1
EXHIBIT 10.46
================================================================================
CREDIT AGREEMENT
among
UNIVERSAL COMPRESSION HOLDINGS, INC.,
UNIVERSAL COMPRESSION, INC.,
VARIOUS LENDERS,
DEUTSCHE BANK SECURITIES INC.,
AS LEAD ARRANGER
and
BANKERS TRUST COMPANY,
as ADMINISTRATIVE AGENT
----------------------------------
Dated as of May __, 2000
----------------------------------
================================================================================
2
Page
----
TABLE OF CONTENTS
SECTION 1. Amount and Terms of Credit........................................1
1.01 The Commitments................................................1
1.02 Minimum Amount of Each Borrowing...............................2
1.03 Notice of Borrowing............................................3
1.04 Disbursement of Funds..........................................3
1.05 Notes..........................................................4
1.06 Conversions....................................................5
1.07 Pro Rata Borrowings............................................5
1.08 Interest.......................................................5
1.09 Interest Periods...............................................6
1.10 Increased Costs, Illegality, etc...............................7
1.11 Compensation...................................................9
1.12 Change of Lending Office.......................................9
1.13 Replacement of Lenders........................................10
SECTION 2. Letters of Credit................................................11
2.01 Letters of Credit.............................................11
2.02 Minimum Stated Amount.........................................12
2.03 Letter of Credit Requests.....................................12
2.04 Letter of Credit Participations...............................13
2.05 Agreement to Repay Letter of Credit Drawings..................14
2.06 Increased Costs...............................................15
SECTION 3. Commitment Commission; Fees; Reductions of Commitment............16
3.01 Fees..........................................................16
3.02 Voluntary Termination of Unutilized Commitments...............17
3.03 Mandatory Reduction of Commitments............................17
SECTION 4. Prepayments; Payments; Taxes.....................................17
4.01 Voluntary Prepayments.........................................17
4.02 Mandatory Repayments and Commitment Reductions................18
4.03 Method and Place of Payment...................................19
4.04 Net Payments..................................................20
SECTION 5. Conditions Precedent to Effectiveness............................22
5.01 Execution of Agreement; Notes.................................22
5.02 Officer's Certificate.........................................22
5.03 Opinions of Counsel...........................................22
(i)
3
5.04 Corporate Documents; Proceedings; etc.........................22
5.05 Employee Benefit Plans; Shareholders' Agreements; Management
Agreements; Collective Bargaining Agreements; Employment
Agreements; Debt Agreements................................23
5.06 Consummation of the Synthetic Lease Financing.................23
5.07 Refinancing...................................................24
5.08 Pledge Agreement..............................................25
5.09 Security Agreement............................................25
5.10 Subsidiaries Guaranty.........................................25
5.11 Consent Letter................................................25
5.12 Adverse Change, etc...........................................26
5.13 Litigation....................................................26
5.14 Fees, etc.....................................................26
5.15 Solvency Letter; Insurance Certificate........................27
5.16 Financial Statements; Pro Forma Financial Statements;
Financial Projections......................................27
5.17 Consummation of the Repurchase................................27
SECTION 6. Conditions Precedent to All Credit Events........................27
6.01 No Default; Representations and Warranties...................28
6.02 Notice of Borrowing; Letter of Credit Request................28
SECTION 7. Representations, Warranties and Agreements.......................28
7.01 Corporate and Other Status....................................28
7.02 Corporate and Other Power and Authority.......................29
7.03 No Violation..................................................29
7.04 Governmental Approvals........................................29
7.05 Financial Statements; Financial Condition; Undisclosed
Liabilities; Projections; etc..............................29
7.06 Litigation....................................................31
7.07 True and Complete Disclosure..................................31
7.08 Use of Proceeds; Margin Regulations...........................31
7.09 Tax Returns and Payments......................................31
7.10 Compliance with ERISA.........................................32
7.11 The Security Documents........................................33
7.12 Representations and Warranties in Documents...................33
7.13 Properties....................................................33
7.14 Capitalization................................................34
7.15 Subsidiaries..................................................34
7.16 Compliance with Statutes, etc.................................34
7.17 Investment Company Act........................................34
7.18 Public Utility Holding Company Act............................34
7.19 Environmental Matters.........................................34
7.20 Labor Relations...............................................35
7.21 Patents, Licenses, Franchises and Formulas....................36
7.22 Indebtedness..................................................36
(ii)
4
7.23 Synthetic Lease Financing.....................................36
7.24 Holdings IPO and Repurchase...................................36
7.25 Insurance.....................................................37
SECTION 8. Affirmative Covenants............................................37
8.01 Information Covenants.........................................37
8.02 Books, Records and Inspections................................39
8.03 Maintenance of Property; Insurance............................40
8.04 Corporate Franchises..........................................41
8.05 Compliance with Statutes, etc.................................41
8.06 Compliance with Environmental Laws............................41
8.07 ERISA.........................................................42
8.08 End of Fiscal Years; Fiscal Quarters..........................43
8.09 Performance of Obligations....................................43
8.10 Payment of Taxes..............................................43
8.11 Additional Security; Further Assurances.......................43
8.12 Foreign Subsidiaries Security.................................44
SECTION 9. Negative Covenants...............................................45
9.01 Liens.........................................................45
9.02 Consolidation, Merger, Purchase or Sale of Assets, etc........47
9.03 Dividends.....................................................51
9.04 Indebtedness..................................................52
9.05 Advances, Investments and Loans...............................53
9.06 Transactions with Affiliates..................................55
9.07 Capital Expenditures..........................................56
9.08 Consolidated EBITDAR to Total Interest Expense................57
9.09 Maximum Leverage Ratio........................................58
9.10 Maximum Senior Secured Leverage Ratio.........................59
9.11 Limitation on Voluntary Payments and Modifications of
Indebtedness; Modifications of Certificate of
Incorporation, By-Laws and Certain Other Agreements; etc...61
9.12 Limitation on Certain Restrictions on Subsidiaries............61
9.13 Limitation on Issuance of Capital Stock.......................61
9.14 Business......................................................62
9.15 Limitation on Creation of Subsidiaries and Entering into
Partnerships and Joint Ventures............................62
9.16 Special Purpose Corporation...................................62
SECTION 10. Events of Default...............................................63
10.01 Payments.....................................................63
10.02 Representations, etc. .......................................63
10.03 Covenants....................................................63
10.04 Default Under Other Agreements...............................63
(iii)
5
10.05 Bankruptcy, etc..............................................64
10.06 ERISA........................................................64
10.07 Security Documents...........................................65
10.08 Subsidiaries Guaranty........................................65
10.09 Judgments....................................................65
10.10 Change of Control............................................65
SECTION 11. Definitions and Accounting Terms................................66
11.01 Defined Terms................................................66
SECTION 12. The Administrative Agent........................................88
12.01 Appointment..................................................88
12.02 Nature of Duties.............................................88
12.03 Lack of Reliance on the Administrative Agent.................88
12.04 Certain Rights of the Administrative Agent...................89
12.05 Reliance.....................................................89
12.06 Indemnification..............................................89
12.07 The Administrative Agent in its Individual Capacity..........90
12.08 Holders......................................................90
12.09 Resignation by the Administrative Agent......................90
SECTION 13. Miscellaneous...................................................91
13.01 Payment of Expenses, etc.....................................91
13.02 Right of Setoff..............................................92
13.03 Notices......................................................92
13.04 Benefit of Agreement; Assignments; Participations............92
13.05 No Waiver; Remedies Cumulative...............................94
13.06 Payments Pro Rata............................................94
13.07 Calculations; Computations; Accounting Terms.................95
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF
JURY TRIAL.................................................96
13.09 Counterparts.................................................97
13.10 Effectiveness................................................97
13.11 Headings Descriptive.........................................97
13.12 Amendment or Waiver..........................................97
13.13 Survival.....................................................98
13.14 Domicile of Loans............................................98
13.15 Limitation on Additional Amounts, etc........................99
13.16 Register.....................................................99
13.17 Confidentiality.............................................100
SECTION 14. Holdings Guaranty..............................................100
14.01 Guaranty....................................................100
14.02 Bankruptcy..................................................101
(iv)
6
14.03 Nature of Liability.........................................101
14.04 Independent Obligation......................................101
14.05 Authorization...............................................102
14.06 Reliance....................................................102
14.07 Subordination...............................................103
14.08 Waiver......................................................103
14.09 Nature of Liability.........................................104
SCHEDULE I Commitments
SCHEDULE II ERISA
SCHEDULE III Subsidiaries
SCHEDULE IV Existing Indebtedness
SCHEDULE V Insurance
SCHEDULE VI Existing Liens
SCHEDULE VII Indebtedness to be Refinanced
SCHEDULE VIII Lender Addresses
SCHEDULE IX Existing Investments
SCHEDULE X Existing Letters of Credit
EXHIBIT A Form of Notice of Borrowing
EXHIBIT B-1 Form of Note
EXHIBIT B-2 Form of Swingline Note
EXHIBIT C Form of Letter of Credit Request
EXHIBIT D Form of Section 4.04(b)(ii) Certificate
EXHIBIT E Form of Opinion of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ LLP,
counsel to each Credit Party
EXHIBIT F Form of Officer's Certificate
EXHIBIT G Form of Pledge Agreement
EXHIBIT H Form of Security Agreement
EXHIBIT I Form of Subsidiaries Guaranty
EXHIBIT J Form of Consent Letter
EXHIBIT K Form of Assignment and Assumption Agreement
EXHIBIT L Form of Intercompany Note
(v)
7
CREDIT AGREEMENT, dated as of May __, 2000, among UNIVERSAL
COMPRESSION HOLDINGS, INC., a Delaware corporation ("Holdings"), UNIVERSAL
COMPRESSION, INC., a Texas Corporation (the "Borrower"), the Lenders party
hereto from time to time, DEUTSCHE BANK SECURITIES INC., as Lead Arranger and
BANKERS TRUST COMPANY, as Administrative Agent (all capitalized terms used
herein and defined in Section 11 are used herein as therein defined).
W I T N E S S E T H:
WHEREAS, subject to and upon the terms and conditions herein
set forth, the Lenders are willing to make available to the Borrower the credit
facility provided for herein;
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
1.01 The Commitments. (a) Subject to and upon the terms and
conditions set forth herein, each Lender with a Commitment severally agrees, at
any time and from time to time on and after the Effective Date and prior to the
Maturity Date, to make a revolving loan or revolving loans (each, a "Revolving
Loan" and, collectively, the "Revolving Loans") to the Borrower, which Revolving
Loans (i) shall, at the option of the Borrower, be Base Rate Loans or Eurodollar
Loans, provided that except as otherwise specifically provided in Section
1.10(b), all Revolving Loans comprising the same Borrowing shall at all times be
of the same Type, (ii) may be repaid and reborrowed in accordance with the
provisions hereof, (iii) shall not exceed for any Lender at any time outstanding
that aggregate principal amount which, when added to the product of (x) such
Lender's Adjusted Percentage and (y) the sum of (I) the aggregate amount of all
Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid
with the proceeds of, and simultaneously with the incurrence of, the respective
incurrence of Revolving Loans) at such time and (II) the aggregate principal
amount of all Swingline Loans (exclusive of Swingline Loans which are repaid
with the proceeds of, and simultaneously with the incurrence of, the respective
incurrence of Revolving Loans) then outstanding, equals the Commitment of such
Lender at such time and (iv) shall not exceed for all Lenders at any time
outstanding that aggregate principal amount which, when added to (x) the amount
of all Letter of Credit Outstandings (exclusive of Unpaid Drawings which are
repaid with the proceeds of, and simultaneously with the incurrence of, the
respective incurrence of Revolving Loans) at such time and (y) the aggregate
principal amount of all Swingline Loans (exclusive of Swingline Loans which are
repaid with the proceeds of, and simultaneously with the incurrence of, the
respective incurrence of Revolving Loans) then outstanding, equals the Total
Commitment at such time.
(b) Subject to and upon the terms and conditions herein set
forth, BTCo in its individual capacity agrees to make at any time and from time
to time on and after the Effective Date and prior to the Swingline Expiry Date,
a revolving loan or revolving loans (each, a "Swingline Loan" and, collectively,
the "Swingline Loans") to the Borrower, which Swingline Loans (i) shall be made
and maintained as Base Rate Loans, (ii) may be repaid and reborrowed in
8
accordance with the provisions hereof, (iii) shall not exceed in aggregate
principal amount at any time outstanding, when combined with the aggregate
principal amount of all Revolving Loans made by Non-Defaulting Lenders then
outstanding and the Letter of Credit Outstandings at such time, an amount equal
to the Adjusted Total Commitment at such time (after giving effect to any
reductions to the Adjusted Total Commitment on such date) and (iv) shall not
exceed in aggregate principal amount at any time outstanding the Maximum
Swingline Amount.
(c) On any Business Day, BTCo may, in its sole discretion,
give notice to the Lenders that its outstanding Swingline Loans shall be funded
with a Borrowing of Revolving Loans (provided that such notice shall be deemed
to have been automatically given upon the occurrence of a Default or an Event of
Default under Section 10.05 or upon the exercise of any of the remedies provided
in the last paragraph of Section 10), in which case a Borrowing of Revolving
Loans constituting Base Rate Loans (each such Borrowing, a "Mandatory
Borrowing") shall be made on the immediately succeeding Business Day by all
Lenders with a Commitment (without giving effect to any termination thereof
pursuant to the last paragraph of Section 10) pro rata based on each Lender's
Adjusted Percentage (determined before giving effect to any termination of the
Commitments pursuant to the last paragraph of Section 10) and the proceeds
thereof shall be applied directly to BTCo to repay BTCo for such outstanding
Swingline Loans. Each such Lender hereby irrevocably agrees to make Revolving
Loans upon one Business Day's notice pursuant to each Mandatory Borrowing in the
amount and in the manner specified in the preceding sentence and on the date
specified in writing by BTCo notwithstanding (i) the amount of the Mandatory
Borrowing may not comply with the minimum amount for Borrowings otherwise
required hereunder, (ii) whether any conditions specified in Section 6 are then
satisfied, (iii) whether a Default or an Event of Default then exists, (iv) the
date of such Mandatory Borrowing and (v) the amount of the Total Commitment or
the Adjusted Total Commitment at such time. In the event that any Mandatory
Borrowing cannot for any reason be made on the date otherwise required above
(including, without limitation, as a result of the commencement of a proceeding
under the Bankruptcy Code with respect to the Borrower), then each such Lender
hereby agrees that it shall forthwith purchase (as of the date the Mandatory
Borrowing would otherwise have occurred, but adjusted for any payments received
from the Borrower on or after such date and prior to such purchase) from BTCo
such participations in the outstanding Swingline Loans as shall be necessary to
cause such Lenders to share in such Swingline Loans ratably based upon their
respective Adjusted Percentages (determined before giving effect to any
termination of the Commitments pursuant to the last paragraph of Section 10),
provided that (x) all interest payable on the Swingline Loans shall be for the
account of BTCo until the date as of which the respective participation is
required to be purchased and, to the extent attributable to the purchased
participation, shall be payable to the participant from and after such date and
(y) at the time any purchase of participations pursuant to this sentence is
actually made, the purchasing Lender shall be required to pay BTCo interest on
the principal amount of participation purchased for each day from and including
the day upon which the Mandatory Borrowing would otherwise have occurred to but
excluding the date of payment for such participation, at the overnight Federal
Funds Rate for the first three days and at the rate otherwise applicable to
Revolving Loans maintained as Base Rate Loans hereunder for each day thereafter.
1.02 Minimum Amount of Each Borrowing. The aggregate principal
amount of each Borrowing of Revolving Loans shall not be less than $1,000,000
and, if greater, shall be in
-2-
9
an integral multiple of $100,000; provided that Mandatory Borrowings shall be
made in the amounts required by Section 1.01(c). The aggregate principal amount
of each Borrowing of Swingline Loans shall not be less than $100,000 and, if
greater, shall be in an integral multiple of $50,000. More than one Borrowing
may occur on the same date, but at no time shall there be outstanding more than
ten Borrowings of Eurodollar Loans.
1.03 Notice of Borrowing. (a) Whenever the Borrower desires to
make a Borrowing hereunder (excluding Borrowings of Swingline Loans and
Mandatory Borrowings), it shall give the Administrative Agent at its Notice
Office at least one Business Day's prior notice of each Base Rate Loan and at
least three Business Days' prior notice of each Eurodollar Loan to be made
hereunder, provided that any such notice shall be deemed to have been given on a
certain day only if given before 12:00 Noon (New York time) on such day. Each
such notice (each a "Notice of Borrowing"), except as otherwise expressly
provided in Section 1.10, shall be irrevocable and shall be given by the
Borrower in writing, or by telephone promptly confirmed in writing, in the form
of Exhibit A, appropriately completed to specify the aggregate principal amount
of the Loans to be made pursuant to such Borrowing, the date of such Borrowing
(which shall be a Business Day), whether the Loans being made pursuant to such
Borrowing are to be initially maintained as Base Rate Loans or Eurodollar Loans
and, if Eurodollar Loans, the initial Interest Period to be applicable thereto.
The Administrative Agent shall promptly give each Lender notice of such proposed
Borrowing, of such Lender's proportionate share thereof and of the other matters
required by the immediately preceding sentence to be specified in the Notice of
Borrowing.
(b)(i) Whenever the Borrower desires to make a Borrowing of
Swingline Loans hereunder, it shall give BTCo not later than 12:00 Noon (New
York time) on the date that a Swingline Loan is to be made, written notice or
telephonic notice confirmed in writing of each Swingline Loan to be made
hereunder. Each such notice shall be irrevocable and specify in each case (A)
the date of Borrowing (which shall be a Business Day) and (B) the aggregate
principal amount of the Swingline Loans to be made pursuant to such Borrowing.
(ii) Mandatory Borrowings shall be made upon the notice
specified in Section 1.01(c), with the Borrower irrevocably agreeing, by its
incurrence of any Swingline Loan, to the making of the Mandatory Borrowings as
set forth in Section 1.01(c).
(c) Without in any way limiting the obligation of the Borrower
to confirm in writing any telephonic notice of such Borrowing of Loans, BTCo may
act without liability upon the basis of telephonic notice of such Borrowing,
believed by BTCo in good faith to be from the President, any Vice President or
the Treasurer of the Borrower, or from any other authorized officer of the
Borrower designated by the Borrower to the Administrative Agent, prior to
receipt of written confirmation. In each such case, the Borrower hereby waives
the right to dispute BTCo's record of the terms of such telephonic notice of
such Borrowing of Loans.
1.04 Disbursement of Funds. Except as otherwise specifically
provided in the immediately succeeding sentence, no later than 12:00 Noon (New
York time) on the date specified in each Notice of Borrowing (or (x) in the case
of Swingline Loans, not later than 2:00 P.M. (New York time) on the date
specified pursuant to Section 1.03(b)(i) or (y) in the case
-3-
10
of Mandatory Borrowings, not later than 12:00 Noon (New York time) on the date
specified in Section 1.01(c)), each Lender will make available its pro rata
portion of each such Borrowing requested to be made on such date (or in the case
of Swingline Loans, BTCo shall make available the full amount thereof). All such
amounts shall be made available in Dollars and in immediately available funds at
the Payment Office of the Administrative Agent, and the Administrative Agent
will make available to the Borrower at the Payment Office the aggregate of the
amounts so made available by the Lenders. Unless the Administrative Agent shall
have been notified by any Lender prior to the date of Borrowing that such Lender
does not intend to make available to the Administrative Agent such Lender's
portion of any Borrowing to be made on such date, the Administrative Agent may
assume that such Lender has made such amount available to the Administrative
Agent on such date of Borrowing and the Administrative Agent may, in reliance
upon such assumption, make available to the Borrower a corresponding amount. If
such corresponding amount is not in fact made available to the Administrative
Agent by such Lender, the Administrative Agent shall be entitled to recover such
corresponding amount on demand from such Lender. If such Lender does not pay
such corresponding amount forthwith upon the Administrative Agent's demand
therefor, the Administrative Agent shall promptly notify the Borrower and the
Borrower shall immediately pay such corresponding amount to the Administrative
Agent. The Administrative Agent shall also be entitled to recover on demand from
such Lender or the Borrower, as the case may be, interest on such corresponding
amount in respect of each day from the date such corresponding amount was made
available by the Administrative Agent to the Borrower until the date such
corresponding amount is recovered by the Administrative Agent, at a rate per
annum equal to (i) if recovered from such Lender, at the overnight Federal Funds
Rate and (ii) if recovered from the Borrower, the rate of interest applicable to
the respective Borrowing, as determined pursuant to Section 1.08. Nothing in
this Section 1.04 shall be deemed to relieve any Lender from its obligation to
make Loans hereunder or to prejudice any rights which the Borrower may have
against any Lender as a result of any failure by such Lender to make Loans
hereunder.
1.05 Notes. (a) The Borrower's obligation to pay the principal
of, and interest on, the Loans made by each Lender shall be evidenced (i) if
Revolving Loans, by a promissory note duly executed and delivered by the
Borrower substantially in the form of Exhibit B-1, with blanks appropriately
completed in conformity herewith (each, a "Revolving Note" and, collectively,
the "Revolving Notes") and (ii) if Swingline Loans, by a promissory note duly
executed and delivered by the Borrower substantially in the form of Exhibit B-2,
with blanks appropriately completed in conformity herewith (the "Swingline
Note").
(b) The Revolving Note issued to each Lender shall (i) be
executed by the Borrower, (ii) be payable to the order of such Lender and be
dated the Effective Date, (iii) be in a stated principal amount equal to the
Commitment of such Lender and be payable in the principal amount of the
Revolving Loans evidenced thereby, (iv) mature on the Maturity Date, (v) bear
interest as provided in the appropriate clause of Section 1.08 in respect of the
Base Rate Loans and Eurodollar Loans, as the case may be, evidenced thereby,
(vi) be subject to mandatory repayment as provided in Section 4.02 and (vii) be
entitled to the benefits of this Agreement and the other Credit Documents.
-4-
11
(c) The Swingline Note issued to BTCo shall (i) be executed by
the Borrower, (ii) be payable to the order of BTCo and be dated the Effective
Date, (iii) be in a stated principal amount equal to the Maximum Swingline
Amount and be payable in the principal amount of the outstanding Swingline Loans
evidenced thereby from time to time, (iv) mature on the Swingline Expiry Date,
(v) bear interest as provided in the appropriate clause of Section 1.08 in
respect of the Base Rate Loans evidenced thereby and (vi) be entitled to the
benefits of this Agreement and the other Credit Documents.
(d) Each Lender will note on its internal records the amount
of each Loan made by it and each payment in respect thereof and will prior to
any transfer of any of its Notes endorse on the reverse side thereof the
outstanding principal amount of Loans evidenced thereby. Failure to make any
such notation shall not affect the Borrower's obligations in respect of such
Loans.
1.06 Conversions. The Borrower shall have the option to
convert, on any Business Day occurring on or after the Effective Date, all or a
portion equal to at least $1,000,000 of the outstanding principal amount of such
Loans made pursuant to one or more Borrowings of one or more Types of Loans into
a Borrowing of another Type of Loan, provided that (i) except as otherwise
provided in Section 1.10(b), Eurodollar Loans may be converted into Base Rate
Loans only on the last day of an Interest Period applicable to the Loans being
converted and no such partial conversion of Eurodollar Loans shall reduce the
outstanding principal amount of such Eurodollar Loans made pursuant to a single
Borrowing to less than $1,000,000, (ii) Base Rate Loans may only be converted
into Eurodollar Loans if no Default or Event of Default is in existence on the
date of the conversion, (iii) no conversion pursuant to this Section 1.06 shall
result in a greater number of Borrowings than is permitted under Section 1.02
and (iv) Swingline Loans may not be converted pursuant to this Section 1.06.
Each such conversion shall be effected by the Borrower by giving the
Administrative Agent at its Notice Office prior to 12:00 Noon (New York time) at
least three Business Days' prior notice (each a "Notice of Conversion")
specifying the Loans to be so converted, the Borrowing(s) pursuant to which such
Loans were made and, if to be converted into Eurodollar Loans, the Interest
Period to be initially applicable thereto. The Administrative Agent shall give
each Lender prompt notice of any such proposed conversion affecting any of its
Loans. Upon any such conversion the proceeds thereof will be deemed to be
applied directly on the day of such conversion to prepay the outstanding
principal amount of the Loans being converted.
1.07 Pro Rata Borrowings. All Borrowings of Revolving Loans
under this Agreement shall be incurred from the Lenders pro rata on the basis of
their Commitments; provided that all Borrowings of Revolving Loans made pursuant
to a Mandatory Borrowing shall be incurred from the Lenders pro rata on the
basis of their Adjusted Percentages. It is understood that no Lender shall be
responsible for any default by any other Lender of its obligation to make Loans
hereunder and that each Lender shall be obligated to make the Loans provided to
be made by it hereunder, regardless of the failure of any other Lender to make
its Loans hereunder.
1.08 Interest. (a) The Borrower agrees to pay interest in
respect of the unpaid principal amount of each Base Rate Loan from the date the
proceeds thereof are made available to the Borrower until the maturity thereof
(whether by acceleration or otherwise) at a rate per
-5-
12
annum which shall be equal to the sum of the Applicable Base Rate Margin plus
the Base Rate in effect from time to time.
(b) The Borrower agrees to pay interest in respect of the
unpaid principal amount of each Eurodollar Loan from the date the proceeds
thereof are made available to the Borrower until the maturity thereof (whether
by acceleration or otherwise) at a rate per annum which shall, during each
Interest Period applicable thereto, be equal to the sum of the Applicable
Eurodollar Rate Margin plus the Eurodollar Rate for such Interest Period.
(c) Overdue principal and, to the extent permitted by law,
overdue interest in respect of each Loan and any other overdue amount payable
hereunder shall, in each case, bear interest at a rate per annum equal to 2% per
annum in excess of the rate otherwise applicable to Base Rate Loans from time to
time.
(d) Accrued (and theretofore unpaid) interest shall be payable
(i) in respect of each Base Rate Loan, quarterly in arrears on each Quarterly
Payment Date, (ii) in respect of each Eurodollar Loan, on the last day of each
Interest Period applicable thereto and, in the case of an Interest Period in
excess of three months, on each date occurring at three month intervals after
the first day of such Interest Period and (iii) in respect of each Loan, on any
repayment or prepayment (on the amount repaid or prepaid), at maturity (whether
by acceleration or otherwise) and, after such maturity, on demand.
(e) Upon each Interest Determination Date, the Administrative
Agent shall determine the Eurodollar Rate for each Interest Period applicable to
Eurodollar Loans and shall promptly notify the Borrower and the Lenders thereof.
Each such determination shall, absent manifest error, be final and conclusive
and binding on all parties hereto.
1.09 Interest Periods. At the time it gives any Notice of
Borrowing or Notice of Conversion in respect of the making of, or conversion
into, any Eurodollar Loan (in the case of the initial Interest Period applicable
thereto) or prior to 12:00 Noon (New York time) on the third Business Day prior
to the expiration of an Interest Period applicable to such Eurodollar Loan (in
the case of any subsequent Interest Period), the Borrower shall have the right
to elect, by giving the Administrative Agent notice thereof, the interest period
(each an "Interest Period") applicable to such Eurodollar Loan, which Interest
Period shall, at the option of the Borrower, be a one, two, three or six-month
period or, to the extent then available to all Lenders, a nine or twelve-month
period, provided that:
(i) all Eurodollar Loans comprising a Borrowing shall at all
times have the same Interest Period;
(ii) the initial Interest Period for any Eurodollar Loan shall
commence on the date of Borrowing of such Eurodollar Loan (including
the date of any conversion thereto from a Loan of a different Type) and
each Interest Period occurring thereafter in respect of such Eurodollar
Loan shall commence on the day on which the next preceding Interest
Period applicable thereto expires;
-6-
13
(iii) if any Interest Period relating to a Eurodollar Loan
begins on a day for which there is no numerically corresponding day in
the calendar month at the end of such Interest Period, such Interest
Period shall end on the last Business Day of such calendar month;
(iv) if any Interest Period would otherwise expire on a day
which is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day; provided, however, that if any Interest
Period for a Eurodollar Loan would otherwise expire on a day which is
not a Business Day but is a day of the month after which no further
Business Day occurs in such month, such Interest Period shall expire on
the next preceding Business Day;
(v) no Interest Period may be selected at any time when a
Default or Event of Default is then in existence; and
(vi) no Interest Period in respect of any Borrowing shall be
selected which extends beyond the Maturity Date.
If upon the expiration of any Interest Period applicable to a
Borrowing of Eurodollar Loans, the Borrower has failed to elect, or is not
permitted to elect, a new Interest Period to be applicable to such Eurodollar
Loans as provided above, the Borrower shall be deemed to have elected to convert
such Eurodollar Loans into Base Rate Loans effective as of the expiration date
of such current Interest Period.
1.10 Increased Costs, Illegality, etc. (a) In the event that
any Lender shall have determined (which determination shall, absent manifest
error, be final and conclusive and binding upon all parties hereto but, with
respect to clause (i) below, may be made only by the Administrative Agent):
(i) on any Interest Determination Date that, by reason of any
changes arising after the date of this Agreement affecting the
interbank Eurodollar market, adequate and fair means do not exist for
ascertaining the applicable interest rate on the basis provided for in
the definition of Eurodollar Rate; or
(ii) at any time, that such Lender shall incur increased costs
or reductions in the amounts received or receivable hereunder with
respect to any Eurodollar Loan because of (x) any change since the date
of this Agreement in any applicable law or governmental rule,
regulation, order, guideline or request (whether or not having the
force of law) or in the interpretation or administration thereof and
including the introduction of any new law or governmental rule,
regulation, order, guideline or request, such as, for example, but not
limited to: (A) a change in the basis of taxation of payment to any
Lender of the principal of or interest on the Notes or any other
amounts payable hereunder (except for changes in the rate of tax on, or
determined by reference to, the net income or profits of such Lender
pursuant to the laws of the jurisdiction in which it is organized or in
which its principal office or applicable lending office is located or
any subdivision thereof or therein) or (B) a change in official reserve
requirements, but, in all events, excluding reserves required under
Regulation D to the extent included in the computation of the
Eurodollar Rate
-7-
14
and/or (y) other circumstances since the date of this Agreement
affecting such Lender or the interbank Eurodollar market or the
position of such Lender in such market; or
(iii) at any time, that the making or continuance of any
Eurodollar Loan has been made (x) unlawful by any law or governmental
rule, regulation or order, (y) impossible by compliance by any Lender
in good faith with any governmental request (whether or not having
force of law) or (z) impracticable as a result of a contingency
occurring after the date of this Agreement which materially and
adversely affects the interbank Eurodollar market;
then, and in any such event, such Lender (or the Administrative Agent, in the
case of clause (i) above) shall promptly give notice (by telephone promptly
confirmed in writing) to the Borrower and, except in the case of clause (i)
above, to the Administrative Agent of such determination (which notice the
Administrative Agent shall promptly transmit to each of the other Lenders).
Thereafter (x) in the case of clause (i) above, Eurodollar Loans shall no longer
be available until such time as the Administrative Agent notifies the Borrower
and the Lenders that the circumstances giving rise to such notice by the
Administrative Agent no longer exist, and any Notice of Borrowing or Notice of
Conversion given by the Borrower with respect to Eurodollar Loans which have not
yet been incurred (including by way of conversion) shall be deemed rescinded by
the Borrower, (y) in the case of clause (ii) above, the Borrower shall pay to
such Lender, within 15 days of such Lender's written request therefor, such
additional amounts (in the form of an increased rate of, or a different method
of calculating, interest or otherwise as such Lender reasonably shall determine)
as shall be required to compensate such Lender for such increased costs or
reductions in amounts received or receivable hereunder as set forth in such
written request as to the additional amounts owed to such Lender, showing in
reasonable detail the basis for the calculation thereof, submitted to the
Borrower by such Lender shall, absent manifest error, be final and conclusive
and binding on all the parties hereto) and (z) in the case of clause (iii)
above, the Borrower shall take one of the actions specified in Section 1.10(b)
as promptly as possible and, in any event, within the time period required by
law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected by the circumstances described in
Section 1.10(a)(iii) shall) either (x) if the affected Eurodollar Loan is then
being made initially or pursuant to a conversion, by giving the Administrative
Agent telephonic notice (confirmed in writing) on the same date that the
Borrower was notified by the affected Lender or the Administrative Agent
pursuant to Section 1.10(a)(ii) or (iii) or (y) if the affected Eurodollar Loan
is then outstanding, upon at least three Business Days' written notice to the
Administrative Agent, require the affected Lender to convert such Eurodollar
Loan into a Base Rate Loan, provided that, if more than one Lender is affected
at any time, then all affected Lenders must be treated the same pursuant to this
Section 1.10(b).
(c) If at any time after the date of this Agreement any Lender
determines that the introduction of or any change in any applicable law or
governmental rule, regulation, order, guideline, directive or request (whether
or not having the force of law) concerning capital adequacy, or any change in
interpretation or administration thereof by any governmental authority, central
bank or comparable agency, will have the effect of increasing the amount of
capital
-8-
15
required or expected to be maintained by such Lender or any corporation
controlling such Lender based on the existence of such Lender's Commitments
hereunder or its obligations hereunder, then the Borrower shall pay to such
Lender, upon its written demand therefor, such additional amounts as shall be
required to compensate such Lender or such other corporation for the increased
cost to such Lender or such other corporation or the reduction in the rate of
return to such Lender or such other corporation as a result of such increase of
capital. In determining such additional amounts, each Lender will act reasonably
and in good faith and will use averaging and attribution methods which are
reasonable, provided that such Lender's determination of compensation owing
under this Section 1.10(c) shall, absent manifest error, be final and conclusive
and binding on all the parties hereto. Each Lender, upon determining that any
additional amounts will be payable pursuant to this Section 1.10(c), will give
prompt written notice thereof to the Borrower, which notice shall show in
reasonable detail the basis for calculation of such additional amounts.
(d) The provisions of this Section 1.10 are subject to Section
13.15 (to the extent same is applicable in accordance with the terms thereof).
