reportable Event or the substantial cessation of operations (within the meaning
of Section 4062(e) of ERISA); (b) the withdrawal by any Credit Party or any of
its Subsidiaries or any ERISA Affiliate from a Multiple Employer Plan during a
plan year in which it was a substantial employer (as such term is defined in
Section 4001(a)(2) of ERISA), or the termination of a Multiple Employer Plan;
(c) the distribution of a notice of intent to terminate or the actual
termination of a Plan pursuant to Section 4041(a)(2) or 4041A of ERISA; (d) the
institution of proceedings to terminate or the actual termination of a Plan by
the PBGC under Section 4042 of ERISA; (e) any event or condition which would
reasonably be expected to constitute grounds under Section 4042 of ERISA for
the termination of, or the appointment of a trustee to administer, any Plan;
(f) the complete or partial withdrawal of any Credit Party or any of its
Subsidiaries or any ERISA Affiliate from a Multiemployer Plan; (g) the
conditions for imposition of a lien under Section 302(f) of ERISA exist with
respect to any Plan; or (h) the adoption of an amendment to any Plan requiring
the provision of security to such Plan pursuant to Section 307 of ERISA.
"Event of Default" has the meaning specified in Section 7.01.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Assets" means (a) avoidance actions (and proceeds thereof)
under Chapter 5 of the Bankruptcy Code other than actions under Section 549
thereof and (b) the percentage of the Capital Stock of Foreign Subsidiaries
that are members of the Transit Group that is not pledged under the Pledge
Agreement.
"Expense Account" has the meaning specified in Section 5.11(c).
"Facilities" has the meaning specified in Section 4.16(a).
"Federal Funds Rate" means, for any day, the rate of interest per
annum (rounded upwards, if necessary, to the nearest whole multiple of 1/100 of
1%) equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of 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 and (b) if no such rate is
so published on such next preceding Business Day, the Federal Funds Rate for
such day shall be the average rate quoted to the Administrative Agent on such
day on such transactions as determined by the Administrative Agent.
"Filing Date" has the meaning specified in the recitals hereto.
"Final DIP Financing Order" means the final order entered by the
Bankruptcy Court on October 24, 2001 authorizing and approving the Credit
Documents, the Financing Agreements and in each case, the transactions
contemplated thereby, which shall include, without limitation, the provisions
included in the Interim DIP Financing Order and shall be in a form satisfactory
to the Administrative Agent and the Lenders in their sole discretion.
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"Financing Agreements" means, collectively, (a) the "Credit
Documents", as defined in the TP&S Revolving Credit Agreement, (b) the Bond
Credit Agreement, the Bonds (as defined therein) and all other agreements and
documents issued or delivered thereunder and (c) the "Credit Documents", as
defined in the Bond Support Credit Agreement.
"Forecast" has the meaning specified in Section 5.01(c)(iii)(A).
"Foreign Subsidiary" means a Subsidiary that is not a Domestic
Subsidiary.
"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to the terms of Section 1.03.
"General Corporate Overhead Expenses" means the expenses of the
corporate office that are not specifically allocable to either the Transit
Group or the TP&S Group.
"General Restructuring Costs" are the restructuring costs that are not
specifically allocable to either the Transit Group or the TP&S Group.
"Governmental Authority" means any federal, state, local or foreign
court or governmental agency, authority, instrumentality or regulatory body.
"Guaranteed Obligations" means, as to each Guarantor, without
duplication, all obligations of the Borrower to the Lenders, the Issuer and the
Administrative Agent, whenever arising, under this Agreement, the Notes or the
other Credit Documents.
"Guarantor" means each of those Persons identified as a "Guarantor" on
the signature pages hereto and each other Person which may hereafter become a
Guarantor by execution of a Joinder Agreement, together with its successors and
permitted assigns.
"Indebtedness" means, with respect to any Person, (a) all obligations
of such Person for borrowed money, (b) all obligations of such Person evidenced
by bonds, debentures, notes or similar instruments, or upon which interest
payments are customarily made, (c) all obligations of such Person under
conditional sale or other title retention agreements relating to Property
purchased by such Person (other than customary reservations or retentions of
title under agreements with suppliers entered into in the ordinary course of
business), (d) all obligations of such Person issued or assumed as the deferred
purchase price of Property or services purchased by such Person (other than
trade debt incurred in the ordinary course of business and due within six
months of the incurrence thereof) which would appear as liabilities on a
balance sheet of such Person, (e) all obligations of such Person under
take-or-pay or similar arrangements or under commodities agreements, (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on,
or payable out of the proceeds of production from, Property owned or acquired
by such Person, whether or not the obligations secured thereby have been
assumed, provided that for purposes hereof the amount of such Indebtedness
shall be limited to the greater of (i) the amount of such Indebtedness as to
which there is recourse to such Person and (ii) the fair market value of the
Property which is subject to the Lien, (g) all Support Obligations of such
Person, (h) the principal portion of all obligations of such Person under
Capital Leases, (i) all obligations of such Person in respect of interest rate
protection agreements, foreign currency exchange
9
agreements, commodity purchase or option agreements or other interest or
exchange rate or commodity price hedging agreements, (j) the maximum amount of
all standby letters of credit issued or bankers' acceptances facilities created
for the account of such Person and, without duplication, all drafts drawn
thereunder (to the extent unreimbursed), (k) all preferred stock issued by such
Person and required by the terms thereof to be redeemed, or for which mandatory
sinking fund payments are due, by a fixed date, (l) the outstanding attributed
principal amount under any Securitization Transaction and (m) the principal
balance outstanding under any synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing product to which
such Person is a party, where such transaction is considered borrowed money
indebtedness for tax purposes but is classified as an operating lease in
accordance with GAAP ("Synthetic Leases"). The Indebtedness of any Person shall
include the Indebtedness of any partnership or joint venture in which such
Person is a general partner or a joint venturer, but only to the extent to
which there is recourse to such Person for payment of such Indebtedness.
"Indemnitee" has the meaning specified in Section 11.05(b).
"Information" has the meaning specified in Section 11.14.
"Initial Transit Budget" has the meaning specified in Section
5.01(d)(iv).
"Intellectual Property" means all Copyrights, Copyright Licenses,
Patents, Patent Licenses, Trademarks and Trademark Licenses, as each of those
terms are defined in the Security Agreement.
"Interim DIP Financing Order" means the interim order entered by the
Bankruptcy Court on October 5, 2001 authorizing and approving, subject to the
approval of the Final DIP Financing Order, the Credit Documents and the
transactions contemplated hereby, which order shall be substantially in the
form of Exhibit D and shall otherwise be in form and substance satisfactory to
the Lenders and the Administrative Agent.
"Interim Period" means the period commencing on the date of entry of
the Interim DIP Financing Order and ending on the earlier of (i) 45 days
thereafter and (ii) the date of entry of the Final DIP Financing Order by the
Bankruptcy Court.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations issued thereunder, in each case as in effect from time to time.
References to sections of the Internal Revenue Code shall be construed also to
refer to any successor sections.
"Investment", in any Person, means any loan or advance to such Person,
any purchase or other acquisition of any Capital Stock, warrants, rights,
options, obligations or other securities of, or equity interest in, such
Person, any capital contribution to such Person or any other investment in such
Person, including, without limitation, any Support Obligation incurred for the
benefit of such Person.
"Issuer" has the meaning specified in the preamble hereto.
10
"Joinder Agreement" means a joinder agreement substantially in the
form of Exhibit C hereto executed and delivered by a Domestic Subsidiary which
is a member of the Transit Group in accordance with the provisions of Section
5.09(a).
"Lenders" has the meaning specified in the preamble hereto.
"Letter of Credit" means a standby letter of credit, issued by the
Issuer in favor of AIG or its Affiliates in accordance with Section 2.01(b),
substantially in the form of Exhibit G.
"Letter of Credit Documents" means the Letter of Credit, any
amendments thereto, any documents delivered in connection therewith, any
application therefor, and any agreements, instruments, guarantees or other
documents (whether general in application or applicable only to the Letter of
Credit) governing or providing for (a) the rights and obligations of the
parties concerned or at risk or (b) any collateral security for such
obligations.
"Letter of Credit Obligations" means, at any time, the sum of (a) the
maximum amount which is, or at any time thereafter may become, available to be
drawn under the Letter of Credit, assuming compliance with all requirements for
drawings referred to in the Letter of Credit plus (b) the aggregate amount of
all drawings under the Letter of Credit honored by the Issuer but not
theretofore reimbursed.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or otherwise),
preference, priority or charge of any kind (including any agreement to give any
of the foregoing, any conditional sale or other title retention agreement, and
any lease in the nature thereof).
"Loans" means, collectively, the Tranche A Loans and the Tranche B
Loans.
"Majority Lenders" means, at any time, Lenders holding more than 50%
of the then aggregate unpaid principal amount of the Loans or, if no Loans are
then outstanding, Lenders having more than 50% of the aggregate Commitments.
"Material Adverse Effect" means a material adverse effect on (a) the
condition (financial or otherwise), operations, business, prospects, assets or
liabilities of the Credit Parties taken as a whole, (b) the ability of the
Credit Parties taken as a whole to perform any obligation under the Credit
Documents, (c) the legality, validity or enforceability of any Credit Document,
(d) the perfection or priority of the Liens granted pursuant hereto and the
other Credit Documents or (e) the rights and remedies of the Lenders under the
Credit Documents or the DIP Financing Order.
"Material Pleading" means any of the following items filed with the
Bankruptcy Court (a) a plan of reorganization, (b) a disclosure statement with
respect to a plan of reorganization, (c) a motion to extend the Credit Parties'
exclusive right to file a plan of reorganization and solicit acceptances in
connection thereto, (d) a motion, under Section 363 of the Bankruptcy Code, to
sell, lease or otherwise dispose of an asset or assets of the estate in an
amount not to exceed $1,000,000 for any sale, lease or other disposition and
$5,000,000 in the aggregate for all sales, leases and other dispositions, (e) a
motion, under Section 363 of the Bankruptcy Code, to implement, adopt or revise
an employee retention, severance or similar program, (f) a motion, under
Section 364 of the Bankruptcy Code, for any "debtor-in-possession financing"
(other than
11
the debtor-in-possession financing authorized in the DIP Financing Order) that
does not provide for the repayment in full of the Obligations on the date the
first loan is made under such other financing, (g) a motion, under Section 105
of the Bankruptcy Code, to substantively consolidate (A) the estate of the
Borrower with the estate of any other member of the Consolidated Group or (B)
the estate of any Guarantor with the estate of any member of the Consolidated
Group that is not a Guarantor, and (h) any other pleading that would impair, or
would have the effect of impairing, the Borrower's ability to repay its
obligations arising hereunder or under the DIP Financing Order.
"Materials of Environmental Concern" means any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as
such in or under any Environmental Laws, including, without limitation,
asbestos, polychlorinated biphenyls and urea-formaldehyde insulation.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., or any successor or
assignee of the business of such company in the business of rating securities.
"Multiemployer Plan" means a Plan which is a multiemployer plan as
defined in Sections 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which any Credit Party or any of
its Subsidiaries or any ERISA Affiliate and at least one employer other than
any Credit Party or any of its Subsidiaries or any ERISA Affiliate are
contributing sponsors.
"Net Cash Proceeds" means the aggregate proceeds paid in cash or Cash
Equivalents received by any Credit Party in respect of any Divestiture, net of
(a) direct costs (including, without limitation, legal, accounting and
investment banking fees, and sales commissions) paid or payable as a result
thereof, (b) taxes paid or payable as a result thereof, (c) repayment of
Indebtedness that is required to be repaid in connection with such Divestiture,
and (d) appropriate amounts to be provided by such Credit Party as a reserve,
in accordance with GAAP, against liabilities associated with such Divestiture
and retained by such Credit Party after such Divestiture, including, without
limitation, pension and other post-employment benefit liabilities, liabilities
related to environmental matters and liabilities under any indemnification
obligations associated with such Divestiture; provided that "Net Cash Proceeds"
shall include an amount equal to any reserves previously taken against
liabilities associated with Divestitures immediately upon those reserves being
determined to be in excess of such liabilities. The "Net Cash Proceeds" shall
also include, without limitation, any cash or Cash Equivalents received upon
the sale or other disposition of any non-cash consideration received by any
Credit Party.
"Notes" means, collectively, the Tranche A Notes and the Tranche B
Notes.
"Notice of Borrowing" has the meaning specified in Section 2.02(a).
"Obligations" means the Loans, the Letter of Credit Obligations, the
Notes and all other advances, debts, liabilities, obligations, covenants and
duties owing by the Borrower and each of the Guarantors to the Administrative
Agent, any Lender, any Affiliate of any of them or any Indemnitee, of every
type and description, present or future, whether or not evidenced by any note,
Joinder Agreement or other instrument, arising under this Agreement or under
any other
12
Credit Document, whether or not for the payment of money, loan, guaranty,
indemnification or in any other manner, whether direct or indirect (including,
without limitation, those acquired by assignment), absolute or contingent, due
or to become due, now existing or hereafter arising and however acquired. The
term "Obligations" includes, without limitation, all interest, charges,
expenses, fees, attorneys' fees and disbursements and any other sum chargeable
to any of the Credit Parties under this Agreement or any other Credit Document.
"Operating Lease" means, as applied to any Person, any lease
(including, without limitation, leases which may be terminated by the lessee at
any time) of any Property which is not a Capital Lease other than any such
lease in which that Person is the lessor.
"Other Taxes" has the meaning specified in Section 2.13(b).
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA and any successor thereof.
"Permitted Expenses" means any fees or expenses paid by any Credit
Party in accordance with the DIP Financing Order and as otherwise allowed by
the Bankruptcy Court.
"Permitted Investments" means Investments which are (a) Investments
that are approved by the Bankruptcy Court; (b) cash and Cash Equivalents; (c)
accounts receivable created, acquired or made in the ordinary course of
business and payable or dischargeable in accordance with customary trade terms;
(d) Investments consisting of stock, obligations, securities or other property
received in settlement of accounts receivable (created in the ordinary course
of business) from obligors; (e) Support Obligations permitted by Section 6.01;
(f) Investments existing on the Filing Date made by the Borrower or any other
Credit Party in or to its Subsidiaries; and (g) Investments by any Credit Party
in and to a Domestic Credit Party.
"Permitted Liens" means:
(a) Liens in favor of the Pre-Petition Agents and the Pre-Petition
Lenders in connection with the Pre-Petition Credit Facility, and any adequate
protection liens granted thereto pursuant to the Interim DIP Financing Order
and the Final DIP Financing Order;
(b) the Carve-Out and the UST/Clerk Fees;
(c) Liens relating to periods or arising after the Filing Date (other
than Liens created or imposed under ERISA) for taxes, assessments or
governmental charges or levies not yet due or Liens for taxes being contested
in good faith by appropriate proceedings for which adequate reserves determined
in accordance with GAAP have been established (and as to which the Property
subject to any such Lien is not yet subject to foreclosure, sale or loss on
account thereof);
(d) Liens in respect of Property imposed by law arising in the
ordinary course of business such as materialmen's, mechanics', warehousemen's,
carriers', suppliers', landlords', and other like Liens provided that (i) for
any such Liens arising before the Filing Date, the enforcement and collection
of such Liens is stayed by section 362 of the Bankruptcy Code, and (ii) for any
such Liens arising after the Filing Date, such Liens secure only amounts not
overdue
13
for a period of more than 30 days or are being contested in good faith by
appropriate proceedings for which adequate reserves determined in accordance
with GAAP have been established (and as to which the Property subject to any
such Lien is not yet subject to foreclosure, sale or loss on account thereof);
(e) Liens (other than Liens created or imposed under ERISA)
consisting of deposits made by the Borrower and its Subsidiaries in the
ordinary course of business in connection with, or to secure payment of,
obligations under workers' compensation, unemployment insurance, social
security and other similar laws, or to secure the performance of tenders,
statutory obligations, bids, leases, government contracts, performance and
return-of-money bonds and other similar obligations (exclusive of obligations
for the payment of borrowed money);
(f) Liens in connection with attachments or judgments (including
judgment or appeal bonds) provided that the judgments secured shall, within 30
days after the entry thereof, have been discharged or execution thereof stayed
pending appeal, or shall have been discharged within 30 days after the
expiration of any such stay;
(g) easements, rights-of-way, restrictions (including zoning
restrictions), minor defects or irregularities in title and other similar
charges or encumbrances not, in any material respect, impairing the use of the
encumbered Property for its intended purposes;
(h) Liens securing purchase money Indebtedness (including Capital
Leases) to the extent permitted under Section 6.01(d) provided that any such
Lien attaches only to the Property financed and such Lien attaches thereto
concurrently with or within 90 days after the acquisition thereof in connection
with the purchase money transactions;
(i) leases or subleases granted to others not interfering in any
material respect with the business of the Borrower or any Subsidiary;
(j) any interest of title of a lessor under, and Liens arising from
UCC financing statements (or equivalent filings, registrations or agreements in
foreign jurisdictions) relating to, leases permitted by this Agreement;
(k) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;
(l) Liens deemed to exist in connection with Investments in
repurchase agreements permitted under Section 6.05;
(m) the equitable interests of any surety validly acquired by right
of subrogation or under applicable non-bankruptcy law to the extent such
interests (i) are senior to those of the Credit Parties and the liens granted
in connection with the Pre-Petition Credit Facility and (ii) have not been
waived or released by Travelers as provided in the Interim DIP Financing Order
or the Final DIP Financing Order;
(n) Liens that are perfected (but not granted) after the Filing Date
to the extent such post-petition perfection is permitted under the Bankruptcy
Code and which are superior under applicable law to liens granted in connection
with the Pre-Petition Credit Facility;
14
(o) normal and customary rights of setoff upon deposits of cash in
favor of banks or other depository institutions;
(p) Liens in respect of Indebtedness permitted under Section 6.01(f),
limited solely to sums payable under the policy or policies to which such
Indebtedness relates;
(q) Liens existing as of the Filing Date and set forth on Schedule
II; provided that no such Lien shall at any time be extended to or cover any
Property other than the Property subject thereto on the Closing Date;
(r) Liens in favor of (i) the Bond Support Administrative Agent
granted pursuant to the Bond Support Credit Agreement and (ii) Travelers
granted pursuant to the Bond Credit Agreement;
(s) Liens created pursuant to the Credit Documents; and
(t) Senior Liens.
"Person" means any individual, partnership, firm, corporation, limited
liability company, association, trust or other enterprise or entity (whether or
not incorporated) or any Governmental Authority.
"Plan" means any employee benefit plan (as defined in Section 3(3) of
ERISA) which is covered by ERISA and with respect to which any Credit Party or
any of its Subsidiaries or any ERISA Affiliate is (or, if such plan were
terminated at such time, would under Section 4069 of ERISA be deemed to be) an
"employer" within the meaning of Section 3(5) of ERISA.
"Pledge Agreement" means a pledge agreement, in form and substance
satisfactory to the Lenders and the Administrative Agent, executed by the
Borrower, as such agreement may be amended, supplemented, restated or modified
from time to time.
"Pre-Petition Agents" means the administrative agent and the
collateral agent under the Pre-Petition Credit Facility and the documents
related thereto.
"Pre-Petition Credit Agreement" means that certain Amended and
Restated Credit Agreement, dated as of April 28, 2000, as amended, by and among
the Borrower, the guarantors party thereto, the lenders identified therein and
Bank of America, N.A., as administrative agent.
"Pre-Petition Credit Facility" means the $100 million revolving credit
facility and the $150 million term loan credit facility provided to the
Borrower pursuant to the Pre-Petition Credit Agreement.
"Pre-Petition Lenders" means the lenders party to the Pre-Petition
Credit Agreement.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by ▇.▇. ▇▇▇▇▇▇ ▇▇▇▇▇ as its "prime" or "base" rate in effect
at its principal office in New York, New York, with each change in the Prime
Rate being effective on the date such change is publicly announced as effective
(it being understood and agreed that the Prime Rate is a
15
reference rate used by ▇.▇. ▇▇▇▇▇▇ Chase in determining interest rates on
certain loans and is not intended to be the lowest rate of interest charged on
any extension of credit by ▇.▇. ▇▇▇▇▇▇ ▇▇▇▇▇ to any debtor).
"Property" means any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible.
"Ratable Portion" means, with respect to each Lender, a fraction
(expressed as a percentage) the numerator of which is the Commitment of such
Lender at such time and the denominator of which is the aggregate Commitments
of all Lenders at such time.
"Register" has the meaning specified in Section 11.03(c).
"Regulation D, O, T, U or X" means Regulation D, O, T, U or X,
respectively, of the Board of Governors of the Federal Reserve System as from
time to time in effect and any successor to all or a portion thereof.
"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping or disposing into
the environment (including the abandonment or discarding of barrels, containers
and other closed receptacles containing any Materials of Environmental Concern).
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than those events as to which the notice requirement has been
waived by regulation.
"Requirement of Law" means, as to any Person, any law, treaty, rule or
regulation or determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or any of its
material property is subject.
"Responsible Officer" means the Chief Executive Officer, the Chief
Financial Officer, the Controller, the Chief Operating Officer, the Chief
Accounting Officer and the Treasurer of the Borrower.
"Restricted Payment" by any Person means (a) any dividend or other
distribution, direct or indirect, on account of any shares of any class of stock
of such Person now or hereafter outstanding, except (i) a dividend payable
solely in shares of that class to the holders of that class and (ii) dividends
and other distributions payable to a Domestic Credit Party, (b) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of Capital Stock of such
Person now or hereafter outstanding, and (c) any payment made to retire, or to
obtain the surrender of, any outstanding warrants, options or other rights to
acquire shares of any class of Capital Stock of such Person now or hereafter
outstanding.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill,
Inc., or any successor or assignee of the business of such division in the
business of rating securities.
"SEC" means the Securities and Exchange Commission and any successor
Governmental Authority.