1.11 Compensation. The Borrower shall compensate each Lender,
within 15 days of its written request (which request shall set forth in
reasonable detail the basis for requesting such compensation), for all
reasonable losses, expenses and liabilities (including, without limitation, any
loss, expense or liability incurred by reason of the liquidation or reemployment
of deposits or other funds required by such Lender to fund its Eurodollar Loans
but excluding loss of anticipated profits) which such Lender may sustain: (i) if
for any reason (other than a default by such Lender or the Administrative Agent)
a Borrowing of, or conversion from or into, Eurodollar Loans does not occur on a
date specified therefor in a Notice of Borrowing or Notice of Conversion
(whether or not withdrawn by the Borrower or deemed withdrawn pursuant to
Section 1.10(a)); (ii) if any repayment (including any repayment made pursuant
to Section 4.02 or as a result of an acceleration of the Loans pursuant to
Section 10) or conversion of any of its Eurodollar Loans occurs on a date which
is not the last day of an Interest Period with respect thereto; (iii) if any
prepayment of any of its Eurodollar Loans is not made on any date specified in a
notice of prepayment given by the Borrower; or (iv) as a consequence of (x) any
other default by the Borrower to repay its Loans when required by the terms of
this Agreement or any Note held by such Lender or (y) any election made pursuant
to Section 1.10(b). Calculation of all amounts payable to each Lender under
clause (ii) of the immediately preceding sentence shall be made as if such
Lender (x) had actually funded its relevant Eurodollar Loan through the purchase
of a Eurodollar deposit bearing interest at the Eurodollar Rate in an amount
equal to the amount of that Loan, having a maturity comparable to the relevant
Interest Period and (y) is actually required to terminate such deposit on the
date of the respective repayment or conversion and pay the customary breakage
charges in connection therewith; provided, however, that each Lender may fund
each of its Eurodollar Loans in any manner it sees fit and the foregoing
assumption shall be utilized only for the calculation of amounts payable under
clause (ii) of the first sentence of this Section 1.11.
1.12 Change of Lending Office. Each Lender agrees that on the
occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or
(iii), Section 1.10(c), Section 2.06 or Section 4.04 with respect to such
Lender, it will, if requested by the Borrower, use reasonable
-9-
16
efforts (subject to overall policy considerations of such Lender) to designate
another lending office for any Loans or Letters of Credit affected by such
event, provided that such designation is made on such terms that such Lender and
its lending office suffer no economic, legal or regulatory disadvantage, with
the object of avoiding the consequence of the event giving rise to the operation
of such Section. Nothing in this Section 1.12 shall affect or postpone any of
the obligations of the Borrower or the right of any Lender provided in Sections
1.10, 2.06 and 4.04.
1.13 Replacement of Lenders. (x) If any Lender becomes a
Defaulting Lender or otherwise defaults in its obligations to make Loans or fund
Unpaid Drawings, (y) upon the occurrence of an event giving rise to the
operation of Section 1.10(a)(ii) or (iii), Section 1.10(c), Section 2.06 or
Section 4.04 with respect to any Lender which results in such Lender charging to
the Borrower increased costs in excess of those being generally charged by the
Lenders or (z) as provided in Section 13.12(b) in the case of certain refusals
by a Lender to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Lenders, the Borrower shall have the right, if no Default or Event of
Default then exists, to replace such Lender (the "Replaced Lender") with one or
more other Eligible Transferee or Transferees, none of whom shall constitute a
Defaulting Lender at the time of such replacement (collectively, the
"Replacement Lender") reasonably acceptable to the Administrative Agent,
provided that (i) at the time of any replacement pursuant to this Section 1.13,
the Replacement Lender shall enter into one or more Assignment and Assumption
Agreements pursuant to Section 13.04(b) (and with all fees payable pursuant to
said Section 13.04(b) to be paid by the Replacement Lender) pursuant to which
the Replacement Lender shall acquire all of the Commitments and outstanding
Loans of, and participations in Letters of Credit by, the Replaced Lender and,
in connection therewith, shall pay to (x) the Replaced Lender in respect thereof
an amount equal to the sum of (A) an amount equal to the principal of, and all
accrued interest on, all outstanding Loans of the Replaced Lender, (B) an amount
equal to all Unpaid Drawings that have been funded by (and not reimbursed to)
such Replaced Lender, together with all then unpaid interest with respect
thereto at such time and (C) an amount equal to all accrued, but theretofore
unpaid, Fees owing to the Replaced Lender pursuant to Section 3.01 and (y) BTCo
an amount equal to such Replaced Lender's Adjusted Percentage (for this purpose,
determined as if the adjustment described in clause (y) of the immediately
succeeding sentence had been made with respect to such Replaced Lender) of any
Unpaid Drawing (which at such time remains an Unpaid Drawing) to the extent such
amount was not theretofore funded by such Replaced Lender, and (ii) all
obligations of the Borrower owing to the Replaced Lender (other than those
specifically described in clause (i) above in respect of which the assignment
purchase price has been, or is concurrently being, paid) shall be paid in full
to such Replaced Lender concurrently with such replacement. Upon the execution
of the respective Assignment and Assumption Agreements, the payment of amounts
referred to in clauses (i) and (ii) above and, if so requested by the
Replacement Lender, delivery to the Replacement Lender of the appropriate Note
or Notes executed by the Borrower, (x) the Replacement Lender shall become a
Lender hereunder and the Replaced Lender shall cease to constitute a Lender
hereunder, except with respect to indemnification provisions under this
Agreement, which shall survive as to such Replaced Lender and (y) the Adjusted
Percentages of the Lenders shall be automatically adjusted at such time to give
effect to such replacement (and to give effect to the replacement of a
Defaulting Lender with one or more Non-Defaulting Lenders).
-10-
17
SECTION 2. Letters of Credit.
2.01 Letters of Credit. (a) Subject to and upon the terms and
conditions herein set forth, the Borrower may request that BTCo issue, at any
time and from time to time on and after the Effective Date and prior to the 10th
day preceding the Maturity Date, (x) for the account of the Borrower and for the
benefit of any holder (or any trustee, agent or other similar representative for
any such holders) of L/C Supportable Obligations of the Borrower or any of its
Subsidiaries, an irrevocable sight standby letter of credit in Dollars or an
Alternate Currency and in a form customarily used by BTCo or in such other form
as has been approved by BTCo (each such standby letter of credit, a "Standby
Letter of Credit") in support of such L/C Supportable Obligations and (y) for
the account of the Borrower, an irrevocable sight trade letter of credit in
Dollars or an Alternate Currency and in a form customarily used by BTCo or in
such other form as has been approved by BTCo (each such trade letter of credit,
a "Trade Letter of Credit", and each such Trade Letter of Credit and each
Standby Letter of Credit, a "Letter of Credit") in support of customary
commercial transactions of the Borrower and its Subsidiaries.
(b) BTCo hereby agrees that it will, at any time and from time
to time on or after the Effective Date and prior to the Maturity Date, following
its receipt of the respective Letter of Credit Request, issue for the account of
the Borrower one or more Letters of Credit (x) in the case of Standby Letters of
Credit, in support of such L/C Supportable Obligations of the Borrower or any of
its Subsidiaries as are permitted to remain outstanding without giving rise to a
Default or Event of Default hereunder and (y) in the case of Trade Letters of
Credit, in support of buyers of goods as referenced in Section 2.01(a), provided
that BTCo shall be under no obligation to issue any Letter of Credit of the
types described above if at the time of such issuance:
(i) any order, judgment or decree of any governmental
authority or arbitrator shall purport by its terms to enjoin or
restrain BTCo from issuing such Letter of Credit or any requirement of
law applicable to BTCo or any request or directive (whether or not
having the force of law) from any governmental authority with
jurisdiction over BTCo shall prohibit, or request that BTCo refrain
from, the issuance of letters of credit generally or such Letter of
Credit in particular or shall impose upon BTCo with respect to such
Letter of Credit any restriction or reserve or capital requirement (for
which BTCo is not otherwise compensated) not in effect on the date
hereof, or any unreimbursed loss, cost or expense which was not
applicable, in effect or known to BTCo as of the date hereof and which
BTCo reasonably and in good ▇▇▇▇▇ ▇▇▇▇▇ material to it; or
(ii) BTCo shall have received notice from any Lender prior to
the issuance of such Letter of Credit of the type described in the
second sentence of Section 2.03(b).
(c) Notwithstanding the foregoing, (i) no Letter of Credit
shall be issued the Stated Amount of which, when added to the Letter of Credit
Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and
prior to the issuance of, the respective Letter of Credit) at such time would
exceed either (x) $15,000,000 or (y) when added to the aggregate principal
amount of all Revolving Loans made by Non-Defaulting Lenders and Swingline Loans
then outstanding, an amount equal to the Adjusted Total Commitment at such time,
(ii) no Letter of Credit denominated in an Alternate Currency shall be issued if
the Stated Amount of such
-11-
18
Letter of Credit, (x) when added to the Letter of Credit Outstandings (exclusive
of Unpaid Drawings which are repaid on the date of, and prior to the issuance
of, such Letter of Credit) at such time in respect of all other outstanding
Letters of Credit denominated in an Alternate Currency, would exceed $13,500,000
unless the Administrative Agent consents in writing prior to the issuance
thereof, and (y) when added to the aggregate principal amount of all Revolving
Loans made by Non-Defaulting Lenders and Swingline Loans and Letter of Credit
Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and
prior to the issuance of, such Letter of Credit) at such time, would exceed an
amount equal to 95% of the Adjusted Total Commitment at such time and (iii) each
Letter of Credit shall by its terms terminate on or before the earlier of (x)
(A) in the case of Standby Letters of Credit, the date which occurs 24 months
after the date of the issuance thereof (although any such Standby Letter of
Credit may be extendible for successive periods of up to 12 months, but not
beyond the date which is 10 days prior to the Maturity Date, on terms acceptable
to BTCo) and (B) in the case of Trade Letters of Credit, the date which occurs
24 months after the date of issuance thereof and (y) the date which is 10 days
prior to the Maturity Date.
(d) Schedule X contains a description of all letters of credit
issued by BTCo pursuant to the Existing Credit Agreement and which are to remain
outstanding on the Effective Date. Each such letter of credit, including any
extension thereof (each an "Existing Letter of Credit") shall constitute a
"Letter of Credit" for all purposes of this Agreement. Each Existing Letter of
Credit shall be deemed issued for purposes of Sections 2.04(a), 3.01(b) and
3.01(c) on the Effective Date.
2.02 Minimum Stated Amount. The Stated Amount of each Letter
of Credit shall be not less than $20,000 or such lesser amount as is acceptable
to BTCo.
2.03 Letter of Credit Requests. (a) Whenever the Borrower
desires that a Letter of Credit be issued for its account, the Borrower shall
give the Administrative Agent and BTCo at least two Business Days' (or such
shorter period as is acceptable to BTCo in any given case) written notice
thereof. Each notice shall be in the form of Exhibit C (each a "Letter of Credit
Request").
(b) The making of each Letter of Credit Request shall be
deemed to be a representation and warranty by the Borrower that such Letter of
Credit may be issued in accordance with, and will not violate the requirements
of, Section 2.01(c). Unless BTCo has received notice from the Required Lenders
before it issues a Letter of Credit that one or more of the conditions specified
in Section 5 are not satisfied on the Effective Date or Section 6 are not then
satisfied, or that the issuance of such Letter of Credit would violate Section
2.01(c), then BTCo may issue the requested Letter of Credit for the account of
the Borrower in accordance with BTCo's usual and customary practices. Upon its
issuance of or amendment to any Standby Letter of Credit, BTCo shall promptly
notify the Borrower and each Lender, in writing of such issuance or amendment
and, if requested by a Lender, BTCo shall provide such Lender with copies of any
such issuance or amendment. In the case of Trade Letters of Credit, BTCo shall
promptly notify the Lenders of the aggregate Stated Amount of same as of the
close of business on the last Business Day of the preceding week.
-12-
19
2.04 Letter of Credit Participations. (a) Immediately upon the
issuance by BTCo of any Letter of Credit, BTCo shall be deemed to have sold and
transferred to each Lender other than BTCo (each such Lender, in its capacity
under this Section 2.04, a "Participant"), and each such Participant shall be
deemed irrevocably and unconditionally to have purchased and received from BTCo,
without recourse or warranty, an undivided interest and participation, to the
extent of such Participant's Adjusted Percentage in such Letter of Credit, each
amendment and each drawing made thereunder and the obligations of the Borrower
under this Agreement with respect thereto, and any security therefor or guaranty
pertaining thereto. Upon any change in the Commitments or Adjusted Percentages
of the Lenders pursuant to Section 1.13 or 13.04 or as a result of a Lender
Default, it is hereby agreed that, with respect to all outstanding Letters of
Credit and Unpaid Drawings, there shall be an automatic adjustment to the
participations pursuant to this Section 2.04 to reflect the new Adjusted
Percentages of the assignor and assignee Lender or of all Lenders with
Commitments, as the case may be.
(b) In determining whether to pay under any Letter of Credit,
BTCo shall have no obligation relative to the other Lenders other than to
confirm that any documents required to be delivered under such Letter of Credit
appear to have been delivered and that they appear to substantially comply on
their face with the requirements of such Letter of Credit. Any action taken or
omitted to be taken by BTCo under or in connection with any Letter of Credit if
taken or omitted in the absence of gross negligence or willful misconduct (as
determined by the final, non-appealable decision of a court of competent
jurisdiction) shall not create for BTCo any resulting liability to the Borrower
or any Lender.
(c) In the event that BTCo makes any payment under any Letter
of Credit and the Borrower shall not have reimbursed such amount in full to BTCo
pursuant to Section 2.05(a), BTCo shall promptly notify the Administrative
Agent, which shall promptly notify each Participant of such failure, and each
Participant shall promptly and unconditionally pay to BTCo the amount of such
Participant's Adjusted Percentage of such unreimbursed payment in Dollars and in
same day funds. If BTCo so notifies, prior to 11:00 A.M. (New York time) on any
Business Day, any Participant required to fund a payment under a Letter of
Credit, such Participant shall make available to BTCo in Dollars such
Participant's Adjusted Percentage of the amount of such payment on such Business
Day in same day funds. If and to the extent such Participant shall not have so
made its Adjusted Percentage of the amount of such payment available to BTCo,
such Participant agrees to pay to BTCo, forthwith on demand such amount,
together with interest thereon, for each day from such date until the date such
amount is paid to BTCo at the overnight Federal Funds Rate for the first three
days and at the rate applicable to Revolving Loans maintained as Base Rate Loans
hereunder for each day thereafter. The failure of any Participant to make
available to BTCo its Adjusted Percentage of any payment under any Letter of
Credit shall not relieve any other Participant of its obligation hereunder to
make available to BTCo its Adjusted Percentage of any Letter of Credit on the
date required, as specified above, but no Participant shall be responsible for
the failure of any other Participant to make available to BTCo such other
Participant's Adjusted Percentage of any such payment.
(d) Whenever BTCo receives a payment of a reimbursement
obligation as to which it has received any payments from the Participants
pursuant to clause (c) above, BTCo shall pay to each Participant which has paid
its Adjusted Percentage thereof, in Dollars and in same day
-13-
20
funds, an amount equal to such Participant's share (based upon the proportionate
aggregate amount originally funded by such Participant to the aggregate amount
funded by all Participants) of the principal amount of such reimbursement
obligation and interest thereon accruing after the purchase of the respective
participations.
(e) The obligations of the Participants to make payments to
BTCo with respect to Letters of Credit issued by it shall be irrevocable and not
subject to any qualification or exception whatsoever and shall be made in
accordance with the terms and conditions of this Agreement under all
circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement
or any of the other Credit Documents;
(ii) the existence of any claim, setoff, defense or other
right which the Borrower or any of its Subsidiaries may have at any
time against a beneficiary named in a Letter of Credit, any transferee
of any Letter of Credit (or any Person for whom any such transferee may
be acting), the Administrative Agent, any Participant, or any other
Person, whether in connection with this Agreement, any Letter of
Credit, the transactions contemplated herein or any unrelated
transactions (including any underlying transaction between the Borrower
and the beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or any other document presented
under any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents; or
(v) the occurrence of any Default or Event of Default.
2.05 Agreement to Repay Letter of Credit Drawings. (a) The
Borrower hereby agrees to reimburse BTCo, by making payment in Dollars (in an
amount equal to the Dollar Equivalent of any payments or disbursements in
respect of Letters of Credit denominated in an Alternate Currency determined on
the date of such payment or disbursement) to BTCo in immediately available funds
at the Payment Office, for any payment or disbursement made by BTCo under any
Letter of Credit (each such amount (using the Dollar Equivalent of any Letters
of Credit denominated in an Alternate Currency determined on the date of such
payment or disbursement), so paid until reimbursed, an "Unpaid Drawing"), upon
receipt of notice by BTCo of such payment or disbursement prior to 11:00 A.M.
(New York time) on the date of, such payment or disbursement, with interest on
the amount so paid or disbursed by BTCo, to the extent not reimbursed prior to
12:00 Noon (New York time) on the date of such payment or disbursement, from and
including the date paid or disbursed to but excluding the date BTCo was
reimbursed by the Borrower therefor at a rate per annum which shall be the Base
Rate in effect from time to time plus the Applicable Base Rate Margin, provided,
however, to the extent such amounts are not reimbursed prior to 12:00 Noon (New
York time) on the third Business Day following the receipt by the Borrower of
notice of such payment or disbursement or the
-14-
21
occurrence of a Default under Section 10.05, interest shall thereafter accrue on
the amounts so paid or disbursed by BTCo (and until reimbursed by the Borrower)
at a rate per annum which shall be the Base Rate in effect from time to time
plus the Applicable Base Rate Margin plus 2%, in each such case, with interest
to be payable on demand. BTCo shall give the Borrower prompt written notice of
each Drawing under any Letter of Credit, provided that the failure to give any
such notice shall in no way affect, impair or diminish the Borrower's
obligations hereunder.
(b) The obligations of the Borrower under this Section 2.05 to
reimburse BTCo with respect to Unpaid Drawings (including, in each case,
interest thereon) shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to payment
which the Borrower may have or have had against any Lender (including in its
capacity as issuer of the Letter of Credit or as Participant), including,
without limitation, any defense based upon the failure of any drawing under a
Letter of Credit (each a "Drawing") to substantially conform to the terms of the
Letter of Credit or any nonapplication or misapplication by the beneficiary or
any transferee of the proceeds of such Drawing; provided, however, that the
Borrower shall not be obligated to reimburse BTCo for any wrongful payment made
by BTCo under a Letter of Credit as a result of acts or omissions constituting
willful misconduct or gross negligence on the part of BTCo (as determined by the
final, non-appealable decision of a court of competent jurisdiction).
2.06 Increased Costs. (a) If at any time after the date of
this Agreement, the introduction of or any change in any applicable law, rule,
regulation, order, guideline or request or in the interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof, or compliance by BTCo or any
Participant with any request or directive by any such authority (whether or not
having the force of law), shall either (i) impose, modify or make applicable any
reserve, deposit, capital adequacy or similar requirement against letters of
credit issued by BTCo or participated in by any Participant, or (ii) impose on
BTCo or any Participant any other conditions relating, directly or indirectly,
to this Agreement; and the result of any of the foregoing is to increase the
cost to BTCo or any Participant of issuing, maintaining or participating in any
Letter of Credit, or reduce the amount of any sum received or receivable by BTCo
or any Participant hereunder or reduce the rate of return on its capital with
respect to Letters of Credit (except for changes in the rate of tax on, or
determined by reference to, the net income or profits of BTCo or such
Participant pursuant to the laws of the jurisdiction in which it is organized or
in which its principal office or applicable lending office is located or any
subdivision thereof or therein), then, within 15 days of the delivery of the
certificate referred to below to the Borrower by BTCo or any Participant (a copy
of which certificate shall be sent by BTCo or such Participant to the
Administrative Agent), the Borrower shall pay to BTCo or such Participant such
additional amount or amounts as will compensate such Lender for such increased
cost or reduction in the amount receivable or reduction on the rate of return on
its capital. BTCo or any Participant, upon determining that any additional
amounts will be payable pursuant to this Section 2.06, will give prompt written
notice thereof to the Borrower, which notice shall include a certificate
submitted to the Borrower by BTCo or such Participant (a copy of which
certificate shall be sent by BTCo or such Participant to the Administrative
Agent), setting forth in reasonable detail the basis for the calculation of such
additional amount or amounts necessary to compensate BTCo or such Participant.
The certificate required to be
-15-
22
delivered pursuant to this Section 2.06 shall, absent manifest error, be final
and conclusive and binding on the Borrower.
(b) The provisions of this Section 2.06 are subject to Section
13.15 (to the extent same is applicable in accordance with the terms thereof).
SECTION 3. Commitment Commission; Fees; Reductions of
Commitment.
3.01 Fees. (a) The Borrower agrees to pay to the
Administrative Agent for distribution to each Non-Defaulting Lender a commitment
commission (the "Commitment Commission") for the period from the Effective Date
to and including the Maturity Date (or such earlier date as the Total Commitment
shall have been terminated), computed at a rate for each day equal to (i) 0.375%
per annum on the daily average Unutilized Commitment of such Non-Defaulting
Lender at any time when the Leverage Ratio shall be less than or equal to
4.5:1.0 and (ii) 0.50% per annum on the daily average Unutilized Commitment of
such Non-Defaulting Lender at any time when the Leverage Ratio shall be greater
than 4.5:1.0. Accrued Commitment Commission shall be due and payable quarterly
in arrears on each Quarterly Payment Date and on the Maturity Date or such
earlier date upon which the Total Commitment is terminated.
(b) The Borrower agrees to pay to the Administrative Agent for
distribution to each Non-Defaulting Lender (based on their respective Adjusted
Percentages) a fee in respect of each Letter of Credit issued hereunder (the
"Letter of Credit Fee") in the case of each Letter of Credit, for the period
from and including the date of issuance of such Letter of Credit to and
including the termination of such Letter of Credit (or, in the case of a Trade
Letter of Credit, the date of the stated expiration thereof), computed at a rate
per annum equal to the Applicable Eurodollar Rate Margin on the daily average
Stated Amount of such Letter of Credit. Accrued Letter of Credit Fees shall be
due and payable quarterly in arrears on each Quarterly Payment Date and on the
first day after the termination of the Total Commitment upon which no Letters of
Credit remain outstanding.
(c) The Borrower agrees to pay to BTCo, for its own account, a
facing fee in respect of each Letter of Credit issued for its account hereunder
(the "Facing Fee") (x) in the case of each Standby Letter of Credit, for the
period from and including the date of issuance of such Standby Letter of Credit
to and including the termination of such Standby Letter of Credit, computed at a
rate equal to 1/4 of 1% per annum of the daily average Stated Amount of such
Standby Letter of Credit, provided that, in any event, the minimum amount of the
Facing Fee payable in any 12-month period for each Standby Letter of Credit
shall be $500 (it being agreed that, on each anniversary of the issuance of any
Standby Letter of Credit or upon any earlier termination or expiration of a
Standby Letter of Credit, if $500 exceeds the amount of Facing Fees theretofore
paid or then accrued with respect to such Standby Letter of Credit, in either
case after the date of the issuance thereof or, if later, after the date of the
last anniversary of the issuance thereof (but excluding any amounts paid after
such anniversary with respect to periods ending on or prior to such anniversary,
including, without limitation, as a result of the operation of this
parenthetical), the amount of such excess shall be payable on the next date upon
which accrued Facing Fees are otherwise payable with respect to Standby Letters
of Credit as provided in the following sentence), and (y) in the case of each
Trade Letter of Credit, in an amount equal
-16-
23
to the greater of (A) the Applicable Eurodollar Rate Margin for Revolving Loans
maintained as Eurodollar Loans multiplied by the daily average Stated Amount of
such Trade Letter of Credit and (B) $500. Except as otherwise provided in the
proviso to the immediately preceding sentence, accrued Facing Fees shall be due
and payable quarterly in arrears on each Quarterly Payment Date and upon the
first day after the termination of the Total Commitment upon which no Letters of
Credit remain outstanding.
(d) The Borrower shall pay, upon each drawing under, issuance
of, or amendment to, any Letter of Credit, such amount as shall at the time of
such event be the administrative charge and reasonable out-of-pocket expenses
which BTCo is generally imposing in connection with such occurrence with respect
to letters of credit.
(e) The Borrower shall pay to the Administrative Agent, for
its own account, such other fees as have been agreed to in writing by the
Borrower and the Administrative Agent.
3.02 Voluntary Termination of Unutilized Commitments. Upon at
least two Business Days' prior notice to the Administrative Agent at its Notice
Office (which notice the Administrative Agent shall promptly transmit to each of
the Lenders), the Borrower shall have the right, at any time or from time to
time, without premium or penalty, to terminate the Total Unutilized Commitment,
in whole or in part, in integral multiples of $1,000,000 in the case of partial
reductions to the Total Unutilized Commitment, provided that (i) each such
reduction shall apply proportionately to permanently reduce the Commitment of
each Lender and (ii) the reduction to the Total Unutilized Commitment shall in
no case be in an amount which would cause the Commitment of any Lender to be
reduced (as required by preceding clause (i)) by an amount which exceeds the
remainder of (x) the Unutilized Commitment of such Lender as in effect
immediately before giving effect to such reduction minus (y) such Lender's
Adjusted Percentage of the aggregate principal amount of Swingline Loans then
outstanding.
3.03 Mandatory Reduction of Commitments. (a) The Total
Commitment (and the Commitment of each Lender) shall terminate in its entirety
on June 30, 2000 unless the Effective Date has occurred on or before such date.
(b) In addition to any other mandatory commitment reductions
pursuant to this Section 3.03, the Total Commitment (and the Commitment of each
Lender) shall terminate in its entirety on the Maturity Date.
(c) Each reduction to the Total Commitment pursuant to this
Section 3.03 (or pursuant to Section 4.02) shall be applied proportionately to
reduce the Commitment of each Lender.
SECTION 4. Prepayments; Payments; Taxes.
4.01 Voluntary Prepayments. The Borrower shall have the right
to prepay the Loans, without premium or penalty, in whole or in part at any time
and from time to time on the following terms and conditions: (i) the Borrower
shall give the Administrative Agent prior to 12:00 Noon (New York time) at its
Notice Office (x) at least one Business Day's prior written
-17-
24
notice (or telephonic notice promptly confirmed in writing) of its intent to
prepay Eurodollar Loans, whether Revolving Loans or Swingline Loans shall be
prepaid, the amount of such prepayment and the Types of Loans to be prepaid and,
in the case of Eurodollar Loans, the specific Borrowing or Borrowings pursuant
to which made, which notice the Administrative Agent shall promptly transmit to
each of the Lenders; (ii) each prepayment shall be in an aggregate principal
amount of at least $100,000, provided that if any partial prepayment of
Eurodollar Loans made pursuant to any Borrowing shall reduce the outstanding
Eurodollar Loans made pursuant to such Borrowing to an amount less than
$1,000,000, then such Borrowing may not be continued as a Borrowing of
Eurodollar Loans and any election of an Interest Period with respect thereto
given by the Borrower shall have no force or effect; (iii) prepayments of
Eurodollar Loans made pursuant to this Section 4.01 may only be made on the last
day of an Interest Period applicable thereto; (iv) each prepayment in respect of
any Loans made pursuant to a Borrowing shall, except as provided in clause (v)
below, be applied pro rata among such Loans; and (v) at the Borrower's election
in connection with any prepayment of Revolving Loans pursuant to this Section
4.01, such prepayment shall not be applied to any Revolving Loan of a Defaulting
Lender.
4.02 Mandatory Repayments and Commitment Reductions. (a)(i) On
any day on which the sum of the aggregate outstanding principal amount of the
Revolving Loans made by Non-Defaulting Lenders, Swingline Loans and the Letter
of Credit Outstandings exceeds the Adjusted Total Commitment as then in effect,
the Borrower shall prepay principal of Swingline Loans and, after the Swingline
Loans have been repaid in full, Revolving Loans of Non-Defaulting Lenders in an
amount equal to such excess. If, after giving effect to the prepayment of all
outstanding Swingline Loans and Revolving Loans of Non-Defaulting Lenders, the
aggregate amount of the Letter of Credit Outstandings exceeds the Adjusted Total
Commitment as then in effect, the Borrower shall pay to the Administrative Agent
at the Payment Office on such date an amount of cash or Cash Equivalents equal
to the amount of such excess (up to a maximum amount equal to the Letter of
Credit Outstandings at such time), such cash or Cash Equivalents to be held as
security for all obligations of the Borrower to Non-Defaulting Lenders hereunder
in a cash collateral account to be established by the Administrative Agent.
(ii) On any day on which the aggregate outstanding principal
amount of the Revolving Loans made by any Defaulting Lender exceeds the
Commitment of such Defaulting Lender, the Borrower shall prepay principal of
Revolving Loans of such Defaulting Lender in an amount equal to such excess.
(b) In addition to any other mandatory repayments or
commitment reductions pursuant to this Section 4.02, on the fifth Business Day
after each date after the Effective Date upon which Holdings or any of its
Subsidiaries consummates any Asset Sale, the Total Commitment shall be
permanently reduced by an amount equal to 100% of the Net Sale Proceeds
therefrom in accordance with the requirements of Section 4.02(c), provided that
the Total Commitment shall not be required to be so reduced by any Net Sale
Proceeds received by Holdings or any of its Subsidiaries in connection with any
Asset Sale within such five Business
-18-
25
Days to the extent the Borrower has delivered a Reinvestment Notice to the
Administrative Agent on or prior to such date stating that such Net Sale
Proceeds shall be reinvested or shall be committed to be reinvested (a
"Reinvestment Election") in equipment or other assets useful in a Permitted
Business (including capital stock or other equity interests of a Person engaged
in such business) (each a "Reinvestment Asset" and collectively, the
"Reinvestment Assets") within 18 months following the date of receipt of such
Net Sale Proceeds and provided further, that if all or any portion of such Net
Sale Proceeds referred to in the preceding proviso are not so used within the
18-month period following the date of the receipt of such Net Sale Proceeds,
such remaining portion shall be applied on the last day of such period as a
permanent reduction of the Total Commitment as provided above in this Section
4.02(b) without regard to the immediately preceding proviso. The Borrower may
exercise its Reinvestment Election (within the parameters specified in the
preceding sentence) with respect to an Asset Sale if (x) no Default or Event of
Default exists and (y) the Borrower delivers a Reinvestment Notice to the
Administrative Agent within three Business Days following the date of the
consummation of the respective Asset Sale, with such Reinvestment Election being
effective with respect to the Net Sale Proceeds of such Asset Sale equal to the
Anticipated Reinvestment Amount specified in such Reinvestment Notice.
(c) With respect to each repayment of Loans required by this
Section 4.02, the Borrower may designate the Types of Loans which are to be
repaid and, in the case of Eurodollar Loans, the specific Borrowing or
Borrowings pursuant to which made, provided that: (i) repayments of Eurodollar
Loans pursuant to this Section 4.02 may only be made on the last day of an
Interest Period applicable thereto unless all Eurodollar Loans made pursuant to
such Borrowing with Interest Periods ending on such date of required repayment
and all Base Rate Loans made pursuant to such Borrowing have been paid in full;
(ii) if any repayment of Eurodollar Loans made pursuant to a single Borrowing
shall reduce the outstanding Eurodollar Loans made pursuant to such Borrowing to
an amount less than $1,000,000, such Borrowing shall be converted at the end of
the then current Interest Period into a Borrowing of Base Rate Loans; and (iii)
each repayment of any Loans made pursuant to a Borrowing shall be applied pro
rata among such Loans. In the absence of a designation by the Borrower as
described in the preceding sentence, the Administrative Agent shall, subject to
the above, make such designation in its sole discretion.
(d) Notwithstanding anything to the contrary contained
elsewhere in this Agreement, (i) all then outstanding Swingline Loans shall be
repaid in full on the Swingline Expiry Date and (ii) all other then outstanding
Loans shall be repaid in full on the Maturity Date.
4.03 Method and Place of Payment. Except as otherwise
specifically provided herein, all payments under this Agreement or any Note
shall be made to the Administrative Agent for the account of the Lender or
Lenders entitled thereto not later than 12:00 Noon (New York time) on the date
when due and shall be made in Dollars in immediately available funds at the
Payment Office of the Administrative Agent. Whenever any payment to be made
hereunder or under any Note shall be stated to be due on a day which is not a
Business Day, the due date thereof shall be extended to the next succeeding
Business Day and, with respect to payments of principal, interest shall be
payable at the applicable rate during such extension.
-19-
26
4.04 Net Payments. (a) All payments made by the Borrower
hereunder or under any Note will be made without setoff, counterclaim or other
defense. Except as provided in Section 4.04(b), all such payments will be made
free and clear of, and without deduction or withholding for, any present or
future taxes, levies, imposts, duties, fees, assessments or other charges of
whatever nature now or hereafter imposed by any jurisdiction or by any political
subdivision or taxing authority thereof or therein with respect to such payments
(but excluding any tax imposed on or measured by the net income or net profits
of a Lender pursuant to the laws of the jurisdiction in which it is organized or
in which the principal office or applicable lending office of such Lender is
located or any subdivision thereof or therein) and all interest, penalties or
similar liabilities with respect thereto (all such non-excluded taxes, levies,
imposts, duties, fees, assessments or other charges being referred to
collectively, as "Taxes"). If any Taxes are so levied or imposed, the Borrower
agrees to pay the full amount of such Taxes, and such additional amounts as may
be necessary so that every payment of all amounts due under this Agreement or
under any Note, after withholding or deduction for or on account of any Taxes,
will not be less than the amount provided for herein or in such Note. The
Borrower will furnish to the Administrative Agent within 45 days after the date
the payment of any Taxes is due pursuant to applicable law certified copies of
tax receipts evidencing such payment by the Borrower or, if the relevant taxing
authority does not issue such receipts, such other evidence of payment as may be
reasonably satisfactory to the Administrative Agent. The Borrower agrees to
indemnify and hold harmless each Lender, and reimburse such Lender upon its
written request, for the amount of any Taxes so levied or imposed and paid by
such Lender.