16
"Second Transit Budget" has the meaning specified in Section
5.01(d)(iv).
"Securitization Transaction" means any financing transaction or series
of financing transactions entered into by a Credit Party pursuant to which such
Credit Party may sell, convey or otherwise transfer to (a) a Subsidiary or
Affiliate (a "Securitization Subsidiary"), or (b) any other Person, or may grant
a security interest in, any receivables or interests therein secured by
merchandise or services financed thereby (whether such receivables are then
existing or arising in the future) of such Credit Party, and any assets related
thereto, including without limitation, all security interests in merchandise or
services financed thereby, the proceeds of such receivables, and other assets
which are customarily sold or in respect of which security interests are
customarily granted in connection with securitization transactions involving
such assets.
"Security Agreement" means an agreement, in form and substance
satisfactory to the Lenders and the Administrative Agent, executed by each
Credit Party, as such agreement may be amended, supplemented, restated or
modified from time to time.
"Senior Liens" means the Liens granted to the Administrative Agent for
and on behalf of the Lenders pursuant to this Agreement and the other Credit
Documents that have been granted secured status by the Bankruptcy Court pursuant
to sections 364(c)(2), 364(c)(3) and 364(d) of the Bankruptcy Code subject only
to (a) any statutory liens existing as of the Filing Date that by statute are
senior to the liens of the Pre-Petition Lenders, (b) any purchase money security
interests under applicable law existing as of the Filing Date which are senior
to the liens in favor of the Pre-Petition Lenders arising prior to the Filing
Date, (c) those senior liens and interests arising as a matter of law as a
result of equitable subrogation or other applicable non-bankruptcy law in favor
of Travelers, as issuer of surety bonds and as administrator for it and certain
other surety companies that have issued surety bonds on behalf of the Credit
Parties, (d) the Carve-Out and (e) UST/Clerk Fees.
"Single Employer Plan" means any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan or a Multiple Employer Plan.
"Specified Contracts" has the meaning specified in Section 4.15(a)(ii).
"Statutory Committee" has the meaning specified in Section 9.01(a).
"Subsidiary" means, as to any Person, (a) any corporation more than 50%
of whose stock of any class or classes having by the terms thereof ordinary
voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time, any class or classes of such
corporation shall have or might have voting power by reason of the happening of
any contingency) is at the time owned by such Person directly or indirectly
through Subsidiaries, and (b) any partnership, association, limited liability
company or other entity in which such Person directly or indirectly through
Subsidiaries has more than 50% of the voting interests at any time.
Notwithstanding anything herein to the contrary, the term "Subsidiary" shall not
include ▇▇▇▇▇ South, Inc., a Georgia corporation. Unless otherwise identified,
"Subsidiary" shall mean a Subsidiary of the Borrower.
"Support Obligations" means, with respect to any Person, without
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of
17
negotiable instruments for deposit or collection) guaranteeing or intended to
guarantee any Indebtedness of any other Person in any manner, whether direct or
indirect, and including without limitation any obligation, whether or not
contingent, (a) to purchase any such Indebtedness or any Property constituting
security therefor, (b) to advance or provide funds or other support for the
payment or purchase of any such Indebtedness or to maintain working capital,
solvency or other balance sheet condition of such other Person (including
without limitation keep well agreements, maintenance agreements, comfort
letters or similar agreements or arrangements) for the benefit of any holder of
Indebtedness of such other Person, (c) to lease or purchase Property,
securities or services primarily for the purpose of assuring the holder of such
Indebtedness against loss, or (d) to otherwise assure or hold harmless the
holder of such Indebtedness against loss in respect thereof, but specifically
excluding guaranties or other assurances with respect to any Credit Party's
performance obligations under bids or contracts made or entered into in the
ordinary course of business. The amount of any Support Obligation hereunder
shall (subject to any limitations set forth therein) be deemed to be an amount
equal to the outstanding principal amount (or maximum principal amount, if
larger) of the Indebtedness in respect of which such Support Obligation is made.
"Synthetic Leases" shall have the meaning assigned to such term in the
definition of "Indebtedness".
"Taxes" has the meaning specified in Section 2.13(a).
"TP&S Revolving Credit Agreement" has the meaning specified in the
recitals hereto.
"Tranche A Availability Period" means the period from the Closing Date
to the earlier of (i) the Business Day immediately preceding the Tranche A
Maturity Date, or (ii) the date on which the Tranche A Commitments are
terminated in accordance with the provisions of this Agreement.
"Tranche A Commitment" means, (a) in the case of each Tranche A Lender
that is a Tranche A Lender on the date hereof, the amount set forth opposite
such Tranche A Lender's name on Schedule I as such Tranche A Lender's "Tranche A
Commitment" and (b) in the case of any Tranche A Lender that becomes a Tranche A
Lender after the date hereof, the amount specified as such Tranche A Lender's
"Tranche A Commitment" in the Assignment and Acceptance pursuant to which such
Tranche A Lender assumed a portion of the Tranche A Commitments, in each case,
as the same may be changed from time to time pursuant to the terms hereof.
"Tranche A Lender" means each Lender that has a Tranche A Commitment
and/or has made a Tranche A Loan.
"Tranche A Loan" has the meaning specified in Section 2.01(a)(i).
"Tranche A Maturity Date" means the earliest to occur of (a) September
30, 2002, (b) the effective date of any Credit Party's plan of reorganization
and (c) the sale of the Transit Group or the sale of all or substantially all of
the Transit Group's Property.
"Tranche A Note" has the meaning specified in Section 2.06.
18
"Tranche B Availability Period" means the period from the Effective
Date to the earlier of (i) the Tranche B Maturity Date, or (ii) the date on
which the Tranche B Commitments are terminated in accordance with the provisions
of this Agreement.
"Tranche B Commitment" means, (a) in the case of each Tranche B Lender
that is a Tranche B Lender on the date hereof, the amount set forth opposite
such Tranche B Lender's name on Schedule I as such Tranche B Lender's "Tranche B
Commitment" and (b) in the case of any Tranche B Lender that becomes a Tranche B
Lender after the date hereof, the amount specified as such Tranche B Lender's
"Tranche B Commitment" in the Assignment and Acceptance pursuant to which such
Tranche B Lender assumed a portion of the Tranche B Commitments, in each case,
as the same may be changed from time to time pursuant to the terms hereof.
"Tranche B Lender" means each Lender that has a Tranche B Commitment
and/or has made a Tranche B Loan.
"Tranche B Loan" has the meaning specified in Section 2.01(a)(ii).
"Tranche B Maturity Date" means the earliest to occur of (a) December
31, 2002, (b) the effective date of any Credit Party's plan of reorganization
and (c) the sale of the Transit Group or the sale of all or substantially all of
the Transit Group's Property.
"Tranche B Note" has the meaning specified in Section 2.06.
"Transit Budget" has the meaning specified in Section 5.01(d)(iv).
"Transit Group" means, collectively, the Borrower (with respect to the
"transit" segment of its business), Guarantors and any other Domestic Subsidiary
that is part of the "transit" segment of the Borrower's business.
"Transit Payment Account" has the meaning specified in Section
5.13(a)(i).
"Transit Payment Account Agent" has the meaning specified in Section
5.13(a)(i).
"Travelers" means Travelers Casualty & Surety Company of America and
any of its Affiliates and Subsidiaries.
"UCC" means the Uniform Commercial Code, as in effect in any applicable
jurisdiction.
"United States Trustee" means the United States trustee, appointed
pursuant to 28 U.S.C. [sec] 581, for the District of Maryland.
"UST/Clerk Fees" means fees required to be paid pursuant to 28 U.S.C
ss. 1930(a)(6) and any fees payable to the Clerk of the Bankruptcy Court and any
agent thereof.
"Variance Analysis" has the meaning specified in Section
5.01(c)(iii)(B).
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"Voting Stock" means, with respect to any Person, Capital Stock issued
by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
Section 1.02 Computation of Time Periods
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding."
Section 1.03 Accounting Terms; Certain Calculations.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the
Administrative Agent or the Lenders hereunder shall be prepared, in accordance
with GAAP applied on a consistent basis. All calculations made for the purposes
of determining compliance with this Agreement shall (except as otherwise
expressly provided herein) be made by application of GAAP applied on a basis
consistent with the most recent annual or quarterly financial statements
delivered pursuant to Section 5.01; provided, however, if (a) the Borrower shall
object to determining such compliance on such basis at the time of delivery of
such financial statements due to any change in GAAP or the rules promulgated
with respect thereto or (b) the Administrative Agent or the Required Lenders
shall so object in writing within 30 days after delivery of such financial
statements, then such calculations shall be made on a basis consistent with the
most recent financial statements delivered by the Borrower to the Lenders as to
which no such objection shall have been made.
Section 1.04 Certain Terms.
(a) The words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole, and not to any particular
Article, Section, subsection or clause in this Agreement. References herein to
an Exhibit, Schedule, Article, Section, subsection or clause refer to the
appropriate Exhibit or Schedule to, or Article, Section, subsection or clause
in, this Agreement.
(b) The terms "Lender" and "Administrative Agent" include their
respective successors and the term "Lender" includes each assignee of such
Lender who becomes a party hereto pursuant to Section 11.03(b).
(c) Any definition of or reference to any agreement, instrument or
other document herein shall be construed as referring to such agreement,
instrument or other document as from time to time amended, supplemented or
otherwise modified.
ARTICLE II
THE LOANS AND LETTER OF CREDIT
Section 2.01 Loans and Letters of Credit.
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(a) Loans.
(i) Tranche A Loans. Subject to the terms and conditions set
forth herein, each Tranche A Lender severally agrees to make a loan
(each a "Tranche A Loan" and, collectively, the "Tranche A Loans") to
the Borrower, which Tranche A Loans (i) shall be made on the Closing
Date and from time to time thereafter if requested by the Borrower
pursuant to Section 2.02(a) during the Tranche A Availability Period,
(ii) may be prepaid in accordance with the provisions hereof, and once
prepaid, may be reborrowed in accordance with the terms hereof, (iii)
shall not exceed at any time outstanding for any such Tranche A Lender
the Tranche A Commitment of such Tranche A Lender and (iv) shall not
exceed at any time outstanding in the aggregate the aggregate Tranche A
Commitments of all of the Tranche A Lenders.
(ii) Tranche B Loans. Subject to the terms and conditions set
forth herein, each Tranche B Lender severally agrees to make a loan
(each a "Tranche B Loan" and, collectively, the "Tranche B Loans") to
the Borrower, which Tranche B Loans (i) shall be automatically made
from time to time pursuant to Sections 2.02(b) during the Tranche B
Availability Period, (ii) may be prepaid in accordance with the
provisions hereof, but once prepaid, may not be reborrowed, (iii) shall
not exceed at any time outstanding for any such Tranche B Lender the
Tranche B Commitment of such Tranche B Lender and (iv) shall not exceed
at any time outstanding in the aggregate the aggregate Tranche B
Commitments of all of the Tranche B Lenders.
(b) Letter of Credit. Subject to the terms and conditions set forth
herein and of the Letter of Credit Documents, if any, and such other terms and
conditions which the Issuer may reasonably require, on the Effective Date, the
Issuer shall issue the Letter of Credit solely for the purposes hereinafter set
forth; provided that the aggregate face amount of the Letter of Credit shall
not exceed the aggregate Tranche B Commitments of all of the Tranche B Lenders.
The Letter of Credit shall be used solely by the Borrower to secure its
reimbursement obligations to AIG or its Affiliates in respect of the Borrower's
automobile, general liability and workers' compensation insurance policies
issued by AIG or its Affiliates for the 2002 policy year.
Section 2.02 Method of Borrowing and Issuance.
(a) Each Borrowing of Tranche A Loans subsequent to the Closing Date
shall be made on notice, given by the Borrower to the Administrative Agent not
later than 11:00 A.M. (New York City time) on the Business Day prior to the
date of the proposed Borrowing. Each such notice (a "Notice of Borrowing")
shall be in substantially the form of Exhibit B, specifying therein (a) the
date of such proposed Borrowing and (b) the aggregate amount of such proposed
Borrowing, accompanied by a description in reasonable detail of the proposed
use of proceeds of such Borrowing; provided that each Borrowing shall be in an
aggregate amount of not less than $1,000,000 or an integral multiple of
$1,000,000 in excess thereof. Each Notice of Borrowing shall be irrevocable and
binding on the Borrower. The Borrower may not request more than four Borrowings
of Tranche A Loans in any month.
(b) The Issuer shall send to the Administrative Agent, simultaneously
with the sending thereof to the Borrower, a notice of each draw made under the
Letter of Credit and
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demand for reimbursement therefor on the day such draw is made. If the Borrower
shall not have reimbursed the Issuer in respect of any draw under the Letter of
Credit in accordance with Section 2.15(b), then, on the day such draw is made,
without further action on the part of the Borrower, and subject to the
availability of the Tranche B Commitments, the Borrower shall be deemed to have
made an irrevocable request for a Borrowing of Tranche B Loans in an amount
sufficient to pay such amounts due and payable to the Issuer. On the date such
Borrowing request is deemed made pursuant to this clause (b), the
Administrative Agent shall advise each Tranche B Lender and the Borrower of the
details thereof, the amount of such Tranche B Lender's Tranche B Loan to be
made as part of the requested Borrowing and the date of such Borrowing (which
shall be the same Business Day as the request for Borrowing).
Section 2.03 Funding of Borrowings.
(a) Funding by Lenders. Each Lender shall, before 11:00 A.M. (New
York City time) (in the case of Tranche A Loans) and 2:30 P.M. (New York City
time) (in the case of Tranche B Loans) on the date of the proposed Borrowing,
make available to the Administrative Agent at its address referred to in
Section 11.01, in immediately available funds, such Lender's Ratable Portion of
such proposed Borrowing. After the Administrative Agent's receipt of such funds
and upon fulfillment of the applicable conditions set forth in Article III, the
Administrative Agent will (i) in the case of a Borrowing of Tranche A Loans,
make such funds available to the Borrower, and (ii) in the case of a Borrowing
of Tranche B Loans, remit such funds by wire transfer of immediately available
funds directly to the Issuer.
(b) Presumption by the Administrative Agent. Unless the Administrative
Agent shall have received notice from a Lender prior to the date of any
proposed Borrowing that such Lender will not make available to the
Administrative Agent such Lender's Ratable Portion of such Borrowing, the
Administrative Agent may assume that such Lender has made such Ratable Portion
available to the Administrative Agent on the date of such Borrowing in
accordance with this Section 2.03, and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have so
made such Ratable Portion available to the Administrative Agent, such Lender
and the Borrower severally agree to repay to the Administrative Agent forthwith
on demand such corresponding amount together with interest thereon, for each
day from the date such amount is made available to the Borrower until the date
such amount is repaid to the Administrative Agent, at (i) in the case of the
Borrower, the interest rate applicable at the time to the Loans comprising such
Borrowing and (ii) in the case of such Lender, the Federal Funds Rate. If such
Lender shall repay to the Administrative Agent such corresponding amount, such
amount so repaid shall constitute such Lender's Loan as part of such Borrowing
for purposes of this Agreement. If the Borrower shall repay to the
Administrative Agent such corresponding amount, such payment shall not relieve
such Lender of any obligation it may have to the Borrower hereunder.
(c) The failure of any Lender to make the Loan to be made by it as
part of any Borrowing shall not relieve any other Lender of its obligation, if
any, hereunder to make its Loan on the date of such Borrowing, but no Lender
shall be responsible for the failure of any other Lender to make the Loan to be
made by such other Lender on the date of any Borrowing.
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Section 2.04 Repayment.
The Borrower shall repay the entire unpaid principal amount of (a) the
Tranche A Loans on the Tranche A Maturity Date and (b) the Tranche B Loans on
the Tranche B Maturity Date.
Section 2.05 Prepayments.
(a) Optional Prepayments. The Borrower may, upon at least one
Business Day's prior notice to the Administrative Agent, stating the proposed
date and aggregate principal amount of the prepayment, prepay the outstanding
principal amount of the Loans in whole or ratably in part, together with
accrued interest to the date of such prepayment on the principal amount
prepaid; provided, however, that each partial prepayment shall be in an
aggregate principal amount not less than $1,000,000 or integral multiples of
$1,000,000 in excess thereof. Upon the giving of such notice of prepayment,
the principal amount of the Loans specified to be prepaid shall become due and
payable on the date specified for such prepayment.
(b) Mandatory Prepayments.
(i) If at any time the aggregate principal amount of Tranche A
Loans or Tranche B Loans outstanding shall exceed the aggregate Tranche
A Commitments or Tranche B Commitments, as the case may be, the
Borrower shall immediately prepay the Tranche A Loans or Tranche B
Loans then outstanding in an amount equal to such excess together with
accrued interest thereon.
(ii) Upon its receipt of Net Cash Proceeds of any Divestiture
completed in accordance with Section 6.03(b), the Borrower shall,
within one Business Day after receipt of such Net Cash Proceeds (A)
first prepay the outstanding Tranche A Loans until paid in full, and
(B) thereafter, prepay the outstanding Tranche B Loans until paid in
full.
Section 2.06 Notes.
The obligation of the Borrower to repay the Tranche A Loans made by
each Tranche A Lender and to pay interest thereon at the rates provided herein
shall be further evidenced by a promissory note, substantially in the form of
Exhibit A-1 (each, a "Tranche A Note" and collectively, the "Tranche A Notes"),
payable to the order of such Tranche A Lender and in the principal amount of
such Tranche A Lender's initial Tranche A Commitment. The obligation of the
Borrower to repay the Tranche B Loans made by each Tranche B Lender and to pay
interest thereon at the rates provided herein shall be further evidenced by a
promissory note, substantially in the form of Exhibit A-2 (each, a "Tranche B
Note" and collectively, the "Tranche B Notes"), payable to the order of such
Tranche B Lender and in the principal amount of such Tranche B Lender's initial
Tranche B Commitment. The Borrower authorizes each Lender to record on the
schedule annexed to such Lender's Note(s), the date and amount of each Loan made
by such Lender, and each payment or prepayment of principal thereunder and
agrees that all such notations shall constitute prima facie evidence of the
matters noted. The Borrower further authorizes each Lender to attach to and make
a part of such Lender's Note(s) continuations of the schedule attached thereto
as necessary. No failure to make any such notations, nor any errors in making
any such notations, shall affect the validity of the Borrower's obligations to
repay the
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full unpaid principal amount of the Loans and accrued interest thereon, or the
duties of Borrower hereunder or thereunder.
Section 2.07 Reduction and Expiration of Commitments.
(a) The Tranche A Commitments and Tranche B Commitments shall expire
on the last day of the Tranche A Availability Period and Tranche B Availability
Period, respectively, if not utilized prior to such date.
(b) The Borrower may, upon at least five Business Days' prior notice
to the Administrative Agent, terminate in whole or reduce ratably in part the
unused portions of the respective Tranche A Commitments of the Tranche A
Lenders; provided, however, that each partial reduction shall be in the
aggregate amount of not less than $1,000,000 or an integral multiple of
$1,000,000 in excess thereof. The Borrower may not terminate or reduce the
unused portions of the respective Tranche B Commitments of the Tranche B
Lenders.
(c) The Tranche A Commitments and Tranche B Commitments shall be
automatically and permanently reduced by an amount equal to the amount of any
prepayment required by Section 2.05(b)(ii) in connection with any Divestiture
to the extent that the aggregate amount of Net Cash Proceeds received from all
Divestitures from and after the Closing Date exceeds $500,000.
Section 2.08 Fees.
(a) Unused Tranche A Commitment Fee. The Borrower agrees to pay to the
Administrative Agent, for the account of each Tranche A Lender, an unused
commitment fee on the average daily unused portion of such Tranche A Lender's
Tranche A Commitment at the rate of 0.50% per annum, payable in arrears on (i)
the last day of each fiscal quarter and (ii) the last day of the Tranche A
Availability Period.
(b) Unused Tranche B Commitment Fee. The Borrower agrees to pay to the
Administrative Agent, for the account of each Tranche B Lender, an unused
commitment fee on the average daily unused portion of such Tranche B Lender's
Tranche B Commitment at the rate of 0.50% per annum, payable in arrears on (i)
the last day of each fiscal quarter and (ii) the last day of the Tranche B
Availability Period.
(c) Tranche A Up-Front Fee. The Borrower shall pay to the
Administrative Agent, for the account of each Tranche A Lender party hereto on
the date hereof, on the Closing Date in immediately available funds, a
one-time, up-front fee equal to 3.0% of the aggregate Tranche A Commitments of
all of the Tranche A Lenders. Each of the parties hereto acknowledge that such
fee was paid in full on the Closing Date.
(d) Additional Commitment Fee. In the event a plan of reorganization
acceptable to the Lenders, the Bond Support Lenders and the Bank Lenders has
not been (i) confirmed on or prior to March 6, 2002 and/or (ii) consummated on
or prior to April 8, 2002, the Borrower shall pay to the Administrative Agent,
for the ratable account of each Lender, on the first Business Day after such
date, in immediately available funds, a one-time fee equal to $900,000.
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(e) Letter of Credit Issuance Fee. The Borrower shall pay to the
Issuer, for its own account, a letter of credit issuance fee equal to $225,000,
payable in four equal installments of $56,250 on March 31, 2002, June 30, 2002,
September 30, 2002 and December 31, 2002.
(f) Payment of Fees. All fees payable hereunder shall be paid on the
dates due, in immediately available funds, to the Administrative Agent for
distribution, in the case of the fees set forth in clauses (a), (b), (c) and
(d), to the Persons entitled thereto. Fees paid hereunder shall not be
refundable under any circumstances.
Section 2.09 Interest.
The Borrower shall pay interest on the unpaid principal amount of each
Loan from the date thereof until the principal amount thereof shall be paid in
full, at a rate per annum equal at all times to the Prime Rate in effect from
time to time plus 3.0% per annum, payable quarterly in arrears on the last day
of each fiscal quarter and on the date any Loan is or is to be paid or prepaid,
in whole or in part; provided, however, that during the continuance of an Event
of Default, all Loans shall bear interest, payable on demand, at a rate per
annum equal at all times to the Prime Rate then in effect plus 5.0% per annum.
The Administrative Agent shall give prompt notice to the Borrower and the
Lenders of the applicable interest rate determined by the Administrative Agent
for purposes of this Section 2.09.
Section 2.10 Capital Adequacy.
If after the date hereof, (a) the introduction of or any change in or
in the interpretation of any law or regulation, (b) compliance with any law or
regulation, or (c) compliance with any guideline or request from any central
bank or other Governmental Authority (whether or not having the force of law)
affects or would affect the amount of capital required or expected to be
maintained by any Lender or any corporation controlling any Lender and such
Lender reasonably determines that such amount is based upon the existence of
such Lender's Commitments, Loans and its other commitments and loans of similar
type, then, within ten Business Days after demand by such Lender (with a copy of
such demand to the Administrative Agent), the Borrower shall pay to the
Administrative Agent for the account of such Lender, from time to time as
specified by such Lender, additional amounts sufficient to compensate such
Lender in the light of such circumstances, to the extent that such Lender
reasonably determines such increase in capital to be allocable to the existence
of any or all of such Lender's Commitments and Loans. A certificate containing
reasonably detailed calculations of such amounts submitted to the Borrower and
the Administrative Agent by such Lender shall be conclusive and binding for all
purposes absent manifest error.
Section 2.11 Increased Costs.
If, due to either (a) the introduction of or any change in or in the
interpretation of any law or regulation or (b) compliance with any guideline or
request from any central bank or other Governmental Authority (whether or not
having the force of law), there shall be any increase in the cost to any Lender
of agreeing to make or making, funding or maintaining any Loans, then the
Borrower shall from time to time, within ten Business Days after demand by such
Lender (with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for
25
the account of such Lender additional amounts sufficient to compensate such
Lender for such increased cost. A certificate containing reasonably detailed
calculations of the amount of such increased cost, submitted to the Borrower
and the Administrative Agent by such Lender, shall be conclusive and binding
for all purposes, absent manifest error.
Section 2.12 Payments and Computations.
(a) The Borrower shall make each payment hereunder and under the
Notes not later than 11:00 A.M. (New York City time) on the day when due, in
Dollars, to the Administrative Agent at its address referred to in Section
11.01 in immediately available funds without set-off or counterclaim. The
Administrative Agent will promptly thereafter cause to be distributed
immediately available funds relating to the payment of principal, interest or
fees (other than amounts payable pursuant to Sections 2.10, 2.11 and 2.13) to
the Lenders, in accordance with their respective Ratable Portions, and like
funds relating to the payment of any other amount payable to any Lender to such
Lender, in each case to be applied in accordance with the terms of this
Agreement. Payment received by the Administrative Agent after 11:00 A.M. (New
York City time) shall be deemed to be received on the next Business Day.
(b) The Borrower hereby authorizes each Lender, if and to the extent
payment owed to such Lender is not made when due hereunder or under any Loan
held by such Lender, to charge from time to time against any or all of the
Borrower's accounts with such Lender any amount so due.
(c) All computations of interest based on the Prime Rate or the
Federal Funds Rate and of fees shall be made by the Administrative Agent on the
basis of a year of 365 or 366 days, as the case may be, for the actual number
of days (including the first day but excluding the last day) occurring in the
period for which such interest or fees are payable. Each determination by the
Administrative Agent of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.
(d) Whenever any payment hereunder or under the Notes shall be stated
to be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or fee, as the case may be.
(e) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due hereunder to the
Lenders that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date, and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Lender on such
due date an amount equal to the amount then due such Lender. If and to the
extent the Borrower shall not have so made such payment in full to the
Administrative Agent, each Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender together with
interest thereon, for each day from the date such amount is distributed to such
Lender until the date such Lender repays such amount to the Administrative
Agent, at the Federal Funds Rate.
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Section 2.13 Taxes.
(a) Any and all payments by the Borrower under each Credit Document
shall be made free and clear of and without deduction for any and all present
or future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of the Administrative
Agent, taxes measured by its net income and franchise taxes (imposed in lieu of
a tax on net income) imposed on it by each jurisdiction under the laws of which
the Administrative Agent is organized or any political subdivision thereof and,
in the case of each Lender and the Issuer, taxes measured by its net income and
franchise taxes (imposed in lieu of a tax on net income) imposed on it by each
jurisdiction under the laws of which such Lender or the Issuer is organized 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 Borrower shall be required by law to deduct or
withhold any Taxes from or in respect of any sum payable hereunder to any
Lender, the Issuer or the Administrative Agent (i) the sum payable shall be
increased as may be necessary so that after making all required deductions or
withholdings (including, without limitation, deductions or withholdings
applicable to additional sums payable under this Section 2.13) such Lender, the
Issuer or the Administrative Agent, as the case may be, receives an amount
equal to the sum it would have received had no such deductions or withholdings
been made, (ii) the Borrower shall make such deductions or withholdings, and
(iii) the Borrower shall pay the full amount deducted or withheld to the
relevant taxing authority or other authority in accordance with applicable law.
(b) In addition, the Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies of any applicable Governmental Authority which arise from any
payment made under any Credit Document or from the execution, delivery or
registration of, or otherwise with respect to, any Credit Document
(collectively, "Other Taxes").
(c) The Borrower will indemnify each Lender, the Issuer and the
Administrative Agent for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed by any jurisdiction on
amounts payable under this Section 2.13) paid by such Lender, the Issuer or the
Administrative Agent, as the case may be, and any liability (including, without
limitation, for penalties, interest and expenses) arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly or
legally asserted. This indemnification shall be made within 30 days from the
date such Lender, the Issuer or the Administrative Agent, as the case may be,
makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes or Other
Taxes, the Borrower will furnish to the Administrative Agent, at its address
referred to in Section 11.01, the original or a certified copy of a receipt
evidencing payment thereof.
(e) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained in
this Section 2.13 shall survive the payment in full of the Obligations.
(f) Any Lender that is a United States person under Section
7701(a)(30) of the Code for U.S. Federal income tax purposes shall deliver to
the Borrower and the Administrative Agent
27
at the time or times prescribed by applicable law or reasonably requested by
the Borrower a properly completed and executed Internal Revenue Service Form
W-9 (or any subsequent versions thereof or successors thereto). Any Lender that
is not a United States person under Section 7701(a)(30) of the Code for U.S.
Federal income tax purposes that is entitled to an exemption from or reduction
of withholding tax under the laws of the United States of America, or any
treaty to which the United States of America is a party, with respect to
payments under any Credit Document shall deliver to the Borrower and the
Administrative Agent, at the time or times prescribed by applicable law or
reasonably requested by the Borrower, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate.
(g) In those circumstances as shall be necessary under applicable
law to allow payments hereunder to be made free of (or at a reduced rate of)
United States withholding tax, at the written request of the Borrower, the
Administrative Agent shall provide the Borrower with (i) two properly completed
and executed originals of IRS Form W-8IMY (or any subsequent versions thereof
or successors thereto) with respect to its exemption from United States
withholding tax because it is a U.S. branch of a foreign bank and (ii) such
documentation as shall have been received from the Lenders by the
Administrative Agent but not the Borrower pursuant to subparagraph (f) of this
Section.
Section 2.14 Sharing of Payments, Etc.
If any Lender shall obtain any payment (whether voluntary, involuntary,
through the exercise of any right of set-off, or otherwise) on account of the
Loans made by it (other than pursuant to Section 2.10, 2.11, or 2.13) in excess
of its Ratable Portion of payments on account of the Loans obtained by all the
Lenders, such Lender shall forthwith purchase from the other Lenders such
participations in their Loans as shall be necessary to cause such purchasing
Lender to share the excess payment ratably with each of them; provided, however,
that if all or any portion of such excess payment is thereafter recovered from
such purchasing Lender, such purchase from each Lender shall be rescinded, and
such Lender shall repay to the purchasing Lender the purchase price to the
extent of such recovery together with an amount equal to such Lender's ratable
share (according to the proportion of (a) the amount of such Lender's required
repayment to (b) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. The Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant to this Section 2.14
may, to the fullest extent permitted by law, exercise all its rights of payment
(including, without limitation, the right of set-off) with respect to such
participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation.
Section 2.15 Additional Provisions Relating to the Letter of
Credit.
(a) Reports. The Issuer will provide to the Administrative Agent at
least monthly, and more frequently upon request, a detailed summary report on
the Letter of Credit and the activity thereon, in form and substance reasonably
acceptable to the Administrative Agent. The Issuer will provide copies of the
Letter of Credit and any amendment or supplement thereto to the Administrative
Agent and the Lenders promptly upon request.
28
(b) Reimbursement. In the event of any drawing under the Letter of
Credit, the Issuer will promptly notify the Borrower. The Borrower promises to
reimburse the Issuer on the day of drawing under any Letter of Credit in same
day funds. If the Borrower shall fail to reimburse the Issuer as provided
hereinabove, it shall reimburse the Issuer with the proceeds of a Tranche B
Loan made in accordance with Section 2.02(c). The Borrower's reimbursement
obligations hereunder shall be absolute and unconditional under all
circumstances irrespective of any rights of setoff, counterclaim or defense to
payment the Borrower may claim or have against the Issuer, the Administrative
Agent, the Lenders, the beneficiary of the Letter of Credit or any other
Person, including, without limitation, any defense based on any failure of the
Borrower or any other Credit Party to receive consideration or the legality,
validity, regularity or unenforceability of the Letter of Credit.
(c) Indemnification; Nature of Issuer's Duties.
(i) In addition to its other obligations under this Section
2.15, the Borrower hereby agrees to protect, indemnify, pay and save
the Issuer harmless from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including
reasonable attorneys' fees) that the Issuer may incur or be subject to
as a consequence, direct or indirect, of (A) the issuance of the Letter
of Credit or (B) the failure of the Issuer to honor a drawing under the
Letter of Credit as a result of any act or omission, whether rightful
or wrongful, of any present or future de jure or de facto government or
governmental authority (all such acts or omissions, herein called
"Government Acts").
(ii) As between the Borrower and the Issuer, the Borrower
shall assume all risks of the acts, omissions or misuse of the Letter
of Credit by the beneficiary thereof. The Issuer shall not be
responsible: (A) for the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in
connection with the application for and issuance of any Letter of
Credit, even if it should in fact prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent or forged; (B) for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, that may
prove to be invalid or ineffective for any reason; (C) for errors,
omissions, interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex or otherwise, whether or not
they be in cipher; (D) for any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under the
Letter of Credit or of the proceeds thereof; and (E) for any
consequences arising from causes beyond the control of the Issuer,
including, without limitation, any Government Acts. None of the above
shall affect, impair, or prevent the vesting of the Issuer's rights or
powers hereunder.
(iii) In furtherance and extension and not in limitation of
the specific provisions hereinabove set forth, any action taken or
omitted by the Issuer, under or in connection with the Letter of Credit
or the related certificates, if taken or omitted in good faith, shall
not put the Issuer under any resulting liability to the Borrower or any
other Credit Party. It is the intention of the parties that this
Agreement shall be construed and applied to protect and indemnify the
Issuer against any and all risks involved in the
29
issuance of the Letter of Credit, all of which risks are hereby
assumed by the Borrower (on behalf of itself and each of the other
Credit Parties), including, without limitation, any and all Government
Acts. The Issuer shall not in any way be liable for any failure by the
Issuer or anyone else to pay any drawing under any Letter of Credit as
a result of any Government Acts or any other cause beyond the control
of the Issuer.
(iv) Nothing in this subsection (d) is intended to limit the
reimbursement obligations of the Borrower contained in subsection (b)
above. The obligations of the Borrower under this subsection (d) shall
survive the termination of this Agreement. No act or omissions of any
current or prior beneficiary of the Letter of Credit shall in any way
affect or impair the rights of the Issuer to enforce any right, power
or benefit under this Agreement.
(v) Notwithstanding anything to the contrary contained in this
subsection (d), the Borrower shall have no obligation to indemnify the
Issuer in respect of any liability incurred by the Issuer (A) arising
out of the gross negligence or willful misconduct of the Issuer, as
determined by a court of competent jurisdiction, or (B) caused by the
Issuer's failure to pay under the Letter of Credit after presentation
to it of a request strictly complying with the terms and conditions of
the Letter of Credit, as determined by a court of competent
jurisdiction, unless such payment is prohibited by any law, regulation,
court order or decree.
(d) Limitation on Obligation of the Issuer. Notwithstanding anything
contained herein to the contrary, the Issuer shall not be under any obligation
to issue, renew or extend the Letter of Credit if (i) any order, judgment or
decree of any Governmental Authority or arbitrator shall by its terms purport
to enjoin or restrain the Issuer from issuing the Letter of Credit, or any
applicable law, rule or regulation or any request or directive (whether or not
having the force of law) from any Governmental Authority with jurisdiction over
the Issuer shall prohibit, or request that the Issuer refrain from, the
issuance of letters of credit generally or the Letter of Credit in particular,
or shall impose upon the Issuer with respect to the Letter of Credit any
restriction, reserve or capital requirement (for which the Issuer is not
otherwise compensated hereunder) not in effect on the Effective Date, or shall
impose upon the Issuer any unreimbursed loss, costs or expense which was not
applicable on the Effective Date and which the Issuer should deem material to
it in good faith, or (ii) the issuance, renewal or extension would violate or
otherwise contravene its internal policy.
(e) Conflict with Letter of Credit Documents. Solely as among the
parties hereto, in the event of any conflict between this Agreement and any
Letter of Credit Document (including any letter of credit application), this
Agreement shall control.
30
ARTICLE III
CONDITIONS
Section 3.01 Conditions Precedent to Initial Loans.
The obligation of each Lender to make its initial Loan on the Closing
Date is subject to satisfaction of all of the following conditions precedent:
(a) Certain Documents. The Administrative Agent shall have received,
on the Closing Date, the following, each dated the Closing Date unless
otherwise indicated, in form and substance satisfactory to the Administrative
Agent and (except for the Notes) in sufficient copies for each Lender:
(i) From each party hereto either (A) a counterpart of this
Agreement signed on behalf of such party or (B) written evidence
satisfactory to the Administrative Agent (which may include telecopy
transmission of a signed signature page to this Agreement) that such
party has signed a counterpart of this Agreement.
(ii) The Notes to the order of the Lenders, respectively, duly
executed by the Borrower.
(iii) Copies of each of the Financing Agreements.
(iv) The Pledge Agreement, duly executed by the respective
parties thereto, together with evidence that all action necessary or,
in the opinion of the Administrative Agent, desirable to perfect and
protect the Lien created by the Pledge Agreement has been taken.
(v) The Security Agreement, duly executed by the respective
parties thereto, together with evidence that all action necessary or,
in the opinion of the Administrative Agent, desirable to perfect the
Liens created by the Security Agreement has been taken.
(vi) A favorable written opinion (addressed to the
Administrative Agent and the Lenders and dated the Closing Date) of (A)
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, counsel for the Credit Parties, in form and
substance satisfactory to the Lenders and the Administrative Agent (and
the Credit Parties hereby instruct such counsel to deliver such opinion
to the Administrative Agent and the Lenders) and (B) the general
counsel of the Credit Parties, in form and substance satisfactory to
the Lenders and the Administrative Agent (and the Credit Parties hereby
instruct such general counsel to deliver such opinion to the
Administrative Agent and the Lenders).
(vii) Copies of (A) the audited consolidated and consolidating
balance sheets for the members of the Consolidated Group as of December
31, 2000, and the related audited consolidated and consolidating
statements of operations, shareholders' equity, and cash flows for the
fiscal year ending as of such date and (B) the unaudited consolidated
balance sheet of the Consolidated Group as of June 30, 2000, and the
related
31
unaudited statements of operations and cash flows for the six-month
period ending as of such date.
(viii) Receipt by the Administrative Agent of the following
(or their equivalent) for each of the Credit Parties, certified by a
secretary or assistant secretary as of the Closing Date to be true and
correct and in force and effect as of such date:
(A) Resolutions. Copies of resolutions of the
Board of Directors approving and adopting
the respective Credit Documents, the
transactions contemplated thereby and
authorizing execution and delivery thereof.
(B) Organizational Documents. Copies of the
organizational documents of each Credit
Party.
(C) Incumbency Certificate. A certificate of the
Secretary or an Assistant Secretary of each
Credit Party certifying the names and true
signatures of each officer of such Credit
Party who has been authorized to execute and
deliver any Credit Document or other
document required hereunder to be executed
and delivered by or on behalf of such Credit
Party.
(ix) Copies, where applicable, of (A) certificates of good
standing, existence or its equivalent certified as of a recent date by
the appropriate Governmental Authorities of the state of incorporation
and (B) certificates indicating payment of all corporate franchise
taxes certified as of a recent date by the appropriate governmental
taxing authorities of the state of incorporation.
(x) Officer's Certificate Regarding Conditions Precedent. A
certificate, signed by a Responsible Officer of the Borrower, stating
that each of the conditions specified in Sections 3.02(a) and 3.02(b)
has been satisfied.
(xi) Officer's Certificate Regarding Representations and
Warranties. A certificate, signed by a Responsible Officer of the
Borrower, with respect to the additional representations and warranties
to be made by the Credit Parties on the Closing Date.
(xii) Other Documents and Information. Such additional
documents, information and materials as any Lender, through the
Administrative Agent, may reasonably request.
(b) Fees and Expenses. All costs and accrued and unpaid fees and
expenses (including, without limitation, reasonable legal fees and expenses)
required to be paid to the Lenders and the Administrative Agent on or before
the Closing Date, including, without limitation, those referred to in Sections
2.08 and 11.05, to the extent then due and payable, shall have been paid.
32
(c) Absence of Legal Proceedings. The absence of any action, suit,
investigation or proceeding (other than the Bankruptcy Cases) pending in any
court or before any arbitrator or governmental instrumentality which could
reasonably be expected to have a Material Adverse Effect.
(d) DIP Financing Orders. Receipt by the Administrative Agent of
evidence satisfactory to the Administrative Agent, in its sole discretion, that
the Interim DIP Financing Order has been entered by the Bankruptcy Court and
docketed by the Clerk of the Bankruptcy Court, and that such order is in full
force and effect and has not been vacated, reversed, modified, amended, or
stayed pending appeal.
(e) Motions, Etc. The Lenders and the Administrative Agent shall have
reviewed and found satisfactory all motions, orders and other pleadings or
related documents to be filed or submitted to the Bankruptcy Court in
connection with this Agreement and the Bankruptcy Cases.
(f) Initial Transit Budgets. Receipt by the Administrative Agent of
the Initial Transit Budget, in form, scope and substance satisfactory to the
Administrative Agent in its sole discretion.
(g) Due Diligence. The Lenders shall have completed a satisfactory
due diligence review of the Credit Parties.
(h) No Material Adverse Change. Since the Filing Date, there has been
no event, condition or change that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect (and if requested by
the Administrative Agent, the Borrower shall deliver a certificate to such
effect from a Responsible Officer of the Borrower).
Section 3.02 Conditions Precedent to Each Loan and Issuance of
Letter of Credit.
The obligation of each Lender to make any Loan (including the Loan
being made by such Lender on the Closing Date) and of the Issuer to issue the
Letter of Credit shall be subject to the further conditions precedent that:
(a) Accuracy of Certain Statements. The following statements shall be
true on the date of such Loan or issuance, before and after giving effect
thereto, and to the application of the proceeds therefrom (and the acceptance
by the Borrower of the proceeds of such Loan or the issuance of the Letter of
Credit shall constitute a representation and warranty by the Borrower that on
the date of such Loan or issuance such statements are true):
(i) The representations and warranties of the Credit Parties
contained in Article IV of this Agreement and in the other Credit
Documents are true and correct on and as of such date as though made on
and as of such date (unless such representations and warranties are
made as of another date, in which case they shall be true and correct
as of such date); and
(ii) No Default or Event of Default has occurred and is
continuing or will result from the Loans being made on such date.
33
(b) No Violation of Law or Injunction.
The making of the Loans on such date does not violate any Requirement
of Law and is not enjoined, temporarily, preliminarily or permanently.
(c) DIP Financing Orders.
Either the Interim DIP Financing Order or Final DIP Financing Order
shall be in full force and effect and shall not have been vacated, reversed,
modified, amended or stayed (except to the extent that the Interim DIP Financing
Order is replaced and superseded by the Final DIP Financing Order) and shall be
in form and substance satisfactory to the Administrative Agent.
(d) No Order of Bankruptcy.
No order of the Bankruptcy Court shall have been entered (i)
authorizing the Credit Parties to borrow money pursuant to section 364 of the
Bankruptcy Code from any Person (other than the Lenders pursuant to this
Agreement or otherwise) or to obtain any other credit from any Person secured by
a Lien on any of the assets of the Credit Parties pursuant to sections 364(c) or
(d) of the Bankruptcy Code, or (ii) affording any creditor adequate protection
under sections 361 through 364 of the Bankruptcy Code by granting a Lien in any
Collateral, unless the Lenders consent to such a Lien or such Lien is junior and
expressly subordinated in all respects to the Liens of the Administrative Agent
in the Collateral.
(e) Expiration of Interim Period.
The obligation of the Lenders to extend credit under this Agreement
after the Interim Period expires shall be subject to the further condition
precedent that, in addition to the conditions set forth in this Section 3.02,
the Administrative Agent shall have received evidence, satisfactory to the
Administrative Agent, that the Final DIP Financing Order has been entered by the
Bankruptcy Court and docketed by the Clerk of the Bankruptcy Court, and that
such order (i) shall be in full force and effect, (ii) shall provide that the
Credit Parties are prohibited from asserting any claims against the Collateral
pursuant to 11 U.S.C. [sec] 506(c) (except as provided in the Carve Out and as
agreed to by the Lenders) and (iii) shall not have been vacated, reversed,
modified, amended or stayed pending appeal.