(b) Each Lender that is not a United States person (as such
term is defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax
purposes agrees to deliver to the Borrower and the Administrative Agent on or
prior to the Effective Date, or in the case of a Lender that is an assignee or
transferee of an interest under this Agreement pursuant to Section 1.13 or 13.04
(unless the respective Lender was already a Lender hereunder immediately prior
to such assignment or transfer) on the date of such assignment or transfer to
such Lender, (i) two accurate and complete original signed copies of Internal
Revenue Service Form W-8ECI or W-8BEN (with respect to a complete exemption from
withholding tax under an income tax treaty) (or successor forms) certifying to
such Lender's entitlement as of such date to a complete exemption from United
States withholding tax with respect to payments to be made under this Agreement
and under any Note or (ii) if the Lender is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form W-8BEN (with respect to a complete exemption from withholding tax
under an income tax treaty) or W-8ECI pursuant to clause (i) above, (x) a
certificate substantially in the form of Exhibit D (any such certificate, a
"Section 4.04(b)(ii) Certificate") and (y) two accurate and complete original
signed copies of Internal Revenue Service Form W-8BEN (with respect to the
portfolio interest exception) (or successor form) certifying to such Lender's
entitlement on the date of such certificate to a complete exemption from United
States withholding tax with respect to payments of interest to be made under
this Agreement and under any Note. In addition, each Lender agrees that from
time to time after the Effective Date, when a lapse in time or change in
circumstances renders the previous certification obsolete or inaccurate in any
material respect, it will deliver to the Borrower and the Administrative Agent
two new accurate and complete original signed copies of Internal Revenue
Service Form W-8ECI or W-8BEN (with respect to a complete exemption
-20-
27
from or reduction in United States withholding tax with respect to
payments under this Agreement and any Note, or it shall immediately notify the
Borrower and the Administrative Agent of its inability to deliver any such Form
or Certificate. Such Lender shall not be required to deliver any such Form or
Certificate pursuant to this Section 4.04(b) if such inability results from a
change after the Effective Date (or, in the case of a Lender that is not a
Lender hereunder on the Effective Date, a change after the date such Lender
became an assignee or a transferee of an interest hereunder) in any applicable
law, treaty, governmental rule, regulation, guideline or order, or in the
interpretation thereof. Notwithstanding anything to the contrary contained in
Section 4.04(a), but subject to Section 13.04(b) and the immediately succeeding
sentence, (x) the Borrower shall be entitled, to the extent it is required to do
so by law, to deduct or withhold income or similar taxes imposed by the United
States (or any political subdivision or taxing authority thereof or therein)
from interest, Fees or other amounts payable hereunder for the account of any
Lender which is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for U.S. Federal income tax purposes to the extent that
such Lender has not provided to the Borrower U.S. Internal Revenue Service Forms
that establish a complete exemption from such deduction or withholding and (y)
the Borrower shall not be obligated pursuant to Section 4.04(a) hereof to
gross-up payments to be made to a Lender in respect of income or similar taxes
imposed by the United States if (I) such Lender has not provided to the Borrower
the Internal Revenue Service Forms required to be provided to the Borrower
pursuant to this Section 4.04(b) or (II) in the case of a payment, other than
interest, to a Lender described in clause (ii) above, to the extent that such
Forms do not establish a complete exemption from withholding of such taxes.
Notwithstanding anything to the contrary contained in the preceding sentence or
elsewhere in this Section 4.04 and except as set forth in Section 13.04(b), the
Borrower agrees to pay any additional amounts and to indemnify each Lender in
the manner set forth in Section 4.04(a) (without regard to the identity of the
jurisdiction requiring the deduction or withholding) in respect of any Taxes
deducted or withheld by it as described in the immediately preceding sentence as
a result of any change on or after the Effective Date in any applicable law,
treaty, governmental rule, regulation, guideline or order, or in the
interpretation thereof, relating to the deducting or withholding of such Taxes.
(c) If the Borrower pays any additional amount under this
Section 4.04 to a Lender and such Lender determines in its sole discretion that
it has actually received or realized in connection therewith any refund or any
reduction of, or credit against, its Tax liabilities in or with respect to the
taxable year in which the additional amount is paid (a "Tax Benefit"), such
Lender shall pay to the Borrower an amount that the Lender shall, in its sole
discretion, determine is equal to the net benefit, after tax, which was obtained
by the Lender in such year as a consequence of such Tax Benefit; provided,
however, that (i) any Lender may determine, in its sole discretion consistent
with the policies of such Lender, whether to seek a Tax Benefit; (ii) any Taxes
that are imposed on a Lender as a result of a disallowance or reduction
(including through the expiration of any tax credit carryover or carryback of
such Lender that otherwise would not have expired) of any Tax Benefit with
respect to which such Lender has made a payment to the Borrower pursuant to this
Section 4.04(c) shall be treated as a Tax for which the Borrower is
-21-
28
obligated to indemnify such Lender pursuant to this Section 4.04 without any
exclusions or defenses; and (iii) nothing in this Section 4.04(c) shall require
the Lender to disclose any confidential information to the Borrower (including,
without limitation, its tax returns).
SECTION 5. Conditions Precedent to Effectiveness. The
obligation of each Lender to make Loans, and the obligation of BTCo to issue
Letters of Credit, on and after the Effective Date, are subject at the time of
the making of such Loans or the issuance of such Letters of Credit to the
satisfaction of the following conditions:
5.01 Execution of Agreement; Notes. On or prior to the
Effective Date, there shall have been delivered to the Administrative Agent for
the account of each of the Lenders the appropriate Revolving Note executed by
the Borrower, and to BTCo the Swingline Note executed by the Borrower, in each
case in the amount, maturity and as otherwise provided herein.
5.02 Officer's Certificate. On the Effective Date, the
Administrative Agent shall have received a certificate dated the Effective Date
signed on behalf of the Borrower by the President or any Vice President of the
Borrower stating that all of the conditions in Sections 5.06, 5.07, 5.12, 5.13
and 6.01 have been satisfied on such date (except to the extent that any such
condition is required to be satisfactory to the Administrative Agent or any
Lender).
5.03 Opinions of Counsel. On the Effective Date, the
Administrative Agent shall have received (i) from ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ LLP,
counsel to each Credit Party, an opinion addressed to the Administrative Agent
and each of the Lenders and dated the Effective Date covering the matters set
forth in Exhibit E and such other matters incident to the transaction
contemplated herein as the Administrative Agent may request and (ii) from local
counsel to the Borrower satisfactory to the Administrative Agent, opinions each
of which shall be in form and substance satisfactory to the Administrative Agent
and the Required Lenders and shall cover the perfection of the security
interests granted pursuant to the Security Documents and such other matters
incident to the transactions contemplated herein as the Administrative Agent may
reasonably request.
5.04 Corporate Documents; Proceedings; etc. (a) On the
Effective Date, the Administrative Agent shall have received a certificate,
dated the Effective Date, signed by the President or any Vice President of each
Credit Party, and attested to by the Secretary or any Assistant Secretary of
such Credit Party, in the form of Exhibit F with appropriate insertions,
together with copies of the Certificate of Incorporation and By-Laws of such
Credit Party and the resolutions of such Credit Party referred to in such
certificate, and the foregoing shall be reasonably acceptable to the
Administrative Agent.
(b) On the Effective Date, all corporate and legal proceedings
and all instruments and agreements in connection with the transactions
contemplated by this Agreement and the other Documents shall be satisfactory in
form and substance to the Administrative Agent and the Required Lenders, and the
Administrative Agent shall have received all information and copies of all
documents and papers, including records of corporate proceedings, governmental
approvals, good standing certificates and bring-down telegrams, if any, which
the Administrative Agent
-22-
29
reasonably may have requested in connection therewith, such documents and papers
where appropriate to be certified by proper corporate or governmental
authorities.
5.05 Employee Benefit Plans; Shareholders' Agreements;
Management Agreements; Collective Bargaining Agreements; Employment Agreements;
Debt Agreements. On the Effective Date, there shall have been delivered to the
Administrative Agent true and correct copies, certified as true and complete by
an appropriate officer of the relevant Credit Party of (i) all Plans that are
subject to Title IV of ERISA (and for each Plan that is required to file an
annual report on Internal Revenue Service Form 5500-series, a copy of the most
recent such report (including, to the extent required, the related financial and
actuarial statements and opinions and other supporting statements,
certifications, schedules and information), and for each Plan that is a
"single-employer plan," as defined in Section 4001(a)(15) of ERISA, the most
recently prepared actuarial valuation therefor) (provided that the foregoing
shall apply in the case of any multiemployer plan, as defined in 4001(a)(3) of
ERISA, only to the extent that any document described therein is in the
possession of Holdings or any Subsidiary of Holdings or any ERISA Affiliate or
reasonably available thereto from the sponsor or trustee of any such plan)
(collectively, the "Employee Benefit Plans"), (ii) all agreements entered into
by such Credit Party or any of its Subsidiaries governing the terms and relative
rights of its capital stock and any agreements entered into by shareholders
relating to any such entity with respect to its capital stock (collectively, the
"Shareholders' Agreements"), (iii) all agreements with members of, or with
respect to, the management of such Credit Party (collectively, the "Management
Agreements"), (iv) all collective bargaining agreements applying or relating to
any employee of such Credit Party or any of its Subsidiaries (collectively, the
"Collective Bargaining Agreements"), (v) all material employment agreements
entered into by Holdings or any of its Subsidiaries (collectively, the
"Employment Agreements") and (vi) all agreements evidencing or relating to
Indebtedness of such Credit Party or any of its Subsidiaries which is to remain
outstanding after the Effective Date (collectively, the "Debt Agreements"); all
of which Employee Benefit Plans, Shareholders' Agreements, Management
Agreements, Collective Bargaining Agreements, Employment Agreements and Debt
Agreements shall be in form and substance reasonably satisfactory to the
Administrative Agent and the Required Lenders and shall be in full force and
effect on the Effective Date.
5.06 Consummation of the Synthetic Lease Financing; etc. (a)
On the Effective Date, the Synthetic Lease Financing shall have been consummated
in all material respects in accordance with the Synthetic Lease Financing
Documents and all applicable laws, and each of the conditions precedent to the
consummation of the Synthetic Lease Financing shall have been satisfied and not
waived in any material respect except with the consent of the Administrative
Agent and the Required Lenders (which consent shall not be unreasonably
withheld).
(b) On or prior to the Effective Date, (i) the Borrower shall
have consummated a consent solicitation (the "Borrower Senior Discount Notes
Consent Solicitation") with respect to the outstanding Borrower Senior Discount
Notes, pursuant to which consents shall be solicited from the holders of the
Borrower Senior Discount Notes to permit the Borrower and its Subsidiaries to
enter into the Synthetic Lease Financing, (ii) the Borrower shall have received
sufficient consents to authorize the execution and delivery of the Synthetic
Lease Financing Documents, which consents shall be in form and substance
reasonably satisfactory to the
-23-
30
Administrative Agent, and (iii) the Administrative Agent shall be reasonably
satisfied that the Borrower Senior Discount Notes Consent Solicitation shall
have been consummated in accordance with all applicable laws.
(c) On or prior to the Effective Date, there shall have been
delivered to the Administrative Agent true and correct copies of the Synthetic
Lease Financing Documents, and all of the terms and conditions of the Synthetic
Lease Financing Documents shall be reasonably satisfactory in form and substance
to the Administrative Agent and the Required Lenders.
5.07 Refinancing. (a) On or prior to the Effective Date, the
total commitment in respect of the Indebtedness to be Refinanced shall have been
terminated, and all loans and notes with respect thereto shall have been repaid
in full, together with interest thereon, all letters of credit issued thereunder
(including the Existing Letters of Credit) shall have been terminated,
incorporated hereunder as Letters of Credit as contemplated by Section 2.01(d)
or supported by a back-stop Letter of Credit issued hereunder and all other
amounts (including premiums) owing pursuant to the Indebtedness to be Refinanced
shall have been repaid in full and all documents in respect of the Indebtedness
to be Refinanced and all guarantees with respect thereto shall have been
terminated (except as to indemnification provisions which may survive to the
extent provided therein) and be of no further force and effect.
(b) On or prior to the Effective Date, the creditors in
respect of the Indebtedness to be Refinanced shall have terminated and released
any and all security interests and Liens on the assets owned by Holdings and its
Subsidiaries. The Administrative Agent shall have received such releases of
security interests in and Liens on the assets owned by Holdings and its
Subsidiaries as may have been reasonably requested by the Administrative Agent,
which releases shall be in form and substance reasonably satisfactory to the
Administrative Agent. Without limiting the foregoing, there shall have been
delivered (i) proper termination statements (Form UCC-3 or the appropriate
equivalent) for filing under the UCC of each jurisdiction where a financing
statement (Form UCC-1 or the appropriate equivalent) was filed with respect to
Holdings or any of its Subsidiaries in connection with the security interests
created with respect to the Indebtedness to be Refinanced and the documentation
related thereto, (ii) termination or reassignment of any security interest in,
or Lien on, any patents, trademarks, copyrights, or similar interests of
Holdings or any of its Subsidiaries on which filings have been made, (iii)
terminations of all mortgages, leasehold mortgages, deeds of trust and leasehold
deeds of trust created with respect to property of Holdings or any of its
Subsidiaries, in each case, to secure the obligations in respect of the
Indebtedness to be Refinanced, all of which shall be in form and substance
reasonably satisfactory to the Administrative Agent, and (iv) all collateral
owned by Holdings and its Subsidiaries in the possession of any of the creditors
in respect of the Indebtedness to be Refinanced or any collateral agent or
trustee under any related security document shall have been returned to Holdings
or its respective Subsidiary, as the case may be.
(c) The Administrative Agent shall have received evidence, in
form and substance reasonably satisfactory to it, that the matters set forth in
this Section 5.07 have been satisfied as of the Effective Date.
-24-
31
5.08 Pledge Agreement. On the Effective Date, each Credit
Party shall have duly authorized, executed and delivered the Pledge Agreement in
the form of Exhibit G (as amended, modified or supplemented from time to time,
the "Pledge Agreement") and shall have delivered to the Collateral Agent, as
pledgee thereunder, all of the Pledged Securities, if any, referred to therein
and owned by such Credit Party, (x) endorsed in blank in the case of promissory
notes constituting Pledged Securities and (y) together with executed and undated
stock powers in the case of capital stock constituting Pledged Securities.
5.09 Security Agreement. On the Effective Date, each Credit
Party shall have duly authorized, executed and delivered the Security Agreement
in the form of Exhibit H (as modified, supplemented or amended from time to
time, the "Security Agreement") covering all of such Credit Party's present and
future Security Agreement Collateral, together with:
(i) proper Financing Statements (Form UCC-1 or the equivalent)
fully executed for filing under the UCC or other appropriate filing
offices of each jurisdiction as may be necessary or, in the reasonable
opinion of the Collateral Agent, desirable to perfect the security
interests purported to be created by the Security Agreement;
(ii) certified copies of Requests for Information or Copies
(Form UCC-11), or equivalent reports, listing all effective financing
statements that name any Credit Party or any of its Subsidiaries as
debtor and that are filed in the jurisdictions referred to in clause
(i) above, together with copies of such other financing statements that
name any Credit Party or any of its Subsidiaries as debtor (none of
which shall cover the Collateral except to the extent evidencing
Permitted Liens or in respect of which the Collateral Agent shall have
received termination statements (Form UCC-3 or the equivalent) as shall
be required by local law fully executed for filing);
(iii) evidence of the completion of all other recordings and
filings of, or with respect to, the Security Agreement as may be
necessary or, in the reasonable opinion of the Collateral Agent,
desirable to perfect the security interests intended to be created by
the Security Agreement; and
(iv) evidence that all other actions necessary or, in the
reasonable opinion of the Collateral Agent, desirable to perfect and
protect the security interests purported to be created by the Security
Agreement have been taken.
5.10 Subsidiaries Guaranty. On the Effective Date, each
Subsidiary Guarantor shall have duly authorized, executed and delivered the
Subsidiaries Guaranty in the form of Exhibit I (as amended, modified or
supplemented from time to time, the "Subsidiaries Guaranty"), and the
Subsidiaries Guaranty shall be in full force and effect.
5.11 Consent Letter. On the Effective Date, the Administrative
Agent shall have received a letter from CT Corporation System, presently located
at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, substantially in the form of Exhibit
J, indicating its consent to its appointment by each Credit Party as such Credit
Party's agent to receive service of process as specified in Section 13.08.
-25-
32
5.12 Adverse Change, etc. (a) On the Effective Date, nothing
shall have occurred since March 31, 2000 (and the Lenders shall not have become
aware of any facts or conditions not previously known) which the Administrative
Agent or the Required Lenders shall determine has, or could reasonably be
expected to have, a material adverse effect on the rights or remedies of the
Administrative Agent or the Lenders, or on the ability of any Credit Party to
perform its Obligations to the Administrative Agent and the Lenders or which
has, or could reasonably be expected to have, a materially adverse effect on the
business, operations, property, assets, liabilities, condition (financial or
otherwise) or prospects of Holdings and its Subsidiaries taken as a whole.
(b) On or prior to the Effective Date, all necessary
governmental (domestic and foreign) and material third party approvals in
connection with the Holdings IPO, the Repurchase, the Synthetic Lease Financing
and the other transactions contemplated by the Credit Documents and otherwise
referred to herein or therein shall have been obtained and remain in effect, and
all applicable waiting periods shall have expired without any action being taken
by any competent governmental authority which restrains, prevents or imposes
materially adverse conditions upon the consummation of the Holdings IPO, the
Repurchase, the Synthetic Lease Financing or the other transactions contemplated
by the Credit Documents and otherwise referred to herein or therein.
Additionally, there shall not exist any judgment, order, injunction or other
restraint of any governmental authority issued or filed or a hearing seeking
injunctive relief or other restraint pending or notified prohibiting or imposing
materially adverse conditions upon the consummation of the Holdings IPO, the
Repurchase, the Synthetic Lease Financing, the other transactions contemplated
by the Credit Documents or the making of the Loans.
(c) On the Effective Date, there shall not have occurred and
be continuing any material adverse change to the syndication market for credit
facilities similar in nature to this Agreement and there shall not have occurred
and be continuing a material disruption or a material adverse change in
financial, banking or capital markets that would have a material adverse effect
on the syndication, in each case as determined by the Administrative Agent in
its reasonable discretion.
5.13 Litigation. On the Effective Date, no litigation by any
entity (private or governmental) shall be pending or threatened in writing
against any Credit Party with respect to this Agreement or any documentation
executed in connection herewith or the transactions contemplated hereby, or with
respect to the Holdings IPO, the Repurchase or the Synthetic Lease Financing or
which the Administrative Agent or the Required Lenders shall determine could
reasonably be expected to have a materially adverse effect on the Holdings IPO,
the Repurchase or the Synthetic Lease Financing or on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of Holdings and its Subsidiaries taken as a whole.
5.14 Fees, etc. On the Effective Date, the Borrower shall have
paid to the Administrative Agent and the Lenders all costs, fees and expenses
(including, without limitation, the reasonable legal fees and expenses of the
Administrative Agent's counsel and local counsel) payable to the Administrative
Agent and the Lenders to the extent then due.
-26-
33
5.15 Solvency Letter; Insurance Certificate. On the Effective
Date, the Borrower shall cause to be delivered to the Administrative Agent (i) a
solvency certificate signed by the Chief Financial Officer of the Borrower, in
form and substance satisfactory to the Required Lenders, setting forth the
conclusion that, after giving effect to the Holdings IPO, the Repurchase, the
Synthetic Lease Financing and the incurrence of all financings contemplated
herein, the Borrower and its Subsidiaries, taken as a whole, are not insolvent
and will not be rendered insolvent by the indebtedness incurred in connection
herewith, will not be left with unreasonably small capital with which to engage
in their businesses and will not have incurred debts beyond their ability to pay
such debts as they mature and (ii) evidence of insurance complying with the
requirements of Section 8.03 for the business and properties of the Borrower and
its Subsidiaries, in scope, form and substance satisfactory to the
Administrative Agent and the Required Lenders and naming the Collateral Agent as
an additional insured and/or loss payee where appropriate, and stating that such
insurance shall not be canceled or revised without 30 days' prior written notice
by the insurer to the Administrative Agent.
5.16 Financial Statements; Pro Forma Financial Statements;
Financial Projections. On or prior to the Effective Date, the Administrative
Agent shall have received true and correct copies of the historical financial
statements, the pro forma financial statements and the Projections referred to
in Sections 7.05(a) and (d), which historical financial statements, pro forma
financial statements and projections shall be in form and substance reasonably
satisfactory to the Administrative Agent and the Required Lenders.
5.17 Consummation of the Holdings IPO and the Repurchase. (a)
On or prior to the Effective Date, (i) Holdings shall have consummated a
Qualified Public Equity Offering of the capital stock of Holdings and shall have
received gross cash proceeds in a minimum aggregate principal amount equal to
$100,000,000 from such Qualified Public Equity Offering and (ii) Holdings and
its Subsidiaries shall have utilized the proceeds of the Qualified Public Equity
Offering described in clause (i) above to defease, redeem or otherwise retire
(the "Repurchase"), on terms and conditions reasonably satisfactory to the
Administrative Agent, all of the outstanding Holdings Senior Discount Notes in
accordance with the applicable provisions of the Holdings Senior Note Documents.
The Repurchase shall have been consummated in accordance with the Repurchase
Documents and all applicable laws, and each of the conditions precedent to the
consummation of the Repurchase shall have been satisfied and not waived in any
material respect except with the consent of the Administrative Agent and the
Required Lenders (which consent shall not be unreasonably withheld or delayed).
(b) On or prior to the Effective Date, there shall have been
delivered to the Administrative Agent true and correct copies of the Repurchase
Documents, and all of the terms and conditions of the Repurchase Documents shall
be reasonably satisfactory in form and substance to the Administrative Agent and
the Required Lenders.
SECTION 6. Conditions Precedent to All Credit Events. The
obligation of each Lender to make Loans (excluding Mandatory Borrowings which
shall be made as provided in Section 1.01(c)), and the obligation of BTCo to
issue any Letter of Credit, is subject, at the time of each such Credit Event
(except as hereinafter indicated), to the satisfaction of the following
conditions:
-27-
34
6.01 No Default; Representations and Warranties. At the time
of each such Credit Event and also after giving effect thereto (i) there shall
exist no Default or Event of Default and (ii) all representations and warranties
contained herein shall be true and correct in all material respects with the
same effect as though such representations and warranties had been made on the
date of the making of such Credit Event (it being understood and agreed that any
representation or warranty which by its terms is made as of a specified date
shall be required to be true and correct in all material respects only as of
such specified date).
6.02 Notice of Borrowing; Letter of Credit Request. (a) Prior
to the making of each Loan (excluding Swingline Loans), the Administrative Agent
shall have received a Notice of Borrowing meeting the requirements of Section
1.03(a). Prior to the making of any Swingline Loan, BTCo shall have received the
notice required by Section 1.03(b)(i).
(b) Prior to the issuance of each Letter of Credit, the
Administrative Agent and BTCo shall have received a Letter of Credit Request
meeting the requirements of Section 2.03.
The acceptance of the proceeds of each Credit Event shall
constitute a representation and warranty by Holdings and the Borrower to the
Administrative Agent and each of the Lenders that all the conditions specified
in Section 5 (with respect to Credit Events on the Effective Date) and in this
Section 6 (with respect to Credit Events on and after the Effective Date) and
applicable to such Credit Event exist as of that time. All of the Notes,
certificates, legal opinions and other documents and papers referred to in
Section 5 and in this Section 6, unless otherwise specified, shall be delivered
to the Administrative Agent at the Notice Office for the account of each of the
Lenders and, except for the Notes, in sufficient counterparts or copies for each
of the Lenders and shall be in form and substance reasonably satisfactory to the
Administrative Agent and the Required Lenders.
SECTION 7. Representations, Warranties and Agreements. In
order to induce the Lenders to enter into this Agreement and to make the Loans,
and issue (or participate in) the Letters of Credit as provided herein, each of
Holdings and the Borrower makes the following representations, warranties and
agreements, in each case after giving effect to the Holdings IPO, the Repurchase
and the Synthetic Lease Financing, all of which shall survive the execution and
delivery of this Agreement and the Notes and the making of the Loans and
issuance of the Letters of Credit, with the occurrence of each Credit Event on
or after the Effective Date being deemed to constitute a representation and
warranty that the matters specified in this Section 7 are true and correct on
and as of the Effective Date and in all material respects on the date of each
such Credit Event (it being understood and agreed that any representation or
warranty which by its terms is made as of a specified date shall be required to
be true and correct in all material respects only as of such specified date).
7.01 Corporate and Other Status. Each Credit Party and each of
its Subsidiaries (i) is a duly organized and validly existing corporation in
good standing under the laws of the jurisdiction of its incorporation, (ii) has
the corporate power and authority to own its property and assets and to transact
the business in which it is engaged and presently proposes to engage and (iii)
is duly qualified and is authorized to do business and is in good standing in
each jurisdiction where the ownership, leasing or operation of its property or
the conduct of its business requires
-28-
35
such qualifications except for failures to be so qualified which, individually
or in the aggregate, could not reasonably be expected to have a material adverse
effect on the business, operations, property, assets, liabilities, condition
(financial or otherwise) or prospects of Holdings and its Subsidiaries taken as
a whole.
7.02 Corporate and Other Power and Authority. Each Credit
Party has the corporate power and authority to execute, deliver and perform the
terms and provisions of each of the Documents to which it is party and has taken
all necessary corporate action to authorize the execution, delivery and
performance by it of each of such Documents. Each Credit Party has duly executed
and delivered each of the Documents to which it is party, and each of such
Documents constitutes its legal, valid and binding obligation enforceable in
accordance with its terms, except to the extent that the enforceability thereof
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws generally affecting creditors' rights and by equitable
principles (regardless of whether enforcement is sought in equity or at law).
7.03 No Violation. Neither the execution, delivery or
performance by any Credit Party of the Documents to which it is a party, nor
compliance by it with the terms and provisions thereof, (i) will contravene any
provision of any law, statute, rule or regulation or any order, writ, injunction
or decree of any court or governmental instrumentality, (ii) will, after giving
effect to any waivers, conflict with or result in any material breach of any of
the terms, covenants, conditions or provisions of, or constitute a default
under, or result in the creation or imposition of (or the obligation to create
or impose) any Lien (except pursuant to the Security Documents) upon any of the
property or assets of Holdings or any of its Subsidiaries pursuant to the terms
of any indenture, mortgage, deed of trust, credit agreement or loan agreement,
or any other material agreement, contract or instrument, to which Holdings or
any of its Subsidiaries of Holdings is a party or by which it or any of its
property or assets is bound or to which it may be subject or (iii) will violate
any provision of the Certificate of Incorporation or By-Laws of Holdings or any
of its Subsidiaries.
7.04 Governmental Approvals. No order, consent, approval,
license, authorization or validation of, or filing, recording or registration
with (other than the filing of the Financing Statements relating to the Security
Agreement and except as have otherwise been obtained or made on or prior to the
Effective Date), or exemption by, any governmental or public body or authority,
or any subdivision thereof, is required to authorize, or is required in
connection with, (i) the execution, delivery and performance of any Document or
(ii) the legality, validity, binding effect or enforceability of any such
Document.
7.05 Financial Statements; Financial Condition; Undisclosed
Liabilities; Projections; etc. (a) The audited consolidated balance sheets of
Holdings and its Subsidiaries for the fiscal years ended on March 31, 1999 and
March 31, 2000 and the related statements of income, cash flows and
shareholders' equity of Holdings and its Subsidiaries for the fiscal years ended
on such dates, which annual financial statements have been examined by Deloitte
& Touche LLP, certified public accountants, who delivered an unqualified opinion
with respect thereto and copies of which have heretofore been delivered to each
Lender, present fairly in all material respects the financial position of
Holdings and its Subsidiaries at the date of such balance sheets and the results
of the operations of Holdings and its Subsidiaries for the periods covered
thereby.
-29-
36
All of the foregoing historical financial statements have been prepared in
accordance with generally accepted accounting principles consistently applied.
The pro forma consolidated financial statements of Holdings and its Subsidiaries
as of March 31, 2000, in each case after giving effect to the Holdings IPO, the
Repurchase and the Synthetic Lease Financing, copies of which have been
furnished to the Lenders prior to the Effective Date, present fairly in all
material respects the pro forma consolidated financial position of Holdings and
its Subsidiaries as of March 31, 2000. After giving effect to the Holdings IPO,
the Repurchase and the Synthetic Lease Financing, since March 31, 2000, there
has been no material adverse change in the business, operations, property,
assets, liabilities, condition (financial or otherwise) or prospects of the
Borrower or of Holdings and its Subsidiaries taken as a whole.
(b) On and as of the Effective Date and after giving effect to
the Holdings IPO, the Repurchase and the Synthetic Lease Financing and to all
Indebtedness (including any Loans) being incurred or assumed and Liens created
by the Credit Parties in connection therewith (i) the sum of the assets, at a
fair valuation, of each of the Borrower on a stand-alone basis and of Holdings
and its Subsidiaries taken as a whole will exceed its debts; (ii) each of the
Borrower on a stand-alone basis and Holdings and its Subsidiaries taken as a
whole has not incurred and does not intend to incur, and does not believe that
it will incur, debts beyond its ability to pay such debts as such debts mature;
and (iii) each of the Borrower on a stand alone basis and Holdings and its
Subsidiaries taken as a whole will have sufficient capital with which to conduct
its business. For purposes of this Section 7.05(b), "debt" means any liability
on a claim, and "claim" means (A) right to payment, whether or not such a right
is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured, or unsecured or (B)
right to an equitable remedy for breach of performance if such breach gives rise
to a payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured
or unsecured. The amount of contingent liabilities at any time shall be computed
as the amount that, in the light of all the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.
(c) Except as fully disclosed in the financial statements
delivered pursuant to Section 7.05(a) or the Documents, there are as of the
Effective Date no liabilities or obligations with respect to Holdings or any of
its Subsidiaries of any nature whatsoever (whether absolute, accrued, contingent
or otherwise and whether or not due) which, either individually or in aggregate,
could reasonably be expected to be material to the Borrower or to Holdings and
its Subsidiaries taken as a whole. As of the Effective Date, neither Holdings
nor the Borrower knows of any basis for the assertion against it or any of its
Subsidiaries of any liability or obligation of any nature whatsoever that is not
fully disclosed in the financial statements delivered pursuant to Section
7.05(a) or the Documents which, either individually or in the aggregate, could
reasonably be expected to be material to the Borrower or to Holdings and its
Subsidiaries taken as a whole.
(d) On and as of the Effective Date, the Projections delivered
to the Administrative Agent and the Lenders prior to the Effective Date have
been prepared in good faith and are based on reasonable assumptions, and there
are no statements or conclusions in the Projections which are based upon or
include information known to Holdings or the Borrower to
-30-
37
be misleading in any material respect or which fail to take into account
material information known to Holdings or the Borrower regarding the matters
reported therein. On the Effective Date, Holdings and the Borrower believe that
the Projections are reasonable and attainable, it being recognized by the
Lenders, however, that projections as to future events are not to be viewed as
facts and that the actual results during the period or periods covered by the
Projections may differ from the projected results and that the differences may
be material.
7.06 Litigation. There are no actions, suits or proceedings
pending or, to the best knowledge of Holdings and the Borrower, threatened (i)
with respect to the Holdings IPO, the Repurchase, the Synthetic Lease Financing
or any Document, or (ii) that could reasonably be expected to materially and
adversely affect the business, operations, property, assets, liabilities,
condition (financial or otherwise) or prospects of Holdings and its Subsidiaries
taken as a whole.
7.07 True and Complete Disclosure. All factual information
(taken as a whole) furnished by any Credit Party in writing to the
Administrative Agent (including, without limitation, all information contained
in the Documents) for purposes of or in connection with this Agreement, the
other Credit Documents or any transaction contemplated herein or therein is, and
all other such factual information (taken as a whole) hereafter furnished by any
Credit Party in writing to the Administrative Agent or any Lender will be, true
and accurate in all material respects on the date as of which such information
is dated or certified and not incomplete by omitting to state any fact necessary
to make such information (taken as a whole) not misleading in any material
respect at such time in light of the circumstances under which such information
was provided.
7.08 Use of Proceeds; Margin Regulations. (a) All proceeds of
the Loans shall be used by the Borrower for the Borrower's general corporate and
working capital purposes.
(b) No part of the proceeds of any Loan or the purpose of any
issuance of any Letter of Credit will be used to purchase or carry any Margin
Stock or to extend credit for the purpose of purchasing or carrying any Margin
Stock. Neither the making of any Loan nor the use of the proceeds thereof nor
the occurrence of any other Credit Event will violate or be inconsistent with
the provisions of Regulation T, U or X of the Board of Governors of the Federal
Reserve System.
7.09 Tax Returns and Payments. Holdings and each of its
Subsidiaries have timely filed or caused to be timely filed with the appropriate
taxing authority, all Federal, state and other returns, statements, forms and
reports for taxes, domestic and foreign (the "Returns") required to be filed by
or with respect to the income, properties or operations of Holdings and/or any
of its Subsidiaries. The Returns accurately reflect all material liability for
taxes of Holdings and its Subsidiaries for the periods covered thereby. Holdings
and each of its Subsidiaries have paid all taxes payable by them other than
taxes contested in good faith and for which adequate reserves have been
established in accordance with generally accepted accounting principles. Except
as disclosed in the financial statements referred to in Section 7.05(a), as of
the Effective Date, there is no action, suit, proceeding, investigation, audit,
or claim now pending or, to the knowledge of Holdings and the Borrower,
threatened by any authority regarding any taxes relating to Holdings or any of
its Subsidiaries. As of the Effective Date, neither Holdings nor any
-31-
38
of its Subsidiaries has entered into an agreement or waiver or been requested to
enter into an agreement or waiver extending any statute of limitations relating
to the payment or collection of U.S. Federal income taxes of Holdings or any of
its Subsidiaries or is aware of any agreement or waiver extending any statute of
limitations relating to the payment or collection of other taxes of Holdings or
any of its Subsidiaries. None of Holdings or any of its Subsidiaries has
provided, with respect to itself or property held by it, any consent under
Section 341 of the Code.
7.10 Compliance with ERISA. (a) Except as set forth on
Schedule II, each Plan (and each related trust, insurance contract or fund) is
in substantial compliance with its terms and with all applicable laws,
including, without limitation, ERISA and the Code; each Plan (and each related
trust, if any) which is intended to be qualified under Section 401(a) of the
Code has received a determination letter from the Internal Revenue Service to
the effect that it meets the requirements of Sections 401(a) and 501(a) of the
Code; no Reportable Event has occurred; to the best knowledge of Holdings and
the Borrower, each Plan which is a multiemployer plan (as defined in Section
4001(a)(3) of ERISA) is in substantial compliance with its terms and with all
applicable laws, including, without limitation, ERISA and the Code; no Plan
which is a multiemployer plan (as defined in Section 4001(a)(3) of ERISA) is
insolvent or in reorganization; no Plan which is subject to Title IV of ERISA
has an Unfunded Current Liability; no Plan which is subject to Section 412 of
the Code or Section 302 of ERISA has an accumulated funding deficiency, within
the meaning of such sections of the Code or ERISA, or has applied for or
received a waiver of an accumulated funding deficiency or an extension of any
amortization period, within the meaning of Section 412 of the Code or Section
303 or 304 of ERISA; to the best knowledge of Holdings and the Borrower, no Plan
which is a multiemployer plan (as defined in Section 4001(a)(3) of ERISA) has an
Unfunded Current Liability; all contributions required to be made with respect
to a Plan have been timely made, neither Holdings nor any Subsidiary of Holdings
nor any ERISA Affiliate has incurred any material liability (including any
indirect, contingent or secondary liability) to or on account of a Plan pursuant
to Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212
of ERISA or Section 401(a)(29), 4971 or 4975 of the Code or expects to incur any
such liability under any of the foregoing sections with respect to any Plan; no
condition exists which presents a material risk to Holdings or any Subsidiary of
Holdings or any ERISA Affiliate of incurring a liability to or on account of a
Plan pursuant to the foregoing provisions of ERISA and the Code; no proceedings
have been instituted to terminate or appoint a trustee to administer any Plan
which is subject to Title IV of ERISA; no action, suit, proceeding, hearing,
audit or investigation with respect to the administration, operation or the
investment of assets of any Plan (other than routine claims for benefits) is
pending, to the best knowledge of Holdings and the Borrower, expected or
threatened; to the best knowledge of Holdings, using actuarial assumptions and
computation methods consistent with Part 1 of subtitle E of Title IV of ERISA,
the aggregate liabilities of Holdings and its Subsidiaries and its ERISA
Affiliates to all Plans which are multiemployer plans (as defined in Section
4001(a)(3) of ERISA) in the event of a complete withdrawal therefrom, as of the
close of the most recent fiscal year of each such Plan ended prior to the date
of the most recent Credit Event, would not exceed $50,000; no lien imposed under
the Code or ERISA on the assets of Holdings or any Subsidiary of Holdings or any
ERISA Affiliate exists or is likely to arise on account of any Plan; and
Holdings and its Subsidiaries may cease contributions to or terminate any
employee benefit plan maintained by any of them without incurring any material
liability.