Section 3.03 Conditions to Effectiveness.
This Agreement shall become effective on the date (such date, the
"Effective Date") on which each of the following conditions shall have been
satisfied:
(a) Certain Documents. The Administrative Agent shall have received,
on the Effective Date, the following, each dated the Effective Date unless
otherwise indicated, in form and substance satisfactory to the Administrative
Agent and (except for the Notes) in sufficient copies for each Lender and the
Issuer:
(i) From each party hereto either (A) a counterpart of this
Agreement signed on behalf of such party or (B) written evidence
satisfactory to the Administrative Agent
34
(which may include telecopy transmission of a signed signature page to
this Agreement) that such party has signed a counterpart of this
Agreement.
(ii) The Tranche A Notes and the Tranche B Notes to the order
of the Tranche A Lenders and Tranche B Lenders, respectively, duly
executed by the Borrower.
(iii) A favorable written opinion (addressed to the
Administrative Agent, the Issuer and the Lenders and dated the
Effective Date) of (A) ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, counsel for the Credit
Parties, in form and substance satisfactory to the Lenders, the Issuer
and the Administrative Agent (and the Credit Parties hereby instruct
such counsel to deliver such opinion to the Administrative Agent, the
Issuer and the Lenders) and (B) the general counsel of the Credit
Parties, in form and substance satisfactory to the Lenders, the Issuer
and the Administrative Agent (and the Credit Parties hereby instruct
such general counsel to deliver such opinion to the Administrative
Agent and the Lenders).
(iv) A letter of credit application in respect of the Letter
of Credit in the Issuer's customary form, duly completed and executed
by the Borrower.
(b) Fees and Expenses. All costs and accrued and unpaid fees and
expenses (including, without limitation, reasonable legal fees and expenses)
required to be paid to the Lenders, the Issuer and the Administrative Agent on
or before the Effective Date, to the extent then due and payable, shall have
been paid.
(c) Absence of Legal Proceedings. The absence of any action, suit,
investigation or proceeding (other than the Bankruptcy Cases) pending in any
court or before any arbitrator or governmental instrumentality which could
reasonably be expected to have a Material Adverse Effect.
(d) Amendment Order. Receipt by the Administrative Agent of evidence
satisfactory to the Administrative Agent, in its sole discretion, that the
Amendment Order has been entered by the Bankruptcy Court and docketed by the
Clerk of the Bankruptcy Court, and that such order is in full force and effect
and has not been vacated, reversed, modified, amended, or stayed pending appeal.
(e) Accuracy of Certain Statements. The following statements shall be
true on the Effective Date:
(i) The representations and warranties of the Credit Parties
contained in Article IV of this Agreement and in the other Credit
Documents are true and correct on and as of the Effective Date as
though made on and as of the Effective Date (unless such
representations and warranties are made as of another date, in which
case they shall be true and correct as of such date); and
(ii) No Default or Event of Default has occurred and is
continuing or will result from the effectiveness of this Agreement.
35
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
To induce the Lenders, the Issuer and the Administrative Agent to
enter into this Agreement, each of the Credit Parties hereby represents and
warrants to each Lender, the Issuer and the Administrative Agent that:
Section 4.01 Financial Condition.
Each of the financial statements described below (copies of which have
heretofore been provided to the Administrative Agent for distribution to the
Lenders), have been prepared in accordance with GAAP consistently applied
throughout the periods covered thereby, are complete and correct in all
material respects and present fairly the financial condition and results from
operations of the entities and for the periods specified (subject in the case
of interim company-prepared statements to normal year-end adjustments and the
absence of footnotes):
(a) audited consolidated and consolidating balance sheets for the
members of the Consolidated Group for the fiscal years ended December 31, 1999
and December 31, 2000, together with related audited consolidated and
consolidating statements of operations, shareholders equity and cash flows for
such fiscal years, in each case certified by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, certified
public accountants; and
(b) after the Closing Date, the annual and quarterly financial
statements provided in accordance with Sections 5.01(a) and 5.01(b).
Section 4.02 No Changes or Restricted Payments.
Since December 31, 2000, (a) except as set forth on Schedule 4.02 and
other than the commencement of the Bankruptcy Cases, there has been no
circumstance, development or event relating to or affecting the members of the
Transit Group which has had or would be reasonably expected to have a Material
Adverse Effect, and (b) except as permitted herein, no Restricted Payments have
been made or declared by any Credit Party.
Section 4.03 Organization; Existence; Compliance with Law.
Each of the Credit Parties (a) is duly organized, validly existing and
in good standing under the laws of the jurisdiction of its incorporation or
organization, (b) has the corporate or other necessary power and authority, and
the legal right to own and operate its property, to lease the property it
operates as lessee and to conduct the business in which it is currently
engaged, (c) is duly qualified as a foreign entity and in good standing under
the laws of each jurisdiction where its ownership, lease or operation of
property or the conduct of its business requires such qualification, other than
in such jurisdictions where the failure to be so qualified or in good standing
would not, in the aggregate, have a Material Adverse Effect, and (d) is in
compliance with its Certificate of Incorporation and Bylaws (or other
organizational or governing documents) and all Requirements of Law, except to
the extent that the failure to comply therewith would not, in the aggregate, be
reasonably expected to have a Material Adverse Effect.
36
Section 4.04 Power; Authorization; Enforceable Obligations.
(a) Subject to the entry of the DIP Financing Order, each of the
Credit Parties has the corporate or other necessary power and authority, and
the legal right, to execute, make, deliver and perform the Credit Documents to
which it is a party and has taken all necessary corporate or other action to
authorize the execution, delivery and performance by it of the Credit Documents
to which it is a party.
(b) Subject to the entry of the DIP Financing Order, the execution,
delivery and performance by each Credit Party of the Credit Documents to which
it is a party and the consummation of the transactions contemplated thereby do
not and will not (i) contravene such Person's Certificate of Incorporation or
Bylaws or other comparable governing documents, (ii) violate any other
applicable Requirement of Law (including, without limitation, Regulations T, U
and X of the Board of Governors of the Federal Reserve System), or any order or
decree of any Governmental Authority or arbitrator, (iii) result in the
creation or imposition of any Lien upon any of the property of such Person or
any of its Subsidiaries, other than those in favor of the Administrative Agent
pursuant hereto and the Collateral Documents or (iv) violate or conflict with
any order, writ, judgment, injunction, decree or permit applicable to any
Credit Party.
(c) Except for the entry of each of the DIP Financing Orders, no
consent or authorization of, filing with, notice to or other act by or in
respect of, any Governmental Authority or any other Person is required in
connection with acceptance of the Loans or the making of the guaranties
hereunder or with the execution, delivery or performance of any Credit
Documents by the Credit Parties (other than (i) those which have been obtained
and are in full force and effect, (ii) such filings as are required by the
Securities and Exchange Commission and (iii) other filings necessary to fulfill
other reporting requirements with Governmental Authorities) or with the
validity or enforceability of any Credit Document against the Credit Parties
(except such filings as are necessary in connection with the perfection of the
Liens created by such Credit Documents).
(d) Subject to the entry of the DIP Financing Order, each Credit
Document to which it is a party constitutes a legal, valid and binding
obligation of such Credit Party enforceable against such Credit Party in
accordance with its terms without defense, setoff or counterclaim.
Section 4.05 [Reserved.]
Section 4.06 No Material Litigation.
No claim, litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the best knowledge of
the Credit Parties, threatened by or against, any Credit Party or against any
of the Facilities or revenues which (a) purports to affect the legality,
validity or enforceability of any of the Credit Documents or (b) is reasonably
likely to have a Material Adverse Effect.
Section 4.07 No Default.
No Default or Event of Default has occurred and is continuing.
37
Section 4.08 Ownership of Property; Liens.
Each of the Credit Parties has good record and marketable title in fee
simple to, or a valid leasehold interest in, all its real property material to
the Credit Parties taken as a whole, and good title to, or a valid leasehold
interest in, all its other property material to the Credit Parties taken as a
whole, and none of such property is subject to any Lien, except for Permitted
Liens.
Section 4.09 Intellectual Property.
Each Credit Party owns, or has the legal right to use, the
Intellectual Property necessary for it to conduct its business as currently
conducted, except to the extent the failure to do so would not be reasonably
expected to have a Material Adverse Effect. No claim has been asserted and is
pending by any Person challenging or questioning the use of any such
Intellectual Property or the validity or effectiveness of any such Intellectual
Property, nor does any Credit Party know of any such claim, and the use of such
Intellectual Property by the Credit Parties does not infringe on the rights of
any Person, except for such claims and infringements that in the aggregate,
would not be reasonably expected to have a Material Adverse Effect.
Section 4.10 No Burdensome Restrictions.
Neither the Certificate of Incorporation or Bylaws (or other
organizational or governing documents) nor any Requirement of Law of any Credit
Party would be reasonably expected to have a Material Adverse Effect.
Section 4.11 Taxes.
Each Credit Party has filed all post-petition federal and other tax
returns and material reports required to be filed, and has paid all
post-petition federal and other taxes, assessments, fees and other governmental
charges levied or imposed upon it or its Facilities, income or assets otherwise
due and payable unless such unpaid taxes and assessments are (a) not yet past
due or (b) being contested in good faith and by appropriate proceedings
diligently pursued and as to which adequate reserves determined in accordance
with GAAP have been established on such Credit Party's books and records and no
Lien with respect to nonpayment thereof has been asserted. No Credit Party is
aware of any proposed tax assessments against it, with respect to any prior
period, in excess of amounts accrued on its financial statements (as required to
be accrued in accordance with GAAP), nor does any Credit Party anticipate any
further material tax liability with respect to any open taxable years taken as a
whole in excess of accrued amounts.
Section 4.12 ERISA.
Except as would not reasonably be expected to have a Material Adverse
Effect:
(a) During the five-year period prior to the date on which this
representation is made or deemed made: (i) no ERISA Event has occurred, and, to
the best knowledge of the Credit Parties, no event or condition has occurred or
exists as a result of which any ERISA Event could reasonably be expected to
occur, with respect to any Plan; (ii) no "accumulated funding deficiency," as
such term is defined in Section 302 of ERISA and Section 412 of the Internal
Revenue Code, whether or not waived, has occurred with respect to any Plan;
(iii) each Plan has
38
been maintained, operated, and funded in compliance with its own terms and in
material compliance with the provisions of ERISA, the Internal Revenue Code,
and any other applicable federal or state laws; and (iv) no lien in favor of
the PBGC or a Plan has arisen or is reasonably likely to arise on account of
any Plan.
(b) The actuarial present value of all "benefit liabilities" (as
defined in Section 4001(a)(16) of ERISA), whether or not vested, under each
Single Employer Plan, as of the last annual valuation date prior to the date on
which this representation is made or deemed made (determined, in each case, in
accordance with Financial Accounting Standards Board Statement 87, utilizing
the actuarial assumptions used in such Plan's most recent actuarial valuation
report), did not exceed as of such valuation date the fair market value of the
assets of such Plan.
(c) Neither any Credit Party nor any ERISA Affiliate has incurred, or,
to the best knowledge of the Credit Parties, could be reasonably expected to
incur, any withdrawal liability under ERISA to any Multiemployer Plan or
Multiple Employer Plan. Neither any Credit Party nor any ERISA Affiliate would
become subject to any withdrawal liability under ERISA if any Credit Party or
any ERISA Affiliate were to withdraw completely from all Multiemployer Plans
and Multiple Employer Plans as of the valuation date most closely preceding the
date on which this representation is made or deemed made. Neither any Credit
Party nor any ERISA Affiliate has received any notification that any
Multiemployer Plan is in reorganization (within the meaning of Section 4241 of
ERISA), is insolvent (within the meaning of Section 4245 of ERISA), or has been
terminated (within the meaning of Title IV of ERISA), and no Multiemployer Plan
is, to the best knowledge of the Credit Parties, reasonably expected to be in
reorganization, insolvent, or terminated.
(d) No prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Internal Revenue Code) or breach of fiduciary
responsibility has occurred with respect to a Plan which has subjected or may
subject any Credit Party or any ERISA Affiliate to any liability under Sections
406, 409, 502(i), or 502(l) of ERISA or Section 4975 of the Internal Revenue
Code, or under any agreement or other instrument pursuant to which any Credit
Party or any ERISA Affiliate has agreed or is required to indemnify any person
against any such liability.
(e) Neither any Credit Party nor any ERISA Affiliates has any
material liability with respect to "expected post-retirement benefit
obligations" within the meaning of the Financial Accounting Standards Board
Statement 106. Each Plan which is a welfare plan (as defined in Section 3(1) of
ERISA) to which Sections 601-609 of ERISA and Section 4980B of the Internal
Revenue Code apply has been administered in compliance in all material respects
of such sections.
(f) Neither the execution and delivery of this Agreement nor the
consummation of the financing transactions contemplated thereunder will involve
any transaction which is subject to the prohibitions of Sections 404, 406 or
407 of ERISA or in connection with which a tax could be imposed pursuant to
Section 4975 of the Internal Revenue Code. The representation by the Credit
Parties in the preceding sentence is made in reliance upon and subject to the
accuracy of the Lenders' representation in Section 11.15 with respect to their
source of funds and is subject, in the event that the source of the funds used
by the Lenders in connection with this transaction is
39
an insurance company's general asset account, to the application of Prohibited
Transaction Class Exemption 95-60, 60 Fed. Reg. 35,925 (1995), compliance with
the regulations issued under Section 401(c)(1)(A) of ERISA, or the issuance of
any other prohibited transaction exemption or similar relief, to the effect
that assets in an insurance company's general asset account do not constitute
assets of an "employee benefit plan" within the meaning of Section 3(3) of
ERISA or a "plan" within the meaning of Section 4975(e)(1) of the Internal
Revenue Code.
Section 4.13 Governmental Regulations, Etc.
(a) No part of the proceeds of the Loans hereunder will be used,
directly or indirectly, for the purpose of purchasing or carrying any "margin
stock" within the meaning of Regulation U. If requested by any Lender or the
Administrative Agent, the Borrower will furnish to the Administrative Agent and
each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form U-1 referred to in said Regulation U. No Indebtedness
being reduced or retired out of the proceeds of the Loans hereunder was or will
be incurred for the purpose of purchasing or carrying any margin stock within
the meaning of Regulation U or any "margin security" within the meaning of
Regulation T. "Margin stock" within the meanings of Regulation U does not
constitute more than 25% of the value of the consolidated assets of the
Borrower and its Subsidiaries. None of the transactions contemplated by this
Agreement (including, without limitation, the direct or indirect use of the
proceeds of the Loans) will violate or result in a violation of the Securities
Act of 1933, as amended or the Exchange Act, or regulations issued pursuant
thereto, or Regulation T, U or X.
(b) The Borrower will not use any proceeds of the Loans for any
purpose that is improper under the Bankruptcy Code.
(c) No Credit Party is subject to regulation under the Public Utility
Holding Company Act of 1935, the Federal Power Act or the Investment Company
Act of 1940, each as amended. In addition, no Credit Party is (i) an
"investment company" registered or required to be registered under the
Investment Company Act of 1940, as amended, and is not controlled by such a
company, or (ii) a "holding company", or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary" of a
"holding company", within the meaning of the Public Utility Holding Company Act
of 1935, as amended.
(d) No director, executive officer or principal shareholder of any
Credit Party is a director, executive officer or principal shareholder of any
Lender. For the purposes hereof the terms "director", "executive officer" and
"principal shareholder" (when used with reference to any Lender) have the
respective meanings assigned thereto in Regulation O.
Section 4.14 Subsidiaries and Guarantors.
(a) Set forth on Schedule 4.14(a) are all of the Subsidiaries of the
Borrower at the Closing Date, the jurisdiction of their incorporation and the
direct or indirect ownership interest of the Borrower therein.
(b) Set forth on Schedule 4.14(b) are all of the Guarantors at the
Closing Date. Each Guarantor is a member of the Transit Group. The Borrower
has no Domestic Subsidiaries that are in the "transit" segment of the
Borrower's business other than the Guarantors.
40
Section 4.15 Use of Proceeds.
(a) The proceeds of the Tranche A Loans made hereunder shall be used
by the Borrower for the members off the Transit Group solely:
(i) to pay the payables owed by any member of the Transit
Group that have been approved by the Administrative Agent, the Bond
Support Administrative Agent and Travelers;
(ii) to pay the payables related to the Cass County Contract
and the payables with respect to contracts identified by the Bank
Administrative Agent to the Administrative Agent within 30 days after
the Filing Date; provided, that (A) the Bank Administrative Agent may
identify no more than three such additional contracts (such additional
contracts, together with the Cass County Contract, the "Specified
Contracts") and (B) the aggregate estimated loss of those additional
contracts (as determined by the most recent good faith calculation by
the Borrower's management at the time of identification of such
contract by the Bank Administrative Agent) shall not exceed $1,868,000;
(iii) to repay the Indebtedness of the Borrower outstanding
under the Emergency Loan for costs incurred by the members of the
Transit Group; and
(iv) to pay the fees payable pursuant to the terms hereof and
the Bond Support Credit Agreement;
(v) to fund the Expense Account;
(vi) for general working capital purposes (including payment
of up to fifty-eight percent (58%) of General Corporate Overhead
Expenses and General Restructuring Costs of the Borrower);
in each case in accordance with the Transit Budget most recently
delivered to the Administrative Agent and the Lenders pursuant to Section
5.01(d)(iv) (subject to the variance permitted under Section 6.12).
(b) The proceeds of the Tranche B Loans made hereunder shall be used by
the Borrower solely as specified in Sections 2.02(b).
(c) None of the proceeds of the Loans may be used by the Borrower to
amortize, repay or prepay any Indebtedness of the Borrower or any of its
Subsidiaries or Affiliates for borrowed money, other than (i) the Emergency
Loan, (ii) as provided in Section 4.15(a)(i), or (iii) as provided in Article II
in respect of Indebtedness owed by the Borrower to the Issuer.
(d) No proceeds of the Loans or the Collateral will be used by the
Borrower or any other Person (including, without limitation, any statutory
committee appointed in the Bankruptcy Cases) to (i) object to or contest in any
manner, or raise any defenses to, the validity, extent, perfection, priority or
enforceability of the Obligations, the Liens granted to the Administrative Agent
and the Lenders under this Agreement and the Collateral Documents or any other
rights or
41
interests of the Administrative Agent and the Lenders under this Agreement and
the other Credit Documents or (ii) assert any claims or causes of action,
including, without limitation, any actions under Chapter 5 of the Bankruptcy
Code, against the Administrative Agent and/or the Lenders.
Section 4.16 Environmental Matters.
Except as would not reasonably be expected to have a Material Adverse
Effect:
(a) Each of the facilities and Properties owned, leased or operated by
any Credit Party (the "Facilities") and all operations at the Facilities are in
compliance with all applicable Environmental Laws, and there is no violation of
any Environmental Law with respect to the Facilities or the businesses operated
by any Credit Party (the "Businesses"), and there are no conditions relating to
the Businesses or Facilities that could give rise to liability under any
applicable Environmental Laws.
(b) None of the Facilities contains, or has previously contained, any
Materials of Environmental Concern at, on or under the Facilities in amounts or
concentrations that constitute or constituted a violation of, or could give rise
to liability under, Environmental Laws.
(c) No Credit Party has received any written or verbal notice of, or
inquiry from any Governmental Authority regarding, any violation, alleged
violation, non-compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws with regard to any
of the Facilities or the Businesses, nor does any Credit Party have knowledge or
reason to believe that any such notice will be received or is being threatened.
(d) Materials of Environmental Concern have not been transported or
disposed of from the Facilities, or generated, treated, stored or disposed of
at, on or under any of the Facilities or any other location, in each case by or
on behalf any Credit Party in violation of, or in a manner that would be
reasonably likely to give rise to liability under, any applicable Environmental
Law.
(e) No judicial proceeding or governmental or administrative action is
pending or, to the best knowledge of any Credit Party, threatened, under any
Environmental Law to which any Credit Party is or will be named as a party, 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 Credit Party, the
Facilities or the Businesses.
(f) There has been no release or, threat of release of Materials of
Environmental Concern at or from the Facilities, or arising from or related to
the operations (including, without limitation, disposal) of any Credit Party in
connection with the Facilities or otherwise in connection with the Businesses,
in violation of or in amounts or in a manner that could give rise to liability
under Environmental Laws.
Section 4.17 Disclosure.
(a) Neither this Agreement, any of the financial statements delivered
to the Administrative Agent, the Lenders or the Issuer, any other document,
certificate or statement
42
furnished to the Administrative Agent, the Lenders or the Issuer (with the
exception of budgets and projections) nor any of the information delivered in
writing to the Bankruptcy Court by or on behalf of any Credit Party in
connection with the transactions contemplated hereby contains any untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements contained therein or herein not misleading.
(b) The budget and projections furnished to the Administrative Agent
and/or the Lenders by or on behalf of any Credit Party in connection with the
transactions contemplated hereby have been prepared in good faith on the basis
of reasonable assumptions.
Section 4.18 Bank Accounts.
Schedule 4.18 contains a complete and accurate list of all bank
accounts maintained by the Credit Parties with any bank or other financial
institution.
Section 4.19 Insurance.
All policies of insurance of any kind or nature owned by or issued to
any Credit Party, including, without limitation, policies of life, fire, theft,
product liability, public liability, property damage, other casualty, employee
fidelity, workers' compensation and employee health and welfare insurance, are
(a) in full force and effect, (b) to the Credit Parties' knowledge, sufficient,
and (c) of a nature and provide such coverage as is customarily carried by
companies of the size and character of such Person.
Section 4.20 Labor Matters.
(a) There are no strikes, work stoppages, slowdowns or lockouts pending
or, to the Credit Parties' knowledge, threatened against or involving any Credit
Party, other than those which in the aggregate have no Material Adverse Effect.
(b) There are no arbitrations or grievances pending against or
involving any Credit Party, nor are there any arbitrations or grievances, to
any Credit Party's knowledge, threatened involving any Credit Party, other than
those which, in the aggregate, if resolved adversely to a Credit Party, would
have no Material Adverse Effect.
(c) There is no organizing activity involving any Credit Party pending
or, to any Credit Party's knowledge, threatened by any labor union or group of
employees, other than those which in the aggregate have no Material Adverse
Effect. There are no representation proceedings pending or, to any Credit
Party's knowledge, threatened with the National Labor Relations Board, and no
labor organization or group of employees of any Credit Party has made a pending
demand for recognition, other than those which in the aggregate have no Material
Adverse Effect.
(d) There are no unfair labor practices charges, grievances or
complaints pending or in process or, to each Credit Party's knowledge,
threatened by or on behalf of any employee or group of employees of any Credit
Party, other than those which in the aggregate, if adversely determined, would
have no Material Adverse Effect.
43
(e) There are no complaints or charges against any Credit Party pending
or, to each Credit Party's knowledge, threatened to be filed with any Federal,
state, local or foreign court, governmental agency or arbitrator based on,
arising out of, in connection with, or otherwise relating to the employment by
any Credit Party of any individual, other than those which in the aggregate, if
resolved adversely, would have no Material Adverse Effect.
(f) Each Credit Party is in compliance with all laws, and all orders of
any court, Governmental Authority or arbitrator, relating to the employment of
labor, including, without limitation, all such laws relating to wages, hours,
collective bargaining, discrimination, civil rights, and the payment of
withholding and/or social security and similar taxes, except for such
non-compliances that in the aggregate have no Material Adverse Effect.
ARTICLE V
AFFIRMATIVE COVENANTS
As long as any of the Obligations, Commitments or the Letter of Credit
remain outstanding, each Credit Party agrees with the Lenders, the Issuer and
the Administrative Agent that:
Section 5.01 Financial Statements.
The Borrower shall furnish, or cause to be furnished, to the
Administrative Agent, the Issuer and Lenders:
(a) Audited Consolidated Financial Statements. As soon as available,
but in any event within ninety-five (95) days after the end of each fiscal
year, an audited consolidated balance sheet of the Consolidated Group as of the
end of such fiscal year and the related consolidated statements of operations,
shareholders' equity and cash flows for such fiscal year, all prepared in
conformity with GAAP and certified by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, or other firm of
independent certified public accountants of nationally recognized standing
reasonably acceptable to the Majority Lenders, setting forth in each case in
comparative form the figures for the previous year.
(b) Quarterly Financial Statements. As soon as available and in any
event within forty-five (45) days after the end of each of the first three
fiscal quarters of each fiscal year, (i) a consolidated balance sheet of the
Consolidated Group as of the end of such quarter, (ii) consolidated statements
of income and cash flows of the Consolidated Group, in each case for the period
commencing at the end of the previous fiscal year and ending with the end of
such fiscal quarter, all prepared in conformity with GAAP and certified by the
chief financial officer of the Borrower as fairly presenting the financial
condition and results of operations of the Consolidated Group at such date and
for such period (subject to normal year-end adjustments).
(c) Borrower-Prepared Financial Statements.
(i) Annual Transit Group Financial Statements.
44
As soon as available, but in any event within ninety-five (95) days
after the end of each fiscal year, a company-prepared consolidated balance
sheet of the Transit Group as of the end of such fiscal year and the related
consolidated statements of operations, shareholders' equity and cash flows for
the Transit Group for such fiscal year.
(ii) Monthly Financial Statements.
(A) Consolidated Group. As soon as available,
but in any event within forty (40) days
after the end of the first calendar month
ending after the Closing Date and within
thirty (30) days after the end of each
subsequent calendar month, company-prepared
consolidated and consolidating balance
sheets of the Consolidated Group as of the
end of such calendar month and related
company-prepared consolidated and
consolidating statements of operations,
shareholders' equity and cash flows for such
monthly period and for the fiscal year to
date, in each case setting forth in
comparative form the consolidated and
consolidating figures for the corresponding
period or periods of the preceding fiscal
year or the portion of the fiscal year
ending with such period, as applicable, in
each case subject to normal year-end audit
adjustments.
(B) Transit Group. As soon as available, but in
any event forty (40) days after the end of
the first calendar month ending after the
Closing Date and within thirty (30) days
after the end of each subsequent calendar
month, company-prepared consolidated and
consolidating balance sheets of the Transit
Group as of the end of such calendar month
and related company-prepared consolidated
and consolidating statements of operations,
shareholders' equity and cash flows for the
Transit Group such monthly period and for
the fiscal year to date, in each case
setting forth in comparative form the
consolidated and consolidating figures for
the corresponding period or periods of the
preceding fiscal year or the portion of the
fiscal year ending with such period, as
applicable, in each case subject to normal
year-end audit adjustments.
(iii) Cash Flow Reports for Transit Group.
(A) Forecast. A report, in a form acceptable to
the Administrative Agent, that includes a
detailed cash flow projection (including the
total amount of General Corporate Overhead
Expenses and General Restructuring Costs and
the allocation thereof) of the Transit Group
for the then upcoming thirteen weeks, on a
consolidated and consolidating basis (each a
"Forecast"), with (x) the initial Forecast
to be for the period from October 1, 2001
through December 31, 2001 and to be
delivered on or prior to October 11, 2001
and (y) each subsequent Forecast to be for
the thirteen week period immediately
following the end of the thirteen
45
week period covered by the prior Forecast
and to be delivered at least ten (10) days
prior to the commencement of such thirteen
week period; and
(B) Variance Analysis. Within four (4) Business
Days after the end of each week, a variance
analysis (the "Variance Analysis")
reflecting a detailed comparison between
actual cash flows for the Transit Group
through the end of the previous week on a
consolidated and consolidating basis and
those projected for such period in the
Initial Transit Budget, the Second Transit
Budget or the Transit Budget, as the case
may be, for such period, in each case in
form reasonably acceptable to the
Administrative Agent, together with a
certificate from a Responsible Officer of
the Borrower explaining any variances
between the actual results from operations
and the amounts set forth in the
corresponding budget.
(iv) Accounts Payable Agings for Transit Group.
Concurrently with the delivery of the Forecast, a summary of the
accounts payable agings of the Transit Group in a form reasonably acceptable to
the Administrative Agent.
(v) Surety Claims.
Within five (5) Business Days of receipt, written notice of any
notification from any surety of any member of the Transit Group concerning
claims made against such surety in connection with any significant project of
such member of the Track Group, and, as soon as available, and in any event
within five (5) Business Days after the receipt of such notification, a copy of
any such notification.
(d) Borrower-Prepared Budgets and Reconciliations.
(i) [Reserved.]
(ii) within twenty (20) days of the Filing Date, a business
analysis for the Transit Group in form, scope and substance
satisfactory to the Administrative Agent that includes an evaluation
of all open bonded contracts with values in excess of $50,000 (or such
greater amount as determined by the Administrative Agent in its sole
discretion) and details the cash flows of such bonded contracts (to
identify in particular negative cash flow contracts) for the next year
or thereafter;
(iii) within thirty (30) days of the Closing Date, a business
analysis for the Transit Group in form, scope and substance
satisfactory to the Administrative Agent that includes an evaluation
of all open non bonded contracts with values in excess of $50,000 (or
such greater amount as determined by the Administrative Agent in its
sole discretion) to include a cash flow analysis of such non bonded
contracts (to identify in particular negative cash flow contracts) for
the next year or thereafter that addresses the profitability of
existing projects with large cash requirements in the near term;
46
(iv) itemized budgets for each member of the Transit Group in
form, scope and substance satisfactory to the Administrative Agent in
its sole discretion (each, a "Transit Budget"), with (A) the initial
Transit Budget to be for the 45-day period immediately following the
Closing Date (the "Initial Transit Budget") and to be delivered on or
prior to the Closing Date, (B) the subsequent Transit Budget to be for
the 45-day period immediately following the end of the Initial Transit
Budget period (the "Second Transit Budget") and to be delivered at
least 15 days prior to the commencement of such 45-day period, and (C)
each subsequent Transit Budget to be for the 180-day period
immediately following the end of the previous budgeted period and to
be delivered at least 15 days prior to the commencement of such
180-day period;
(v) within forty (40) days after the end of the first calendar
month ending after the Closing Date and within thirty (30) days after
the end of each subsequent calendar month, an itemized report
reconciling actual results from operations of each member of the
Transit Group for such calendar month with the Borrower's original
2001 business plan or the revised Business Plan submitted and accepted
by the Administrative Agent in accordance with clause (vi) of this
Section, as the case may be, for such period, in each case in form
reasonably acceptable to the Administrative Agent, together with a
certificate from the chief financial officer of the Borrower
explaining any variances between the actual results from operations
and the amounts set forth in the corresponding business plan; and
(vi) on or before December 1, 2001, a business plan for the
Consolidated Group in form, scope and substance satisfactory to the
Administrative Agent (the "Business Plan").
All such financial statements and reports delivered pursuant to this
Section 5.01 shall be complete and correct in all material respects (subject,
in the case of interim statements, to normal year-end audit adjustments) and
shall be prepared in reasonable detail and, in the case of the annual and
quarterly financial statements provided in accordance with subsections (a) and
(b) above, in accordance with GAAP applied consistently throughout the periods
reflected therein and further accompanied by a description of, and an
estimation of the effect on the financial statements on account of, any change
in the application of accounting principles as provided in Section 1.03.
Section 5.02 Certificates; Other Information.
The Borrower shall furnish, or cause to be furnished, to the
Administrative Agent, the Issuer and the Lenders:
(a) Accountant's Certificate and Reports. Concurrently with the
delivery of the financial statements referred to in subsection 5.01(a) above, a
certificate of the independent certified public accountants reporting on such
financial statements stating that in the course of the regular audit of the
business of the Borrower and its Subsidiaries, which audit was conducted by
such accounting firm in accordance with generally accepted auditing standards,
such accounting firm has obtained no knowledge that the Borrower is not in
compliance with the
47
financial covenants set forth in Section 6.14 hereof, insofar as such covenants
relate to accounting matters, except as specified in such certificate.
(b) Officer's Compliance Certificate. Concurrently with the delivery
of the financial statements referred to in Sections 5.01(b) and 5.01(c) above,
a certificate of a Responsible Officer, substantially in the form of Exhibit E,
stating that, to the best of such Responsible Officer's knowledge and belief,
(i) the financial statements fairly present in all material respects the
financial condition of the parties covered by such financial statements, (ii)
during such period the Credit Parties have observed or performed in all
material respects the covenants and other agreements hereunder and under the
other Credit Documents relating to them, and satisfied in all material respects
the conditions contained in this Agreement to be observed, performed or
satisfied by them, and (iii) such Responsible Officer has obtained no knowledge
of any Default or Event of Default, except as specified in such certificate.
(c) Accountants' Reports. Promptly upon receipt, a copy of any final
(as distinguished from a preliminary or discussion draft) "management letter"
or other similar report submitted by independent accountants or financial
consultants to the members of the Consolidated Group in connection with any
annual, interim or special audit or which refers in whole or in part to any
inadequacy, defect, problem, qualification or other lack of fully satisfactory
accounting controls utilized by the Borrower or any of its Subsidiaries.
(d) Public Information. Within thirty days after the same are sent,
copies of all reports (other than those otherwise provided pursuant to Section
5.01) and other financial information which the Borrower sends to its public
stockholders, and within thirty days after the same are filed, copies of all
financial statements and non-confidential reports which the Borrower may make
to, or file with, the SEC.
(e) Bankruptcy Court Matters. Promptly, copies of all pleadings,
motions, applications, and other documents filed by any Credit Party with the
Bankruptcy Court or distributed by any Credit Party to the office of the United
States Trustee or to any official committee of creditors or interest holders.
(f) Insurance Policy Reimbursement Invoices. Promptly, and in any
event within two Business Days of its receipt thereof, a copy of (i) each
invoice or other notification from AIG or its Affiliates of amounts due in
respect of reimbursement obligations due under the Borrower's automobile,
general liability or workers' compensation policies issued by AIG or its
Affiliates for the 2002 policy year and (ii) each notification from or on
behalf of AIG or its Affiliates of its or their intention to draw on the Letter
of Credit.
(g) Other Information. Promptly, such additional financial and other
information as the Administrative Agent, at the request of any Lender, may from
time to time reasonably request.
Section 5.03 Notices.
The Borrower shall give notice to the Administrative Agent (which
shall promptly transmit such notice to each Lender and the Issuer) of:
48
(a) Defaults. Immediately (and in any event within two (2) days)
after any Responsible Officer knows of the occurrence of any Default or Event
of Default.
(b) Contractual Obligations. Promptly (and in any event within ten
(10) days) after any Responsible Officer knows of the occurrence of any default
or event of default under any Contractual Obligation of any Credit Party which
would reasonably be expected to have a Material Adverse Effect.
(c) Legal Proceedings. Promptly (and in any event within ten (10)
days) after any Responsible Officer knows of any litigation, or any
investigation or proceeding (including without limitation, any environmental
proceeding), or any material development in respect thereof, affecting any
Credit Party which, if adversely determined, would reasonably be expected to
have a Material Adverse Effect.
(d) ERISA. Promptly (and in any event within thirty (30) days) after
any Responsible Officer knows or has reason to know of (i) any event or
condition, including, but not limited to, any Reportable Event, that
constitutes, or might reasonably lead to, an ERISA Event; (ii) with respect to
any Multiemployer Plan, the receipt of notice as prescribed in ERISA or
otherwise of any withdrawal liability assessed against any of their ERISA
Affiliates, or of a determination that any Multiemployer Plan is in
reorganization or insolvent (both within the meaning of Title IV of ERISA);
(iii) the failure to make full payment on or before the due date (including
extensions) thereof of all amounts which any Credit Party or any ERISA
Affiliate are required to contribute to each Plan pursuant to its terms and as
required to meet the minimum funding standard set forth in ERISA and the
Internal Revenue Code; or (iv) any change in the funding status of any Plan
that reasonably could be expected to have a Material Adverse Effect; together
with a description of any such event or condition or a copy of any such notice
and a statement by the chief financial officer of the Borrower briefly setting
forth the details regarding such event, condition, or notice, and the action,
if any, which has been or is being taken or is proposed to be taken by the
Credit Parties with respect thereto. Promptly upon request, the Credit Parties
shall furnish the Administrative Agent and the Lenders with such additional
information concerning any Plan as may be reasonably requested, including, but
not limited to, copies of each annual report/return (Form 5500 series), as well
as all schedules and attachments thereto required to be filed with the
Department of Labor and/or the Internal Revenue Service pursuant to ERISA and
the Internal Revenue Code, respectively, for each "plan year" (within the
meaning of Section 3(39) of ERISA).
(e) Other. Promptly (and in any event within ten (10) days), any
other development or event which a Responsible Officer determines could
reasonably be expected to have a Material Adverse Effect.
Each notice pursuant to this subsection shall be accompanied by a
statement of a Responsible Officer setting forth details of the occurrence
referred to therein and stating what action the relevant Credit Parties propose
to take with respect thereto.
Section 5.04 Payment of Obligations.
49
Subject to the DIP Financing Orders, each Credit Party shall pay,
discharge or otherwise satisfy, at or before maturity or before they become
delinquent (subject, where applicable, to specified grace periods), as the case
may be, all material post-petition obligations of such Credit Party of whatever
nature and any additional costs that are imposed as a result of any failure to
so pay, discharge or otherwise satisfy such obligations, except when the amount
or validity of such obligations and costs is currently being contested in good
faith by appropriate proceedings and reserves, if applicable, in conformity
with GAAP with respect thereto have been provided on the books of such Credit
Party.
Section 5.05 Conduct of Business and Maintenance of Existence.
Subject to the DIP Financing Orders, each Credit Party shall (a)
continue to engage in business of the same general type as conducted on the
Closing Date by such Credit Party and similar or related businesses (including,
without limitation, the provision of any services to rail transportation
businesses); (b) preserve, renew and keep in full force and effect its
corporate or other legal existence except as otherwise permitted by this
Agreement, (c) take all reasonable action to maintain all rights, privileges,
licenses and franchises necessary or desirable in the normal conduct of its
business except to the extent that failure to comply therewith would not, in
the aggregate, have a Material Adverse Effect and (d) comply with all
post-petition Contractual Obligations, its Certificate of Incorporation or
Bylaws (or other organizational or governing documents) and all Requirements of
Law applicable to it except to the extent that failure to comply therewith
would not, in the aggregate, have a Material Adverse Effect.
Section 5.06 Maintenance of Property; Insurance.
Each member of the Transit Group shall keep all material property
useful and necessary in its business in reasonably good working order and
condition (ordinary wear and tear excepted) except to the extent that failure
to comply therewith would not, in the aggregate, have a Material Adverse
Effect; maintain with financially sound and reputable insurance companies
casualty, liability and such other insurance (which may include plans of
self-insurance) with such coverage and deductibles, and in such amounts as may
be consistent with prudent business practice and in any event consistent with
normal industry practice (except to any greater extent as may be required by
the terms of any of the other Credit Documents); and furnish to the
Administrative Agent, upon written request, full information as to the
insurance carried.
Section 5.07 Books and Records; Inspection of Property;
Discussions.
(a) Each Credit Party shall keep proper books of records and account
in which full, true and correct entries in conformity with GAAP and all
Requirements of Law shall be made of all dealings and transactions in relation
to its businesses and activities;
(b) Each Credit Party shall permit, during regular business hours and
upon reasonable notice to a Responsible Officer by the Administrative Agent,
the Administrative Agent, and its representatives, to visit and inspect any of
its Facilities that are used by any member of the Transit Group and examine and
make abstracts (including photocopies) from any of its books and records (other
than materials protected by the attorney-client privilege and materials which
50
such Credit Party may not disclose without violation of a confidentiality
obligation binding upon it);
(c) Each Credit Party shall permit the Administrative Agent and the
Lenders to discuss the business, operations, Facilities and financial and other
condition of the Credit Parties with officers and employees of the Credit
Parties and, so long as any discussion takes place in the presence of a
Responsible Officer, the Borrower's independent certified public accountants;
and
(d) Each Credit Party shall cooperate fully with any consultant that
is a "disinterested person" (as defined in Section 101(14) of the Bankruptcy
Code) retained by the Administrative Agent and the Lenders (the "Consultant"),
which cooperation shall include, without limitation, allowing the Consultant
reasonable access to observe the Credit Parties' respective operations and
financial records and projections, and the Borrower shall reimburse the
Administrative Agent and the Lenders for all reasonable fees and expenses
incurred by the Administrative Agent and the Lenders in connection with their
retention of the Consultant;
(e) The Borrower shall (i) continue to engage a crisis manager (the
"Crisis Manager") to assist it in improving its cash management and financial
reporting and developing a comprehensive business recovery plan in form
reasonably acceptable to the Administrative Agent for presentation to the
Administrative Agent and the Lenders, (ii) cause the Crisis Manager to meet
periodically with the Administrative Agent and the Lenders to report on the
Crisis Manager's findings, reports and recommendations, and (iii) refrain from
terminating its current engagement of Glass & Associates, Inc. as Crisis
Manager unless the Borrower immediately replaces Glass & Associates, Inc. with
another Crisis Manager with similar experience and reputation, and upon similar
terms and scope; and
(f) Each Credit Party shall permit the Administrative Agent, on behalf
of the Lenders, and its representatives (including representatives of the
Lenders), to conduct an annual audit of the inventory and receivables of the
Credit Parties, at the expense of the Borrower.
The cost of the inspection referred to in clause (b) above shall be
for the account of the Credit Parties.
Section 5.08 Environmental Laws.
(a) Each Credit Party shall comply in all material respects with, and
take reasonable actions to ensure compliance in all material respects by all
tenants and subtenants, if any, with, all applicable Environmental Laws and
obtain and comply in all material respects with and maintain, and take
reasonable actions to ensure that all tenants and subtenants obtain and comply
in all material respects with and maintain, any and all licenses, approvals,
notifications, registrations or permits required by applicable Environmental
Laws except to the extent that failure to do so would not reasonably be
expected to have a Material Adverse Effect; and
(b) Each Credit Party shall conduct and complete all investigations,
studies, sampling and testing, and all remedial, removal and other actions
required under Environmental Laws and promptly comply in all material respects
with all lawful orders and directives of all Governmental Authorities regarding
Environmental Laws except to the extent that the same are
51
being contested in good faith by appropriate proceedings and the failure to do
or the pendency of such proceedings would not reasonably be expected to have a
Material Adverse Effect.
Section 5.09 Additional Guaranties and Stock Pledges.
(a) Domestic Subsidiaries. At any time that any Credit Party forms,
creates or otherwise acquires any Domestic Subsidiary that is part of the
"transit" segment of the Borrower's business, such Credit Party shall (i)
notify the Administrative Agent within 10 days thereof and (ii) within 30 days
thereof, (A) cause such Domestic Subsidiary to become a Guarantor by execution
of a Joinder Agreement, (B) cause such Domestic Subsidiary to deliver with the
Joinder Agreement such supporting resolutions, incumbency certificates,
corporate formation and organizational documentation and opinions of counsel as
the Administrative Agent may reasonably request, and (C) deliver stock
certificates and related pledge agreements or pledge joinder agreements (in
form and substance satisfactory to the Administrative Agent) evidencing the
pledge of 100% of the Capital Stock of such Domestic Subsidiary as security for
the Obligations, together with undated stock transfer powers executed in blank.