-32-
39
(b) Each Foreign Pension Plan has been maintained in
substantial compliance with its terms and with the requirements of any and all
applicable laws, statutes, rules, regulations and orders and has been
maintained, where required, in good standing with applicable regulatory
authorities. All contributions required to be made with respect to a Foreign
Pension Plan have been timely made. Neither Holdings nor any of its Subsidiaries
has incurred any obligation in connection with the termination of or withdrawal
from any Foreign Pension Plan. The present value of the accrued benefit
liabilities (whether or not vested) under each Foreign Pension Plan, determined
as of the end of Holdings' most recently ended fiscal year on the basis of
actuarial assumptions, each of which is reasonable, did not exceed the current
value of the assets of such Foreign Pension Plan allocable to such benefit
liabilities.
7.11 The Security Documents. (a) The provisions of the
Security Agreement are effective to create in favor of the Collateral Agent for
the benefit of the Secured Creditors a legal, valid and enforceable security
interest in all right, title and interest of the Credit Parties in the Security
Agreement Collateral described therein, and the Security Agreement creates a
perfected lien on, and security interest in, all right, title and interest of
the Credit Parties, in all of the Security Agreement Collateral described
therein, subject to no other Liens other than Permitted Liens. The recordation
of the Assignment of Security Interest in U.S. Patents and Trademarks in the
form attached to the Security Agreement in the United States Patent and
Trademark Office together with filings on Form UCC-1 made pursuant to the
Security Agreement will be effective, under federal law, to perfect the security
interest granted to the Collateral Agent in the trademarks and patents covered
by the Security Agreement and the recordation of the Assignment of Security
Interest in U.S. Copyrights in the form attached to the Security Agreement with
the United States Copyright Office together with filings on Form UCC-1 made
pursuant to the Security Agreement will be effective under federal law to
perfect the security interest granted to the Collateral Agent in the copyrights
covered by the Security Agreement. The Credit Parties have good and marketable
title to all Security Agreement Collateral, free and clear of all Liens except
those described above in this clause (a).
(b) The security interests created in favor of the Collateral
Agent, as pledge, for the benefit of the Secured Creditors, under the Pledge
Agreement constitute first priority perfected security interests in the Pledged
Securities described in the Pledge Agreement, subject to no security interests
of any other Person. No filings or recordings are required to perfect (or
maintain the perfection or priority of) the security interest created in the
Pledged Securities under the Pledge Agreement.
7.12 Representations and Warranties in Documents. All
representations and warranties of the Credit Parties (or their predecessors in
interest) set forth in the other Documents were true and correct in all material
respects at the time as of which such representations and warranties were made
(or deemed made) and shall be true and correct in all material respects as of
the Effective Date if such representations and warranties were made on and as of
such date, unless stated to relate to a specific earlier date, in which case
such representations and warranties shall be true and correct in all material
respects as of such earlier date.
7.13 Properties. Holdings and each of its Subsidiaries have
good and marketable title to all material properties owned by them, including
all property owned by them, including all
-33-
40
property reflected in the balance sheets referred to in Section 7.05(a) (except
as sold or otherwise disposed of since the date of such balance sheet in the
ordinary course of business), free and clear of all Liens, other than (i) as
referred to in the balance sheet or in the notes thereto or (ii) Liens otherwise
permitted by Section 9.01.
7.14 Capitalization. On the Effective Date and after giving
effect to the transactions contemplated hereby (including the Holdings IPO), (i)
the authorized capital stock of Holdings shall consist of (a) 200,000,000 shares
of common stock, $.01 par value per share, of which 12,707,769 shares shall be
issued and 12,695,861 shall be outstanding, (b) 50,000,000 shares of Series A
preferred stock, none of which shall be issued and outstanding and (c) 6,000
shares of Class A non-voting common stock, $.01 par value per share, none of
which shall be issued and outstanding and (ii) the authorized capital stock of
the Borrower shall consist of 5,000 shares of common stock, $10 par value per
share, of which 4,900 shall be issued and outstanding, all of the shares of
which shall be issued and outstanding and owned by Holdings. All such
outstanding shares of common stock have been duly and validly issued, are fully
paid and nonassessable and are free of preemptive rights. No Credit Party has
outstanding any securities convertible into or exchangeable for its capital
stock or outstanding any rights to subscribe for or to purchase, or any options
for the purchase of, or any agreements providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating to,
its capital stock.
7.15 Subsidiaries. As of the Effective Date, the Borrower has
no Subsidiaries other than those Subsidiaries listed on Schedule III hereto.
Schedule III correctly sets forth, as of the Effective Date, the percentage
ownership (direct and indirect) of the Borrower in each class of capital stock
of each of its Subsidiaries and also identifies the direct owner thereof.
7.16 Compliance with Statutes, etc. Each of Holdings and its
Subsidiaries is in compliance with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the ownership
of its property (including applicable statutes, regulations, orders and
restrictions relating to environmental standards and controls), except such
noncompliances as could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of Holdings and its Subsidiaries taken as a whole.
7.17 Investment Company Act. Neither Holdings nor any of its
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.
7.18 Public Utility Holding Company Act. Neither Holdings nor
any of its Subsidiaries is a "holding company," or a "subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company" within the meaning of the Public Utility Holding
Company Act of 1935, as amended.
7.19 Environmental Matters. (a) Holdings and each of its
Subsidiaries have complied in all material respects with, and on the date of
such Credit Event are in compliance in
-34-
41
all material respects with, all applicable Environmental Laws and the
requirements of any permits issued under such Environmental Laws. There are no
pending, past or threatened Environmental Claims against Holdings or any of its
Subsidiaries (including any such claim arising out of the ownership or operation
by Holdings or any of its Subsidiaries of any Real Property no longer owned by
Holdings or any of its Subsidiaries) or any Real Property owned or operated by
Holdings or any of its Subsidiaries. There are no facts, circumstances,
conditions or occurrences with respect to any Real Property owned or operated by
Holdings or any of its Subsidiaries or any business or operations of Holdings or
any of its Subsidiaries (including any Real Property formerly owned or operated
by Holdings or any of its Subsidiaries but no longer owned by Holdings or any of
its Subsidiaries or any business or operations thereof) or any property
adjoining or in the vicinity of any such Real Property that could reasonably be
expected (i) to form the basis of an Environmental Claim against Holdings or any
of its Subsidiaries or any Real Property owned or operated by Holdings or any of
its Subsidiaries, or (ii) to cause any Real Property owned or operated by
Holdings or any of its Subsidiaries to be subject to any restrictions on the
ownership, occupancy or transferability of such Real Property by Holdings or any
of its Subsidiaries under any applicable Environmental Law.
(b) Hazardous Materials have not at any time been generated,
used, treated or stored on, or transported to or from, any Real Property owned
or operated by Holdings or any of its Subsidiaries except in a manner so as not
to give rise to an Environmental Claim. Hazardous Materials have not at any time
been Released on or from any Real Property owned or operated by Holdings or any
of its Subsidiaries.
(c) Notwithstanding anything to the contrary in this Section
7.19, the representations made in this Section 7.19 shall not be untrue unless
the aggregate effect of all violations, claims, restrictions, failures and
noncompliances of the types described above could reasonably be expected to have
a material adverse effect on the business, operations, property, assets,
liabilities, condition (financial or otherwise) or prospects of Holdings and its
Subsidiaries taken as a whole.
7.20 Labor Relations. Neither Holdings nor any of its
Subsidiaries is engaged in any unfair labor practice that could reasonably be
expected to have a material adverse effect on Holdings and its Subsidiaries
taken as a whole. There is (i) no unfair labor practice complaint pending
against Holdings or any of its Subsidiaries or, to the best knowledge of
Holdings or the Borrower, threatened against any of them, before the National
Labor Relations Board, and no significant grievance or significant arbitration
proceeding arising out of or under any collective bargaining agreement is so
pending against Holdings or any of its Subsidiaries or, to the best knowledge of
Holdings or the Borrower, threatened against any of them, (ii) no strike, labor
dispute, slowdown or stoppage pending against Holdings or any of its
Subsidiaries or, to the best knowledge of Holdings or the Borrower, threatened
against Holdings or any of its Subsidiaries and (iii) to the best knowledge of
Holdings or the Borrower, no union representation question existing with respect
to the employees of Holdings or any of its Subsidiaries, except (with respect to
any matter specified in clause (i), (ii) or (iii) above, either individually or
in the aggregate) such as could not reasonably be expected to have a material
adverse effect on the business, operations, property, assets, liabilities,
condition (financial or otherwise) or prospects of Holdings and its Subsidiaries
taken as a whole.
-35-
42
7.21 Patents, Licenses, Franchises and Formulas. Each of
Holdings and its Subsidiaries owns all the patents, trademarks, permits, service
marks, trade names, copyrights, licenses, franchises and formulas, or rights
with respect to the foregoing, and has obtained assignments of all leases and
other rights of whatever nature, necessary for the present conduct of its
business, without any known conflict with the rights of others which, or the
failure to obtain which, as the case may be, would result in a material adverse
effect on the business, operations, property, assets, liabilities, condition
(financial or otherwise) or prospects of Holdings and its Subsidiaries taken as
a whole.
7.22 Indebtedness. Schedule IV sets forth a true and complete
list of all Indebtedness (including Contingent Obligations) of Holdings and its
Subsidiaries as of the Effective Date and which is to remain outstanding after
such date (excluding the Loans, the Letters of Credit and the Borrower Senior
Discount Notes, the "Existing Indebtedness"), in each case showing the aggregate
principal amount thereof and the name of the respective borrower and any other
entity which directly or indirectly guaranteed such debt.
7.23 Synthetic Lease Financing. At the time of consummation
thereof, all material consents and approvals of, and filings and registrations
with, and all other actions in respect of, all governmental agencies,
authorities or instrumentalities required in order to make or consummate the
Synthetic Lease Financing to the extent then required have been obtained, given,
filed or taken and are or will be in full force and effect (or effective
judicial relief with respect thereto has been obtained). All applicable waiting
periods with respect thereto have or, prior to the time when required, will
have, expired without, in all such cases, any action being taken by any
competent authority which restrains, prevents, or imposes material adverse
conditions upon the Synthetic Lease Financing. Additionally, there does not
exist any judgment, order or injunction prohibiting or imposing material adverse
conditions upon the Synthetic Lease Financing, or the occurrence of any Credit
Event or the performance by each Credit Party of its obligations under the
respective Documents. All actions taken by each Credit Party pursuant to or in
furtherance of the Synthetic Lease Financing have been taken in compliance with
the Documents and all applicable laws except to the extent consented to by the
Administrative Agent and the Required Lenders pursuant to Section 5.06(a).
7.24 Holdings IPO and Repurchase. At the time of consummation
thereof, all material consents and approvals of, and filings and registrations
with, and all other actions in respect of, all governmental agencies,
authorities or instrumentalities required in order to make or consummate the
Holdings IPO and the Repurchase, in each case, to the extent then required have
been obtained, given, filed or taken and are or will be in full force and effect
(or effective judicial relief with respect thereto has been obtained). All
applicable waiting periods with respect thereto have or, prior to the time when
required, will have, expired without, in all such cases, any action being taken
by any competent authority which restrains, prevents, or imposes material
adverse conditions upon the Holdings IPO or the Repurchase. Additionally, there
does not exist any judgment, order or injunction prohibiting or imposing
material adverse conditions upon the Holdings IPO or the Repurchase. All actions
taken by each Credit Party pursuant to or in furtherance of the Holdings IPO or
the Repurchase, as the case may be, have been taken in compliance with the
Documents and all applicable laws except to the extent consented to by the
Administrative Agent and the Required Lenders pursuant to Section 5.17(a).
-36-
43
7.25 Insurance. Schedule V sets forth a true and complete
listing of all insurance maintained by Holdings and its Subsidiaries as of the
Effective Date, and with the amounts insured (and any deductibles) set forth
therein.
SECTION 8. Affirmative Covenants. Each of Holdings and the
Borrower covenants and agrees with respect to itself and its Subsidiaries that
on and after the Effective Date and until the Total Commitment and all Letters
of Credit have terminated and the Loans, Notes and Unpaid Drawings, together
with interest, Fees and all other Obligations (other than indemnities described
in Section 13.13) incurred hereunder and thereunder, are paid in full:
8.01 Information Covenants. Holdings will furnish to each
Lender:
(a) Monthly Reports. Within 45 days after the end of each
fiscal month of Holdings, the consolidated balance sheets of Holdings and its
Subsidiaries on a consolidated basis and the Borrower and its Consolidated
Subsidiaries on a stand-alone basis as at the end of such month and the related
consolidated statements of income and retained earnings and statement of cash
flows for such month and for the elapsed portion of the fiscal year ended with
the last day of such month, in each case accompanied by an abbreviated
discussion of the operating results in such preceding fiscal month.
(b) Quarterly Financial Statements. Within 45 days after the
close of the first three quarterly accounting periods in each fiscal year of
Holdings, the consolidated balance sheets of Holdings and its Subsidiaries on a
consolidated basis and the Borrower and its Consolidated Subsidiaries on a
stand-alone basis as at the end of such quarterly accounting period and the
related consolidated statements of income and retained earnings and statement of
cash flows for such quarterly accounting period and for the elapsed portion of
the fiscal year ended with the last day of such quarterly accounting period, in
each case setting forth comparative figures for the related periods in the prior
fiscal year, all of which shall be certified by the chief financial officer of
Holdings, subject to normal year-end audit adjustments.
(c) Annual Financial Statements. Within 105 days after the
close of each fiscal year of Holdings, the consolidated balance sheets of
Holdings and its Subsidiaries on a consolidated basis and the Borrower and its
Consolidated Subsidiaries on a stand-alone basis as at the end of such fiscal
year and the related consolidated statements of income and retained earnings and
of cash flows for such fiscal year setting forth comparative figures for the
preceding fiscal year and certified, in the case of the consolidated financial
statements of Holdings, by Deloitte & Touche LLP or such other independent
certified public accountants of recognized national standing reasonably
acceptable to the Administrative Agent, and in the case of the other financial
statements, certified by the chief financial officer of Holdings, together with
a report of such accounting firm stating that in the course of its regular audit
of the financial statements of Holdings and its Subsidiaries, which audit was
conducted in accordance with generally accepted auditing standards, such
accounting firm obtained no knowledge of any Default or Event of Default which
has occurred and is continuing or, if in the opinion of such accounting firm
such a Default or Event of Default has occurred and is continuing, a statement
as to the nature thereof.
-37-
44
(d) Management Letters. Promptly after Holdings' or any of its
Subsidiaries' receipt thereof, a copy of any "management letter" addressed to
the board of directors of Holdings or such Subsidiary from its certified public
accountants and any internal control memoranda relating thereto.
(e) Budgets. No later than the first day of each fiscal year
of Holdings, a budget in form satisfactory to the Required Lenders (including
budgeted statements of income and sources and uses of cash and balance sheets)
prepared by Holdings for each of the twelve months of such fiscal year prepared
in detail, accompanied by a statement of the Chief Financial Officer of Holdings
to the effect that, to the best of his knowledge, the budget is a reasonable
estimate for the period covered thereby.
(f) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Sections 8.01(b) and (c), a certificate of
the President or any Vice President of Holdings to the effect that, to the best
of such officer's knowledge, no Default or Event of Default has occurred and is
continuing or, if any Default or Event of Default has occurred and is
continuing, specifying the nature and extent thereof, which certificate shall
set forth in reasonable detail the calculations required to establish whether
the Borrower was in compliance with the provisions of Sections 4.02(b), 9.04,
9.05 and 9.07 through 9.10 (but with respect to Section 9.07 only to the extent
delivered with the financial statements required by Section 8.01(c)), inclusive,
at the end of such fiscal quarter or year, as the case may be.
(g) Notice of Default or Litigation. Promptly, and in any
event within three Business Days after a senior officer of Holdings or the
Borrower obtains knowledge thereof, notice of (i) the occurrence of any event
which constitutes a Default or Event of Default and (ii) any litigation or
governmental investigation or proceeding pending (x) against Holdings or any of
its Subsidiaries which could reasonably be expected to materially and adversely
affect the business, operations, property, assets, liabilities, condition
(financial or otherwise) or prospects of Holdings or any of its Subsidiaries or
(y) with respect to the Holdings IPO, the Repurchase, the Synthetic Lease
Financing or any Document.
(h) Other Reports and Filings. Promptly, copies of all
financial information, proxy materials and reports, if any, which Holdings or
any of its Subsidiaries shall publicly file with the Securities and Exchange
Commission or any successor thereto (the "SEC") and all material financial
information delivered to holders of its Indebtedness pursuant to the terms of
the documentation governing such Indebtedness (or any trustee, agent or other
representative therefor).
(i) Environmental Matters. Promptly upon, and in any event
within ten Business Days after, an officer of any Credit Party obtains knowledge
thereof, notice of one or more of the following environmental matters, unless
such environmental matters could not, individually or when aggregated with all
other such environmental matters, be reasonably expected to materially and
adversely affect the business, operations, property, assets, liabilities,
condition (financial or otherwise) or prospects of Holdings and its Subsidiaries
taken as a whole: (i) any pending or threatened Environmental Claim against
Holdings or any of its Subsidiaries or any Real Property owned or operated by
Holdings or any of its Subsidiaries; (ii) any condition or
-38-
45
occurrence on or arising from any Real Property owned or operated by Holdings or
any of its Subsidiaries that (a) results in noncompliance by Holdings or any of
its Subsidiaries with any applicable Environmental Law or (b) could reasonably
be expected to form the basis of an Environmental Claim against Holdings or any
of its Subsidiaries or any such Real Property; (iii) any condition or occurrence
on any Real Property owned or operated by Holdings or any of its Subsidiaries
that could reasonably be expected to cause such Real Property to be subject to
any restrictions on the ownership, occupancy, use or transferability by Holdings
or any of its Subsidiaries of such Real Property under any Environmental Law;
and (iv) the taking of any removal or remedial action in response to the actual
or alleged presence of any Hazardous Material on any Real Property owned or
operated by Holdings or any of its Subsidiaries as required by any Environmental
Law or any governmental or other administrative agency; provided that, in any
event, Holdings shall deliver to the Administrative Agent all notices received
by Holdings or any of its Subsidiaries from any government or governmental
agency under, or pursuant to, CERCLA which identify Holdings or any of its
Subsidiaries as potentially responsible parties for remediation costs or which
otherwise notify Holdings or any of its Subsidiaries of potential liability
under CERCLA. All such notices shall describe in reasonable detail the nature of
the claim, investigation, condition, occurrence or removal or remedial action
and Holdings' or such Subsidiary's response thereto. In addition, Holdings will
provide the Administrative Agent with copies of all material communications
between Holdings or any of its Subsidiaries and any government or governmental
agency relating to Environmental Laws which could reasonably be expected to
materially and adversely effect the business, operations, property, assets,
liabilities, condition (financial or otherwise) or prospects of Holdings and its
Subsidiaries taken as a whole, all notice of any Environmental Claims, and such
detailed reports of any Environmental Claim as may reasonably be requested by
the Lenders.
(j) Annual Meetings with Lenders. At a date to be mutually
agreed upon between the Administrative Agent and the Borrower, Holdings shall
hold a meeting with all of the Lenders at which meeting shall be reviewed the
financial results of the previous fiscal year and the financial condition of
Holdings and its Subsidiaries and the budgets presented for the current fiscal
year of Holdings.
(k) Other Information. From time to time, such other
information or documents (financial or otherwise) with respect to Holdings or
its Subsidiaries as any Lender may reasonably request.
8.02 Books, Records and Inspections. Holdings will, and will
cause each of its Subsidiaries to, keep proper books of record and account in
which full, true and correct entries in conformity with generally accepted
accounting principles and all requirements of law shall be made of all dealings
and transactions in relation to its business and activities. Holdings will, and
will cause each of its Subsidiaries to, permit upon two Business Days' prior
notice officers and designated representatives of the Administrative Agent or
the Required Lenders to visit and inspect, under guidance of officers of
Holdings or such Subsidiary, any of the properties of Holdings or such
Subsidiary, and to examine the books of account of Holdings or such Subsidiary
and discuss the affairs, finances and accounts of Holdings or such Subsidiary
with, and be advised as to the same by, its and their officers and independent
accountants, all at such reasonable times and intervals and to such reasonable
extent as the Administrative Agent or the Required Lenders
-39-
46
may reasonably request, all such inspections to be subject to any binding
confidentiality agreement for the benefit of a third party that prohibits the
foregoing. Holdings will, and will cause each of its Subsidiaries to, permit
officers and designated representatives of the Administrative Agent to conduct,
at Holdings' expense, an annual audit of the accounts receivable and inventories
of Holdings and its Subsidiaries.
8.03 Maintenance of Property; Insurance. (a) Holdings will,
and will cause each of its Subsidiaries to, (i) keep all property necessary to
the business of Holdings and its Subsidiaries taken as a whole in reasonably
good working order and condition, (ii) maintain insurance on all such property
in at least such amounts and against at least such risks as is consistent and in
accordance with industry practice, and (iii) furnish to the Administrative Agent
or the Required Lenders, upon written request, full information as to the
insurance carried. At any time that Holdings or any Subsidiary of Holdings fails
to maintain insurance (other than property or business interruption insurance)
at the levels maintained on the Effective Date, Holdings will, or will cause one
of its Subsidiaries to, notify the Administrative Agent and the Required Lenders
in writing within three Business Days thereof and, if thereafter notified by the
Required Lenders to do so, Holdings or any such Subsidiary, as the case may be,
shall obtain such insurance at such levels to the extent such insurance is
reasonably available. In addition to the requirements of the immediately
preceding sentence, Holdings and the Borrower will at all times cause property
and business interruption insurance of the type maintained on the Effective Date
to be maintained (with the same scope of coverage as on the Effective Date) at
levels which are at least as great as the respective amounts maintained on the
Effective Date.
(b) Holdings will, and will cause its Subsidiaries to, at all
times keep its insured property insured in favor of the Collateral Agent, and
all policies or certificates (or certified copies thereof) with respect to such
insurance (and any other insurance maintained by Holdings and/or its
Subsidiaries) (i) shall be endorsed to the Collateral Agent's reasonable
satisfaction for the benefit of the Collateral Agent (including, without
limitation, by naming the Collateral Agent as loss payee and/or additional
insured), (ii) shall state that such insurance policies shall not be canceled or
revised without 30 days' prior written notice thereof by the respective insurer
to the Collateral Agent, (iii) shall provide that the respective insurers
irrevocably waive any and all rights of subrogation with respect to the
Collateral Agent and the Secured Creditors, (iv) shall, except in the case of
public liability insurance, workers' compensation and cargo insurance, provide
that any losses shall be payable notwithstanding (A) any act or neglect of
Holdings or any of its Subsidiaries, (B) the occupation or use of the properties
for purposes more hazardous than those permitted by the terms of the respective
policy if such coverage is obtainable at commercially reasonable rates and is of
the kind from time to time customarily insured against by Persons owning or
using similar property and in such amounts as are customary, (C) any foreclosure
or other proceeding relating to the insured properties or (D) any change in the
title to or ownership or possession of the insured properties and (v) shall be
deposited with the Collateral Agent. If Holdings or any of its Subsidiaries
shall fail to insure its property in accordance with this Section 8.03, or if
Holdings or any of its Subsidiaries shall fail to so endorse and deposit all
policies or certificates with respect thereto, the Collateral Agent shall have
the right (but shall be under no obligation), upon ten Business Days' prior
notice to the Borrower, to procure such insurance and the Borrower agrees to
reimburse the Collateral Agent for all costs and expenses of procuring such
insurance.
-40-
47
(c) The foregoing requirements of this Section 8.03 shall not
apply to any equipment or inventory of Holdings and its Subsidiaries which is
subject to an Equipment Financing Transaction, so long as Holdings and its
Subsidiaries are in material compliance with any similar requirements imposed by
the terms of such Equipment Financing Transaction.
8.04 Corporate Franchises. Holdings will, and will cause each
of its Subsidiaries to, do or cause to be done, all things necessary to preserve
and keep in full force and effect its existence and its material rights,
franchises, licenses and patents; provided, however, that nothing in this
Section 8.04 shall prevent (i) transactions in accordance with Section 9.02 or
(ii) the withdrawal by Holdings or any of its Subsidiaries of its qualification
as a foreign corporation in any jurisdiction where such withdrawal could not
reasonably be expected to have a material adverse effect on the business,
operations, property, assets, liabilities, condition (financial or otherwise) or
prospects of Holdings and its Subsidiaries taken as a whole.
8.05 Compliance with Statutes, etc. Holdings will, and will
cause each of its Subsidiaries to, comply with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property, except such noncompliances as could
not, individually or in the aggregate, reasonably be expected to have a material
adverse effect on the business, operations, property, assets, liabilities,
condition (financial or otherwise) or prospects of Holdings and its Subsidiaries
taken as a whole.
8.06 Compliance with Environmental Laws. (a) Holdings will
comply, and will cause each of its Subsidiaries to comply, in all material
respects with all Environmental Laws applicable to the ownership or use of its
Real Property now or hereafter owned or operated by Holdings or any of its
Subsidiaries (except such noncompliances as could not, individually or in the
aggregate, reasonably be expected to have a material adverse effect on the
business, operations, property, assets, liabilities, condition (financial or
otherwise) or prospects of Holdings and its Subsidiaries taken as a whole), will
promptly pay or cause to be paid all costs and expenses incurred in connection
with such compliance, and will keep or cause to be kept all such Real Property
free and clear of any Liens imposed pursuant to such Environmental Laws. Neither
Holdings nor any of its Subsidiaries will generate, use, treat, store, release
or dispose of, or permit the generation, use, treatment, storage, release or
disposal of Hazardous Materials on any Real Property now or hereafter owned or
operated by Holdings or any of its Subsidiaries, or transport or permit the
transportation of Hazardous Materials to or from any such Real Property, except
for Hazardous Materials generated, used, treated, stored, released or disposed
of at any such Real Properties in compliance in all material respects with all
applicable Environmental Laws and reasonably required in connection with the
operation, use and maintenance of the business or operations of Holdings or any
of its Subsidiaries.
(b) At the written request of the Administrative Agent or the
Required Lenders, which request shall specify in reasonable detail the basis
therefor, at any time and from time to time, Holdings will provide, at Holdings'
sole cost and expense, an environmental site assessment report concerning any
Real Property owned or operated by Holdings and its Subsidiaries, prepared by an
environmental consulting firm reasonably satisfactory to the Administrative
Agent, indicating the presence or absence of Hazardous Materials and the
-41-
48
potential cost of any removal or remedial action in connection with any
Hazardous Materials on such Real Property, provided that in no event shall such
request be made more often that once every three years for any particular Real
Property unless (i) the Obligations have been declared due and payable pursuant
to Section 10; (ii) the Lenders receive notice under Section 8.01(i) of any
event for which notice is required to be delivered for any such Real Property or
any business or operations of Holdings or any of its Subsidiaries; or (iii) a
Default or an Event of Default then exists. If Holdings or the Borrower fails to
provide the same within ninety days after such request was made, the
Administrative Agent may order the same, the cost of which shall be borne by the
Borrower, and Holdings and the Borrower shall grant and hereby grant to the
Administrative Agent and the Lenders and their agents access to such Real
Property and specifically grant the Administrative Agent and the Lenders an
irrevocable non-exclusive license to undertake such an assessment, all at
Holdings' expense.
8.07 ERISA. As soon as possible and, in any event, within ten
(10) business days after Holdings, any Subsidiary of Holdings or any ERISA
Affiliate knows or has reason to know of the occurrence of any of the following,
Holdings will deliver to each of the Lenders a certificate of the chief
financial officer of Holdings setting forth the full details as to such
occurrence and the action, if any, that Holdings, such Subsidiary or such ERISA
Affiliate is required or proposes to take, together with any notices required or
proposed to be given to or filed with or by Holdings, the Subsidiary, the ERISA
Affiliate, the PBGC, a Plan participant or the Plan administrator with respect
thereto: (i) that a Reportable Event has occurred (except to the extent that
Holdings has previously delivered to the Lenders a certificate and notices (if
any) concerning such event pursuant to the next clause hereof); (ii) that a
contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan
subject to Title IV of ERISA is subject to the advance reporting requirement of
PBGC Regulation Section 4043.61 (without regard to subparagraph (b)(1) thereof),
and an event described in subsection .62, .63, .64, .65, .66, .67 or .68 of PBGC
Regulation Section 4043 is reasonably expected to occur with respect to such
Plan within the following 30 days; (iii) that an accumulated funding deficiency,
within the meaning of Section 412 of the Code or Section 302 of ERISA, has been
incurred or an application may be or has been made for a waiver or modification
of the minimum funding standard (including any required installment payments) or
an extension of any amortization period under Section 412 of the Code or Section
303 or 304 of ERISA with respect to a Plan; (iv) that any contribution required
to be made with respect to a Plan or Foreign Pension Plan has not been timely
made; (v) that a Plan which is subject to Title IV of ERISA has been or may be
terminated, reorganized, partitioned or declared insolvent under Title IV of
ERISA; (vi) that a Plan has an Unfunded Current Liability; (vii) that
proceedings may be or have been instituted to terminate or appoint a trustee to
administer a Plan which is subject to Title IV of ERISA; (viii) that a
proceeding has been instituted pursuant to Section 515 of ERISA to collect a
delinquent contribution to a Plan; (ix) that Holdings or any Subsidiary of
Holdings will or may incur any liability (including any indirect, contingent, or
secondary liability) to or on account of the termination of or withdrawal from a
Plan under Section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with
respect to a Plan under Section 401(a)(29), 4971, 4975 or 4980 of the Code or
Section 409, 502(i) or 502(l) of ERISA or with respect to a group health plan
(as defined in Section 607(1) of ERISA or Section 4980B(g)(2) of the Code) under
Section 4980B of the Code; or (x) that Holdings or any Subsidiary of Holdings
may incur any material liability pursuant to any employee welfare benefit
-42-
49
plan (as defined in Section 3(1) of ERISA) that provides benefits to retired
employees or other former employees (other than as required by Section 601 of
ERISA) or any Plan or any Foreign Pension Plan in addition to the liability that
existed on the Effective Date pursuant to any such plan or plans. Holdings will
deliver to each of the Lenders copies of any records, documents or other
information that must be furnished to the PBGC with respect to any Plan pursuant
to Section 4010 of ERISA. Holdings will also deliver to each of the Lenders a
complete copy of the annual report (on Internal Revenue Service Form
5500-series) of each Plan which is subject to Title IV of ERISA (including, to
the extent required, the related financial and actuarial statements and opinions
and other supporting statements, certifications, schedules and information)
required to be filed with the Internal Revenue Service. In addition to any
certificates or notices delivered to the Lenders pursuant to the first sentence
hereof, copies of annual reports and any records, documents or other information
required to be furnished to the PBGC, and any material notices received by
Holdings, any Subsidiary of Holdings or any ERISA Affiliate with respect to any
Plan or Foreign Pension Plan shall be delivered to the Lenders no later than
twenty (20) days after the date such annual report has been filed with the
Internal Revenue Service or such records, documents and/or information has been
furnished to the PBGC or such notice has been received by Holdings, the
Subsidiary or the ERISA Affiliate, as applicable.
8.08 End of Fiscal Years; Fiscal Quarters. Holdings shall
cause (i) each of its, and each of its Subsidiaries', fiscal years and fourth
fiscal quarter to end on March 31 of each year, and (ii) each of its, and each
of its Subsidiaries', first three fiscal quarters to end on June 30, September
30 and December 31 of each year.
8.09 Performance of Obligations. Holdings will, and will cause
each of its Subsidiaries to, perform all of its obligations under the terms of
each mortgage, indenture, security agreement and other debt instrument by which
it is bound, except such non-performances as could not, individually or in the
aggregate, reasonably be expected to have a material adverse effect on the
business, operations, property, assets, liabilities, condition (financial or
otherwise) or prospects of Holdings and its Subsidiaries taken as a whole.
8.10 Payment of Taxes. Holdings will pay and discharge or
cause to be paid and discharged, and will cause each of its Subsidiaries to pay
and discharge, all lawful claims, taxes, assessments and governmental charges or
levies imposed upon it or upon its income or profits, or upon any properties
belonging to it, in each case on a timely basis; provided that neither Holdings
nor any of its Subsidiaries shall be required to pay any such tax, assessment,
charge, levy or claim which is being contested in good faith and by proper
proceedings if it has maintained adequate reserves with respect thereto in
accordance with generally accepted accounting principles.
8.11 Additional Security; Further Assurances. (a) Holdings
will, and will cause each of its Domestic Subsidiaries (and subject to Section
8.12, each of its Foreign Subsidiaries) to, grant to the Collateral Agent
security interests in such assets and properties of Holdings and its
Subsidiaries as are not covered by the original Security Documents and/or
Subsidiaries Guaranty as required by Section 9.15, and as may be reasonably
requested from time to time by the Administrative Agent or the Required Lenders
(collectively, the "Additional Security Documents"). All such security interests
shall be granted pursuant to documentation reasonably satisfactory in form and
substance to the Administrative Agent and shall constitute valid and
-43-
50
enforceable perfected security interests superior to and prior to the rights of
all third Persons and subject to no other Liens except for Permitted Liens. The
Additional Security Documents or instruments related thereto shall have been
duly recorded or filed in such manner and in such places as are required by law
to establish, perfect, preserve and protect the Liens in favor of the Collateral
Agent required to be granted pursuant to the Additional Security Documents and
all taxes, fees and other charges payable in connection therewith shall have
been paid in full.
(b) Holdings will, and will cause each of its Subsidiaries to,
at the expense of Holdings and the Borrower, make, execute, endorse,
acknowledge, file and/or deliver to the Collateral Agent from time to time such
vouchers, invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, powers of attorney, certificates, reports and
other assurances or instruments and take such further steps relating to the
Collateral covered by any of the Security Documents as the Collateral Agent may
reasonably require to obtain the benefits intended to be conferred to the
Administrative Agent and the Lenders pursuant to the Security Documents.
Furthermore, Holdings and the Borrower will cause to be delivered to the
Collateral Agent such opinions of counsel, title insurance and other related
documents as may be reasonably requested by the Administrative Agent to assure
itself that this Section 8.11 has been complied with.
(c) Holdings and the Borrower agree that each action required
above by this Section 8.11 shall be completed as soon as possible, but in no
event later than 90 days (30 days in connection with compliance with Section
9.15) after such action is either requested to be taken by the Administrative
Agent or the Required Lenders or required to be taken by Holdings and/or its
Subsidiaries pursuant to the terms of this Section 8.11; provided that in no
event will Holdings or any of its Subsidiaries be required to take any action,
other than using its reasonable best efforts, to obtain consents from third
parties with respect to its compliance with this Section 8.11.
(d) Notwithstanding anything to the contrary contained in this
Section 8.11, no Domestic Subsidiary of the Borrower which is not a Wholly-Owned
Subsidiary and which is acquired pursuant to an acquisition otherwise permitted
hereunder shall be required to enter into Additional Security Documents to the
extent, and only to the extent, the terms of any Indebtedness of such Subsidiary
at the time of such acquisition prohibits the entering into of the Additional
Security Documents by such Subsidiary (it being understood that at such time
when such prohibition shall no longer be effective, such Subsidiary shall enter
into Additional Security Documents as otherwise described in this Section 8.11).
8.12 Foreign Subsidiaries Security. (a) If following a change
in the relevant sections of the Code or the regulations, rules, rulings, notices
or other official pronouncements issued or promulgated thereunder, counsel for
the Borrower acceptable to the Administrative Agent and the Required Lenders
does not within 120 days after a request from the Administrative Agent or the
Required Lenders deliver evidence, in form and substance satisfactory to the
Administrative Agent and the Required Lenders, with respect to any Foreign
Subsidiary which has not already had all of its stock pledged pursuant to the
Pledge Agreement that (i) a pledge (x) of 66-2/3% or more of the total combined
voting power of all classes of capital stock of such Foreign Subsidiary entitled
to vote, and (y) of any promissory note issued by such Foreign Subsidiary to
Holdings or any of its Domestic Subsidiaries, (ii) the entering into by such
Foreign
-44-
51
Subsidiary of a security agreement in substantially the form of the Security
Agreement and (iii) the entering into by such Foreign Subsidiary of a guaranty
in substantially the form of the Subsidiaries Guaranty, in any such case would
cause the undistributed earnings of such Foreign Subsidiary as determined for
Federal income tax purposes to be treated as a deemed dividend to such Foreign
Subsidiary's United States parent for Federal income tax purposes, then in the
case of a failure to deliver the evidence described in clause (i) above, that
portion of such Foreign Subsidiary's outstanding capital stock or any promissory
notes so issued by such Foreign Subsidiary, in each case not theretofore pledged
pursuant to the Pledge Agreement shall be pledged to the Collateral Agent for
the benefit of the Secured Creditors pursuant to the Pledge Agreement (or
another pledge agreement in substantially similar form, if needed), and in the
case of a failure to deliver the evidence described in clause (ii) above, such
Foreign Subsidiary shall execute and deliver the Security Agreement (or another
security agreement in substantially similar form, if needed), granting the
Secured Creditors a security interest in all of such Foreign Subsidiary's assets
and securing the Obligations of the Borrower under the Credit Documents and
under any Interest Rate Protection Agreement or Other Hedging Agreement and, in
the event the Subsidiaries Guaranty shall have been executed by such Foreign
Subsidiary, the obligations of such Foreign Subsidiary thereunder, and in the
case of a failure to deliver the evidence described in clause (iii) above, such
Foreign Subsidiary shall execute and deliver the Subsidiaries Guaranty (or
another guaranty in substantially similar form, if needed), guaranteeing the
Obligations of the Borrower under the Credit Documents and under any Interest
Rate Protection Agreement or Other Hedging Agreement, in each case to the extent
that the entering into such Security Agreement or Subsidiaries Guaranty is
permitted by the laws of the respective foreign jurisdiction and with all
documents delivered pursuant to this Section 8.12 to be in form and substance
reasonably satisfactory to the Administrative Agent and the Required Lenders,
provided that no pledge shall be required pursuant to this Section 8.12 of a
Foreign Subsidiary if the Administrative Agent has determined pursuant to
Section 9.02(ix) that such a pledge shall result in regulatory or economic
disadvantages.
(d) Notwithstanding anything to the contrary contained in this
Section 8.12, no Foreign Subsidiary of the Borrower which is not a Wholly-Owned
Subsidiary and which is acquired pursuant to an acquisition otherwise permitted
hereunder shall be required to take the actions described in clause (a) of this
Section 8.12 to the extent, and only to the extent, the terms of any
Indebtedness of such Subsidiary at the time of such acquisition prohibits the
taking of such actions by such Subsidiary (it being understood that at such time
when such prohibition shall no longer be effective, such Subsidiary shall take
such actions as otherwise described in this Section 8.12).
SECTION 9. Negative Covenants. Each of Holdings and the
Borrower covenants and agrees with respect to itself and its Subsidiaries that
on and after the Effective Date and until the Total Commitment and all Letters
of Credit have terminated and the Loans, Notes and Unpaid Drawings, together
with interest, Fees and all other Obligations incurred hereunder and thereunder,
are paid in full:
9.01 Liens. Holdings will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets (real or personal, tangible or intangible) of
Holdings or any of its Subsidiaries, whether now
-45-
52
owned or hereafter acquired, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets (including sales of accounts receivable with recourse to Holdings or
any of its Subsidiaries), or assign any right to receive income or permit the
filing of any financing statement under the UCC or any other similar notice of
Lien under any similar recording or notice statute; provided that the provisions
of this Section 9.01 shall not prevent the creation, incurrence, assumption or
existence of the following (Liens described below are herein referred to as
"Permitted Liens"):
(i) inchoate Liens for taxes, assessments or governmental
charges or levies not yet due or Liens for taxes, assessments or
governmental charges or levies being contested in good faith and by
appropriate proceedings for which adequate reserves have been
established in accordance with generally accepted accounting
principles;
(ii) Liens in respect of property or assets of Holdings or any
of its Subsidiaries imposed by law, which were incurred in the ordinary
course of business and do not secure Indebtedness for borrowed money,
such as carriers', warehousemen's, materialmen's and mechanics' liens
and other similar Liens arising in the ordinary course of business, and
(x) which do not in the aggregate materially detract from the value of
Holdings' or such Subsidiary's property or assets or materially impair
the use thereof in the operation of the business of Holdings' or such
Subsidiary or (y) which are being contested in good faith by
appropriate proceedings, which proceedings have the effect of
preventing the forfeiture or sale of the property or assets subject to
any such Lien;
(iii) Liens in existence on the Effective Date which are
listed, and the property subject thereto described, in Schedule VI, but
only to the respective date, if any, set forth in such Schedule VI for
the removal and termination of any such Liens, plus renewals and
extensions of such Liens to the extent set forth on Schedule VI,
provided that (x) the aggregate principal amount of the Indebtedness,
if any, secured by such Liens does not increase from that amount
outstanding at the time of any such renewal or extension and (y) any
such renewal or extension does not encumber any additional assets or
properties of Holdings or any of its Subsidiaries;
(iv) Permitted Encumbrances;
(v) Liens created pursuant to the Security Documents;
(vi) leases or subleases granted to other Persons not
materially interfering with the conduct of the business of Holdings and
its Subsidiaries taken as a whole;
(vii) Liens (including precautionary UCC filings) upon assets
of the Borrower or its Subsidiaries subject to Equipment Financing
Transactions to the extent permitted by Section 9.04(v) and the other
provisions of this Agreement, provided that (x) such Liens secure only
the payment of such obligations under Equipment Financing Transactions,
(y) if such obligations constitute Operating Lease Obligations, the
Attributable Indebtedness in respect thereof shall not exceed
$170,000,000 at any time and (z) such Liens do not encumber any other
asset of Holdings or any Subsidiary of Holdings;
-46-
53
(viii) Liens securing Indebtedness permitted pursuant to
Section 9.04(xv);
(ix) easements, rights-of-way, restrictions, encroachments and
other similar charges or encumbrances, and minor title deficiencies, in
each case not securing Indebtedness and not materially interfering with
the conduct of the business of Holdings and its Subsidiaries taken as a
whole;
(x) Liens on assets of a Foreign Subsidiary of the Borrower
securing Indebtedness permitted to be incurred by such Foreign
Subsidiary under this Agreement;
(xi) Liens arising out of judgments or awards in respect of
which Holdings or any of its Subsidiaries shall in good faith be
prosecuting an appeal or proceedings for review in respect of which
there shall have been secured a subsisting stay of execution pending
such appeal or proceedings, provided that the aggregate amount of all
such judgments or awards (and any cash and the fair market value of any
property subject to such Liens) does not exceed $1,000,000 at any time
outstanding;
(xii) statutory and common law landlords' liens under leases
to which Holdings or any of its Subsidiaries is a party;
(xiii) Liens incurred in the ordinary course of business in
connection with workers compensation claims, unemployment insurance and
social security benefits and Liens securing the performance of bids,
tenders, leases and contracts in the ordinary course of business,
provided that the aggregate outstanding amount of obligations secured
by Liens permitted by this clause (xiii) (and the value of all cash and
property encumbered by Liens permitted pursuant to this clause (xiii))
shall not at any time exceed $5,000,000;
(xiv) Liens securing Indebtedness permitted pursuant to
Section 9.04(xiv); and
(xv) Liens existing on property or assets acquired pursuant to
a Permitted Section 9.02(viii) Acquisition, or on property or assets of
a Subsidiary of the Borrower in existence at the time such Subsidiary
is acquired pursuant to a Permitted Section 9.02(viii) Acquisition,
provided that (x) any Indebtedness that is secured by such Liens is
otherwise permitted under Section 9.04(xiii) and (y) such Liens are not
incurred in connection with, or in contemplation or anticipation of,
any such acquisition and do not attach to any asset of Holdings or any
other asset of the Borrower or any of its Subsidiaries.
9.02 Consolidation, Merger, Purchase or Sale of Assets, etc.
Holdings will not, and will not permit any of its Subsidiaries to, wind up,
liquidate or dissolve its affairs or enter into any transaction of merger or
consolidation, or convey, sell, lease or otherwise dispose of (or agree to do
any of the foregoing at any future time) all or any part of its property or
assets, or enter into any sale-leaseback transactions, or purchase or otherwise
acquire (in one or a series of related transactions) any part of the property or
assets (other than purchases or other acquisitions of inventory, materials and
equipment in the ordinary course of business) of any Person, except that:
(i) Capital Expenditures by the Borrower and its Subsidiaries
shall be permitted to the extent not in violation of Section 9.07;
-47-
54
(ii) each of the Borrower and its Subsidiaries may in the
ordinary course of business sell or otherwise dispose of any assets
which, in the reasonable judgment of such Person, are obsolete, worn
out or otherwise no longer useful in the conduct of such Person's
business, provided that the proceeds of all assets subject to sales or
other dispositions pursuant to this clause (ii) shall not exceed
$5,000,000 in any fiscal year of the Borrower;
(iii) investments may be made to the extent permitted by
Section 9.05;
(iv) each of the Borrower and its Subsidiaries may lease (as
lessee) real or personal property to the extent permitted by Section
9.04 (so long as any such lease does not create a Capitalized Lease
Obligation except to the extent permitted by Section 9.04(v));
(v) each of the Borrower and its Subsidiaries may make sales
or leases of inventory or equipment to their customers in the ordinary
course of business;
(vi) any Subsidiary of the Borrower may be merged or
consolidated with or into the Borrower or any other Wholly-Owned
Domestic Subsidiary of the Borrower or be liquidated, wound up or
dissolved, or all or substantially all of its business, property or
assets may be conveyed, sold, leased, transferred or otherwise disposed
of, in one transaction or a series of transactions, to the Borrower or
any other Wholly-Owned Domestic Subsidiary of the Borrower;
(vii) any disposition of assets required to effectuate
Equipment Finance Transactions otherwise permitted hereby shall be
permitted;
(viii) each of the Borrower and its Subsidiaries may acquire
all or substantially all of the assets of any Person (or all or
substantially all of the assets of a product line or division of any
Person) or 100% of the capital stock of any Person, through merger with
the Borrower or a Subsidiary of the Borrower or by stock purchase (any
such acquisition permitted by this clause (viii), a "Permitted Section
9.02(viii) Acquisition"), so long as (i) no Default of Event of Default
then exists or would result therefrom, (ii) each of the representations
and warranties contained in Section 7 shall be true and correct in all
material respects both before and after giving effect to such Permitted
Section 9.02(viii) Acquisition, (iii) any Liens, Indebtedness or
Operating Lease Obligations assumed or issued in connection with such
acquisition are otherwise permitted under Section 9.01 or 9.04, as the
case may be, (iv) the only consideration paid by the Borrower or any
Subsidiary in connection with any Permitted Section 9.02(viii)
Acquisition consists solely of cash, assumed Indebtedness (including
Capitalized Lease Obligations) and/or Operating Lease Obligations, the
issuance of unsecured Indebtedness to the extent permitted under
Section 9.04(xv), common stock of Holdings and/or Qualified Preferred
Stock of Holdings, (v) Holdings and its Subsidiaries would have been in
compliance with the financial covenants set forth in Section 9.07
through 9.10, inclusive, for the Test Period then most recently ended
prior to the date of the consummation of such Permitted Section
9.02(viii) Acquisition, in each case with such financial covenants to
be determined on a pro forma basis (subject to the methodology to give
effect to such pro forma adjustments
-48-
55
being satisfactory to the Administrative Agent) as if such Permitted
Section 9.02(viii) Acquisition had been consummated on the first day of
such Test Period (and assuming that any Indebtedness (including
Capitalized Lease Obligations) and/or Operating Lease Obligations
incurred, issued or assumed in connection therewith had been incurred,
issued or assumed on the first day of, and had remained outstanding
throughout, such Test Period), (vi) the aggregate consideration paid in
connection with all Permitted Section 9.02(viii) Acquisitions
(including, without limitation, any earn-out, non-compete or deferred
compensation arrangements, the aggregate principal amount of any
Indebtedness assumed in connection therewith and the fair market value
of any capital stock of Holdings issued in connection therewith) shall
not exceed (x) $75,000,000 for any single transaction (or series of
related transactions), (y) in the event such consideration consists of
cash and assumed Indebtedness (including Capitalized Leased
Obligations), $10,000,000 in any fiscal year (and $50,000,000 in the
aggregate) (excluding any portion of such consideration which is
treated as, or involves the acquisition of assets which is treated as,
a Capital Expenditure under Section 9.07), and (z) to the extent that
such consideration consists solely of common stock of Holdings and/or
Qualified Preferred Stock of Holdings, $150,000,000, (vii) the
incurrence, issuance or assumption of Operating Lease Obligations, if
any, is permitted under Section 9.01(vii), (viii) after giving effect
to any Permitted Section 9.02(viii) Acquisition, the Unutilized
Commitment is at least $5,000,000, and (ix) the assets or Person
acquired pursuant to each such Permitted Section 9.02(viii) Acquisition
are employed or engaged, as the case may be, in a Permitted Business;
(ix) any Foreign Subsidiary may be merged with and into, or be
dissolved or liquidated into, or transfer any of its assets to, any
Foreign Subsidiary or Foreign Joint Venture so long as at least 65% of
the total combined voting power of all classes of capital stock of all
first-tier Foreign Subsidiaries and all of the capital stock owned by
any Credit Party of any first-tier Foreign Joint Venture is pledged
pursuant to the Pledge Agreement (unless, (x) in the case of Foreign
Subsidiaries, the Administrative Agent reasonably determines that such
pledge shall result in regulatory or economic disadvantages and (y)
additionally, in the case of Foreign Joint Ventures, the organizational
documents thereof prohibit such Pledge);
(x) the assets of any Foreign Subsidiary or Foreign Joint
Venture may be transferred to the Borrower or any of its Domestic
Subsidiaries and any Foreign Subsidiary or Foreign Joint Venture may be
merged with and into, or be dissolved or liquidated into, the Borrower
or any of its Domestic Subsidiaries so long as the Borrower or such
Domestic Subsidiary is the surviving corporation of any such merger,
dissolution or liquidation;
(xi) the Borrower or any of its Domestic Subsidiaries may
transfer to one or more Foreign Subsidiaries or Foreign Joint Venture
those assets theretofore transferred to the Borrower or such Domestic
Subsidiary by a Foreign Subsidiary or Foreign Joint Venture (whether by
merger, liquidation, dissolution or otherwise) pursuant to clause (x)
of this Section 9.02;
-49-
56
(xii) each of the Borrower and its Subsidiaries may enter into
sale and leaseback transactions with respect to their inventory,
equipment and Real Property, in which the Borrower or any of its
Subsidiaries acts as seller of the inventory, equipment or Real
Property that is the subject of the transaction, so long as (v) no
Default or Event of Default then exists or would result therefrom, (w)
each such sale and leaseback transaction is in an arm's-length
transaction and the Borrower or the respective Subsidiary receives at
least fair market value (as determined in good faith by the Borrower or
such Subsidiary, as the case may be), (x) the total consideration
received by the Borrower or such Subsidiary is cash and is paid at the
time of the closing of such sale, (y) the Net Sale Proceeds therefrom
are applied and/or reinvested as (and to the extent) required by
Section 4.02(b) and (z) the Capitalized Lease Obligations and/or
Operating Lease Obligations are otherwise permitted under this
Agreement;
(xiii) so long as (x) no Default or Event of Default then
exists or would result therefrom and (y) the Borrower shall be in
compliance with the financial covenants contained in Sections 9.07
through 9.10, inclusive, with such covenants to be calculated on a pro
forma basis, the Borrower may, and may permit its Subsidiaries to,
exchange (for reasonably equivalent value, a portion thereof which may
include cash) any inventory, equipment and other assets (each such
transaction an "Asset Swap"), provided that (A) the sum of (1) the
total value of all assets to be swapped in any fiscal year of the
Borrower and (2) the total value of assets sold in accordance with
Section 9.02(xiv) in such fiscal year shall not exceed in the aggregate
10% of the total value of all assets of the Borrower and its
Subsidiaries as of the end of the most recently ended fiscal year, (B)
that the disposition and acquisition of the subject inventory,
equipment or other assets occur within 60 days of one another and (C)
that any such cash proceeds received by the Borrower or any of its
Subsidiaries in connection with any such Asset Swap shall be applied
and/or reinvested as (and to the extent) required by Section 4.02(b);
(xiv) each of the Borrower and its Subsidiaries may sell
assets, so long as (v) no Default or Event of Default then exists or
would result therefrom, (w) each sale is in an arm's length transaction
and the Borrower or the respective Subsidiary receives at least fair
market value (as determined in good faith by the Borrower or such
Subsidiary, as the case may be), (x) the total consideration received
by the Borrower or such Subsidiary is at least 75% cash and is paid at
the time of the closing of such sale, (y) the Net Sale Proceeds
therefrom are applied and/or reinvested as (and to the extent) required
by Section 4.02(b) and (z) the aggregate amount of the proceeds
received from all assets sold pursuant to this clause (xiv) plus the
total value of the assets swapped pursuant to Section 9.02(xiii) in any
fiscal year of the Borrower does not exceed 10% of the total value of
all assets of the Borrower and its Subsidiaries as of the end of the
most recently ended fiscal year of the Borrower; and
(xv) any of Holdings and its Subsidiaries may enter into
agreements to effectuate any transaction otherwise prohibited by this
Section 9.02 so long as the consummation of any such agreement is
conditioned upon obtaining the consent of the Required Lenders or
repaying the Obligations in full (other than indemnification
obligations under Sections 1.10, 1.11, 2.06, 4.04 and 13.01) and
terminating the Commitments.
-50-
57
To the extent the Required Lenders waive the provisions of this Section 9.02
with respect to the sale of any Collateral, or any Collateral is sold to a
Person other than Holdings or a Subsidiary of Holdings as permitted by this
Section 9.02, such Collateral shall be sold free and clear of the Liens created
by the Security Documents (and, in the event that such Collateral consists of
all of the capital stock of a Subsidiary Guarantor, such Subsidiary Guarantor,
and the assets of such Subsidiary Guarantor, shall be released from the
Subsidiaries Guaranty and the Security Documents to which it is a party), and
the Administrative Agent and Collateral Agent shall be authorized to take any
actions deemed appropriate in order to effect the foregoing.
9.03 Dividends. Holdings shall not, and will not permit any of
its Subsidiaries to, authorize, declare or pay any Dividends with respect to
Holdings or any of its Subsidiaries, except that:
(i) (x) any Subsidiary of the Borrower may pay Dividends to
the Borrower or any Wholly-Owned Subsidiary of the Borrower and (y) any
non-Wholly-Owned Subsidiary of the Borrower may pay cash Dividends to
its shareholders generally so long as the Borrower or its respective
Subsidiary which owns the equity interest in the Subsidiary paying such
Dividends receives at least its proportionate share thereof (based upon
its relative holding of the equity interest in the Subsidiary paying
such Dividends and taking into account the relative preferences, if
any, of the various classes of equity interests of such Subsidiary),
provided that no non-Wholly-Owned Subsidiary of the Borrower which is a
Subsidiary Guarantor may pay any Dividends pursuant to this clause (y)
at any time that a Default or Event of Default has occurred and is
continuing;
(ii) so long as there shall exist no Default or Event of
Default (both before and after giving effect to the payment thereof)
the Borrower may pay cash Dividends to Holdings, so long as such
proceeds are promptly used by Holdings to pay (x) corporate overhead
costs, directors' fees and other expenses (including, without
limitation, the fees and expenses permitted pursuant to Section
9.06(vi)), provided that the aggregate amount of cash Dividends paid
during the respective fiscal year pursuant to this clause (ii),
together with the amount of any outstanding loans and advances made
during the respective fiscal year by the Borrower pursuant to Section
9.05(vi) (without reduction for any writedowns or write-offs thereof),
shall not during any fiscal year of the Borrower exceed $1,000,000 or
(y) franchise taxes and federal, state and local income taxes and
interest and penalties with respect thereto, if any, payable by
Holdings (provided that any refund shall be promptly returned by
Holdings to the Borrower); and
(iii) so long as there shall exist no Default or Event of
Default (both before and after giving effect to the payment thereof)
the Borrower may pay cash Dividends to Holdings so long as the proceeds
thereof are immediately used by Holdings to purchase shares of common
stock or options to purchase shares of common stock of Holdings held by
former employees of the Borrower following the termination of their
employment by the Borrower or any of its Subsidiaries, provided that
the aggregate amount of cash Dividends paid pursuant to this clause
(iii) shall (x) be funded with life insurance proceeds received by the
Borrower under life insurance policies maintained with respect to such
-51-
58
employee or (y) to the extent not funded as described in preceding
clause (x), not during any fiscal year of the Borrower exceed
$3,000,000.
9.04 Indebtedness. Holdings will not, and will not permit any
of its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness, except:
(i) Indebtedness incurred pursuant to this Agreement and the
other Credit Documents;
(ii) Existing Indebtedness outstanding on the Effective Date
and listed on Schedule IV, without giving effect to any subsequent
extensions, renewal or refinancing thereof except to the extent set
forth on Schedule IV, provided that the aggregate principal amount of
Indebtedness to be extended, renewed or refinanced does not increase
from that amount outstanding at the time of any such extension, renewal
or refinancing;
(iii) Indebtedness with respect to surety bonds, appeal bonds
or customs bonds required in the ordinary course of business or in
connection with the enforcement of rights or claims of the Borrower or
any of its Subsidiaries or in connection with judgments that do not
result in a Default or an Event of Default, provided that the aggregate
outstanding amount of all such surety bonds, appeal bonds and customs
bonds permitted by this clause (iii) shall not at any time exceed
$5,000,000;
(iv) Indebtedness under Interest Rate Protection Agreements on
terms acceptable to the Administrative Agent;
(v) Indebtedness evidenced by Capitalized Lease Obligations
and Purchase Money Indebtedness to the extent permitted pursuant to
Section 9.07, provided that in no event shall the aggregate principal
amount of Capitalized Lease Obligations and Purchase Money Indebtedness
permitted by this clause (v) exceed $15,000,000 at any time
outstanding;
(vi) Indebtedness of the Borrower and the Subsidiary
Guarantors evidenced by the Borrower Senior Discount Notes outstanding
on the Effective Date (and guarantees thereof) plus the amount of
interest on such Borrower Senior Discount Notes paid in kind or through
accretion or capitalization;
(vii) accrued expenses and current trade accounts payable
incurred in the ordinary course of business and unsecured guarantees of
the Borrower or any of its Subsidiaries of such trade accounts payable,
and obligations under trade letters of credit incurred by the Borrower
or such Subsidiary in the ordinary course of business, which are to be
repaid in full not more than one year after the date on which such
Indebtedness is originally incurred to finance the purchase of goods by
the Borrower or such Subsidiary;
(viii) Indebtedness of the Borrower under any Other Hedging
Agreement which is entered into to protect the Borrower against
fluctuations in currency values so long as such Other Hedging
Agreements are for bona fide business purposes and are not speculative;
-52-
59
(ix) Indebtedness of the Borrower not to exceed $3,000,000 at
any time outstanding and secured by insurance cancellation premiums
relating to insurance maintained by the Borrower in the ordinary course
of business;
(x) intercompany Indebtedness among the Borrower and its
Subsidiaries to the extent permitted by Section 9.05;
(xi) (A) unsecured guarantees by Holdings of Indebtedness,
Operating Lease Obligations or other obligations of its Domestic
Subsidiaries that are permitted to be incurred hereunder and (B)
guarantees by Foreign Subsidiaries of Indebtedness, Operating Lease
Obligations or other obligations of other Foreign Subsidiaries of the
Borrower that are permitted to be incurred hereunder;
(xii) Indebtedness of any Foreign Subsidiary of the Borrower
the proceeds of which Indebtedness are used for such Foreign
Subsidiary's and/or its Foreign Subsidiaries' working capital and
general corporate purposes ("Foreign Subsidiary Indebtedness");
(xiii) Indebtedness consisting of Capitalized Lease
Obligations, Purchase Money Indebtedness or other Indebtedness which
does not constitute debt for borrowed money of a Subsidiary acquired
pursuant to a Permitted Section 9.02(viii) Acquisition (or such
Indebtedness assumed at the time of a Permitted Section 9.02(viii)
Acquisition of an asset securing such Indebtedness), provided that such
Indebtedness was not incurred in connection with, or in anticipation or
contemplation of, such Permitted Section 9.02(viii) Acquisition;
(xiv) Indebtedness of the Borrower and its Subsidiaries
consisting of letters of credit and reimbursement obligations with
respect thereto, including renewals or extensions thereof, so long as
the aggregate stated amount of such letters of credit at any time
outstanding does not exceed $17,500,000 (such amount to be reduced by
the aggregate principal amount of all outstanding Letters of Credit);
and
(xv) Indebtedness of the Borrower and its Subsidiaries to the
extent not permitted by the foregoing clauses of this Section 9.04 not
to exceed $20,000,000 in aggregate principal amount at any time
outstanding.
9.05 Advances, Investments and Loans. Holdings will not, and
will not permit any of its Subsidiaries to, directly or indirectly, lend money
or credit or make advances to any Person, or purchase or acquire any stock,
obligations or securities of, or any other interest in, or make any capital
contribution to, any other Person, or purchase or own a futures contract or
otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, or hold any
cash or Cash Equivalents, except that the following shall be permitted:
(i) the Borrower and its Subsidiaries may acquire and hold
accounts receivable, trade receivables, prepaid expenses and similar
items owing to any of them, if created or acquired in the ordinary
course of business;
-53-
60
(ii) the Borrower and its Subsidiaries may acquire and hold
cash and Cash Equivalents;
(iii) non-cash consideration received by Holdings or any of
its Subsidiaries in connection with any asset sale to the extent
permitted by Section 9.02;
(iv) the Borrower and its Subsidiaries may receive and hold
investments in connection with the bankruptcy or reorganization of
suppliers and customers and in settlement of delinquent obligations of,
and other disputes with, customers and suppliers arising in the
ordinary course of business;
(v) the Borrower and its Subsidiaries may make payroll
advances in the ordinary course of business;
(vi) so long as no Default or Event of Default then exists
(both before and after giving effect to the payment thereof), the
Borrower may make loans to Holdings to enable Holdings to pay the
amounts described in Sections 9.03(ii) and 9.03(iii), in an aggregate
amount not to exceed in any fiscal year $1,000,000 less any amounts
paid pursuant to Sections 9.03(ii) and 9.03(iii) during such fiscal
year;
(vii) the Borrower and its Subsidiaries may hold the
investments held by them on the Effective Date and as set forth on
Schedule IX;
(viii) the Borrower and its Subsidiaries may enter into,
invest in and make loans and advances to (x) corporations,
associations, partnerships, business trusts and other business entities
organized in the United States, any state thereof or Canada which would
not, after the respective investment, be a Subsidiary of Holdings (each
a "Domestic Joint Venture"), provided that (i) neither Holdings nor any
of its Subsidiaries is liable for any Indebtedness or other obligations
of any nature whatsoever (whether absolute, accrued, contingent or
otherwise and whether or not due) of any such Joint Venture [(other
than performance guarantees of any such Joint Venture's service
contracts so long as any such service contract and the performance
guaranty thereof are entered into in the ordinary course of business
and on a basis consistent with past practices)] and (ii) the net
aggregate amount of all such investments and loans in Domestic Joint
Ventures shall at no time exceed $10,000,000 in any fiscal year of the
Borrower (and $25,000,000 in the aggregate);
(ix) Holdings and its Subsidiaries may make loans and advances
in the ordinary course of business to their respective employees so
long as the aggregate principal amount thereof at any time outstanding
(determined without regard to any write-downs or write-offs of such
loans and advances) shall not exceed $500,000;
(x) the Borrower may enter into Interest Protection Agreements
or Other Hedging Agreements to the extent permitted by Section 9.04(iv)
and (viii);
(xi) the Borrower and the Subsidiary Guarantors that are
Wholly-Owned Domestic Subsidiaries of the Borrower may make
intercompany loans and advances between or among one another (and
together with the intercompany loans and advances made
-54-
61
pursuant to clause (xii) of this Section 9.05, collectively,
"Intercompany Loans") or equity investments, so long as no such
Intercompany Loan shall be evidenced by a promissory note or other
instrument except an Intercompany Note that is pledged to the
Collateral Agent pursuant to the Pledge Agreement;
(xii) the Borrower and the Subsidiary Guarantors may make
intercompany loans and advances to, or equity investments in, a
non-Wholly Owned Domestic Subsidiary that is a Subsidiary Guarantor (or
upon the making of any such equity investment the respective Person
will become such a Subsidiary Guarantor) so long as (x) no such
Intercompany Loan shall be evidenced by a promissory note or other
instrument except an Intercompany Note that is pledged to the
Collateral Agent pursuant to the Pledge Agreement and (y) the net
aggregate amount of all such investments made pursuant to this clause
(xii) shall not exceed $20,000,000 in any fiscal year of the Borrower
(and $60,000,000 in the aggregate);
(xiii) the Borrower and its Subsidiaries may effect Permitted
Section 9.02(viii) Acquisitions in accordance with the requirements of
Section 9.02(viii); and
(xiv) the Borrower and its Subsidiaries may enter into, invest
in (including by transferring assets) and make loans and advances to
(x) Foreign Joint Ventures and (y) Foreign Subsidiaries, provided that
(i) neither Holdings nor any of its Subsidiaries is liable for any
Indebtedness or other obligations of any nature whatsoever (whether
absolute, accrued, contingent or otherwise and whether or not due) of
any such Foreign Joint Venture or Foreign Subsidiary [(other than
performance guarantees of any such Foreign Joint Venture's service
contracts so long as any such service contract and the performance
guaranty thereof are entered into in the ordinary course of business
and on a basis consistent with past practices)] and (ii) the net
aggregate amount of all such investments and loans in Foreign Joint
Ventures and Foreign Subsidiaries shall at no time exceed $20,000,000
(using the fair market value of property other than cash) in any fiscal
year of the Borrower (and $60,000,000 in the aggregate); provided that
no more than $30,000,000 in the aggregate shall be invested in Foreign
Joint Venture and Foreign Subsidiaries located or operating in
Restricted Countries (it being understood that, for purposes of this
clause (xiv), the amounts set forth above in this clause (xiv) shall be
net of cash payments of principal in the case of loans and cash equity
returns (whether as a dividend or redemption) in the case of equity
investments, in each case which are received from a non-U.S. Person
constituting a Foreign Joint Venture otherwise permitted under this
Section 9.05).
9.06 Transactions with Affiliates. Holdings will not, and will
not permit any of its Subsidiaries to, enter into any transaction or series of
related transactions, whether or not in the ordinary course of business, with
any Affiliate of Holdings or any of its Subsidiaries, other than in the ordinary
course of business and on terms and conditions substantially as favorable to
Holdings or such Subsidiary as would reasonably be obtained by Holdings or such
Subsidiary at that time in a comparable arm's-length transaction with a Person
other than an Affiliate, except that (i) Dividends may be paid to the extent
provided in Section 9.03, (ii) loans may be made and other transactions may be
entered into by Holdings and its Subsidiaries to the extent permitted by
-55-
62
Section 9.05, (iii) customary fees may be paid to directors of Holdings and its
Subsidiaries, (iv) options to purchase common stock of Holdings may be granted
to officers and directors of Holdings and its Subsidiaries in the ordinary
course of business, (v) Holdings and its Subsidiaries may enter into employment
arrangements with their respective officers in the ordinary course of business,
(vi) customary payments to the directors of Holdings and its Subsidiaries in the
ordinary course of business and (vii) Holdings or its Subsidiaries may pay
directors' fees to the directors of Holdings or any of its Subsidiaries in an
aggregate amount for all such Persons not to exceed $500,000 per year. Except as
specifically provided above, no management or similar fees shall be paid or
payable by Holdings or any of its Subsidiaries to any Person other than
customary investment banking, financing and similar fees arising in connection
with transactions after the date hereof.