(b) Foreign Subsidiaries. At any time that any Credit Party forms,
creates or otherwise acquires any Foreign Subsidiary that is part of the
"transit" segment of the Borrower's business directly owned by the Borrower or
any Domestic Subsidiary, the Borrower shall (i) notify the Administrative Agent
within 10 days thereof and (ii) within 30 days thereof, (A) deliver, or cause
delivery of, stock certificates and related pledge agreements or pledge joinder
agreements (in form and substance satisfactory to the Administrative Agent)
evidencing the pledge of 66% (or such greater percentage which would not result
in material adverse tax consequences) of the Capital Stock entitled to vote
(within the meaning of Treas. Reg. Section 1.956-2(c)(2)) and 100% of the
Capital Stock not entitled to vote (within the meaning of Treas. Reg. Section
1.956-2(c)(2)) of such Foreign Subsidiary as security for the Obligations,
together with undated stock transfer powers executed in blank and (B) cause
such Foreign Subsidiary to deliver such corporate formation and organizational
documentation and opinions of counsel (regarding the enforceability and
creating, priority and perfection of the stock pledge) as the Administrative
Agent may reasonably request.
Section 5.10 Ownership of Subsidiaries.
The Borrower shall, directly or indirectly, own at all times 100% of
the Voting Stock of each of member of the Transit Group.
Section 5.11 Application of Proceeds.
(a) The Borrower shall use the entire amount of the proceeds of the
Loans as provided in Section 4.15.
(b) The Borrower shall use a portion of the proceeds of the initial
Loans and a portion of the proceeds of the initial "Loans" (as defined in the
TP&S Revolving Credit Agreement) under the TP&S Revolving Credit Agreement to
permanently repay 100% of the Indebtedness outstanding under the Emergency
Loan.
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(c) The Borrower shall deposit $1,374,000 of the proceeds of the
initial Loans in a blocked account maintained with the Administrative Agent
(such account, the "Expense Account"). The funds in the Expense Account shall
be a reserve to be applied by the Administrative Agent to pay any unpaid
General Corporate Overhead Expenses and General Restructuring Costs; provided
that in no event shall the members of the Transit Group pay more than 58% of
the Borrower's total General Corporate Overhead Expenses and General
Restructuring Costs. The Credit Parties agree that the amounts in the Expense
Account shall be subject to the Administrative Agent's Lien and withdrawals by
any Credit Party shall not be permitted.
Section 5.12 Compliance with Budgets.
As of the end of each week, the aggregate amount of actual
disbursements for operating expenses by members of the Transit Group during the
period from the Closing Date to the end of such week shall not exceed the
budgeted amounts for such period (as set forth in the related Initial Transit
Budget, Second Transit Budget or Transit Budget, as the case may be) by more
than (i) five percent (5%) for all budgeted line items in the aggregate and
(ii) ten percent (10%) for any individual line item on such budget (such line
items as to which such variance requirement shall apply to be determined by the
Administrative Agent in its sole discretion).
Section 5.13 Transit Payment Accounts; Payments.
(a) Transit Payment Accounts. The Borrower shall at all times
maintain with the Administrative Agent (or, at the option of the Administrative
Agent, its agent or the Bank Administrative Agent (the "Transit Payment Account
Agent")) a bank account for the members of the Transit Group (the "Transit
Payment Account"). All proceeds of any account receivable or other receivables
and all cash from the sale of inventory or equipment or for the rendition of
services, or otherwise, received by any member of the Transit Group shall be
received by such member of the Transit Group as the Administrative Agent's
trustee, and, within one (1) Business Day after receipt thereof, shall be
delivered to the Transit Payment Account Agent in their original form duly
endorsed in blank or deposit them in the Transit Payment Account, as the
Administrative Agent may direct. If requested by the Administrative Agent in
its sole discretion, each Credit Party shall instruct all of the account
debtors in respect of its accounts receivable and other receivables related to
the Transit Group to make all payments with respect thereto directly into the
Transit Payment Account. All amounts in the Transit Payment Account (including
any amounts received directly by any member of the Transit Group and which are
held in trust for the Administrative Agent) shall (i) be subject to the Transit
Payment Account Agent's control and (ii) if applicable, be applied to the
prepayment of the Loans pursuant to Section 2.05. Withdrawals from the Transit
Payment Account by any member of the Transit Group or any other Person shall
not be permitted, during the continuance of any Event of Default.
(b) Payments. Unless a Default or Event of Default shall be
continuing, all collected funds held in the Transit Payment Accounts shall be
remitted by the Transit Payment Account Agent on a daily basis to the Borrower.
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Section 5.14 Payment of Taxes, Etc.
Each Credit Party shall pay and discharge, before the same shall
become delinquent, all lawful post-petition governmental claims, taxes,
assessments, charges and levies, except where contested in good faith by proper
proceedings, if adequate reserves therefor have been established on the books
of such Credit Party in conformity with GAAP.
Section 5.15 Collateral Documents.
Each Credit Party, at its sole cost and expense, shall take all
actions necessary or reasonably requested by the Administrative Agent to
maintain each Collateral Document in full force and effect and enforceable in
accordance with its terms, including (a) making filings and recordations, (b)
making payments of fees and other charges, (c) issuing, and if necessary,
filing or recording supplemental documentation, including continuation
statements, (d) discharging all claims or other Liens (other than Permitted
Liens) adversely affecting the rights of the Administrative Agent or any Lender
in the Collateral, and (e) publishing or otherwise delivering notice to third
parties.
ARTICLE VI
NEGATIVE COVENANTS
As long as any of the Obligations, Commitments or Letter of Credit
remain outstanding, each Credit Party agrees with the Lenders, the Issuer and
the Administrative Agent that:
Section 6.01 Indebtedness.
No member of the Transit Group shall contract, create, incur, assume
or permit to exist, any Indebtedness, except:
(a) Indebtedness arising or existing under this Agreement and the
other Credit Documents;
(b) Indebtedness existing on the Filing Date (including Indebtedness
in respect of pre-petition surety obligations);
(c) Indebtedness arising under the Bond Credit Agreement and the Bond
Support Credit Agreement;
(d) purchase money Indebtedness (including Capital Lease Obligations)
incurred after the Closing Date to provide all or a portion of the purchase
price or costs of construction of an asset; provided that (i) such Indebtedness
when incurred shall not exceed the purchase price or cost of construction of
such asset, (ii) no such Indebtedness shall be refinanced for a principal
amount in excess of the principal balance outstanding thereon at the time of
such refinancing, and (iii) the aggregate amount of all such Indebtedness shall
not exceed $1,000,000 at any time outstanding;
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(e) unsecured intercompany Indebtedness owing by a member of the
Transit Group to another member of the Transit Group to the extent permitted by
Section 6.05;
(f) Indebtedness in respect of financed insurance premium
obligations;
(g) Indebtedness of the Borrower in respect of the "track" segment of
its business, under the TP&S Revolving Credit Agreement as in effect on the
date hereof; and
(h) Support Obligations of any member of the Transit Group in respect
of Indebtedness permitted under clauses (a) through (g) of this Section 6.01.
Section 6.02 Liens.
No member of the Transit Group shall contract, create, incur, assume
or permit to exist, any Lien or apply to the Bankruptcy Court to do the same
with respect to any of its property or assets of any kind (whether real or
personal, tangible or intangible), whether now owned or hereafter acquired,
except for Permitted Liens.
Section 6.03 Consolidation, Merger, Divestiture, etc.
(a) No member of the Transit Group shall enter into a transaction of
merger or consolidation, except the Borrower or any Domestic Credit Party may
be a party to a transaction of merger or consolidation with a Domestic Credit
Party, provided that (i) if the Borrower is a party thereto, it shall be the
surviving corporation, and (ii) no Default or Event of Default shall exist
either immediately prior to or immediately after giving effect thereto.
(b) No member of the Transit Group shall make any Divestiture unless
the consideration paid in connection therewith shall be cash or Cash
Equivalents (and such payment shall be contemporaneous with consummation of
such Divestiture).
(c) No member of the Transit Group shall liquidate, wind-up or
dissolve, whether voluntarily or involuntarily (or suffer to permit any such
liquidation or dissolution), other than in connection with a merger,
consolidation or Divestiture permitted under this Agreement.
Section 6.04 Acquisitions.
No member of the Transit Group shall make any Acquisition.
Section 6.05 Investments.
No member of the Transit Group shall make any Investment in any Person
except for Permitted Investments.
Section 6.06 Ownership of Equity Interests.
No member of the Transit Group shall enter into any Equity Transaction.
Section 6.07 Fiscal Year.
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The Borrower shall not change its fiscal year from a December 31 fiscal
year end.
Section 6.08 Restricted Payments.
No member of the Transit Group shall make or permit any Restricted
Payments.
Section 6.09 Sale Leasebacks.
No member of the Transit Group shall, directly or indirectly, become
liable as lessee or as guarantor or other surety with respect to any lease,
whether an Operating Lease or a Capital Lease, of any Property, whether now
owned or hereafter acquired, (a) which such Person has sold or transferred or is
to sell or transfer to any other Person other than a Credit Party or (b) which
such Person intends to use for substantially the same purpose as any other
Property which has been sold or is to be sold or transferred by such Person to
any other Person in connection with such lease.
Section 6.10 No Further Negative Pledges.
Except with respect to prohibitions against other encumbrances on
specific Property encumbered to secure payment of particular Indebtedness (which
Indebtedness relates solely to such specific Property, and improvements and
accretions thereto, and is otherwise permitted hereby), no member of the Transit
Group shall enter into, assume or become subject to any agreement prohibiting or
otherwise restricting the creation or assumption of any Lien upon its Facilities
or assets, whether now owned or hereafter acquired, or requiring the grant of
any security for such obligation if security is given for some other obligation.
Section 6.11 Limitations on Transactions with Affiliates.
No member of the Transit Group shall enter into or permit to exist any
transaction or series of transactions with any officer, director or Affiliate of
such Person other than (a) intercompany transactions expressly permitted by
Section 6.01, Section 6.03 or Section 6.05, (b) normal compensation and
reimbursement of expenses of officers and directors (including any retention
arrangements approved by the Administrative Agent) and (c) except as otherwise
specifically limited in this Agreement, other transactions which are entered
into in the ordinary course of such Person's business on terms and conditions
substantially as favorable to such Person as would be obtainable by it in a
comparable arms-length transaction with a Person other than an officer, director
or Affiliate.
Section 6.12 Payment of Other Indebtedness.
(a) No member of the Transit Group shall pay any Indebtedness arising
prior to the Filing Date other than (i) pursuant to the Motion of the Debtors
Pursuant to Section 105(a) of the Bankruptcy Code for Authorization to Pay
Prepetition Claims of Trade Vendors in form and substance reasonably
satisfactory to the Administrative Agent and (ii) as permitted by orders of the
Bankruptcy Court reasonably satisfactory in form and substance to the
Administrative Agent and the Lenders.
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(b) No member of the Transit Group shall prepay any Indebtedness,
except for the Obligations in accordance with the terms of this Agreement or in
connection with any mandatory prepayment provisions set forth in the Bond
Support Credit Agreement as in effect on the date hereof.
Section 6.13 Investment Banking and Finder's Fees.
No member of the Transit Group shall pay or agree to pay, or reimburse
any other party with respect to, any investment banking or similar or related
fee, underwriter's fee, finder's fee, or broker's fee to any Person in
connection with this Agreement, other than the fees payable pursuant to Section
2.08 of this Agreement.
Section 6.14 Maximum Capital Expenditures.
(a) From the period commencing on the Closing Date until December
31, 2001, the Credit Parties shall not permit the aggregate Capital
Expenditures of the members of the Transit Group to exceed $100,000 for any
calendar month within such period, provided that the unused amount available
for such Capital Expenditures under this Section 6.14(a) for any given month
may be carried forward and used in any subsequent calendar month.
(b) For each calendar month ending after December 31, 2001, Capital
Expenditures of the Transit Group shall be subject to such limitations as the
Administrative Agent shall establish (in consultation with the Borrower) based
upon the Business Plan.
Section 6.15 No Material Pleadings.
(a) None of the Credit Parties shall file any Material Pleading
without the prior written consent of the Majority Lenders.
(b) None of the Credit Parties shall consent, encourage, support or
assist in any manner to the entry of an order with respect to a Material
Pleading filed by any other Person without the prior written consent of the
Majority Lenders.
Section 6.16 Modification of Contractual Obligations.
The Borrower shall not, and shall not permit any of its Subsidiaries
to, alter, amend, modify, rescind, terminate or waive any of their respective
rights or obligations under, or fail to comply in all material respects with,
any of its material post-petition Contractual Obligations (including, without
limitation any of the Financing Agreements); provided, however, that, (a) with
respect to any Contractual Obligation (other than the Financing Agreements), the
Borrower shall not be deemed in default of this Section 6.16 if such
alterations, amendments, modifications, rescissions, terminations or waivers in
the aggregate have no Material Adverse Effect and (b) with respect to any
Financing Agreement, the Borrower shall not be deemed in default of this Section
6.16 if such alterations, amendments, modifications, rescissions, terminations
or waivers are not materially adverse to the interests of the Lenders and the
Administrative Agent; and provided, further, that in the event of any breach or
event of default by a Person other than the Borrower or any of its Subsidiaries,
the Borrower shall promptly notify the Administrative Agent of any such breach
or event of default and take all such action as
57
may be reasonably necessary in order to avoid having such breach or event of
default have a Material Adverse Effect.
Section 6.17 Accounting Changes.
No Credit Party shall make any change in accounting treatment and
reporting practices or tax reporting treatment, except as required by GAAP or
law and disclosed to the Lenders and the Administrative Agent.
ARTICLE VII
EVENTS OF DEFAULT
Section 7.01 Events of Default.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment. Any Credit Party shall:
(i) default in the payment when due of any principal of any
Loan, or
(ii) default, and such default shall continue for three (3)
or more Business Days, in the payment when due of (A) any interest
on any Loan or (B) any fees or other amounts owing under this
Agreement or any other Credit Documents or otherwise in connection
herewith or therewith; or
(b) Representations. Any representation, warranty or statement made or
deemed to be made herein, in any of the other Credit Documents, or in any
statement or certificate delivered or required to be delivered pursuant hereto
or thereto shall prove untrue in any material respect on the date as of which
it was made or deemed to have been made (other than those which are untrue
solely as a result of changes permitted by this Agreement); or
(c) Covenants. Any Credit Party shall:
(i) Default in the due performance or observance of any term,
covenant or agreement contained in Section 5.03(a), 5.05, 5.09, 5.10,
5.11, 5.13, 5.14, 5.15 or Article VI; or
(ii) Default in the due performance or observance by it of any
term, covenant or agreement (other than those referred to in
subsections (a), (b) or (c)(i) of this Section 7.01) contained in
this Agreement or any other Credit Document and such default shall
continue unremedied for a period of at least 30 days after the
earlier of a Responsible Officer becoming aware of such default or
notice thereof by the Administrative Agent; or
(d) Other Credit Documents. Except as to any Credit Party which is
dissolved, released or merged or consolidated out of existence as the result
of, or in connection with, a dissolution, merger or disposition permitted by
this Agreement, any Credit Document shall fail
58
to be (or any Credit Party or any Person acting by or on behalf of any Credit
Party shall claim or allege in writing that any Credit Document is not) in full
force and effect or to give the Administrative Agent and/or the Lenders any
material part of the Liens, rights, powers and privileges purported to be
created thereby; or
(e) Guaranties. Except as to any Credit Party which is dissolved,
released or merged or consolidated out of existence as the result of or in
connection with a dissolution, merger or disposition permitted by this
Agreement, the guaranty given by any Guarantor hereunder or any material
provision thereof shall cease to be in full force and effect, or any Guarantor
or any Person acting by or on behalf of such Guarantor shall deny or disaffirm
such Guarantor's obligations hereunder or under any other Credit Document; or
(f) Defaults under Other Agreements.
(i) Financing Agreements. The occurrence of an "Event of
Default" under the TP&S Revolving Credit Agreement, the Bond Credit
Agreement or the Bond Support Credit Agreement
(ii) With respect to any Indebtedness arising after the
Filing Date (other than Indebtedness outstanding under this
Agreement, the Bond Credit Agreement and the Bond Support Credit
Agreement) in excess of $500,000 in the aggregate for the members of
Transit Group taken as a whole, (A) (1) any member of the Transit
Group shall default in any payment (beyond the applicable grace
period with respect thereto, if any) with respect to any such
Indebtedness, or (2) the occurrence and continuation of a default in
the observance or performance relating to such Indebtedness or
contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event or condition shall occur or
condition exist, the effect of which default or other event or
condition is to cause, or permit, the holder or holders of such
post-petition Indebtedness (or trustee or agent on behalf of such
holders) to cause (determined without regard to whether any notice or
lapse of time is required), any such Indebtedness to become due prior
to its stated maturity; or (B) any such Indebtedness shall be
declared due and payable, or required to be prepaid other than by a
regularly scheduled required prepayment, prior to the stated maturity
thereof; or
(g) Judgments. Any Credit Party shall fail within 30 days of the date
due and payable to pay, bond or otherwise discharge any judgment, settlement or
order for the payment of money relating to claims arising after the Filing Date
which judgment, settlement or order, when aggregated with all other such
judgments, settlements or orders due and unpaid at such time, exceeds $500,000,
and which is not stayed on appeal (or for which no motion for stay is pending)
or is not otherwise being executed; or
(h) ERISA. Any of the following events or conditions, if such event or
condition could reasonably be expected to have a Material Adverse Effect: (i)
any "accumulated funding deficiency," as such term is defined in Section 302 of
ERISA and Section 412 of the Internal Revenue Code, whether or not waived,
shall exist with respect to any Plan, or any Lien shall arise on the assets of
any Credit Party or any ERISA Affiliate in favor of the PBGC or a Plan; (ii) an
ERISA Event shall occur with respect to a Single Employer Plan, which is, in
the reasonable
59
opinion of the Administrative Agent, likely to result in the termination of
such Plan for purposes of Title IV of ERISA; (iii) an ERISA Event shall occur
with respect to a Multiemployer Plan or Multiple Employer Plan, which is, in
the reasonable opinion of the Administrative Agent, likely to result in (A) the
termination of such Plan for purposes of Title IV of ERISA, or (B) any Credit
Party or any ERISA Affiliate incurring any liability in connection with a
withdrawal from, reorganization of (within the meaning of Section 4241 of
ERISA), or insolvency of (within the meaning of Section 4245 of ERISA) such
Plan; or (iv) any prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Internal Revenue Code) or breach of fiduciary
responsibility shall occur which may subject any Credit Party or any ERISA
Affiliate to any liability under Sections 406, 409, 502(i), or 502(l) of ERISA
or Section 4975 of the Internal Revenue Code, or under any agreement or other
instrument pursuant to which any Credit Party or any ERISA Affiliate has agreed
or is required to indemnify any person against any such liability; or
(i) Ownership. There shall occur a Change of Control; or
(j) Reorganization Plan. Any Credit Party shall file, or consent to,
support or encourage in any manner a filing by any other Person, with the
Bankruptcy Court a reorganization plan in respect of any member of the Transit
Group that does not provide for payment in full in cash of the Obligations on
the effective date thereof without the prior written consent of the Majority
Lenders and that is not otherwise reasonably satisfactory to the Administrative
Agent; or
(k) Prepayment of Other Indebtedness. Any Credit Party shall pay any
Indebtedness arising before the Filing Date other than (i) pursuant to the
Motion of the Debtors Pursuant to Section 105(a) of the Bankruptcy Code for
Authorization to Pay Prepetition Claims of Trade Vendors in form and substance
reasonably satisfactory to the Administrative Agent and (ii) as permitted by
orders of the Bankruptcy Court reasonably satisfactory in form and substance to
the Administrative Agent and the Lenders; or
(l) Bankruptcy Cases. Any of the Bankruptcy Cases shall be dismissed
or converted to a case under Chapter 7 of the Bankruptcy Code; a trustee under
Chapter 7 or Chapter 11 of the Bankruptcy Code shall be appointed in any of the
Bankruptcy Cases; or any Credit Party shall file or support any application for
the approval of, or there shall arise, any other claim (other than the
Carve-Out) which is an administrative expense claim having priority over any or
all administrative expenses of the kind specified in Sections 503(b) or 507(b)
of the Bankruptcy Code; or the Bankruptcy Cases of the Borrower and any other
member of the Consolidated Group shall be substantively consolidated or the
Bankruptcy Cases of any Guarantor and any member of the Consolidated Group that
is not a Guarantor shall be substantively consolidated; or
(m) Relief to Lien Holders. The Bankruptcy Court shall enter an order
granting relief from the automatic stay applicable under section 362 of the
Bankruptcy Code permitting foreclosure on any asset of any Credit Party with a
net depreciated book value in excess of $500,000; or
(n) Appointment of Trustee. An order of the Bankruptcy Court shall be
entered in any of the Bankruptcy Cases appointing a trustee, examiner or
Responsible Officer with
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expanded powers (powers beyond those set forth in Section 1106(a)(3) and (4) of
the Bankruptcy Code) to operate the Borrower's business or a substantial
portion thereof; or
(o) DIP Financing Orders.
(i) An order of the Bankruptcy Court shall be entered amending,
supplementing, vacating or otherwise modifying the Interim DIP
Financing Order or the Final DIP Financing Order that is not consented
to by the Administrative Agent and the Lenders; or
(ii) An order of the Bankruptcy Court shall be entered staying
for a period in excess of ten (10) days the Interim DIP Financing
Order or the Final DIP Financing Order that is not consented to by
the Administrative Agent and the Lenders (it being understood that
the entry of an order of the Bankruptcy Court staying the Interim DIP
Financing Order or the Final DIP Financing Order that is not
consented to by the Administrative Agent and the Lenders shall
constitute a "Default" under this Agreement); or
(p) Final DIP Financing Order. The Final DIP Financing Order shall
not have been entered by the Bankruptcy Court on or before the expiration of
the Interim Period; or
(q) Order of Bankruptcy Court. An order shall be entered by the
Bankruptcy Court confirming a plan of reorganization or liquidation in the
Bankruptcy Cases which does not contain a provision for termination of all of
the Commitments and payment in full in cash of the Obligations on or before the
effective date of such plan.