9.07 Capital Expenditures. (a) Holdings will not, and will not
permit any of its Subsidiaries to, make any Capital Expenditures, except that
(i) the Borrower and its Subsidiaries may make Capital Expenditures in its
fiscal years ending March 31, 2001 and March 31, 2002 and (ii) during any fiscal
year of the Borrower set forth below, the Borrower and its Subsidiaries may make
Capital Expenditures so long as the aggregate amount of such Capital
Expenditures does not exceed in any such fiscal year, the amount set forth
opposite such fiscal year below:
Fiscal Year Ending Amount
------------------ -------------
March 31, 2003 $____________
March 31, 2004 $____________
March 31, 2005 $____________
(b) In addition to the foregoing, to the extent that the
amount of Capital Expenditures made by the Borrower and its Subsidiaries during
any fiscal year of the Borrower set forth in the table in clause (a)(ii) of this
Section 9.07 (exclusive, however, of Capital Expenditures made pursuant to
Sections 9.07(c), (d) and (e)) is less than the amount applicable to the
respective fiscal year as set forth in such table (and without increasing any
such amount set forth in such table by the amount of any additional amounts
permitted to be spent in such fiscal year pursuant to this sentence), such
amount may be carried forward and utilized to make Capital Expenditures in
excess of the amount permitted in clause (a)(ii) above in the following fiscal
year; provided that the aggregate amount expended on Capital Expenditures in any
fiscal year set forth in such table shall not exceed 125% of the amount
permitted to be made in such fiscal year as set forth in clause (a)(ii) of this
Section 9.07.
(c) In addition to the foregoing, the amount of Net Sale
Proceeds received by the Borrower or any of its Subsidiaries from any Asset
Sale, or sale of assets permitted pursuant to Section 9.02(vii), may be
reinvested in replacement assets within 18 months following the date of such
Asset Sale or sale of assets to the extent such Net Sale Proceeds are not
required to be applied pursuant to Section 4.02(b), and, to the extent so
reinvested, shall not count as Capital Expenditures for purposes of determining
compliance with clauses (a) and (b) of this Section 9.07.
-56-
63
(d) In addition to the foregoing, the Borrower and its
Subsidiaries may make Capital Expenditures with the cash proceeds of any
issuance of equity by Holdings (other than the first $100,000,000 of cash
proceeds received from the Holdings IPO).
(e) In addition to the foregoing, the Borrower and its
Subsidiaries may make Capital Expenditures in an amount equal to the amount by
which Consolidated EBITDA for any fiscal year of the Borrower exceeded
Consolidated EBITDA for such fiscal year as set forth in the Projections.
(f) Notwithstanding anything above in this Section 9.07 to the
contrary, in no event may the Borrower or any of its Subsidiaries make Capital
Expenditures pursuant to any single transaction (or series of related
transactions) which exceeds $__________ (subject to any additional restrictions
or limitations set forth in Section 9.02(viii)).
9.08 Consolidated EBITDAR to Total Interest Expense. Holdings
will not permit the ratio of (i) Consolidated EBITDAR to (ii) the sum of Total
Interest Expense plus all lease expenses for such Test Period associated with
the Synthetic Leases for any Test Period ending on the last day of a fiscal
quarter set forth below to be less than the ratio set forth opposite such fiscal
quarter below:
Period Ratio
------ -----
June 30, 2000 ____:1.00
September 30, 2000 ____:1.00
December 31, 2000 ____:1.00
March 31, 2001 ____:1.00
June 30, 2001 ____:1.00
September 30, 2001 ____:1.00
December 31, 2001 ____:1.00
March 31, 2002 ____:1.00
June 30, 2002 ____:1.00
September 30, 2002 ____:1.00
December 31, 2002 ____:1.00
March 31, 2003 ____:1.00
June 30, 2003 ____:1.00
September 30, 2003 ____:1.00
December 31, 2003 ____:1.00
March 31, 2004 ____:1.00
June 30, 2004 and the last day ____:1.00
of each fiscal quarter thereafter
-57-
64
9.09 Maximum Leverage Ratio. Holdings will not permit the
Leverage Ratio at any time during a period set forth below to be greater than
the ratio set forth opposite such period below:
Period Ratio
------ -----
Effective Date ____:1.00
Through and including June 30, 2000
July 1, 2000 ____:1.00
Through and including September 30, 2000
October 1, 2000 ____:1.00
Through and including December 31, 2000
January 1, 2001 ____:1.00
Through and including March 31, 2001
April 1, 2001 ____:1.00
Through and including June 30, 2001
July 1, 2001 ____:1.00
Through and including September 30, 2001
October 1, 2001 ____:1.00
Through and including December 31, 2001
January 1, 2002 ____:1.00
Through and including March 31, 2002
April 1, 2002 ____:1.00
Through and including June 30, 2002
July 1, 2002 ____:1.00
Through and including September 30, 2002
October 1, 2002 ____:1.00
Through and including December 31, 2002
January 1, 2003 ____:1.00
Through and including March 31, 2003
April 1, 2003 ____:1.00
Through and including June 30, 2003
July 1, 2003 ____:1.00
Through and including September 30, 2003
October 1, 2003 ____:1.00
Through and including December 31, 2003
January 1, 2004 ____:1.00
Through and including March 31, 2004
April 1, 2004 ____:1.00
Through and including June 30, 2004
July 1, 2004 ____:1.00
Through and including September 30, 2004
October 1, 2004 ____:1.00
Through and including December 31, 2004
January 1, 2005 ____:1.00
Through and including March 31, 2005
-58-
65
9.10 Maximum Senior Secured Leverage Ratio. Holdings will not
permit the Senior Secured Leverage Ratio at any time during a period set forth
below to be greater than the ratio set forth opposite such period below:
Period Ratio
------ -----
Effective Date ____:1.00
Through and including June 30, 2000
July 1, 2000 ____:1.00
Through and including September 30, 2000
October 1, 2000 ____:1.00
Through and including December 31, 2000
January 1, 2001 ____:1.00
Through and including March 31, 2001
April 1, 2001 ____:1.00
Through and including June 30, 2001
July 1, 2001 ____:1.00
Through and including September 30, 2001
-59-
66
Period Ratio
------ -----
October 1, 2001 ____:1.00
Through and including December 31, 2001
January 1, 2002 ____:1.00
Through and including March 31, 2002
April 1, 2002 ____:1.00
Through and including June 30, 2002
July 1, 2002 ____:1.00
Through and including September 30, 2002
October 1, 2002 ____:1.00
Through and including December 31, 2002
January 1, 2003 ____:1.00
Through and including March 31, 2003
April 1, 2003 ____:1.00
Through and including June 30, 2003
July 1, 2003 ____:1.00
Through and including September 30, 2003
October 1, 2003 ____:1.00
Through and including December 31, 2003
January 1, 2004 ____:1.00
Through and including March 31, 2004
April 1, 2004 ____:1.00
Through and including June 30, 2004
July 1, 2004 ____:1.00
Through and including September 30, 2004
October 1, 2004 ____:1.00
Through and including December 31, 2004
January 1, 2005 ____:1.00
Through and including March 31, 2005
-60-
67
9.11 Limitation on Voluntary Payments and Modifications of
Indebtedness; Modifications of Certificate of Incorporation, By-Laws and Certain
Other Agreements; etc. Holdings will not, and will not permit any of its
Subsidiaries to, (i) make (or give any notice in respect of) any voluntary or
optional payment or prepayment on or redemption or acquisition for value of any
Borrower Senior Discount Notes (except the Borrower may redeem or repurchase up
to 35% of the Borrower Senior Discount Notes outstanding on the Effective Date,
which redemption or repurchase shall be on terms and conditions reasonably
satisfactory to the Administrative Agent), (ii) amend or modify, or permit the
amendment or modification of, any provision of the Existing Indebtedness or the
Borrower Senior Discount Notes (it being understood, however, that Holdings and
its Subsidiaries may amend or modify the Borrower Senior Discount Notes to the
extent the trustee of the respective note can approve such amendment or
modification without obtaining the consent of the holders of such note) or of
any agreement (including, without limitation, any purchase agreement, indenture,
loan agreement or security agreement) relating thereto or the Synthetic Lease
Financing Documents, (iii) make (or give any notice in respect of) any voluntary
or optional payment or prepayment of its lease obligations under the Synthetic
Lease Financing Documents or any other Equipment Financing Transaction (other
than in connection with (x) the refinancing of all obligations thereunder or (y)
the disposition of the assets relating thereto), or (iv) amend, modify or change
its Certificate of Incorporation (including, without limitation, by the filing
or modification of any certificate of designation, other than in connection with
the issuance of Qualified Preferred Stock or Disqualified Preferred Stock) or
By-Laws or any agreement entered into by it, with respect to its capital stock
(including any Shareholders' Agreement), or enter into any new agreement with
respect to its capital stock unless such amendment, modification, change or
other action contemplated by this clause (iv) could not reasonably be determined
to be adverse to the Lenders.
9.12 Limitation on Certain Restrictions on Subsidiaries.
Holdings will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any such Subsidiary to (a) pay
dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by the Borrower or any Subsidiary
of the Borrower, or pay any Indebtedness owed to the Borrower or a Subsidiary of
the Borrower, (b) make loans or advances to the Borrower or any of the
Borrower's Subsidiaries or (c) transfer any of its properties or assets to the
Borrower, except for such encumbrances or restrictions existing under or by
reason of (i) applicable law, (ii) this Agreement and the other Credit
Documents, (iii) customary provisions restricting subletting or assignment of
any lease governing a leasehold interest of the Borrower or a Subsidiary of the
Borrower, (iv) customary provisions restricting assignment of any licensing
agreement entered into by the Borrower or a Subsidiary of the Borrower in the
ordinary course of business, (v) the Borrower Senior Note Documents and
agreements evidencing Existing Indebtedness, (vi) Foreign Subsidiary
Indebtedness, (vii) the Synthetic Lease Financing Documents, and (viii)
restrictions on the transfer of any asset subject to a Lien permitted by
Sections 9.01(vii), (x), (xiv) and (xv) so long as such restrictions only apply
to the assets subject to such Liens.
9.13 Limitation on Issuance of Capital Stock. (a) Holdings
will not, and will not permit any of its Subsidiaries to, issue (i) any
preferred stock other than Qualified Preferred Stock
-61-
68
of Holdings or (ii) any redeemable common stock other than common stock that is
redeemable at the sole option of Holdings or such Subsidiary.
(b) Holdings shall not permit any of its Subsidiaries to issue
any capital stock (including by way of sales of treasury stock) or any options
or warrants to purchase, or securities convertible into, capital stock, except
(i) for transfers and replacements of then outstanding shares of capital stock,
(ii) for stock splits, stock dividends and similar issuances which do not
decrease the percentage ownership of Holdings or any of its Subsidiaries in any
class of the capital stock of such Subsidiary, (iii) to qualify directors to the
extent required by applicable law and (iv) capital stock issued by newly created
or acquired Subsidiaries, in accordance with the other requirements of this
Agreement.
9.14 Business. The Borrower will not, and will not permit any
of its Subsidiaries to, engage (directly or indirectly) in any business other
than the business in which the Borrower is engaged on the Effective Date and
reasonable extensions thereof and businesses ancillary thereto.
9.15 Limitation on Creation of Subsidiaries and Entering into
Partnerships and Joint Ventures. (a) Holdings shall not establish, create or
acquire any additional Subsidiaries provided that the Borrower and its
Wholly-Owned Subsidiaries shall be permitted to establish, create and acquire
Subsidiaries otherwise in compliance with this Agreement, so long as any such
new Subsidiary (other than a Foreign Subsidiary but subject to Section 8.12) (x)
executes and delivers to the Administrative Agent a counterpart of the
Subsidiaries Guaranty, the Pledge Agreement and the Security Agreement, (y)
takes all actions required pursuant to Section 8.11, and/or (z) executes and
delivers, or causes to be executed and delivered, to the Administrative Agent
all other relevant documentation of the type described in Section 5 as such
Subsidiary would have to deliver if such new Subsidiary were a Credit Party on
the Effective Date.
(b) Holdings will not, and will not permit any of its
Subsidiaries to, enter into any partnerships or joint ventures, except to the
extent permitted under Section 9.05(viii) and (xiii).
9.16 Special Purpose Corporation. (a) Holdings shall not
engage in any business activities other than the ownership of the capital stock
of the Borrower, the issuance of Qualified Preferred Stock, and the execution,
delivery and performance of the Documents. In no event shall Holdings be
permitted to incur or suffer to exist any Indebtedness on, or create or suffer
to exist any Liens on, its assets; provided that Holdings may engage in any
necessary activity with respect to (i) the maintenance of its corporate or trust
existence and compliance with applicable law, (ii) accounting, legal, public
relations, investor relations, financial or management activities (including the
employment of employees, counsel, accountants, consultants, bankers, advisors or
other professionals in connection with any of the foregoing activities), and
(iii) entering into, performing its obligations and exercising its rights under
the Documents to which it is a party.
(b) Holdings shall have no Subsidiaries other than the
Borrower and its Subsidiaries.
-62-
69
SECTION 10. Events of Default. Upon the occurrence of any of
the following specified events (each an "Event of Default"):
10.01 Payments. The Borrower shall (i) default in the payment
when due of any principal of any Loan or any Note, (ii) default, and such
default shall continue unremedied for three or more Business Days, in the
payment when due of any interest on any Loan or Note, any Unpaid Drawing (to the
extent the Borrower has knowledge that such Unpaid Drawings are past due) or any
Fees or (iii) default, and such default shall continue unremedied for ten or
more Business Days, in the payment of any other amounts owing hereunder or
thereunder; or
10.02 Representations, etc. Any representation or warranty
made by any Credit Party herein or in any other Credit Document or in any
certificate delivered to the Administrative Agent or any Lender pursuant hereto
or thereto shall prove to be untrue in any material respect on the date as of
which made or deemed made as provided in Section 7; or
10.03 Covenants. Any Credit Party shall (i) default in the due
performance or observance by it of any term, covenant or agreement contained in
Section 8.01(g)(i) or 8.08 or Section 9 or (ii) default in the due performance
or observance by it of any other term, covenant or agreement contained in this
Agreement (other than those set forth in Sections 10.01 and 10.02) and such
default shall continue unremedied for a period of 30 days after written notice
thereof to the Borrower by the Administrative Agent or the Required Lenders; or
10.04 Default Under Other Agreements. Holdings or any of its
Subsidiaries shall (A) (i) default in any payment of any Indebtedness (other
than the Notes) beyond the period of grace, if any, provided in the instrument
or agreement under which such Indebtedness was created or (ii) default in the
observance or performance of any agreement or condition relating to any
Indebtedness (other than the Notes) or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness (or a trustee or
agent on behalf of such holder or holders) to cause (determined without regard
to whether any notice is required), any such Indebtedness to become due prior to
its stated maturity, or (iii) any Indebtedness (other than the Notes) of
Holdings or any of its Subsidiaries shall be declared to be due and payable, or
required to be prepaid other than by a regularly scheduled required prepayment,
prior to the stated maturity thereof, or (B) (i) default in any payment of any
Operating Lease Obligations beyond the period of grace, if any, provided in the
instrument or agreement under which such Operating Lease Obligations were
created or (ii) default in the observance or performance of any agreement or
condition relating to any Operating Lease Obligations or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event shall occur or condition exist, the effect of which default or other event
or condition is to cause, or to permit the holder or holders of such Operating
Lease Obligations (or a trustee or agent on behalf of such holder or holders) to
cause (determined without regard to whether any notice is required), any such
Operating Lease Obligations to become due or prepayable prior to its stated
maturity, or (iii) any Operating Lease Obligations of Holdings or any of its
Subsidiaries shall be declared to be due and payable, or required to be prepaid
other than by a regularly scheduled required payment, prior to the stated
maturity thereof; provided that it shall not be a Default or Event of Default
under this Section 10.04 unless the
-63-
70
aggregate principal amount of all Indebtedness and Operating Lease Obligations
as described in preceding clauses (A) and (B) is at least $4,000,000; or
10.05 Bankruptcy, etc. Holdings or any of its Significant
Subsidiaries shall commence a voluntary case concerning itself under Title 11 of
the United States Code entitled "Bankruptcy," as now or hereafter in effect, or
any successor thereto (the "Bankruptcy Code"); or an involuntary case is
commenced against Holdings or any of its Significant Subsidiaries, and the
petition is not controverted within 10 days, or is not dismissed within 60 days,
after commencement of the case; or a custodian (as defined in the Bankruptcy
Code) is appointed for, or takes charge of, all or substantially all of the
property of Holdings or any of its Significant Subsidiaries, or Holdings or any
of its Significant Subsidiaries commences any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of debtors, dissolution,
insolvency or liquidation or similar law of any jurisdiction whether now or
hereafter in effect relating to Holdings or any of its Significant Subsidiaries,
or there is commenced against Holdings or any of its Significant Subsidiaries
any such proceeding which remains undismissed for a period of 60 days, or
Holdings or any of its Significant Subsidiaries is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case or
proceeding is entered; or Holdings or any of its Significant Subsidiaries
suffers any appointment of any custodian or the like for it or any substantial
part of its property to continue undischarged or unstayed for a period of 60
days; or Holdings or any of its Significant Subsidiaries makes a general
assignment for the benefit of creditors; or any corporate action is taken by
Holdings or any of its Significant Subsidiaries for the purpose of effecting any
of the foregoing; or
10.06 ERISA. (a)(i) Any Plan shall fail to satisfy the minimum
funding standard required for any plan year or part thereof under Section 412 of
the Code or Section 302 of ERISA or a waiver of such standard or extension of
any amortization period is sought or granted under Section 412 of the Code or
Section 303 or 304 of ERISA, (ii) a Reportable Event shall have occurred, (iii)
a contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan
subject to Title IV of ERISA shall be subject to the advance reporting
requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph
(b)(1) thereof) and an event described in subsection .62, .63, .64, .65, .66,
.67 or .68 of PBGC Regulation Section 4043 shall be reasonably expected to occur
with respect to such Plan within the following 30 days, (iv) any Plan which is
subject to Title IV of ERISA shall have had or is likely to have a trustee
appointed to administer such Plan, (v) any Plan which is subject to Title IV of
ERISA is, shall have been or is likely to be terminated or to be the subject of
termination proceedings under ERISA, (vi) any Plan shall have an Unfunded
Current Liability, (vii) a contribution required to be made with respect to a
Plan or a Foreign Pension Plan has not been timely made, (viii) Holdings or any
Subsidiary of Holdings or any ERISA Affiliate has incurred or is likely to incur
any liability to or on account of a Plan under Section 409, 502(i), 502(l), 515,
4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971
or 4975 of the Code or (ix) on account of a group health plan (as defined in
Section 607(1) of ERISA or Section 4980B(g)(2) of the Code) under Section 4980B
of the Code, or (ix) Holdings or any Subsidiary of Holdings has incurred or is
likely to incur liabilities pursuant to one or more employee welfare benefit
plans (as defined in Section 3(1) of ERISA) that provide benefits to retired
employees or other former employees (other than as required by Section 601 of
ERISA) or Plans or Foreign Pension Plans; (b) there shall result from any such
event or events the imposition of a lien, the granting of a security
-64-
71
interest, or a liability or a material risk of incurring a liability; and (c)
such lien, security interest or liability, individually, and/or in the
aggregate, in the opinion of the Required Lenders, has had, or could reasonably
be expected to have, a material adverse effect upon the business, operations,
condition (financial or otherwise) or prospects of Holdings and its Subsidiaries
taken as a whole; or
10.07 Security Documents. At any time after the execution and
delivery thereof, any of the Security Documents shall cease to be in full force
and effect, or shall cease to give the Collateral Agent for the benefit of the
Secured Creditors the Liens, rights, powers and privileges purported to be
created thereby (including, without limitation, a perfected security interest
in, and Lien on, all of the Collateral (other than Collateral with a value not
to exceed $1,000,000), in favor of the Collateral Agent, superior to and prior
to the rights of all third Persons (except as permitted by Section 9.01), and
subject to no other Liens (except as permitted by Section 9.01), or Holdings or
any of its Subsidiaries shall default in the due performance or observance of
any term, covenant or agreement on its part to be performed or observed pursuant
to any of the Security Documents and such default, other than with respect to
Sections [2.4 and 2.5] of the Security Agreement (in which case an Event of
Default shall immediately exist without the giving of any notice), shall
continue unremedied for a period of 30 days after written notice thereof to the
Borrower from the Administrative Agent or the Required Lenders; or
10.08 Subsidiaries Guaranty. At any time after the execution
and delivery thereof, (x) the Subsidiaries Guaranty or any provision thereof
shall cease to be in full force or effect as to any Subsidiary Guarantor, (y) if
any Subsidiary Guarantor or Person acting by or on behalf of any Subsidiary
Guarantor shall deny or disaffirm such Subsidiary Guarantor's obligations under
the Subsidiaries Guaranty, or (z) any Subsidiary Guarantor shall default in the
due performance or observance of any term, covenant or agreement on its part to
be performed or observed pursuant to the Subsidiaries Guaranty; or
10.09 Judgments. One or more judgments or decrees shall be
entered against Holdings or any Subsidiary of Holdings involving in the
aggregate for Holdings and its Subsidiaries a liability (not paid or fully
covered by a reputable and solvent insurance company) and such judgments and
decrees either shall be final and non-appealable or shall not be vacated,
discharged or stayed or bonded pending appeal for any period of 30 consecutive
days, and the aggregate amount of all such judgments exceeds $4,000,000; or
10.10 Change of Control. A Change of Control shall occur;
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent, upon the written request of
the Required Lenders, shall by written notice to the Borrower, take any or all
of the following actions, without prejudice to the rights of the Administrative
Agent, any Lender or the holder of any Note to enforce its claims against the
Borrower (provided, that, if an Event of Default specified in Section 10.05
shall occur with respect to the Borrower, the result which would occur upon the
giving of written notice by the Administrative Agent to the Borrower as
specified in clauses (i) and (ii) below shall occur automatically without the
giving of any such notice): (i) declare the Total Commitment terminated,
whereupon all Commitments of each Lender shall forthwith terminate immediately
-65-
72
and any Commitment Commission shall forthwith become due and payable without any
other notice of any kind; (ii) declare the principal of and any accrued interest
in respect of all Loans and the Notes and all Obligations owing hereunder and
thereunder to be, whereupon the same shall become, forthwith due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by each Credit Party; (iii) terminate any Letter of Credit
which may be terminated, in accordance with its terms; (iv) direct the Borrower
to pay (and the Borrower agrees that upon receipt of such notice, or upon the
occurrence of an Event of Default specified in Section 10.05 with respect to the
Borrower, it will pay) to the Collateral Agent at the Payment Office such
additional amount of cash, to be held as security by the Collateral Agent, as is
equal to the aggregate Stated Amount of all Letters of Credit issued for the
account of the Borrower and then outstanding; (v) enforce, as Collateral Agent,
all of the Liens and security interests created pursuant to the Security
Documents; and (vi) apply any cash collateral held by the Administrative Agent
pursuant to Section 4.02 to the repayment of the Obligations.
SECTION 11. Definitions and Accounting Terms.
11.01 Defined Terms. As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):
"Additional Security Documents" shall have the meaning
provided in Section 8.11.
"Adjusted Certificate of Deposit Rate" shall mean, on any day,
the sum (rounded to the nearest 1/100 of 1%) of (1) the rate obtained by
dividing (x) the most recent weekly average dealer offering rate for negotiable
certificates of deposit with a three-month maturity in the secondary market as
published in the most recent Federal Reserve System publication entitled "Select
Interest Rates," published weekly on Form H.15 as of the date hereof, or if such
publication or a substitute containing the foregoing rate information shall not
be published by the Federal Reserve System for any week, the weekly average
offering rate determined by the Administrative Agent on the basis of quotations
for such certificates received by it from three certificate of deposit dealers
in New York of recognized standing or, if such quotations are unavailable, then
on the basis of other sources reasonably selected by the Administrative Agent,
by (y) a percentage equal to 100% minus the stated maximum rate of all reserve
requirements as specified in Regulation D applicable on such day to a
three-month certificate of deposit of a member bank of the Federal Reserve
System in excess of $100,000 (including, without limitation, any marginal,
emergency, supplemental, special or other reserves), plus (2) the then daily net
annual assessment rate as estimated by the Administrative Agent for determining
the current annual assessment payable by the Administrative Agent to the Federal
Deposit Insurance Corporation for insuring three-month certificates of deposit.
"Adjusted Consolidated Net Income" for any period shall mean
Consolidated Net Income for such period plus, without duplication, the sum of
the amount of all net non-cash charges (including, without limitation,
depreciation, amortization, deferred tax expense and non-cash interest expense)
and net non-cash losses which were included in arriving at Consolidated Net
Income for such period less the sum of the amount of all net non-cash gains
(exclusive of
-66-
73
items reflected in Adjusted Working Capital) included in arriving at
Consolidated Net Income for such period.
"Adjusted Consolidated Working Capital" at any time shall mean
Consolidated Current Assets (but excluding therefrom all cash and Cash
Equivalents) less Consolidated Current Liabilities.
"Adjusted Percentage" shall mean (x) at a time when no Lender
Default exists, for each Lender, such Lender's Percentage and (y) at a time when
a Lender Default exists (i) for each Lender that is a Defaulting Lender, zero
and (ii) for each Lender that is a Non-Defaulting Lender, the percentage
determined by dividing such Lender's Commitment at such time by the Adjusted
Total Commitment at such time, it being understood that all references herein to
Commitments and the Adjusted Total Commitment at a time when the Total
Commitment or Adjusted Total Commitment, as the case may be, has been terminated
shall be references to the Commitments or Adjusted Total Commitment, as the case
may be, in effect immediately prior to such termination, provided that (A) no
Lender's Adjusted Percentage shall change upon the occurrence of a Lender
Default from that in effect immediately prior to such Lender Default if after
giving effect to such Lender Default, and any repayment of Revolving Loans and
Swingline Loans at such time pursuant to Section 4.02(a) or otherwise, the sum
of (i) the aggregate outstanding principal amount of Revolving Loans of all
Non-Defaulting Lenders plus (ii) the aggregate outstanding principal amount of
Swingline Loans plus (iii) the Letter of Credit Outstandings, exceed the
Adjusted Total Commitment; (B) the changes to the Adjusted Percentage that would
have become effective upon the occurrence of a Lender Default but that did not
become effective as a result of the preceding clause (A) shall become effective
on the first date after the occurrence of the relevant Lender Default on which
the sum of (i) the aggregate outstanding principal amount of the Revolving Loans
of all Non-Defaulting Lenders plus (ii) the aggregate outstanding principal
amount of the Swingline Loans plus (iii) the Letter of Credit Outstandings is
equal to or less than the Adjusted Total Commitment; and (C) if (i) a
Non-Defaulting Lender's Adjusted Percentage is changed pursuant to the preceding
clause (B) and (ii) any repayment of such Lender's Revolving Loans, or of Unpaid
Drawings with respect to Letters of Credit or of Swingline Loans, that were made
during the period commencing after the date of the relevant Lender Default and
ending on the date of such change to its Adjusted Percentage must be returned to
the Borrower as a preferential or similar payment in any bankruptcy or similar
proceeding of the Borrower, then the change to such Non-Defaulting Lender's
Adjusted Percentage effected pursuant to said clause (B) shall be reduced to
that positive change, if any, as would have been made to its Adjusted Percentage
if (x) such repayments had not been made and (y) the maximum change to its
Adjusted Percentage would have resulted in the sum of the outstanding principal
of Revolving Loans made by such Lender plus such Lender's new Adjusted
Percentage of the outstanding principal amount of Swingline Loans and of Letter
of Credit Outstandings equaling such Lender's Commitment at such time.
"Adjusted Total Commitment" shall mean at any time the Total
Commitment less the aggregate Commitments of all Defaulting Lenders.
-67-
74
"Administrative Agent" shall mean Bankers Trust Company, in
its capacity as Administrative Agent for the Lenders hereunder, and shall
include any successor to the Administrative Agent appointed pursuant to Section
12.09.
"Affiliate" shall mean, with respect to any Person, any other
Person directly or indirectly controlling, controlled by, or under direct or
indirect common control with, such Person; provided, however, that for purposes
of Section 9.06, an Affiliate of Holdings shall include any Person that directly
or indirectly owns more than 5% of any class of the capital stock of Holdings
and any officer or director of Holdings or the Borrower. A Person shall be
deemed to control another Person if such Person possesses, directly or
indirectly, the power to direct or cause the direction of the management and
policies of such other Person, whether through the ownership of voting
securities, by contract or otherwise.
"Agreement" shall mean this Credit Agreement, as modified,
supplemented or amended from time to time.
"Alternate Currency" shall mean such foreign currencies which
are readily convertible into Dollars and are acceptable to BTCo.
"Anticipated Reinvestment Amount" shall mean, with respect to
any Reinvestment Election, the amount specified in the Reinvestment Notice
delivered by the Borrower in connection therewith as the amount of the Net Sale
Proceeds from the related Asset Sale that the Borrower or its Subsidiaries
intend to use to purchase, construct or otherwise acquire Reinvestment Assets.
"Applicable Base Rate Margin" shall mean (i) for the period
from the Effective Date through but not including the first Start Date after the
Effective Date, 1.50% and (ii) from and after any Start Date to and including
the corresponding End Date, the respective percentage per annum set forth in
clause (A), (B), (C), (D), (E) or (F) below if, but only if, as of the Test Date
for such Start Date the applicable condition set forth in clause (A), (B), (C),
(D), (E) or (F) below, as the case may be, is met:
(A) 1.50% if, but only if, as of the Test Date of such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
greater than 5.50:1.00;
(B) 1.25% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 5.50:1.00 and greater than 5.00:1.00;
(C) 1.00% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 5.00:1.00 and greater than 4.50:1.00;
(D) 0.75% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 4.50:1.00 and greater than 4.00:1.00;
-68-
75
(E) 0.50% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 4.00:1.00 and greater than 3.50:1.00; and
(F) 0.25% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 3.00:1.00.
Notwithstanding anything to the contrary above in this definition, the
Applicable Base Rate Margin shall be 1.50% at all times when a Default or an
Event of Default shall exist.
"Applicable Eurodollar Rate Margin" shall mean (i) for the
period from the Effective Date through but not including the first Start Date
after the Effective Date, 2.50%, and (ii) from and after any Start Date to and
including the corresponding End Date, the respective percentage per annum set
forth in clause (A), (B), (C), (D), (E) or (F) below if, but only if, as of the
Test Date for such Start Date the applicable condition set forth in clause (A),
(B), (C), (D), (E) or (F) below, as the case may be, is met:
(A) 2.50% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
greater than 5.50:1.00;
(B) 2.25% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 5.50:1.00 and greater than 5.00:1.00;
(C) 2.00% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 5.00:1.00 and greater than 4.50:1.00;
(D) 1.75% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 4.50:1.00 and greater than 4.00:1.00;
(E) 1.50% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 4.00:1.00 and greater than 3.50:1.00; and
(F) 1.25% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test Date shall be
less than or equal to 3.00:1.00.
Notwithstanding anything to the contrary above in this definition, the
Applicable Eurodollar Rate Margin shall be 2.50% at all times when a Default or
an Event of Default shall exist.
"Applicable Margin Period" shall mean each period which shall
commence on a date on which the financial statements are delivered pursuant to
Section 8.01(b) or (c), as the case may be, and which shall end on the earlier
of (i) the date of the actual delivery of the next financial statements pursuant
to Section 8.01(b) or (c), as the case may be, and (ii) the latest date on which
the next financial statements are required to be delivered pursuant to Section
8.01(b) or (c), as the
-69-
76
case may be, provided that the first Applicable Margin Period shall commence
with the delivery of Holdings' financial statements for the Test Period ending
on [June 30, 2000].
"Asset Sale" shall mean any sale, transfer or other
disposition by Holdings or any of its Subsidiaries to any Person (including
by-way-of redemption by such Person) other than to Holdings or a Wholly-Owned
Subsidiary of Holdings of any asset (including, without limitation, any capital
stock or other securities of, or equity interests in, another Person) other than
(i) sales of assets pursuant to Sections 9.02(ii), (iii), (v), (vii) and
(xii)(A) and (ii) sales of assets which individually, or together with related
sales, do not exceed $500,000 per sale.
"Asset Swap" shall have the meaning provided in Section
9.02(xiii).
"Assignment and Assumption Agreement" shall mean the
Assignment and Assumption Agreement substantially in the form of Exhibit K
(appropriately completed).
"Attributable Indebtedness" shall mean, at any time, with
respect to Operating Lease Obligations (including the Synthetic Lease or any
similar lease), 85% of the aggregate Operating Lease Obligations (other than the
portion thereof attributable to interest) under the operating lease for such
Operating Lease Obligations.
"Bankruptcy Code" shall have the meaning provided in Section
10.05.
"Base Rate" at any time shall mean the highest of (i) 1/2 of
1% in excess of the Adjusted Certificate of Deposit Rate, (ii) the Prime Lending
Rate and (iii) 1/2 of 1% in excess of the Federal Funds Rate.
"Base Rate Loan" shall mean (i) each Swingline Loan and (ii)
any other Loan designated or deemed designated as such by the Borrower at the
time of the incurrence thereof or conversion thereto.
"Borrower" shall have the meaning provided in the first
paragraph of this Agreement.
"Borrower Senior Discount Note Indenture" shall mean the
Indenture, dated as of February 20, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Trust Company of New York, as trustee.
"Borrower Senior Discount Note Purchase Agreement" shall mean
the Purchase Agreement, dated February 20, 1998, among the Borrower and the
initial purchasers of Borrower Senior Discount Notes.
"Borrower Senior Discount Notes" shall mean the Borrower's 9
7/8% Senior Discount Notes due 2008, which will be issued pursuant to the
Borrower Senior Discount Note Indenture.
"Borrower Senior Discount Notes Consent Solicitation" shall
have the meaning provided in Section 5.06(b).
-70-
77
"Borrower Senior Note Documents" shall mean (i) the Borrower
Senior Discount Notes, (ii) the Borrower Senior Discount Note Indenture, (iii)
the Borrower Senior Discount Note Purchase Agreement and (iv) all other
agreements, documents and instruments effectuating the foregoing and all
amendments and exhibits to any of the foregoing.
"Borrowing" shall mean the borrowing of one Type of Loan from
all the Lenders (or from BTCo in the case of Swingline Loans) on a given date
(or resulting from a conversion or conversions on such date) having in the case
of Eurodollar Loans the same Interest Period, provided that Base Rate Loans
incurred pursuant to Section 1.10(b) shall be considered part of the related
Borrowing of Eurodollar Loans.
"BTCo" shall mean Bankers Trust Company or any successor
thereto by merger or otherwise; provided that for purposes of issuing Letters of
Credit hereunder, BTCo also shall include its affiliates, including but not
limited to Deutsche Bank AG, New York Branch.
"Business Day" shall mean (i) for all purposes other than as
covered by clause (ii) below, any day except Saturday, Sunday and any day which
shall be in New York City a legal holiday or a day on which banking institutions
are authorized or required by law or other government action to close and (ii)
with respect to all notices and determinations in connection with, and payments
of principal and interest on, Eurodollar Loans, any day which is a Business Day
described in clause (i) above and which is also a day for trading by and between
banks in the New York interbank Eurodollar market.
"Capital Expenditures" shall mean, [for any period, (i)
expenditures (including, without limitation, the aggregate amount of Capital
Lease Obligations incurred during such period) made by the Borrower and its
Subsidiaries to acquire or construct fixed assets, plant and equipment
(including renewals, improvements, replacements and capitalized lease repairs)
during such period which would be reflected as additions to property, plant or
equipment on a consolidated balance sheet of the Borrower and its Subsidiaries
prepared in accordance with GAAP and (ii) acquisitions of equity interests
otherwise permitted by this Agreement.]
"Capitalized Lease Obligations" of any Person shall mean all
rental obligations which, under generally accepted accounting principles, are or
will be required to be capitalized on the books of such Person, in each case
taken at the amount thereof accounted for as indebtedness in accordance with
such principles.
"Cash Equivalents" shall mean, as to any Person, (i)
securities issued or directly and fully guaranteed or insured by the United
States or any agency or instrumentality thereof (provided that the full faith
and credit of the United States is pledged in support thereof) having maturities
of not more than six months from the date of acquisition, (ii) time deposits and
certificates of deposit of any commercial bank having, or which is the principal
banking subsidiary of a bank holding company having, a long-term unsecured debt
rating of at least "A" or the equivalent thereof from Standard & Poor's Ratings
Services, a division of McGraw Hill, Inc. Corporation or "A2" or the equivalent
thereof from ▇▇▇▇▇'▇ Investors Service, Inc. with maturities of not more than
six months from the date of acquisition by such Person, (iii) repurchase
obligations with a term of not more than seven days for underlying securities of
the types
-71-
78
described in clause (i) above entered into with any bank meeting the
qualifications specified in clause (ii) above, (iv) commercial paper issued by
any Person incorporated in the United States rated at least A-1 or the
equivalent thereof by Standard & Poor's Ratings Services, a division of McGraw
Hill, Inc. or at least P-1 or the equivalent thereof by ▇▇▇▇▇'▇ Investors
Service, Inc. and in each case maturing not more than six months after the date
of acquisition by such Person, (v) Eurodollar certificates of deposit maturing
within six months after the date of acquisition thereof issued by any commercial
bank organized under the laws of the United States of America or any State
thereof or the District of Columbia or by any foreign bank, which is a Lender,
or United States branches of foreign banks, and in any case having a combined
capital and surplus of not less than $100,000,000, (vi) investments in money
market funds substantially all of whose assets are comprised of securities of
the types described in clauses (i) through (v) above and (vii) investments made
by Foreign Subsidiaries in local currencies in instruments issued by or with
entities of such jurisdiction having correlative attributes to the foregoing.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as the same may be amended from time to
time, 42 U.S.C. Section 9601 et seq.
"Change of Control" means (a)(i) the consummation of any
transaction (including, without limitation, any merger or consolidation) the
result of which is that any "person" (as such term is defined in Section
13(d)(3) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")
or group or related persons, together with Affiliates thereof (other than the
Permitted Investors), becomes the "beneficial owner" (as such term is defined in
Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or indirectly, of
more than 40% of the Voting Stock of Holdings (as determined on a fully diluted
basis and measured by voting power rather than number of shares), or (ii) the
Board of Directors of Holdings shall not consist of a majority of Continuing
Directors, or (b) the Borrower shall cease to be a direct Wholly-Owned
Subsidiary of Holdings or (c) a "Change of Control" or similar event shall occur
under the Borrower Senior Note Documents.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time and the regulations promulgated and the rulings issued
thereunder. Section references to the Code are to the Code, as in effect at the
date of this Agreement, and to any subsequent provision of the Code, amendatory
thereof, supplemental thereto or substituted therefor.
"Collateral" shall mean all property (whether real or
personal) with respect to which any security interests have been granted (or
purport to be granted) pursuant to any Security Document, including, without
limitation, all Security Agreement Collateral, and all cash and Cash Equivalents
delivered as collateral pursuant to Section 4.02 or 10 hereof.
"Collateral Agent" shall mean the Administrative Agent acting
as collateral agent for the Secured Creditors pursuant to the Security
Documents.
"Collective Bargaining Agreements" shall have the meaning
provided in Section 5.05.
-72-
79
"Commitment" shall mean, for each Lender, the amount set forth
opposite such Lender's name in Schedule I hereto directly below the column
entitled "Commitment," as same may be (x) reduced from time to time pursuant to
Sections 3.02, 3.03, 4.02 and/or 10 or (y) adjusted from time to time as a
result of assignments to or from such Lender pursuant to Section 1.13 or
13.04(b).
"Commitment Commission" shall have the meaning provided in
Section 3.01(a).
"Consolidated Current Assets" shall mean, at any time, the
consolidated current assets of Holdings and its Consolidated Subsidiaries.
"Consolidated Current Liabilities" shall mean, at any time,
the consolidated current liabilities of Holdings and its Consolidated
Subsidiaries at such time, but excluding the current portion of and accrued but
unpaid interest on any Indebtedness under this Agreement and any other long-term
Indebtedness which would otherwise be included therein.
"Consolidated Debt" shall mean, at any time, the sum of the
aggregate outstanding principal amount of all Indebtedness for borrowed money,
the amount of any unreimbursed drawings under any letter of credit (which have
been unreimbursed for three or more days), the principal component of
Capitalized Lease Obligations of Holdings and its Consolidated Subsidiaries and
the Attributable Indebtedness for Operating Lease Obligations of Holdings and
its Consolidated Subsidiaries.
"Consolidated EBIT" shall mean, for any period, the
Consolidated Net Income of Holdings and its Consolidated Subsidiaries, before
Consolidated Net Interest Expense and provision for taxes and without giving
effect to any extraordinary gains or losses or gains or losses from sales of
assets other than inventory sold in the ordinary course of business.
"Consolidated EBITDAR" shall mean, for any period,
Consolidated EBIT, adjusted by adding thereto the amount of all amortization of
intangibles, depreciation and rental expense that were deducted in arriving at
Consolidated EBIT for such period.
"Consolidated Net Income" shall mean, for any period, net
after tax income of Holdings and its Consolidated Subsidiaries[, provided that
in determining Consolidated Net Income, the net income of any other Person which
is not a Subsidiary of the Borrower or is accounted for by the Borrower by the
equity method of accounting shall be included only to the extent of the payment
of cash dividends or distributions by such other Person to the Borrower or a
Subsidiary thereof during such period].
"Consolidated Net Interest Expense" shall mean, for any
period, the total consolidated interest expense of Holdings and its Consolidated
Subsidiaries for such period (calculated without regard to any limitations on
the payment thereof) plus, without duplication, that portion of Capitalized
Lease Obligations of Holdings and its Consolidated Subsidiaries representing the
interest factor for such period, and any rental expense associated with any
Operating Lease Obligations for such period, in each case net of the total
consolidated cash interest income of Holdings and its Consolidated Subsidiaries
for such period.
-73-
80
"Consolidated Subsidiaries" shall mean, as to any Person, all
Subsidiaries of such Person which are consolidated with such Person for
financial reporting purposes in accordance with generally accepted accounting
principles in the United States.
"Contingent Obligation" shall mean, as to any Person, any
obligation of such Person guaranteeing or intended to guarantee any
Indebtedness, leases, dividends or other obligations ("primary obligations") of
any other Person (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, any obligation of such Person,
whether or not contingent, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (ii) to advance or
supply funds (x) for the purchase or payment of any such primary obligation or
(y) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (iv) otherwise to assure or hold
harmless the holder of such primary obligation against loss in respect thereof;
provided, however, that the term Contingent Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business. The amount of any Contingent Obligation shall be deemed to be an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Contingent Obligation is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder) as determined by such
Person in good faith.
"Continuing Directors" shall mean the directors of Holdings as
of the Effective Date (after giving effect to the Holdings IPO) and each other
director if such other director's nomination or election to the Board of
Directors of Holdings is recommended by a majority of the then Continuing
Directors.
"Credit Documents" shall mean this Agreement and, after the
execution and delivery thereof pursuant to the terms of this Agreement, each
Note and each Security Document and the Subsidiaries Guaranty.
"Credit Event" shall mean the making of any Loan or the
issuance of any Letter of Credit.
"Credit Party" shall mean Holdings, the Borrower and each
Subsidiary Guarantor.
"Debt Agreements" shall have the meaning provided in Section
5.05.
"Default" shall mean any event, act or condition which with
notice or lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" shall mean any Lender with respect to
which a Lender Default is in effect.
"Dividend" with respect to any Person shall mean that such
Person has declared or paid a dividend or returned any equity capital to its
stockholders or authorized or made any other distribution, payment or delivery
of property (other than common stock of such Person) or cash
-74-
81
to its stockholders as such, or redeemed, retired, purchased or otherwise
acquired, directly or indirectly, for a consideration any shares of any class of
its capital stock outstanding on or after the Effective Date (or any options or
warrants issued by such Person with respect to its capital stock), or set aside
any funds for any of the foregoing purposes, or shall have permitted any of its
Subsidiaries to purchase or otherwise acquire for a consideration any shares of
any class of the capital stock of such Person outstanding on or after the
Effective Date (or any options or warrants issued by such Person with respect to
its capital stock). Without limiting the foregoing, "Dividends" with respect to
any Person shall also include all payments made or required to be made by such
Person with respect to any stock appreciation rights, plans, equity incentive or
achievement plans or any similar plans or setting aside of any funds for the
foregoing purposes.
"Documents" shall mean the Credit Documents, the Repurchase
Documents, the Refinancing Documents and Synthetic Lease Financing Documents.
"Dollar Equivalent" shall mean, at any time of determination
thereof, the amount of the currency involved which could be purchased with
Dollars computed at the spot rate of exchange as quoted or utilized by the
Administrative Agent on the date of determination thereof.
"Dollars" and the sign "$" shall each mean freely transferable
lawful money of the United States.
"Domestic Joint Venture" shall have the meaning provided in
Section 9.05(viii).
"Domestic Subsidiary" shall mean each Subsidiary of the
Borrower which is not a Foreign Subsidiary.
"Drawing" shall have the meaning provided in Section 2.05(b).
"Effective Date" shall have the meaning provided in Section
13.10.
"Eligible Transferee" shall mean and include a commercial
bank, financial institution or other "accredited investor" (as defined in
Regulation D of the Securities Act) other than any such Person that is directly
involved in a Permitted Business.
"Employee Benefit Plans" shall have the meaning provided in
Section 5.05.
"Employment Agreements" shall have the meaning provided in
Section 5.05.
"End Date" shall mean, for any Applicable Margin Period, the
last day of such Applicable Margin Period.
"Environmental Claims" means any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, directives,
claims, liens, notices of noncompliance or violation, investigations or
proceedings relating in any way to any Environmental Law or any permit issued,
or any approval given, under any such Environmental Law (hereafter, "Claims"),
including, without limitation, (a) any and all Claims by governmental or
regulatory authorities for enforcement, cleanup, removal, response, remedial or
other actions or damages pursuant to any
-75-
82
applicable Environmental Law, and (b) any and all Claims by any third party
seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief in connection with alleged injury or threat of injury to
health, safety or the environment due to the presence of Hazardous Materials.
"Environmental Law" shall mean any Federal, state, foreign or
local statute, law, rule, regulation, ordinance, code, guideline, written policy
and rule of common law now or hereafter in effect and in each case as amended,
and any judicial or administrative interpretation thereof, including any
judicial or administrative order, consent decree or judgment, relating to the
environment, employee health and safety or Hazardous Materials, including,
without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33
U.S.C. Section 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. Section
2601 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et seq.; the Safe
Drinking Water Act, 42 U.S.C. Section 3803 et seq.; the Oil Pollution Act of
1990, 33 U.S.C. Section 2701 et seq.; the Emergency Planning and the Community
Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et seq.; the Hazardous
Material Transportation Act, 49 U.S.C. Section 1801 et seq.; the Occupational
Safety and Health Act, 29 U.S.C. Section 651 et seq.; and any state and local or
foreign counterparts or equivalents, in each case as amended from time to time.
"Equipment Financing Transactions" shall mean any Capitalized
Lease, Operating Lease, Purchase Money Indebtedness, and any sale-leaseback or
other transactions consummated in connection therewith creating Capitalized
Lease Obligations, Operating Lease Obligations or Purchase Money Indebtedness.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder. Section references to ERISA are to ERISA, as in
effect at the date of this Agreement and any subsequent provisions of ERISA,
amendatory thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in
Section 3(9) of ERISA) which together with Holdings or any Subsidiary of
Holdings would be deemed to be a "single employer" within the meaning of Section
414(b), (c), (m) or (o) of the Code.
"Eurodollar Loan" shall mean each Loan (excluding Swingline
Loans) designated as such by the Borrower at the time of the incurrence thereof
or conversion thereto.
"Eurodollar Rate" shall mean (a) the offered quotation to
first-class banks in the New York interbank Eurodollar market by BTCo for Dollar
deposits of amounts in immediately available funds comparable to the outstanding
principal amount of the Eurodollar Loan of BTCo with maturities comparable to
the Interest Period applicable to such Eurodollar Loan commencing two Business
Days thereafter as of 10:00 A.M. (New York time) on the date which is two
Business Days prior to the commencement of such Interest Period, divided (and
rounded off to the nearest 1/16 of 1%) by (b) a percentage equal to 100% minus
the then stated maximum rate of all reserve requirements (including, without
limitation, any marginal, emergency, supplemental, special or other reserves
required by applicable law) applicable to any member bank of the Federal
-76-
83
Reserve System in respect of Eurocurrency funding or liabilities as defined in
Regulation D (or any successor category of liabilities under Regulation D).
"Event of Default" shall have the meaning provided in Section
10.
"Existing Credit Agreement" shall mean the Credit Agreement,
dated as of February 20, 1998, among Holdings, the Borrower, the lending
institutions party thereto, and BTCo, as Agent (as in effect on the Effective
Date).
"Existing Indebtedness" shall have the meaning provided in
Section 7.22.
"Existing Letter of Credit" shall have the meaning provided in
Section 2.01(d).
"Facing Fee" shall have the meaning provided in Section
3.01(c).
"Federal Funds Rate" shall mean for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal Funds
brokers of recognized standing selected by the Administrative Agent.
"Fees" shall mean all amounts payable pursuant to or referred
to in Section 3.01.
"Foreign Joint Venture" shall mean any Joint Venture that
involves a corporation, association, partnership, business trust or other
business entity that is incorporated under the laws of any jurisdiction other
than the United States of America, any State thereof, any territory thereof or
Canada.
"Foreign Pension Plan" shall mean any plan, fund (including,
without limitation, any superannuation fund) or other similar program
established or maintained outside the United States of America by Holdings or
any one or more of its Subsidiaries primarily for the benefit of employees of
Holdings or such Subsidiaries residing outside the United States of America,
which plan, fund or other similar program provides, or results in, retirement
income, a deferral of income in contemplation of retirement or payments to be
made upon termination of employment, and which plan is not subject to ERISA or
the Code.
"Foreign Subsidiary" shall mean each Subsidiary of the
Borrower that is incorporated under the laws of any jurisdiction other than the
United States of America, any State thereof, or any territory thereof.
"Foreign Subsidiary Indebtedness" shall have the meaning
provided in Section 9.04(xiii).
-77-
84
"Guaranteed Obligations" shall mean (i) the full and prompt
payment when due (whether at the stated maturity, by acceleration or otherwise)
of the principal and interest on each Note issued by, and Loans made to, the
Borrower under this Agreement and all reimbursement obligations and Unpaid
Drawings with respect to Letters of Credit, together with all the other
obligations (including obligations which, but for the automatic stay under
Section 362(a) of the Bankruptcy Code, would become due) and liabilities
(including, without limitation, indemnities, fees and interest thereon) of the
Borrower to the Lenders, the Administrative Agent, the Issuing Lender and the
Collateral Agent now existing or hereafter incurred under, arising out of or in
connection with this Agreement or any other Credit Document and (ii) the full
and prompt payment when due (whether at the stated maturity, by acceleration or
otherwise) of all obligations (including obligations which, but for the
automatic stay under Section 362(a) of the Bankruptcy Code, would become due) of
the Borrower owing under any Interest Rate Protection Agreement or Other Hedging
Agreement entered into by the Borrower with any Lender or any affiliate thereof
(even if such Lender subsequently ceases to be a Lender under this Agreement for
any reason) so long as such Lender or affiliate participates in such Interest
Rate Protection Agreement or Other Hedging Agreement, and their subsequent
assigns, if any, whether now in existence or hereafter arising, and the due
performance and compliance with all terms, conditions and agreements contained
therein.
"Guarantor" shall mean Holdings and each Subsidiary Guarantor.
"Guaranty" shall mean and include the Holdings Guaranty and
the Subsidiaries Guaranty.
"Hazardous Materials" shall mean (a) any petroleum or
petroleum products, radioactive materials, asbestos in any form that is or could
become friable, urea formaldehyde foam insulation, transformers or other
equipment that contain dielectric fluid containing levels of polychlorinated
biphenyls, and radon gas; (b) any chemicals, materials or substances defined as
or included in the definition of "hazardous substances," "hazardous waste,"
"hazardous materials," "extremely hazardous substances," "restricted hazardous
waste," "toxic substances," "toxic pollutants," "contaminants," or "pollutants,"
or words of similar import, under any applicable Environmental Law; and (c) any
other chemical, material or substance, the Release of which is prohibited,
limited or regulated by any governmental authority.
"Holdings" shall have the meaning provided in the first
paragraph of this Agreement.
"Holdings Guaranty" shall mean the guaranty of Holdings
pursuant to Section 14.
"Holdings IPO" shall mean the Qualified Public Equity Offering
described in Section 5.17(a).
"Holdings Senior Discount Note Indenture" shall mean the
Indenture, dated as of February 20, 1998 between the Borrower and United States
Trust of New York, as trustee.
-78-
85
"Holdings Senior Discount Note Purchase Agreement" shall mean
the Purchase Agreement, dated February 20, 1998, among the Borrower and the
initial purchasers of Holdings Senior Discount Notes.
"Holdings Senior Discount Notes" shall mean Holdings 11 3/8%
Senior Discount Notes due 2009, which will be issued pursuant to the Holdings
Senior Discount Note Indenture.
"Holdings Senior Note Documents" shall mean (i) the Holdings
Senior Discount Notes, (ii) the Holdings Senior Discount Note Indenture, (iii)
the Holdings Senior Discount Note Purchase Agreement and (iv) all other
agreements, documents and instruments effectuating the foregoing and all
amendments and exhibits to any of the foregoing.
"Indebtedness" shall mean, as to any Person, without
duplication, (i) all indebtedness (including principal, interest, fees and
charges) of such Person for borrowed money or for the deferred purchase price of
property or services, (ii) the maximum amount available to be drawn under all
letters of credit issued for the account of such Person and all unpaid drawings
in respect of such letters of credit, (iii) all Indebtedness of the types
described in clause (i), (ii), (iv), (v), (vi) or (vii) of this definition
secured by any Lien on any property owned by such Person, whether or not such
Indebtedness has been assumed by such Person (provided, that, if the Person has
not assumed or otherwise become liable in respect of such Indebtedness, such
Indebtedness shall be deemed to be in an amount equal to the lesser of the fair
market value of the property to which such Lien relates as determined in good
faith by such Person and the stated amount of such Indebtedness), (iv)
Capitalized Lease Obligations, (v) all obligations of such person to pay a
specified purchase price for goods or services, whether or not delivered or
accepted, i.e., take-or-pay and similar obligations, (vi) all Contingent
Obligations of such Person and (vii) all obligations under any Interest Rate
Protection Agreement or Other Hedging Agreement or under any similar type of
agreement. Notwithstanding the foregoing, Indebtedness shall not include trade
payables and accrued expenses incurred by any Person in accordance with
customary practices and in the ordinary course of business of such Person.
"Indebtedness to be Refinanced" shall mean all indebtedness
set forth in Schedule VII.
"Insignificant Foreign Subsidiary" shall mean any Foreign
Subsidiary whose assets represent less than 10% of the total value of all assets
owned by the Borrower and its Subsidiaries.
"Intercompany Loan" shall have the meaning provided in Section
9.05(xi).
"Intercompany Note" shall mean a promissory note, in the form
of Exhibit L, evidencing Intercompany Loans.
"Interest Determination Date" shall mean, with respect to any
Eurodollar Loan, the second Business Day prior to the commencement of any
Interest Period relating to such Eurodollar Loan.
"Interest Period" shall have the meaning provided in Section
1.09.
-79-
86
"Interest Rate Protection Agreement" shall mean any interest
rate swap agreement, interest rate cap agreement, interest collar agreement,
interest rate hedging agreement or other similar agreement or arrangement.
"L/C Supportable Obligations" shall mean (i) obligations of
the Borrower or its Subsidiaries incurred in the ordinary course of business
with respect to workers compensation, surety bonds and other similar statutory
obligations and (ii) such other obligations of the Borrower or any of its
Subsidiaries as are reasonably acceptable to BTCo and otherwise permitted to
exist pursuant to the terms of this Agreement.
"Leaseholds" of any Person means all the right, title and
interest of such Person as lessee or licensee in, to and under leases or
licenses of land, improvements and/or fixtures.
"Lender" shall mean each financial institution listed on
Schedule I, as well as any Person which becomes a "Lender" hereunder pursuant to
Section 1.13 or 13.04(b).
"Lender Default" shall mean (i) the refusal (which has not
been retracted) of a Lender to make available its portion of any Borrowing
(including any Mandatory Borrowing) or to fund its portion of any unreimbursed
payment under Section 2.04(c) or (ii) a Lender having notified in writing the
Borrower and/or the Administrative Agent that it does not intend to comply with
its obligations under Section 1.01(a) or 1.01(c) or Section 2.
"Letter of Credit" shall have the meaning provided in Section
2.01(a).
"Letter of Credit Fee" shall have the meaning provided in
Section 3.01(b).
"Letter of Credit Outstandings" shall mean, at any time, the
sum of (i) the aggregate Stated Amount of all outstanding Letters of Credit and
(ii) the amount of all Unpaid Drawings.
"Letter of Credit Request" shall have the meaning provided in
Section 2.03(a).
"Leverage Ratio" shall mean, at any time, the ratio of (i)
Consolidated Debt at such time to (ii) Consolidated EBITDAR for the Test Period
then most recently ended.
"Lien" shall mean any mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or other),
preference, priority or other security agreement of any kind or nature
whatsoever (including, without limitation, any conditional sale or other title
retention agreement, any financing or similar statement or notice filed under
the UCC or any other similar recording or notice statute, and any lease having
substantially the same effect as any of the foregoing).
"Loan" shall mean each Revolving Loan and each Swingline Loan.
"Management Agreements" shall have the meaning provided in
Section 5.05.
"Mandatory Borrowing" shall have the meaning provided in
Section 1.01(c).
-80-
87
"Margin Stock" shall have the meaning provided in Regulation
U.
"Maturity Date" shall mean May __, 2005.
"Maximum Swingline Amount" shall mean $10,000,000.
"Net Sale Proceeds" shall mean for any sale of assets, the
gross cash proceeds (including any cash received by way of deferred payment
pursuant to a promissory note, receivable or otherwise, but only as and when
received) received from such sale of assets, net of the reasonable costs of such
sale (including payments of unassumed liabilities relating to the assets sold
and required payments of any Indebtedness (other than Indebtedness secured
pursuant to the Security Documents) which is secured by the respective assets
which were sold), and the taxes paid or payable by Holdings' consolidated group
as a result of such sale and appropriate amounts to be provided by Holdings or
any of its Subsidiaries, as the case may be, as a reserve, in accordance with
GAAP, against any liabilities associated with such Asset Sale and retained by
Holdings or any of its Subsidiaries, after such Asset Sale, including without
limitation, pension and other post-employment benefit liabilities, liabilities
related to environmental matters and liabilities under any indemnification
obligations with such Asset Sale (it being understood, however, that, to the
extent such reserves are released or reduced, an amount equal to such release or
reduction shall be required to be applied as a mandatory repayment or mandatory
commitment reduction in accordance with Sections 3.03 and 4.02).
"Non-Defaulting Lender" shall mean and include each Lender
other than a Defaulting Lender.
"Note" shall mean each Revolving Note and the Swingline Note.
"Notice of Borrowing" shall have the meaning provided in
Section 1.03.
"Notice of Conversion" shall have the meaning provided in
Section 1.06.
"Notice Office" shall mean the office of the Administrative
Agent located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, or such other office as the Administrative Agent may hereafter
designate in writing as such to the other parties hereto.
"Obligations" shall mean all amounts owing to the
Administrative Agent, the Collateral Agent or any Lender pursuant to the terms
of this Agreement or any other Credit Document.
"Operating Lease" shall mean, as to any Person, all leases of
inventory, equipment and Real Property which are not Capitalized Leases.
"Operating Lease Obligations" shall mean, as to any Person,
all obligations as lessee under Operating Leases (other than Capital Leases).
-81-
88
"Other Hedging Agreement" shall mean any foreign exchange
contract, currency swap agreement or other similar agreement or arrangement
designed to protect against the fluctuations in currency values.
"Participant" shall have the meaning provided in Section
2.04(a).
"Payment Office" shall mean the office of the Administrative
Agent located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or such
other office as the Administrative Agent may hereafter designate in writing as
such to the other parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor thereto.
"Percentage" of any Lender at any time shall mean 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 Total Commitment at such
time, provided that if the Percentage of any Lender is to be determined after
the Total Commitment has been terminated, then the Percentages of the Lenders
shall be determined immediately prior (and without giving effect) to such
termination.
"Permitted Business" shall mean the business in which the
Borrower is engaged on the Effective Date and reasonable extensions thereof.
"Permitted Encumbrance" shall mean, with respect to any
Mortgaged Property, such exceptions to title as are set forth in the title
insurance policy or title commitment delivered with respect thereto, all of
which exceptions must be acceptable to the Administrative Agent in its
reasonable discretion.
"Permitted Investors" shall mean (x) ▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners
III L.P., ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc. and employees, management and directors of, and
persons owning accounts managed by, any of the foregoing and their respective
Affiliates (including, without limitation, Holdings and the Borrower) and (y)
other investors reasonably satisfactory to the Administrative Agent and the
Required Lenders.
"Permitted Liens" shall have the meaning provided in Section
9.01.
"Permitted Section 9.02(viii) Acquisition" shall have the
meaning provided in Section 9.02(viii).
"Person" shall mean any individual, partnership, joint
venture, firm, corporation, association, trust or other enterprise or any
government or political subdivision or any agency, department or instrumentality
thereof.
"Plan" shall mean any pension plan as defined in Section 3(2)
of ERISA, which is maintained or contributed to by (or to which there is an
obligation to contribute of) Holdings or a Subsidiary of Holdings or an ERISA
Affiliate, and each such plan for the five year period immediately
-82-
89
following the latest date on which Holdings, or a Subsidiary of Holdings or an
ERISA Affiliate maintained, contributed to or had an obligation to contribute to
such plan.
"Pledge Agreement" shall have the meaning provided in Section
5.08.
"Pledge Agreement Collateral" shall mean all "Collateral" as
defined in the Pledge Agreement.
"Pledged Securities" shall mean all "Pledged Securities" as
defined in the Pledge Agreement.
"Prime Lending Rate" shall mean the rate which BTCo announces
from time to time as its prime lending rate, the Prime Lending Rate to change
when and as such prime lending rate changes. The Prime Lending Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. BTCo may make commercial loans or other loans
at rates of interest at, above or below the Prime Lending Rate.
"Projections" shall mean the projections prepared by the
Borrower in connection with the Holdings IPO, the Repurchase and the Synthetic
Lease Financing, dated as of ___ _, 2000 and furnished to the Lenders prior to
the Effective Date.
"Purchase Money Indebtedness" shall mean Indebtedness, the
proceeds of which are used to finance the acquisition, construction or
improvement of inventory, equipment or other property in the ordinary course of
business.
"Qualified Preferred Stock" shall mean the preferred stock of
Holdings so long as the terms of any such preferred stock (i) do not contain any
mandatory put, redemption, repayment, sinking fund or other similar provision
occurring before February __, 2006 other than any such provision which is
comparable to a provision in the preferred stock of Holdings outstanding prior
to the Effective Date, (ii) do not require the cash payment of dividends before
February __, 2006, (iii) do not contain any covenants other than those covenants
of the type (but no more restrictive than those) set forth in the preferred
stock of Holdings outstanding prior to the Effective Date and (iv) are otherwise
reasonably satisfactory to the Administrative Agent.
"Qualified Public Equity Offering" means a bona fide
underwritten sale to the public of common stock of Holdings pursuant to a
registration statement filed with the SEC in accordance with the Securities Act.
"Quarterly Payment Date" shall mean the last Business Day of
each March, June, September and December occurring after the Effective Date.
"RCRA" shall mean the Resource Conservation and Recovery Act,
as the same may be amended from time to time, 42 U.S.C. Section 6901 et seq.
"Real Property" of any Person shall mean all the right, title
and interest of such Person in and to land, improvements and fixtures, including
Leaseholds.
-83-
90
"Refinancing Documents" shall mean all agreements and
documents related to the Refinancing.
"Refinancings" shall mean the repayment in full by the
Borrower of the Indebtedness to be Refinanced.
"Regulations D, T, U and X" shall mean Regulations D, T, U and
X of the Board of Governors of the Federal Reserve System as from time to time
in effect and any successors to all or a portion thereof.
"Reinvestment Asset" shall have the meaning provided in
Section 4.02(b).
"Reinvestment Election" shall have the meaning provided in
Section 4.02(b).
"Reinvestment Notice" shall mean a written notice signed by
the President or any Vice President of the Borrower stating that the Borrower or
its respective Subsidiary, in good faith, intends and expects to use all or a
specified portion of the Net Sale Proceeds of an Asset Sale to purchase,
construct or otherwise acquire Reinvestment Assets.
"Release" means disposing, discharging, injecting, spilling,
pumping, leaking, leaching, dumping, emitting, escaping, emptying, pouring or
migrating, into or upon any land or water or air, or otherwise entering into the
environment.
"Replaced Lender" shall have the meaning provided in Section
1.13.
"Replacement Lender" shall have the meaning provided in
Section 1.13.
"Reportable Event" shall mean an event described in Section
4043(c) of ERISA with respect to a Plan that is subject to Title IV of ERISA
other than those events as to which the 30-day notice period is waived under
PBGC Regulation Section 4043.
"Repurchase" shall have the meaning provided in Section
5.17(a).
"Repurchase Documents" shall mean and include all agreements
governing, or relating to, the Repurchase and the Holdings IPO.
"Required Lenders" shall mean Non-Defaulting Lenders, the sum
of whose outstanding Commitments (or after the termination thereof, outstanding
Revolving Loans and Adjusted Percentage of outstanding Swingline Loans and
Letter of Credit Outstandings) represent an amount greater than fifty percent of
the sum of the Adjusted Total Commitment (or after the termination thereof, the
sum of the then total outstanding Revolving Loans of Non-Defaulting Lenders, and
the aggregate Adjusted Percentages of all Non-Defaulting Lenders of the total
outstanding Swingline Loans and Letter of Credit Outstandings at such time).
"Restricted Countries" shall mean _______.
-84-
91
"Returns" shall have the meaning provided in Section 7.09.
"Revolving Loan" shall have the meaning provided in Section
1.01(a)
"Revolving Note" shall have the meaning provided in Section
1.05(a).
"SEC" shall have the meaning provided in Section 8.01(h).
"Section 4.04(b)(ii) Certificate" shall have the meaning
provided in Section 4.04(b).
"Secured Creditors" shall have the meaning assigned that term
in the Security Documents.
"Securities Act" shall mean the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder.
"Securities Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated thereunder.
"Security Agreement" shall have the meaning provided in
Section 5.09.
"Security Agreement Collateral" shall mean all "Collateral" as
defined in the Security Agreement.
"Security Document" shall mean and include each of the
Security Agreement, the Pledge Agreement and, after the execution and delivery
thereof, each Additional Security Document.
"Senior Secured Consolidated Debt" shall mean all Consolidated
Debt (including any Foreign Subsidiary Indebtedness) which is secured by any of
the assets of Holdings and its Subsidiaries and which is not by its terms
contractually subordinated to any other Indebtedness of Holdings and its
Subsidiaries.
"Senior Secured Leverage Ratio" shall mean, at any time, the
ratio of (i) the sum of (without duplication) (x) Senior Secured Consolidated
Debt at such time plus (y) an amount equal to the Attributable Indebtedness in
respect of Operating Lease Obligations at such time to (ii) Consolidated EBITDAR
for the Test Period then most recently ended.
"Shareholders' Agreements" shall have the meaning provided in
Section 5.05.
"Significant Subsidiary" shall mean, as to any Person, all
Subsidiaries of such Person other than its Insignificant Foreign Subsidiaries.
"Standby Letter of Credit" shall have the meaning provided in
Section 2.01(a).
"Start Date" shall mean, with respect to any Applicable Margin
Period, the first day of such Applicable Margin Period.
-85-
92
"Stated Amount" of each Letter of Credit shall, at any time,
mean the maximum amount available to be drawn thereunder (in each case
determined without regard to whether any conditions to drawing could then be
met); provided that the "Stated Amount" of each Letter of Credit denominated in
an Alternate Currency shall be, on any date of calculation, the Dollar
Equivalent of the maximum amount available to be drawn in such Alternate
Currency thereunder (determined without regard to whether any conditions to
drawing could then be met).
"Subsidiaries Guaranty" shall have the meaning provided in
Section 5.10.
"Subsidiary" shall mean, as to any Person, (i) 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 stock of 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 and/or one or
more Subsidiaries of such Person and (ii) any partnership, association, joint
venture or other entity in which such Person and/or one or more Subsidiaries of
such Person has more than a 50% equity interest at the time.
"Subsidiary Guarantor" shall mean each Subsidiary of the
Borrower (other than a Foreign Subsidiary except to the extent otherwise
provided in Section 8.12) that is or becomes a party to the Subsidiary Guaranty.
"Swingline Expiry Date" shall mean, at any time, the date
which is two Business Days prior to the Maturity Date.
"Swingline Loan" shall have the meaning provided in Section
1.01(b).