Section 7.02 Acceleration; Remedies.
Upon the occurrence and during the continuation of an Event of Default,
without further order of, application to, or action by the Bankruptcy Court, the
Administrative Agent (a) may, and shall upon the request of the Majority
Lenders, by written notice to the Borrower declare that all or any portion of
the Commitments be terminated, whereupon the obligation of each Lender to make
any Loan shall immediately terminate, and/or (b) may, and shall upon the request
of the Majority Lenders, by written notice to the Borrower declare the Loans,
all interest thereon and all other amounts and Obligations payable under this
Agreement to be forthwith due and payable, whereupon the Loans, all such
interest, and all such amounts and Obligations shall become and be forthwith due
and payable, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower. In addition, subject solely to
any requirement of the giving of notice by the terms of the Interim DIP
Financing Order or the Final DIP Financing Order, the automatic stay provided in
Section 362 of the Bankruptcy Code shall be automatically vacated without
further action or order of the Bankruptcy Court, and the Administrative Agent
and the Lenders shall be entitled to exercise all of their respective rights and
remedies under the Credit Documents and applicable law, including without
limitation, all rights and remedies with respect to the Collateral and the
Guarantors.
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ARTICLE VIII
GUARANTY
Section 8.01 The Guarantee.
(a) Each of the Guarantors hereby jointly and severally guarantees to
each Lender, the Issuer and to the Administrative Agent, as hereinafter
provided, the prompt payment of the Guaranteed Obligations in full when due
(whether at stated maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise) strictly in accordance with the
terms thereof. The Guarantors hereby further agree that if any of the
Guaranteed Obligations are not paid in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise), the Guarantors will, jointly and severally,
promptly pay the same, without any demand or notice whatsoever, and that in the
case of any extension of time of payment or renewal of any of the Guaranteed
Obligations, the same will be promptly paid in full when due (whether at
extended maturity, as a mandatory prepayment, by acceleration, as a mandatory
cash collateralization or otherwise) in accordance with the terms of such
extension or renewal.
(b) Notwithstanding any provision to the contrary contained herein or
in any of the other Credit Documents, to the extent the obligations of a
Guarantor shall be adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state, provincial or
Federal law relating to fraudulent conveyances or transfers or the granting of
financial assistance) then the obligations of each Guarantor hereunder shall be
limited to the maximum amount that is permissible under applicable law (whether
Federal, state or provincial and including, without limitation, the Bankruptcy
Code). In such case or otherwise at the request of the Administrative Agent,
each Credit Party shall take such action and shall execute and deliver all such
further documents required by the Administrative Agent to cause the obligations
of such Guarantor to be enforceable to the extent required by this Agreement.
Section 8.02 Obligations Unconditional.
The obligations of the Guarantors under Section 8.01 are joint and
several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Credit Documents or any
other agreement or instrument referred to therein, or any substitution, release
or exchange of any other guarantee of or security for any of the Guaranteed
Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor,
it being the intent of this Section 8.02 that the obligations of each of the
Guarantors hereunder shall be absolute and unconditional under any and all
circumstances. Each Guarantor agrees that such Guarantor shall have no right of
subrogation, indemnity, reimbursement or contribution against the Borrower or
any other Guarantor for amounts paid under this Article VIII until such time as
all of the Lenders and the Issuer have been paid in full, all of the Commitments
and Letter of Credit under the Agreement have been terminated and no Person or
Governmental Authority shall have any right to request any return or
reimbursement of funds from the Lenders or the Issuer in connection with monies
received under the Credit Documents. Without limiting the generality of the
foregoing, it is agreed that,
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to the fullest extent permitted by law, the occurrence of any one or more of
the following shall not alter or impair the liability of any Guarantor
hereunder which shall remain absolute and unconditional as described above:
(i) at any time or from time to time, without notice to any
Guarantor, the time for any performance of or compliance with any of
the Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of any
of the Credit Documents or any other agreement or instrument
referred to in the Credit Documents shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under any of the
Credit Documents or any other agreement or instrument referred to in
the Credit Documents shall be waived or any other guarantee of any of
the Guaranteed Obligations or any security therefor shall be released
or exchanged in whole or in part or otherwise dealt with;
(iv) any Lien granted to, or in favor of, the Administrative
Agent or any Lender or Lenders, as security for any of the Guaranteed
Obligations shall fail to attach or be perfected; or
(v) any of the Guaranteed Obligations shall be determined to
be void or voidable (including, without limitation, for the benefit
of any creditor of any Guarantor) or shall be subordinated to the
claims of any Person (including, without limitation, any creditor of
any Guarantor).
With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest and all notices
whatsoever, and any requirement that the Administrative Agent or any Lender
exhaust any right, power or remedy or proceed against any Person under any of
the Credit Documents or any other agreement or instrument referred to in the
Credit Documents, or against any other Person under any other guarantee of, or
security for, any of the Guaranteed Obligations.
Section 8.03 Reinstatement.
(a) The obligations of the Guarantors under this Article VIII shall be
automatically reinstated if and to the extent that for any reason any payment
by or on behalf of any Person in respect of the Guaranteed Obligations is
rescinded or must be otherwise restored by any holder of any of the Guaranteed
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Administrative Agent and each Lender on demand for all reasonable costs and
expenses (including, without limitation, reasonable fees and expenses of
counsel) incurred by the Administrative Agent or such Lender in connection with
such rescission or restoration, including any such costs and expenses incurred
in defending against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any bankruptcy,
insolvency or similar law.
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Section 8.04 Certain Additional Waivers.
Each Guarantor agrees that such Guarantor shall have no right of
recourse to security for the Guaranteed Obligations, except through the exercise
of the rights of subrogation pursuant to Section 8.02.
Section 8.05 Remedies.
The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, the Guaranteed Obligations may be declared to be
forthwith due and payable as provided in Section 7.02 (and shall be deemed to
have become automatically due and payable in the circumstances provided in said
Section 7.02) for purposes of Section 8.01 notwithstanding any stay, injunction
or other prohibition preventing such declaration (or preventing the Guaranteed
Obligations from becoming automatically due and payable) as against any other
Person and that, in the event of such declaration (or the Guaranteed Obligations
being deemed to have become automatically due and payable), the Guaranteed
Obligations (whether or not due and payable by any other Person) shall forthwith
become due and payable by the Guarantors for purposes of Section 8.01.
Section 8.06 Rights of Contribution.
The Guarantors hereby agree, as among themselves, that if any Guarantor
shall become an Excess Funding Guarantor, each other Guarantor shall, on demand
of such Excess Funding Guarantor (but subject to the succeeding provisions of
this Section 8.06), pay to such Excess Funding Guarantor an amount equal to such
Guarantor's Pro Rata Share (as defined below and determined, for this purpose,
without reference to the Facilities, assets, liabilities and debts of such
Excess Funding Guarantor) of such Excess Payment (as defined below). The payment
obligation of any Guarantor to any Excess Funding Guarantor under this Section
8.06 shall be subordinate and subject in right of payment to the prior payment
in full of the obligations of such Guarantor under the other provisions of this
Article VIII, and such Excess Funding Guarantor shall not exercise any right or
remedy with respect to such excess until payment and satisfaction in full of all
of such obligations. For purposes hereof, (a) "Excess Funding Guarantor" shall
mean, in respect of any obligations arising under the other provisions of this
Article VIII (hereafter, the "Guarantied Obligations"), a Guarantor that has
paid an amount in excess of its Pro Rata Share of the Guarantied Obligations;
(b) "Excess Payment" shall mean, in respect of any Guarantied Obligations, the
amount paid by an Excess Funding Guarantor in excess of its Pro Rata Share of
such Guarantied Obligations; and (c) "Pro Rata Share", for the purposes of this
Section 8.06, shall mean, for any Guarantor, the ratio (expressed as a
percentage) of (i) the amount by which the aggregate present fair saleable value
of all of its assets and Facilities exceeds the amount of all debts and
liabilities of such Guarantor (including contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of such Guarantor
hereunder) to (ii) the amount by which the aggregate present fair saleable value
of all assets and other Facilities of the Borrower and all of the Guarantors
exceeds the amount of all of the debts and liabilities (including contingent,
subordinated, unmatured, and unliquidated liabilities, but excluding the
obligations of the Borrower and the Guarantors hereunder) of the Borrower and
all of the Guarantors, all as of the Closing Date (if any Guarantor becomes a
party
64
hereto subsequent to the Closing Date, then for the purposes of this Section
8.06 such subsequent Guarantor shall be deemed to have been a Guarantor as of
the Closing Date and the information pertaining to, and only pertaining to,
such Guarantor as of the date such Guarantor became a Guarantor shall be deemed
true as of the Closing Date).
Section 8.07 Continuing Guarantee.
The guarantee in this Article VIII is a continuing guarantee, and shall
apply to all Guaranteed Obligations whenever arising.
ARTICLE IX
SECURITY
Section 9.01 Priority and Liens.
(a) Each of the Credit Parties hereby covenants, represents and
warrants that, upon entry of the Interim DIP Financing Order and the Amendment
Order (i) pursuant to Section 364(c)(1) of the Bankruptcy Code, the Obligations
shall at all times constitute allowed administrative expense claims in the
Bankruptcy Cases with priority over all administrative expense claims and
unsecured claims against the Credit Parties, now existing or hereafter arising,
of any kind or nature whatsoever, including, without limitation, administrative
expenses of the kinds specified in or ordered pursuant to Sections 105, 326,
330, 331, 503(a), 503(b), 506(c), 507(a), 507(b), 546(c), 546(d), and 1114 of
the Bankruptcy Code and (ii) pursuant to Sections 364(c)(2) and 364(d) of the
Bankruptcy Code, the Obligations shall at all times be secured by a perfected
first priority Lien on all property and assets of each member of the Transit
Group, except for the Excluded Assets, and all assets directly related to the
Specified Contracts (other than the equipment set forth on Schedule III)
subject only to (A) Senior Liens, (B) the Carve Out (defined below) in an
aggregate amount not in excess of $1,450,000 (the "Carve-Out") and (C) the
UST/Clerk Fees. The Carve-Out may be used only to pay the fees and expenses of
professionals employed by the Credit Parties, the fees and expenses of
professionals employed by any statutory committee appointed by the Bankruptcy
Court under Section 1102 of the Bankruptcy Code ("Statutory Committee"), and
the expenses of members of any such Statutory Committee; provided that all such
fees and expenses are authorized to be paid or approved by the Bankruptcy Court
to the extent required under the Bankruptcy Code; provided, however, that the
Carve-Out shall not include, apply to or be available for any fees or expenses
incurred by any party, including the Credit Parties or any Statutory Committee,
in connection with the initiation or prosecution (but not investigation) of any
claims, causes of action, adversary proceedings or other litigation against the
Administrative Agent or the Lenders, including, without limitation, challenging
the amount, validity, priority or enforceability of, or asserting any defense,
claim, counterclaim or offset to, the Obligations or the Liens of the
Administrative Agent, the Lenders and the Issuer under this Agreement in
respect thereof. The Lenders agree that so long as the Tranche B Maturity Date
shall not have occurred or the Administrative Agent or the Lenders have not
exercised any remedies as a result of an Event of Default, the Credit Parties
shall be permitted to pay compensation and reimbursement of expenses accrued
and payable under 11 U.S.C. [sec] 330 and 11 U.S.C. [sec] 331, as the same may
be due and payable as authorized by the Bankruptcy Court, and the same shall not
reduce the
65
amount available under the Carve-Out. The foregoing shall not be construed as a
consent to the allowance of any fees and expenses or bonuses referred to above
and shall not affect the right of the Credit Parties, the Administrative Agent
or the Lenders to object to the allowance and payment of such amounts.
(b) As to all real property the title to which is held by any of the
Credit Parties, or the possession of which is held by any of the Credit Parties
pursuant to a leasehold interest or otherwise, each of the Credit Parties
hereby assigns and conveys as security, grants a security interest in,
hypothecates, mortgages, pledges and sets over unto the Administrative Agent on
behalf of the Lenders and the Issuer all of the right, title and interest of
such Credit Party in all of such owned real property and in all such leasehold
interests or other interests, together in each case with all of the right,
title and interest of such Credit Party in and to all buildings, improvements,
and fixtures related thereto, any lease or sublease thereof, all general
intangibles relating thereto and all proceeds thereof, such assignment,
conveyance and security interest to have the priorities set forth in Section
9.01(a)(i) and (ii) above.
(c) Each of the Credit Parties acknowledges that, pursuant to the DIP
Financing Orders, the Liens in favor of the Administrative Agent on behalf of
the Lenders and the Issuer in all of such real property and leasehold
interests, and all of the other Collateral, shall be perfected without the
taking of any further action, including any recordation of any instruments of
mortgage or assignment, or the recording or filing of any financing statements,
notices of lien or other similar instruments.
ARTICLE X
THE ADMINISTRATIVE AGENT
Section 10.01 Appointment.
The Lenders and the Issuer hereby designate and appoint CSFB, as
Administrative Agent of the Lenders to act as specified herein and the other
Credit Documents, and each of the Lenders hereby authorizes the Administrative
Agent to take such action on its behalf under the provisions of this Agreement
and the other Credit Documents and to exercise such powers and perform such
duties as are expressly delegated to the Administrative Agent by the terms
hereof and of the other Credit Documents, together with such other powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
elsewhere herein and in the other Credit 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 or the Issuer,
and no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any of the other Credit
Documents, or shall otherwise exist against the Administrative Agent. The
provisions of this Article X are solely for the benefit of the Administrative
Agent, the Lenders and the Issuer, and none of the Credit Parties shall have any
rights as a third party beneficiary of the provisions hereof. In performing its
functions and duties under this Agreement and the other Credit Documents, the
Administrative Agent shall act solely as the Administrative Agent of the Lenders
and the Issuer and does not assume and shall not be deemed to have assumed any
obligation or relationship of agency or trust with or for any Credit Party or
any of their respective Affiliates.
66
Section 10.02 Delegation of Duties.
The Administrative Agent may execute any of its duties hereunder or
under the other Credit 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 it with reasonable
care.
Section 10.03 Exculpatory Provisions.
Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any
action lawfully taken or omitted to be taken by them or such Person under or in
connection herewith or in connection with any of the other Credit Documents
(except for its or such Person's own gross negligence or willful misconduct), or
(ii) responsible in any manner to any of the Lenders or the Issuer for any
recitals, statements, representations or warranties made by any of the Credit
Parties contained herein or in any of the other Credit Documents or in any
certificate, report, document, financial statement or other written or oral
statement referred to or provided for in, or received by the Administrative
Agent under or in connection herewith or in connection with the other Credit
Documents, or the enforceability or sufficiency therefor of any of the other
Credit Documents, or for any failure of any Credit Party to perform its
obligations hereunder or thereunder. The Administrative Agent shall not be
responsible to any Lender or the Issuer for the effectiveness, genuineness,
validity, enforceability, collectibility or sufficiency of this Agreement or any
of the other Credit Documents or for any representations, warranties, recitals
or statements made herein or therein or made by any Credit Party in any written
or oral statement or in any financial or other statements, instruments, reports,
certificates or any other documents in connection herewith or therewith
furnished or made available by the Administrative Agent to the Lenders or the
Issuer or by or on behalf of the Credit Parties to the Administrative Agent or
any Lender or the Issuer or be required to ascertain or inquire as to the
performance or observance of any of the terms, conditions, provisions, covenants
or agreements contained herein or therein or as to the use of the proceeds of
the Loans or of the existence or possible existence of any Default or Event of
Default or to inspect the properties, books or records of the Credit Parties or
any of their respective Affiliates.
Section 10.04 Reliance On Communications.
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 any of the Credit Parties, independent accountants and
other experts selected by the Administrative Agent with reasonable care). The
Administrative Agent may deem and treat the Lenders as the owners of their
respective interests hereunder for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent in accordance with Section 11.03(b). The Administrative
Agent shall be fully justified in failing or refusing to take any action under
this Agreement or under any of
67
the other Credit Documents unless it shall first receive such advice or
concurrence of the Majority 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. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, hereunder or under any of
the other Credit Documents in accordance with a request of the Majority Lenders
(or to the extent specifically provided in Section 11.06, all the Lenders) and
such request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders (including their successors and assigns).
Section 10.05 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 hereunder unless it
has received notice from a Lender or a Credit Party referring to the Credit
Document, 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 give prompt 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 Majority Lenders.
Section 10.06 Non-Reliance On Administrative Agent and Other
Lenders.
Each Lender and the Issuer expressly acknowledges that neither the
Administrative Agent nor any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates has made any representations or warranties to it
and that no act by the Administrative Agent or any affiliate thereof hereinafter
taken, including any review of the affairs of any Credit Party or any of their
respective Affiliates, shall be deemed to constitute any representation or
warranty by the Administrative Agent to any Lender or the Issuer. Each Lender
and the Issuer represents to the Administrative Agent that it has, independently
and without reliance upon the Administrative Agent or any other Lender or the
Issuer, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
assets, operations, property, financial and other conditions, prospects and
creditworthiness of the Credit Parties or their respective Affiliates and made
its own decision to make its Loans hereunder and other financial accommodations
hereunder and enter into this Agreement. Each Lender and the Issuer 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 to make such investigation as it deems necessary to inform
itself as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of the Credit Parties and their
respective Affiliates. Except for notices, reports and other documents expressly
required to be furnished to the Lenders by the Administrative Agent hereunder,
the Administrative Agent shall not have any duty or responsibility to provide
any Lender or the Issuer with any credit or other information concerning the
business, operations, assets, property, financial or other conditions, prospects
or creditworthiness of the Credit Parties or any of their respective Affiliates
which may come into the possession of the Administrative Agent or any of their
officers, directors, employees, agents, attorneys-in-fact or affiliates.
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Section 10.07 Indemnification.
The Lenders agree to indemnify the Administrative Agent in its capacity
as such (to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably according to their respective
Commitments (or if the Commitments have expired or been terminated, in
accordance with the respective principal amounts of outstanding Loans of the
Lenders), 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 final payment of all of the obligations of the Borrower
hereunder and under the other Credit Documents) 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 Credit Documents or
any documents 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 the extent they are found in a final judgment
by a court of competent jurisdiction to have arisen from the Administrative
Agent's gross negligence or willful misconduct. If any indemnity furnished to
the Administrative Agent for any purpose shall, in the opinion of the
Administrative Agent, be insufficient or become impaired, the Administrative
Agent may call for additional indemnity and cease, or not commence, to do the
acts indemnified against until such additional indemnity is furnished. The
agreements in this Section 10.07 shall survive the repayment of the Loans and
other obligations under the Credit Documents and the termination of the
Commitments hereunder.
Section 10.08 Administrative Agent In Its Individual Capacity.
The Administrative Agent and its affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Borrower,
its Subsidiaries or its Affiliates as though the Administrative Agent were not
the Administrative Agent hereunder. With respect to the Loans and all other
obligations of the Borrower hereunder and under the other Credit Documents, the
Administrative Agent shall have the same rights and powers under this Agreement
as any Lender and may exercise the same as though it were not the Administrative
Agent hereunder, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.
Section 10.09 Successor Administrative Agent.
The Administrative Agent may, at any time, resign upon 20 days' written
notice to the Lenders, and may be removed, upon show of cause, by the Majority
Lenders upon 30 days' written notice to the Administrative Agent; provided that
the Administrative Agent shall not resign or be removed without the prior
written consent of the Borrower, which consent shall not be unreasonably
withheld or delayed, and any attempted resignation by or removal of the
Administrative Agent without the prior written consent of the Borrower shall be
null and void ab initio. Upon any such resignation or removal, the Majority
Lenders shall have the right to appoint a successor Administrative Agent. If no
successor Administrative Agent shall have been so appointed by the Majority
Lenders, and shall have accepted such appointment, within 30 days
69
after the notice of resignation or notice of removal, as appropriate, then the
retiring Administrative Agent shall select a successor Administrative Agent;
provided that such successor is a Lender hereunder or a financial institution
organized under the laws of the United States of America or of any State
thereof and has a combined capital and surplus of at least $400,000,000. Upon
the acceptance of any appointment as Administrative Agent hereunder by a
successor, such successor Administrative Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations as Administrative Agent under this
Agreement and the other Credit Documents, and the provisions of this Article X
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement.
ARTICLE XI
MISCELLANEOUS
Section 11.01 Notices.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (i) when
delivered, (ii) when transmitted via telecopy (or other facsimile device) to the
number set out below, (iii) the day following the day on which the same has been
delivered prepaid to a reputable national overnight air courier service, or (iv)
the third Business Day following the day on which the same is sent by certified
or registered mail, postage prepaid, in each case to the respective parties at
the address, in the case of the Borrower, the Guarantors and the Administrative
Agent, set forth below, and, in the case of the Lenders or the Issuer, set forth
on Schedule 11.01, or at such other address as such party may specify by written
notice to the other parties hereto:
if to the Borrower or any Guarantor:
RailWorks Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇, Esq. and ▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
and
70
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Preston
Seven Saint ▇▇▇▇ Street
Baltimore, MD 21202
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
if to the Administrative Agent:
CSFB Global Opportunities Advisers, LLC
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq. and ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ III, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
and
Venable, ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇, LLP
▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Section 11.02 Right of Set-Off.
In addition to any rights now or hereafter granted under applicable law
or otherwise, and not by way of limitation of any such rights, upon the
occurrence of an Event of Default, each Lender and the Issuer is authorized at
any time and from time to time, without presentment, demand, protest or other
notice of any kind (all of which rights being hereby expressly waived), to
set-off and to appropriate and apply any and all deposits (general or special)
and any other indebtedness at any time held or owing by such Lender or the
Issuer (including, without limitation branches, agencies or Affiliates of such
Lender or the Issuer wherever located) to or for the credit or the account of
any Credit Party against obligations and liabilities of such Person to such
Lender or the Issuer hereunder, under the Notes, the other Credit Documents or
otherwise, irrespective of whether such Lender or the Issuer shall have made any
demand
71
hereunder and although such obligations, liabilities or claims, or any of them,
may be contingent or unmatured, and any such set-off shall be deemed to have
been made immediately upon the occurrence of an Event of Default even though
such charge is made or entered on the books of such Lender or the Issuer
subsequent thereto. Any Person purchasing a participation in the Loans and
Commitments hereunder pursuant to Section 11.03(d) may exercise all rights of
set-off with respect to its participation interest as fully as if such Person
were a Lender hereunder.