"Swingline Note" shall have the meaning provided in Section
1.05(a).
"Synthetic Lease Financing" shall mean the lease financing
transaction contemplated by the Synthetic Lease Financing Documents.
"Synthetic Lease Financing Agreement" shall mean the
Participation Agreement, dated as of May __, 2000, among the Borrower, as
lessee, Holdings, as guarantor, [Name of trust company], as trustee, Deutsche
Bank AG, New York Branch, as owner participant, and Bankers Trust Company, as
Administrative Agent.
"Synthetic Lease Financing Documents" shall mean the Synthetic
Lease Financing Agreement, the other Operative Documents (as defined in the
Synthetic Lease Financing Agreement) and all other documents executed and
delivered in connection with the Synthetic Lease Financing, as in effect on the
Effective Date and as same may be amended, modified or supplemented from time to
time in accordance with the terms hereof and thereof.
"Synthetic Lease Guaranty" shall mean the guaranty provided by
Holdings of the obligations and liabilities of the Borrower under the Synthetic
Lease Financing, which guaranty shall be unsecured and otherwise be in form and
substance satisfactory to the Administrative Agent.
-86-
93
"Synthetic Leases" shall mean all lease transactions entered
into by the Borrower pursuant to the Synthetic Lease Financing Agreement and the
other Synthetic Lease Financing Documents.
"Tax Benefit" shall have the meaning provided in Section
4.04(c).
"Taxes" shall have the meaning provided in Section 4.04(a).
"Test Date" shall mean, with respect to any Start Date, the
last day of the most recent fiscal quarter of Holdings ended immediately prior
to such date.
"Test Period" shall mean each period of four consecutive
fiscal quarters of Holdings then last ended (in each case taken as one
accounting period).
"Total Commitment" shall mean, at any time, the sum of the
Commitments of each of the Lenders.
"Total Interest Expense" shall mean, for any period, the total
consolidated interest expense (net of interest income) of Holdings and its
Consolidated Subsidiaries for such period (including, without limitation, the
interest expense associated with Capitalized Lease Obligations), provided that
(x) the amortization or write-off of debt issuance costs, commissions, fees and
expenses and (y) the amortization of original issue discounts (exclusive of any
pay-in-kind interest on the Borrower Senior Discount Notes) shall (in each case)
be excluded from Total Interest Expense to the extent same would otherwise have
been included therein.
"Trade Letter of Credit" shall have the meaning provided in
Section 2.01(a).
"Type" shall mean the type of Loan determined with regard to
the interest option applicable thereto, i.e., whether a Base Rate Loan or a
Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code as from time to
time in effect in the relevant jurisdiction.
"Unfunded Current Liability" of any Plan shall mean the
amount, if any, by which the value of the accumulated plan benefits under the
Plan determined on a plan termination basis in accordance with actuarial
assumptions at such time consistent with those prescribed by the PBGC for
purposes of Section 4044 of ERISA, exceeds the fair market value of all plan
assets allocable to such liabilities under Title IV of ERISA (excluding any
accrued but unpaid contributions).
"United States" and "U.S." shall each mean the United States
of America..
"Unpaid Drawing" shall have the meaning provided for in
Section 2.05(a).
"Unutilized Commitment" with respect to any Lender, at any
time, shall mean such Lender's Commitment at such time less the sum of (i) the
aggregate outstanding principal amount
-87-
94
of Revolving Loans made by such Lender and (ii) such Lender's Adjusted
Percentage of the Letter of Credit Outstandings.
"Voting Stock" of any Person as of any date means the capital
stock of such Person that is at the time entitled to vote in the election of the
Board of Directors of such Person.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i)
any corporation 100% of whose capital stock (other than director's qualifying
shares) is at the time owned by such Person and/or one or more Wholly-Owned
Subsidiaries of such Person and (ii) any partnership, association, joint venture
or other entity in which such Person and/or one or more Wholly-Owned
Subsidiaries of such Person has a 100% equity interest at such time.
SECTION 12. The Administrative Agent.
12.01 Appointment. The Lenders hereby designate Bankers Trust
Company as Administrative Agent (for purposes of this Section 12, the term
"Administrative Agent" shall include Bankers Trust Company in its capacity as
Collateral Agent pursuant to the Security Documents) to act as specified herein
and in the other Credit Documents. Each Lender hereby irrevocably authorizes,
and each holder of any Note by the acceptance of such Note shall be deemed
irrevocably to authorize, the Administrative Agent to take such action on its
behalf under the provisions of this Agreement, the other Credit Documents and
any other instruments and agreements referred to herein or therein and to
exercise such powers and to perform such duties hereunder and thereunder as are
specifically delegated to or required of the Administrative Agent by the terms
hereof and thereof and such other powers as are reasonably incidental thereto.
The Administrative Agent may perform any of its duties hereunder by or through
its respective officers, directors, agents, employees or affiliates.
12.02 Nature of Duties. The Administrative Agent shall not
have any duties or responsibilities except those expressly set forth in this
Agreement and the other Credit Documents. Neither the Administrative Agent nor
any of its respective officers, directors, agents, employees or affiliates shall
be liable for any action taken or omitted by it or them hereunder or under any
other Credit Document or in connection herewith or therewith, unless caused by
its or their gross negligence or willful misconduct. The duties of the
Administrative Agent shall be mechanical and administrative in nature; the
Administrative Agent shall not have by reason of this Agreement or any other
Credit Document a fiduciary relationship in respect of any Lender or the holder
of any Note; and nothing in this Agreement or any other Credit Document,
expressed or implied, is intended to or shall be so construed as to impose upon
the Administrative Agent any obligations in respect of this Agreement or any
other Credit Document except as expressly set forth herein or therein.
12.03 Lack of Reliance on the Administrative Agent.
Independently and without reliance upon the Administrative Agent, each Lender
and the holder of each Note, to the extent it deems appropriate, has made and
shall continue to make (i) its own independent investigation of the financial
condition and affairs of Holdings and its Subsidiaries in connection with the
making and the continuance of the Loans and the taking or not taking of any
action in connection herewith and (ii) its own appraisal of the creditworthiness
of the Credit Parties and their
-88-
95
Subsidiaries and, except as expressly provided in this Agreement, the
Administrative Agent shall not have any duty or responsibility, either initially
or on a continuing basis, to provide any Lender or the holder of any Note with
any credit or other information with respect thereto, whether coming into its
possession before the making of the Loans or at any time or times thereafter.
The Administrative Agent shall not be responsible to any Lender or the holder of
any Note for any recitals, statements, information, representations or
warranties herein or in any document, certificate or other writing delivered in
connection herewith or for the execution, effectiveness, genuineness, validity,
enforceability, perfection, collectibility, priority or sufficiency of this
Agreement or any other Credit Document or the financial condition of Holdings
and its Subsidiaries or be required to make any inquiry concerning either the
performance or observance of any of the terms, provisions or conditions of this
Agreement or any other Credit Document, or the financial condition of Holdings
and its Subsidiaries or the existence or possible existence of any Default or
Event of Default.
12.04 Certain Rights of the Administrative Agent. If the
Administrative Agent shall request instructions from the Required Lenders with
respect to any act or action (including failure to act) in connection with this
Agreement or any other Credit Document, the Administrative Agent shall be
entitled to refrain from such act or taking such action unless and until the
Administrative Agent shall have received instructions from the Required Lenders;
and the Administrative Agent shall not incur liability to any Person by reason
of so refraining. Without limiting the foregoing, no Lender or the holder of any
Note shall have any right of action whatsoever against the Administrative Agent
as a result of the Administrative Agent acting or refraining from acting
hereunder or under any other Credit Document in accordance with the instructions
of the Required Lenders.
12.05 Reliance. The Administrative Agent shall be entitled to
rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, statement, certificate, telex, teletype or telecopier
message, cablegram, radiogram, order or other document or telephone message
signed, sent or made by any Person that the Administrative Agent believed to be
the proper Person, and, with respect to all legal matters pertaining to this
Agreement and any other Credit Document and its duties hereunder and thereunder,
upon advice of counsel selected by the Administrative Agent.
12.06 Indemnification. To the extent the Administrative Agent
is not reimbursed and indemnified by the Parties the Lenders will reimburse and
indemnify the Administrative Agent, in proportion to their respective
"percentages" as used in determining the Required Lenders, for and against any
and all liabilities, obligations, losses, damages, penalties, claims, actions,
judgments, costs, expenses or disbursements of whatsoever kind or nature which
may be imposed on, asserted against or incurred by the Administrative Agent in
performing its respective duties hereunder or under any other Credit Document,
in any way relating to or arising out of this Agreement or any other Credit
Document; provided that no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Administrative Agent's gross
negligence or willful misconduct.
-89-
96
12.07 The Administrative Agent in its Individual Capacity.
With respect to its obligation to make Loans, or issue or participate in Letters
of Credit, under this Agreement, the Administrative Agent shall have the rights
and powers specified herein for a "Lender" and may exercise the same rights and
powers as though it were not performing the duties specified herein; and the
term "Lenders," "Required Lenders," "holders of Notes" or any similar terms
shall, unless the context clearly otherwise indicates, include the
Administrative Agent in its individual capacity. The Administrative Agent may
accept deposits from, lend money to, and generally engage in any kind of
banking, trust or other business with any Credit Party or any Affiliate of any
Credit Party as if it were not performing the duties specified herein, and may
accept fees and other consideration from the Borrower or any other Credit Party
for services in connection with this Agreement and otherwise without having to
account for the same to the Lenders.
12.08 Holders. The Administrative Agent may deem and treat the
payee of any Note as the owner thereof for all purposes hereof unless and until
a written notice of the assignment, transfer or endorsement thereof, as the case
may be, shall have been filed with the Administrative Agent. Any request,
authority or consent of any Person who, at the time of making such request or
giving such authority or consent, is the holder of any Note shall be conclusive
and binding on any subsequent holder, transferee, assignee or indorsee, as the
case may be, of such Note or of any Note or Notes issued in exchange therefor.
12.09 Resignation by the Administrative Agent. (a) The
Administrative Agent may resign from the performance of all its functions and
duties hereunder and/or under the other Credit Documents at any time by giving
15 Business Days' prior written notice to the Borrower and the Lenders. Such
resignation shall take effect upon the appointment of a successor Administrative
Agent pursuant to clauses (b) and (c) below or as otherwise provided below.
(b) Upon any such notice of resignation, the Required Lenders
shall appoint a successor Administrative Agent hereunder or thereunder who shall
be a commercial bank or trust company reasonably acceptable to the Borrower (it
being understood and agreed that any Non-Defaulting Lender is deemed to be
acceptable to the Borrower).
(c) If a successor Administrative Agent shall not have been so
appointed within such 15 Business Day period, the Administrative Agent, with the
consent of the Borrower, shall then appoint a successor Administrative Agent who
shall serve as Administrative Agent hereunder or thereunder until such time, if
any, as the Lenders appoint a successor Administrative Agent as provided above.
(d) If no successor Administrative Agent has been appointed
pursuant to clause (b) or (c) above by the 20th Business Day after the date such
notice of resignation was given by the Administrative Agent, the Administrative
Agent's resignation shall become effective and the Required Lenders shall
thereafter perform all the duties of the Administrative Agent hereunder and/or
under any other Credit Document until such time, if any, as the Required Lenders
appoint a successor Administrative Agent as provided above.
-90-
97
SECTION 13. Miscellaneous.
13.01 Payment of Expenses, etc. The Borrower shall: (i)
whether or not the transactions herein contemplated are consummated, pay within
15 days following written demand by the Administrative Agent (other than any
payments due on the Effective Date, which the Borrower shall pay on such date)
all reasonable out-of-pocket costs and expenses of the Administrative Agent
(including, without limitation, the reasonable fees and disbursements of White &
Case LLP and the Administrative Agent's local counsel) in connection with the
preparation, execution and delivery of this Agreement and the other Credit
Documents and the documents and instruments referred to herein and therein and
any amendment, waiver or consent relating hereto or thereto, of the
Administrative Agent in connection with its syndication efforts with respect to
this Agreement and of the Administrative Agent and, after the occurrence and
during the continuance of an Event of Default, each of the Lenders in connection
with the enforcement of this Agreement and the other Credit Documents and the
documents and instruments referred to herein and therein (including, without
limitation, the reasonable fees and disbursements of counsel for the
Administrative Agent and, after the occurrence and during the continuance of an
Event of Default, for each of the Lenders); (ii) pay within 15 days following
written demand by the Administrative Agent (other than any payments due on the
Effective Date, which the Borrower shall pay on such date) and hold each of the
Lenders harmless from and against any and all present and future stamp, excise
and other similar taxes with respect to the foregoing matters and save each of
the Lenders 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) to pay such taxes; and (iii) indemnify the Administrative Agent and
each Lender, and each of their respective officers, directors, employees,
representatives and agents from and hold each of them harmless against any and
all liabilities, obligations (including removal or remedial actions), losses,
damages, penalties, claims, actions, judgments, suits, costs, expenses and
disbursements (including reasonable attorneys' and consultants' fees and
disbursements) incurred by, imposed on or assessed against 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 Administrative
Agent or any Lender is a party thereto) related to the entering into and/or
performance of this Agreement or any other Credit Document or the use of any
Letter of Credit or the proceeds of any Loans hereunder or the consummation of
any transactions contemplated herein (including, without limitation, the
Synthetic Lease Financing) or in any other Credit Document or the exercise of
any of their rights or remedies provided herein or in the other Credit
Documents, or (b) the actual or alleged presence of Hazardous Materials in the
air, surface water or groundwater or on the surface or subsurface of any Real
Property owned or at any time operated by Holdings or any of its Subsidiaries,
the generation, storage, transportation, handling or disposal of Hazardous
Materials at any location, whether or not owned or operated by Holdings or any
of its Subsidiaries, the non-compliance of any Real Property with foreign,
federal, state and local laws, regulations, and ordinances (including applicable
permits thereunder) applicable to any Real Property, or any Environmental Claim
in connection with Holdings, any of its Subsidiaries or their business or
operations or any Real Property owned or at any time operated by Holdings or any
of its Subsidiaries, including, in each case, without limitation, the reasonable
fees and disbursements of counsel and other consultants incurred in connection
with any such investigation, litigation or other proceeding (but excluding any
losses, liabilities, claims, damages or expenses to the extent incurred by
reason of the gross negligence or willful misconduct of the Person to be
indemnified). To the extent that the undertaking to indemnify, pay or hold
harmless
-91-
98
the Administrative Agent or any Lender set forth in the preceding sentence may
be unenforceable because it is violative of any law or public policy, the
Borrower shall make the maximum contribution to the payment and satisfaction of
each of the indemnified liabilities which is permissible under applicable law.
13.02 Right of Setoff. 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 is hereby authorized at any time or from time to time, without
presentment, demand, protest or other notice of any kind to the Borrower or to
any other Person, any such notice 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 (including, without
limitation, by branches and agencies of such Lender wherever located) to or for
the credit or the account of any Credit Party against and on account of the
Obligations and liabilities of the Credit Parties to such Lender under this
Agreement or under any of the other Credit Documents, including, without
limitation, all interests in Obligations purchased by such Lender pursuant to
Section 13.06(b), and all other claims of any nature or description arising out
of or connected with this Agreement or any other Credit Document, irrespective
of whether or not such Lender shall have made any demand hereunder and although
said Obligations, liabilities or claims, or any of them, shall be contingent or
unmatured.
13.03 Notices. Except as otherwise expressly provided herein,
all notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, telecopier or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered: if to any Credit Party,
at such Credit Party's address specified opposite its signature below; if to any
Lender, at its address specified opposite its name on Schedule VIII below; and
if to the Administrative Agent, at its Notice Office; or, as to any Credit Party
or the Administrative Agent, at such other address as shall be designated by
such party in a written notice to the other parties hereto and, as to each
Lender, at such other address as shall be designated by such Lender in a written
notice to the Borrower and the Administrative Agent. All such notices and
communications shall, when mailed, telegraphed, telexed, telecopied, or cabled
or sent by overnight courier, be effective when deposited in the mails,
delivered to the telegraph company, cable company or overnight courier, as the
case may be, or sent by telex or telecopier, except that notices and
communications to the Administrative Agent and the Borrower shall not be
effective until received by the Administrative Agent or the Borrower, as the
case may be.
13.04 Benefit of Agreement; Assignments; Participations. (a)
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, however, the Borrower may not assign or transfer any of its rights,
obligations or interest hereunder without the prior written consent of the
Lenders and, provided further, that, although any Lender may transfer, assign or
grant participations in its rights hereunder, such Lender shall remain a
"Lender" for all purposes hereunder (and may not transfer or assign all or any
portion of its Commitments hereunder except as provided in Sections 1.13 and
13.04(b)) and the transferee, assignee or participant, as the case may be, shall
not constitute a "Lender" hereunder and, provided further, that no Lender shall
transfer or grant any participation under which the participant shall have
rights to approve any amendment to or waiver of this Agreement or any other
Credit Document except to the extent such amendment or waiver
-92-
99
would (i) extend the final scheduled maturity of any Loan, Note or Letter of
Credit (unless such Letter of Credit is not extended beyond the Maturity Date)
in which such participant is participating, or reduce the rate or extend the
time of payment of interest or Fees thereon (except in connection with a waiver
of applicability of any post-default increase in interest rates) or reduce the
principal amount thereof, or increase the amount of the participant's
participation over the amount thereof then in effect (it being understood that a
waiver of any Default or Event of Default or of a mandatory reduction in the
Total Commitment shall not constitute a change in the terms of such
participation, and that an increase in any Commitment or Loan shall be permitted
without the consent of any participant if the participant's participation is not
increased as a result thereof), (ii) consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this Agreement or (iii)
release all or substantially all of the Collateral under all of the Security
Documents (except as expressly provided in the Credit Documents) supporting the
Loans hereunder in which such participant is participating. In the case of any
such participation, the participant shall not have any rights under this
Agreement or any of the other Credit Documents (the participant's rights against
such Lender in respect of such participation to be those set forth in the
agreement executed by such Lender in favor of the participant relating thereto)
and all amounts payable by the Borrower hereunder shall be determined as if such
Lender had not sold such participation.
(b) Notwithstanding the foregoing, any Lender (or any Lender
together with one or more other Lenders) may (x) assign all or a portion of its
Commitments and related outstanding Obligations hereunder to (i) its parent
company and/or any affiliate of such Lender which is at least 50% owned by such
Lender or its parent company or to one or more Lenders or (ii) in the case of
any Lender that is a fund that invests in loans, any other fund that invests in
loans and is managed or advised by the same investment advisor of such Lender or
by an Affiliate of such investment advisor or (y) assign all, or if less than
all, a portion equal to at least $5,000,000 in the aggregate for the assigning
Lender or assigning Lenders, of such Commitments and related outstanding
Obligations hereunder to one or more Eligible Transferees (treating any fund
that invests in loans and any other fund that invests in loans and is managed or
advised by the same investment advisor of such fund or by an Affiliate of such
investment advisor as a single Eligible Transferee), each of which assignees
shall become a party to this Agreement as a Lender by execution of an Assignment
and Assumption Agreement, provided that (i) at such time Schedule I shall be
deemed modified to reflect the Commitments of such new Lender and of the
existing Lenders, (ii) new Notes will be issued, at the Borrower's expense, to
such new Lender and to the assigning Lender upon the request of such new Lender
or assigning Lender, such new Notes to be in conformity with the requirements of
Section 1.05 (with appropriate modifications) to the extent needed to reflect
the revised Commitments, (iii) the consent of the Administrative Agent and the
Borrower shall be required in connection with any assignment to an Eligible
Transferee pursuant to clause (y) above (which consents shall not be
unreasonably withheld), provided that the consent of the Borrower shall not be
required at any time that an Event of Default has occurred and is continuing,
and the consent of BTCo shall be required in connection with any assignment of
all or a portion of any Commitment, (iv) the Administrative Agent shall receive
at the time of each such assignment, from the assigning or assignee Lender, the
payment of a non-refundable assignment fee of $3,500 and (v) promptly after such
assignment, the Borrower shall have received from the Administrative Agent
notice of any such assignment,
-93-
100
together with the copy of the Assignment and Assumption Agreement relating
thereto. To the extent of any assignment pursuant to this Section 13.04(b), the
assigning Lender shall be relieved of its obligations hereunder with respect to
its assigned Commitments. At the time of each assignment pursuant to this
Section 13.04(b) to a Person which is not already a Lender hereunder and which
is not a United States person (as such term is defined in Section 7701(a)(30) of
the Code) for Federal income tax purposes, the respective assignee Lender shall,
to the extent legally entitled to do so, provide to the Borrower in the case of
a Lender described in clause (ii) or (iv) of Section 4.04(b), the forms
described in such clause (ii) or (iv), as the case may be. To the extent that an
assignment of all or any portion of a Lender's Commitments and related
outstanding Obligations pursuant to Section 1.13 or this Section 13.04(b) would,
at the time of such assignment, result in increased costs under Section 1.10,
2.06 or 4.04 from those being charged by the respective assigning Lender prior
to such assignment, then the Borrower shall not be obligated to pay such
increased costs (although the Borrower shall be obligated to pay any other
increased costs of the type described above resulting from changes after the
date of the respective assignment).
(c) Nothing in this Agreement shall prevent or prohibit any
Lender from pledging its Loans and Notes hereunder to a Federal Reserve Bank in
support of borrowings made by such Lender from such Federal Reserve Bank.
13.05 No Waiver; Remedies Cumulative. No failure or delay on
the part of the Administrative Agent or any Lender or any holder of any Note in
exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between Holdings or any other Credit Party and
the Administrative Agent or any Lender or the holder of any Note 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, powers and remedies herein or in
any other Credit Document expressly provided are cumulative and not exclusive of
any rights, powers or remedies which the Administrative Agent or any Lender or
the holder of any Note would otherwise have. No notice to or demand on any
Credit Party in any case shall entitle any 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 any Lender or the holder of any Note to
any other or further action in any circumstances without notice or demand.
13.06 Payments Pro Rata. (a) Except as otherwise provided in
this Agreement, the Administrative Agent agrees that promptly after its receipt
of each payment from or on behalf of the Borrower in respect of any Obligations
hereunder, it shall distribute such payment to the Lenders (other than any
Lender that has consented in writing to waive its pro rata share of any such
payment) pro rata based upon their respective percentages, if any, of the
Obligations with respect to which such payment was received.
(b) Each of the Lenders agrees that, if it should receive any
amount hereunder (whether by voluntary payment, by realization upon security, by
the exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise), which is applicable to the payment of the principal of, or interest
on,
-94-
101
the Loans, Unpaid Drawings, Commitment Commission or Letter of Credit Fees, of a
sum which with respect to the related sum or sums received by other Lenders is
in a greater proportion than the total of such Obligation then owed and due to
such Lender bears to the total of such Obligation then owed and due to all of
the Lenders immediately prior to such receipt, then such Lender receiving such
excess payment shall purchase for cash without recourse or warranty from the
other Lenders an interest in the Obligations of the respective Party to such
Lenders in such amount as shall result in a proportional participation by all
the Lenders in such amount; provided that if all or any portion of such excess
amount is thereafter recovered from such Lender, such purchase shall be
rescinded and the purchase price restored to the extent of such recovery, but
without interest.
(c) Notwithstanding anything to the contrary contained herein,
the provisions of the preceding Sections 13.06(a) and (b) shall be subject to
the express provisions of this Agreement which require, or permit, differing
payments to be made to Non-Defaulting Lenders as opposed to Defaulting Lenders.
13.07 Calculations; Computations; Accounting Terms. (a) The
financial statements to be furnished to the Lenders pursuant hereto shall be
made and prepared in accordance with generally accepted accounting principles in
the United States consistently applied throughout the periods involved (except
as set forth in the notes thereto or as otherwise disclosed in writing by the
Borrower to the Lenders); provided that, except as otherwise specifically
provided herein, all computations and all definitions used in determining
compliance with Sections 9.07 through 9.10, inclusive, shall utilize accounting
principles and policies in conformity with those used to prepare the historical
financial statements (except that overhaul expenses will be capitalized instead
of expensed) delivered to the Lenders pursuant to Section 7.05(a) (including, in
any event, that (i) all obligations in respect of the Borrower Senior Discount
Notes shall be treated as obligations in respect of Indebtedness, (ii) all
expenses incurred in connection with the consummation of the Synthetic Lease
Financing, the Repurchase and the Borrower Senior Discount Notes Consent
Solicitation shall be ignored for purposes of such calculations and (iii) any
recharacterization, after the Effective Date, of the prepayment penalties paid
in connection with the Refinancings as expenses shall be ignored for purposes of
such calculations).
(b) All computations of (i) interest on Eurodollar Loans,
Commitment Commission and other Fees hereunder shall be made on the basis of a
year of 360 days and (ii) interest on Base Rate Loans shall be made on the basis
of a year of 365 or 366 days, as the case may be, in each case for the actual
number of days (including the first day but excluding the last day, except that
in the case of Letter of Credit Fees, the last day shall be included) occurring
in the period for which such interest, Commitment Commission or Fees are
payable.
(c) For purposes of this Agreement, the Dollar Equivalent of
(i) each Letter of Credit denominated in an Alternate Currency shall be
calculated on the date when such Letter of Credit is issued or any disbursements
thereunder are reimbursed and (ii) all outstanding Letters of Credit denominated
in an Alternate Currency shall also be calculated (x) on the second Business Day
of each month and (y) at such other times as designated by the Administrative
Agent. Such Dollar Equivalent shall remain in effect until the same is
recalculated by the Administrative Agent as provided above and notice of such
recalculation is received by the Borrower, it being
-95-
102
understood that until such notice is received, the Dollar Equivalent shall be
that Dollar Equivalent as last reported to the Borrower by the Administrative
Agent. The Administrative Agent shall promptly notify the Borrower and the
Lenders of each such determination of the Dollar Equivalent.
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER
OF JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL, BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK. ANY LEGAL
ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT
MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES
FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY ACCEPTS FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE
JURISDICTION OF THE AFORESAID COURTS. EACH OF HOLDINGS AND THE BORROWER HEREBY
IRREVOCABLY DESIGNATES, APPOINTS AND EMPOWERS CT CORPORATION SYSTEM, WITH
OFFICES ON THE DATE HEREOF AT ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ AS ITS
DESIGNEE, APPOINTEE AND AGENT TO RECEIVE, ACCEPT AND ACKNOWLEDGE FOR AND ON ITS
BEHALF, AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND ALL LEGAL PROCESS,
SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE SERVED IN ANY SUCH ACTION OR
PROCEEDING. IF FOR ANY REASON SUCH DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO
BE AVAILABLE TO ACT AS SUCH, EACH OF HOLDINGS AND THE BORROWER AGREES TO
DESIGNATE A NEW DESIGNEE, APPOINTEE AND AGENT IN NEW YORK CITY ON THE TERMS AND
FOR THE PURPOSES OF THIS PROVISION SATISFACTORY TO THE AGENT UNDER THIS
AGREEMENT. EACH OF HOLDINGS AND THE BORROWER 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 ANY CREDIT PARTY AT ITS ADDRESS SET FORTH OPPOSITE ITS
SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING.
NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENT UNDER THIS AGREEMENT, ANY
BANK OR THE HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY CREDIT
PARTY IN ANY OTHER JURISDICTION.
(b) EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY
WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE
OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION
WITH THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED
TO IN CLAUSE (a) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO
PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN
ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
-96-
103
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
13.09 Counterparts. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument. A set of
counterparts executed by all the parties hereto shall be lodged with the
Borrower and the Administrative Agent.
13.10 Effectiveness. This Agreement shall become effective on
the date (the "Effective Date") on which (i) all of the conditions provided in
Section 5 have been satisfied or waived and (ii) Holdings, the Borrower, the
Administrative Agent and each of the Lenders shall have signed a counterpart
hereof (whether the same or different counterparts) and shall have delivered the
same to the Administrative Agent at its Notice Office or, in the case of the
Lenders, shall have given to the Administrative Agent telephonic (confirmed in
writing), written or telex notice (actually received) at such office that the
same has been signed and mailed to it. The Administrative Agent will give the
Borrower and each Lender prompt written notice of the occurrence of the
Effective Date.
13.11 Headings Descriptive. The headings of the several
sections and subsections of this Agreement are inserted for convenience only and
shall not in any way affect the meaning or construction of any provision of this
Agreement.
13.12 Amendment or Waiver. (a) Neither this Agreement nor any
other Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the respective Credit Parties party thereto and the
Required Lenders, provided that no such change, waiver, discharge or termination
shall, without the consent of each Lender (other than a Defaulting Lender) (with
Obligations being directly affected in the case of following clause (i)), (i)
extend the final scheduled maturity of any Loan or Note or extend the stated
maturity of any Letter of Credit beyond the Maturity Date, or reduce the rate or
extend the time of payment of interest or Fees thereon (except (x) in connection
with the waiver of applicability of any post-default increase in interest rates
and (y) that any amendment or modification that is not agreed to by each Lender
directly affected thereby to the financial definitions in this Agreement or to
Section 13.07(a) shall not constitute a reduction in the rate of interest or
fees for purposes of this clause (i), notwithstanding the fact that such
amendment or modification would otherwise actually result in such a reduction,
so long as the primary purpose (as determined in good faith by the Borrower and
the Administrative Agent) of the respective amendment or modification was not to
decrease the pricing pursuant to this Agreement), or reduce the principal amount
thereof (except to the extent repaid in cash), (ii) release all or substantially
all of the Collateral (except as expressly
-97-
104
provided in the Security Documents) under all the Security Documents, (iii)
amend, modify or waive any provision of this Section 13.12 (it being understood
that, with the consent of the Required Lenders, additional extensions of credit
pursuant to this Agreement may be included under this Agreement to provide the
Lenders with customary similar or additional rights of consent), (iv) reduce the
percentage specified in the definition of Required Lenders (it being understood
that, with the consent of the Required Lenders, additional extensions of credit
pursuant to this Agreement may be included in the determination of the Required
Lenders on substantially the same basis as the extensions of Commitments are
included on the Effective Date) or (v) consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this Agreement; provided
further, that no such change, waiver, discharge or termination shall (w)
increase the Commitments of any Lender over the amount thereof then in effect
without the consent of such Lender (it being understood that waivers or
modifications of conditions precedent, covenants, Defaults or Events of Default
or of a mandatory reduction in the Total Commitment shall not constitute an
increase of the Commitment of any Lender, and that an increase in the available
portion of any Commitment of any Lender shall not constitute an increase in the
Commitment of such Lender), (x) without the consent of BTCo, amend, modify or
waive any provision of Section 2 or alter its rights or obligations with respect
to Letters of Credit or Swingline Loans, (y) without the consent of the
Administrative Agent, amend, modify or waive any provision of Section 12 as same
applies to such Administrative Agent or any other provision as same relates to
the rights or obligations of such Administrative Agent or (z) without the
consent of the Collateral Agent, amend, modify or waive any provision relating
to the rights or obligations of the Collateral Agent.
(b) If, in connection with any proposed change, waiver,
discharge or termination to any of the provisions of this Agreement as
contemplated by clause (a)(i) through (v), inclusive, of this Section 13.12, the
consent of the Required Lenders is obtained but the consent of one or more of
other Lenders whose consent is required is not obtained, then the Borrower shall
have the right to replace each such non-consenting Lender or Lenders (so long as
all non-consenting Lenders are so replaced) with one or more Replacement Lenders
pursuant to Section 1.13 so long as at the time of such replacement, each such
Replacement Lender consents to the proposed change, waiver, discharge or
termination, provided that the Borrower shall not have the right to replace a
Lender solely as a result of the exercise of such Lender's rights (and the
withholding of any required consent by such Lender) pursuant to the second
proviso to Section 13.12(a).
13.13 Survival. All indemnities set forth herein including,
without limitation, in Sections 1.10, 1.11, 2.06, 4.04, 12.06 and 13.01 shall
survive the execution, delivery and termination of this Agreement and the Notes
and the making and repayment of the Obligations.
13.14 Domicile of Loans. Each Lender may transfer and carry
its Loans at, to or for the account of any office, Subsidiary or Affiliate of
such Lender. Notwithstanding anything to the contrary contained herein, to the
extent that a transfer of Loans pursuant to this Section 13.14 would, at the
time of such transfer, result in increased costs under Section 1.10, 1.11, 2.06
or 4.04 from those being charged by the respective Lender prior to such
transfer, then the Borrower shall not be obligated to pay such increased costs
(although the Borrower shall be obligated to
-98-
105
pay any other increased costs of the type described above resulting from changes
after the date of the respective transfer).
13.15 Limitation on Additional Amounts, etc. Notwithstanding
anything to the contrary contained in Sections 1.10 and 2.06 of this Agreement,
unless a Lender gives notice to the Borrower that it is obligated to pay an
amount under the respective such Section within 180 days after the later of (x)
the date the Lender incurs the respective increased costs, reduction in amounts
received or receivable or reduction in return on capital or (y) the date such
Lender has actual knowledge of its incurrence of the respective increased costs,
reductions in amounts received or receivable or reduction in return on capital,
then such Lender shall only be entitled to be compensated for such amount by the
Borrower pursuant to said Section 1.10 or 2.06, as the case may be, to the
extent the costs, loss, expense or liability, reduction in amounts received or
receivable or reduction in return on capital are incurred or suffered on or
after the date which occurs 180 days prior to such Lender giving notice to the
Borrower that it is obligated to pay the respective amounts pursuant to said
Section 1.10 or 2.06, as the case may be. Furthermore, no Lender shall be
entitled to compensation for any increased costs or reduction in amounts
received or receivable or reduction in return on capital under Section 1.10 or
2.06 unless at the time it is the policy or general practice of such Lender to
request compensation for comparable costs or reductions, if any, in similar
circumstances, if any, under comparable provisions of other credit agreements
for comparable customers (unless specific facts or circumstances applicable to
the Borrower or the transactions contemplated by this Agreement would alter the
application of such policy or general practice). This Section 13.15 shall have
no applicability to any Section of this Agreement other than said Sections 1.10
and 2.06.
13.16 Register. The Borrower hereby designates the
Administrative Agent to serve as the Borrower's agent, solely for purposes of
this Section 13.16, to maintain a register (the "Register") on which it will
record the Commitments from time to time of each of the Lenders, the Loans made
by each of the Lenders and each repayment in respect of the principal amount of
the Loans of each Lender. Failure to make any such recordation, or any error in
such recordation shall not affect the Borrower's obligations in respect of such
Loans. With respect to any Lender, the transfer of the Commitments of such
Lender and the rights to the principal of, and interest on, any Loan made
pursuant to such Commitments shall not be effective until such transfer is
recorded on the Register maintained by the Administrative Agent with respect to
ownership of such Commitments and Loans and prior to