Section 11.03 Benefit of Agreement.
(a) Generally. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the respective successors and assigns of the
parties hereto; provided that, except as expressly provided herein, none of the
Credit Parties may assign or transfer any of its interests without prior
written consent of the Lenders and the Issuer; provided, further, that the
rights of each Lender to transfer, assign or grant participations in its rights
and/or obligations hereunder shall be limited as set forth in this Section
11.03; provided, however, that nothing herein shall prevent or prohibit any
Lender from (i) pledging its Loans hereunder to a Federal Reserve Bank in
support of borrowings made by such Lender from such Federal Reserve Bank or
(ii) granting assignments or selling participations in such Lender's Loans
and/or Commitments hereunder to its parent company and/or to any Affiliate or
Subsidiary of such Lender.
(b) Assignments. Each Lender may assign all or a portion of its
rights and obligations hereunder (including, without limitation, all or a
portion of its Ratable Portion of Obligations and its Commitments), pursuant to
an assignment agreement substantially in the form of Exhibit F, to (i) a
Lender, (ii) an affiliate of a Lender, (iii) any fund that invests in bank
loans and is managed by an investment advisor to a Lender or an affiliate of
such investment advisor, or (iv) any other Person that (A) is a bank, financial
institution, commercial lender or institutional investor, (B) such Person shall
be reasonably acceptable to the Administrative Agent, and (C) so long as no
Default or Event of Default has occurred and is continuing, such Person shall
be reasonably acceptable to the Borrower (the consent of the Borrower not to be
unreasonably withheld or delayed); provided that (i) any such assignment (other
than any assignment to (I) a Lender, (II) an affiliate of a Lender and (III)
any fund that invests in bank loans and is managed by an investment advisor to
a Lender or an affiliate of such investment advisor) shall be in a minimum
aggregate amount of $2,000,000 (or, if less, the remaining amount of the
Commitments being assigned by such Lender); and (ii) each such assignment shall
be of a constant, not varying, percentage of all such Lender's rights and
obligations under this Agreement. Any assignment hereunder shall be effective
upon delivery to the Administrative Agent of written notice of the assignment
together with a transfer fee of $3,500 payable to the Administrative Agent for
its own account from and after the later of (i) the effective date specified in
the applicable assignment agreement and (ii) the date of recording of such
assignment in the Register pursuant to the terms of subsection (c) below;
provided, however, that no such fee shall be payable in the case of an
assignment to another Lender, an affiliate of a Lender or any fund that invests
in bank loans and is managed by an investment advisor to a Lender or an
affiliate of such investment advisor; provided, further, that in the case of
contemporaneous assignments by a Lender to more than one fund managed by the
same investment advisor (which funds are not then Lenders), only a single
assignment fee of $3,500 shall be payable for all such contemporaneous
assignments. The assigning Lender will give
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prompt notice to the Administrative Agent and the Borrower of any such
assignment. Upon the effectiveness of any such assignment (and after notice to,
and (to the extent required pursuant to the terms hereof), with the consent of,
the Borrower as provided herein), the assignee shall become a "Lender" for all
purposes of this Agreement and the other Credit Documents and, to the extent of
such assignment, the assigning Lender shall be relieved of its obligations
hereunder to the extent of the Loans and Commitment components being assigned.
The Borrower agrees that upon notice of any such assignment and surrender of
the appropriate Note or Notes, it will promptly provide to the assigning Lender
and to the assignee separate promissory notes in the amount of their respective
interests substantially in the form of the original Note (but with notation
thereon that it is given in substitution for and replacement of the original
Note or any replacement notes thereof). By executing and delivering an
assignment agreement in accordance with this Section 11.03(b), the assigning
Lender thereunder and the assignee thereunder shall be deemed to confirm to and
agree with each other and the other parties hereto as follows: (i) such
assigning Lender warrants that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim; (ii)
except as set forth in clause (i) above, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement, any of the other Credit Documents or any other instrument or
document furnished pursuant hereto or thereto, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement,
any of the other Credit Documents or any other instrument or document furnished
pursuant hereto or thereto or the financial condition of any Credit Party or
any of their respective Affiliates or the performance or observance by any
Credit Party of any of its obligations under this Agreement, any of the other
Credit Documents or any other instrument or document furnished pursuant hereto
or thereto; (iii) such assignee represents and warrants that it is legally
authorized to enter into such assignment agreement; (iv) such assignee confirms
that it has received a copy of this Agreement, the other Credit Documents and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into such assignment agreement; (v)
such assignee will independently and without reliance upon the Administrative
Agent, such assigning Lender or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Agreement and
the other Credit Documents; (vi) such assignee appoints and authorizes the
Administrative Agent to take such action on its behalf and to exercise such
powers under this Agreement or any other Credit Document as are delegated to
the Administrative Agent by the terms hereof or thereof, together with such
powers as are reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all the obligations which
by the terms of this Agreement and the other Credit Documents are required to
be performed by it as a Lender.
(c) Maintenance of Register. The Administrative Agent shall maintain
at its offices a copy of each Lender assignment agreement delivered to it in
accordance with the terms of subsection (b) above and a register for the
recordation of the identity of the principal amount of each Loan outstanding
hereunder, the names, addresses and the Commitments of the Lenders pursuant to
the terms hereof from time to time (the "Register"). The Administrative Agent
will make reasonable efforts to maintain the accuracy of the Register and to
promptly update the Register from time to time, as necessary. The entries in
the Register shall be conclusive in the absence of manifest error, and the
Borrower, the Administrative Agent and the Lenders may treat
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each Person whose name is recorded in the Register pursuant to the terms hereof
as a Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower and each Lender, at any reasonable
time and from time to time upon reasonable prior notice.
(d) Participations. Each Lender may sell, transfer, grant or assign
participations in all or a portion of such Lender's rights, obligations or
rights and obligations hereunder (including all or a portion of its Commitments
or its Loans); provided that (i) such selling Lender shall remain a "Lender" for
all purposes under this Agreement (such selling Lender's obligations under the
Credit Documents remaining unchanged) and the participant shall not constitute a
Lender hereunder, (ii) no such participant shall have, or be granted, rights to
approve any amendment or waiver relating to this Agreement or the other Credit
Documents except to the extent any such amendment or waiver would (A) reduce the
principal of or rate of interest on or fees in respect of any Loans in which the
participant is participating or (B) postpone the date fixed for any payment of
principal (including extension of the Tranche A Maturity Date or the Tranche B
Maturity Date or the date of any mandatory prepayment), interest or fees in
which the participant is participating, and (iii) sub-participations by the
participant (except to an affiliate, parent company or affiliate of a parent
company of the participant) shall be prohibited. In the case of any such
participation, the participant shall not have any rights under this Agreement or
the other Credit Documents (the participant's rights against the selling Lender
in respect of such participation to be those set forth in the participation
agreement with such Lender creating such participation) and all amounts payable
by the Borrower hereunder shall be determined as if such Lender had not sold
such participation; provided, however, that such participant shall be entitled
to receive additional amounts under Sections 2.10, 2.11, 2.13 and 11.02 on the
same basis as if it were a Lender.
Section 11.04 No Waiver; Remedies Cumulative.
No failure or delay on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege hereunder or under any other
Credit Document and no course of dealing between the Administrative Agent or any
Lender and any of the Credit Parties shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, power or privilege hereunder
or under any other Credit Document preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder or
thereunder. The rights and remedies provided herein are cumulative and not
exclusive of any rights or remedies which the Administrative Agent or any Lender
would otherwise have. No notice to or demand on any Credit Party in any case
shall entitle the Borrower or any other Credit Party to any other or further
notice or demand in similar or other circumstances or constitute a waiver of the
rights of the Administrative Agent or the Lenders to any other or further action
in any circumstances without notice or demand.
Section 11.05 Payment of Expenses; Indemnification.
(a) The Borrower agrees to: (i) pay all reasonable out-of-pocket costs
and expenses (A) of the Administrative Agent, the Issuer and the Lenders in
connection with the negotiation, preparation, execution and delivery and
administration of this Agreement and the other Credit Documents and the
documents and instruments referred to therein (including, without limitation,
74
the reasonable fees and expenses of counsel of the Administrative Agent and the
Lenders) and any amendment, waiver or consent relating hereto and thereto
including, but not limited to, any such amendments, waivers or consents
resulting from or related to any work-out, renegotiation or restructure
relating to the performance by the Credit Parties under this Agreement, (B) the
development, negotiation, approval and consummation of the disclosure statement
and the plan of reorganization of any of the Credit Parties and (C) of the
Administrative Agent, the Issuer and the Lenders in connection with enforcement
of the Credit Documents and the documents and instruments referred to therein
(including, without limitation, in connection with any such enforcement, the
reasonable fees and disbursements of counsel for the Administrative Agent, the
Issuer and each of the Lenders); (ii) permit the Administrative Agent to
perform inventory and accounts receivable field audits at the Borrower's
expense, provided that unless an Event of Default shall be in existence the
Borrower's obligation to reimburse the Administrative Agent for such field
audits shall be limited to one such field audit each fiscal year; and (iii) pay
and hold each of the Lenders and the Issuer harmless from and against any and
all present and future stamp and other similar taxes with respect to the
foregoing matters and save each of the Lenders and the Issuer harmless from and
against any and all liabilities with respect to or resulting from any delay or
omission (other than to the extent attributable to such Lender or the Issuer)
to pay such taxes.
(b) The Borrower shall indemnify the Administrative Agent, each
Lender, the Issuer and their respective officers, directors, employees,
representatives and agents (each, an "Indemnitee") from and hold each of them
harmless against any and all losses, liabilities, claims, damages or expenses
incurred by any of them as a result of, or arising out of, or in any way
related to, or by reason of (A) any investigation, litigation or other
proceeding (whether or not the any Indemnitee is a party thereto) related to
the entering into and/or performance of any Credit Document or the use of
proceeds of any Loan or of the Letter of Credit or the consummation of any
other transactions contemplated in any Credit Document, including, without
limitation, the reasonable fees and disbursements of counsel incurred in
connection with any such investigation, litigation or other proceeding or (B)
the presence or Release of any Materials of Environmental Concern at, under or
from any Property owned, operated or leased by the Borrower or any of its
Subsidiaries, or the failure by the Borrower or any of its Subsidiaries to
comply with any Environmental Law (but excluding, in the case of either of
clause (A) or (B) above, any such losses, liabilities, claims, damages or
expenses to the extent incurred by reason of gross negligence or willful
misconduct on the part of the Person to be indemnified).
Section 11.06 Amendments, Waivers and Consents.
No amendment or waiver of any provision of this Agreement nor consent
to any departure by the Borrower therefrom shall in any event be effective
unless the same shall be in writing and signed by the Majority Lenders, and then
any such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given; provided, however, that no amendment,
waiver or consent shall, unless in writing and signed by all the Lenders do any
of the following:
(a) waive any of the conditions specified in Article III except as
otherwise provided therein;
75
(b) increase the Commitments of the Lenders or subject the Lenders to
any additional obligations;
(c) reduce the principal of, or interest on, the Loans or any fees or
other amounts payable hereunder;
(d) postpone any date fixed for any payment of principal of, or
interest on, the Loans or any fees or other amounts payable hereunder;
(e) change the percentage of the Commitments or the aggregate unpaid
principal amount of the Loans which shall be required for the Lenders or any of
them to take any action hereunder;
(f) release any of the Collateral except as shall otherwise be
provided in the Collateral Documents; or
(g) amend this Section 11.06;
and provided, further, that no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent or the Issuer in addition to the
Lenders required above to take such action, affect the rights or duties of the
Administrative Agent or the Issuer, as the case may be, under this Agreement or
the other Credit Documents. Any amendment, consent, or waiver that does not
comply with the provisions of this Section 11.06 shall be void and of no effect.
Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (x) each Lender is
entitled to vote as such Lender sees fit on any bankruptcy reorganization plan
that affects the Loans, and each Lender acknowledges that the provisions of
Section 1126(c) of the Bankruptcy Code supersede the unanimous consent
provisions set forth herein and (y) the Majority Lenders may consent to allow a
Credit Party to use cash collateral in the context of a bankruptcy or insolvency
proceeding.
Section 11.07 Counterparts.
This Agreement may be executed in any number of counterparts, each of
which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. It shall not be necessary in
making proof of this Agreement to produce or account for more than one such
counterpart.
Section 11.08 Headings.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Agreement.
Section 11.09 Survival.
All indemnities set forth herein, including, without limitation, in
Section 2.10, 2.11, 2.13, 10.07 or 11.05 shall survive the execution and
delivery of this Agreement, the making of the Loans, the repayment of the Loans
and other obligations under the Credit Documents and the
76
termination of the Commitments hereunder, and all representations and
warranties made by the Credit Parties herein shall survive delivery of the
Notes and the making of the Loans hereunder.
Section 11.10 Governing Law; Submission to Jurisdiction; Venue.
(a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
AND THE APPLICABLE PROVISIONS OF THE BANKRUPTCY CODE.
(b) The Bankruptcy Court shall have exclusive jurisdiction over any
motion, claim or dispute arising from or relating to this Agreement or any
other Credit Document Any legal action or proceeding with respect to this
Agreement or any other Credit Document shall be brought in the Bankruptcy Court
or the United States District Court for the District of Maryland and, by
execution and delivery of this Agreement, each of the parties hereto hereby
irrevocably accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of such court. Each of the Credit Parties
further irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to it at the address
set out for notices pursuant to Section 11.01, such service to become effective
three (3) days after such mailing. Nothing herein shall affect the right of the
Administrative Agent or any Lender to serve process in any other manner
permitted by law or to commence legal proceedings or to otherwise proceed
against any Credit Party in any other jurisdiction.
(c) TO THE EXTENT PERMITTED BY LAW, THE ADMINISTRATIVE AGENT, THE
LENDERS, THE BORROWER AND THE OTHER CREDIT PARTIES HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING
OUT OF OR RELATING TO THIS AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
Section 11.11 Severability.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
Section 11.12 Entirety.
This Agreement, together with the Exhibits and Schedules hereto and the
other Credit Documents, represent the entire agreement of the parties hereto and
thereto with respect to the subject matter hereof and thereof, and supersede all
prior agreements and understandings, either oral or written, with respect to the
subject matter hereof and thereof.
Section 11.13 Binding Effect; Termination.
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(a) This Agreement shall become effective at such time on the
Effective Date when (i) all applicable conditions to effectiveness contained in
Section 3.03 have been satisfied, and (ii) this Agreement shall have been
executed by the Borrower, the Guarantors and the Administrative Agent and the
Administrative Agent shall have received copies hereof (telefaxed or otherwise)
which, when taken together, bear the signatures of each Lender and the Issuer,
and thereafter this Agreement shall be binding upon and inure to the benefit of
the Borrower, the Guarantors, the Administrative Agent each Lender and the
Issuer and their respective successors and assigns.
(b) The term of this Agreement shall commence on the Effective Date
pursuant to subsection (a) above and shall continue until no Obligations or any
other amounts payable hereunder or under any of the other Credit Documents
shall remain outstanding and until all of the Commitments hereunder shall have
expired or been terminated.
Section 11.14 Confidentiality.
The Administrative Agent, each Lender and the Issuer agrees to maintain
the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its affiliates' directors, officers,
employees and agents, including accountants, legal counsel and other advisors
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential); (b) to the extent requested by any regulatory
authority; (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process; (d) to any other party to this Agreement;
(e) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder; (f) subject to an agreement containing provisions substantially the
same as those of this Section 11.14, to (i) any assignee of or participant in,
or any prospective assignee of or participant in, any of its rights or
obligations under this Agreement or (ii) any direct or indirect contractual
counterparty or prospective counterparty (or such contractual counterparty's or
prospective counterparty's professional advisor) to any credit derivative
transaction relating to obligations of the Borrower; (g) with the consent of the
Borrower; (h) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section 11.14 or (ii) becomes
available to the Administrative Agent, the Issuer or any Lender on a
nonconfidential basis from a source other than the Borrower; or (i) to the
National Association of Insurance Commissioners or any other similar
organization or any nationally recognized rating agency that requires access to
information about a Lender's or its Affiliates' investment portfolio in
connection with ratings issued with respect to such Lender or its Affiliates.
For the purposes of this Section, "Information" means all information received
from the Borrower relating to the Borrower or its business, other than any such
information that is available to the Administrative Agent, the Issuer or any
Lender on a nonconfidential basis prior to disclosure by the Borrower; provided
that, in the case of information received from the Borrower after the date
hereof, such information is clearly identified in writing at the time of
delivery as confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section 11.14 shall be considered to have
complied with its obligation to do so if such Person has exercised the same
degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.
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Section 11.15 Source of Funds.
Each of the Lenders hereby represents and warrants to the Borrower that
at least one of the following statements is an accurate representation as to the
source of funds to be used by such Lender in connection with the financing
hereunder:
(a) no part of such funds constitutes assets allocated to any
separate account maintained by such Lender in which any employee benefit plan
(or its related trust) has any interest;
(b) to the extent that any part of such funds constitutes assets
allocated to any separate account maintained by such Lender, such Lender has
disclosed to the Borrower the name of each employee benefit plan whose assets
in such account exceed 10% of the total assets of such account as of the date
of such purchase (and, for purposes of this subsection (b), all employee
benefit plans maintained by the same employer or employee organization are
deemed to be a single plan);
(c) to the extent that any part of such funds constitutes assets of
an insurance company's general account, such insurance company has complied
with all of the requirements of the regulations issued under Section
401(c)(1)(A) of ERISA or such insurance company meets the requirements of
Department of Labor Exemption 95-60; or
(d) such funds constitute assets of one or more specific benefit
plans which such Lender has identified in writing to the Borrower.
As used in this Section 11.15, the terms "employee benefit plan" and
"separate account" shall have the respective meanings assigned to such terms in
Section 3 of ERISA.
Section 11.16 Conflict.
To the extent that there is a conflict or inconsistency between any
provision hereof, on the one hand, and any provision of any Credit Document, on
the other hand, this Agreement shall control. To the extent that there is a
conflict or inconsistency between any provision of any Credit Document, on the
one hand, and any provision of the DIP Financing Order, on the other hand, the
DIP Financing Order shall control.
Section 11.17 Limitation on Liability.
NO CLAIM MAY BE MADE BY THE ADMINISTRATIVE AGENT, ANY CREDIT PARTY, ANY
LENDER OR OTHER PERSON AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, ANY CREDIT
PARTY OR THE AFFILIATES, DIRECTORS, OFFICERS, OFFICERS, EMPLOYEES, OR AGENTS OF
ANY OF THEM FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES IN
RESPECT OF ANY CLAIM FOR BREACH OF CONTRACT OR ANY OTHER THEORY OF LIABILITY
ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR
ANY OTHER CREDIT DOCUMENT, OR ANY ACT, OMISSION OR EVENT OCCURRING IN CONNECTION
THEREWITH, AND THE CREDIT PARTIES, THE ADMINISTRATIVE AGENT AND EACH LENDER
HEREBY WAIVE, RELEASE AND
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AGREE NOT TO ▇▇▇ UPON ANY CLAIM FOR SUCH DAMAGES, WHETHER OR NOT ACCRUED AND
WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST IN ITS FAVOR.
Section 11.18 No Novation, Etc.
(a) The terms and conditions of the Original Transit Credit Agreement
are amended as set forth in, and restated in their entirety and superseded by,
this Agreement. Nothing in this Agreement shall be deemed to work a novation of
any of the obligations under the Original Transit Credit Agreement.
Notwithstanding any provision of this Agreement or any other document or
instrument executed in connection herewith, the execution and delivery of this
Agreement and the incurrence of obligations hereunder shall be in substitution
for, but not in payment of, the obligations owed by the Credit Parties under
the Original Transit Credit Agreement.
(b) From and after the Effective Date, each reference to the "Credit
Agreement" or other reference originally applicable to the Original Transit
Credit Agreement contained in any Credit Document shall be a reference to this
Agreement, as amended supplemented, restated or otherwise modified from time to
time. Each of the Credit Parties hereby ratifies, confirms, approves and
acknowledges each of the other Credit Documents and the provisions thereof.
[SIGNATURE PAGE FOLLOWS.]
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IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Agreement to be duly executed and delivered as of the date first above
written.
RAILWORKS CORPORATION,
as Borrower
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
BREAKING TECHNOLOGY & EQUIPMENT INC.,
as Guarantor
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
HSQ TECHNOLOGY, A CORPORATION,
as Guarantor
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
▇.▇. ▇▇▇▇▇▇▇▇ & COMPANY, INC.,
as Guarantor
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
M-TRACK ENTERPRISES, INC.,
as Guarantor
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
RAILWORKS TRANSIT, INC.,
as Guarantor
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
RWKS CONSTRUCTION, INC.,
as Guarantor
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
RAILWORKS TRANSIT SYSTEMS, INC.,
as Guarantor
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
CSFB GLOBAL OPPORTUNITIES ADVISERS, LLC,
as Administrative Agent
By: /S/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title:
CREDIT SUISSE FIRST BOSTON,
NEW YORK BRANCH
as Issuer
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Director
By: /S/ ▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇
Title: Associate
CSFB GLOBAL OPPORTUNITIES PARTNERS, L.P.,
as Lender
By: CSFB Global Opportunities Advisers LLC,
its Investment Adviser
By:/S/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: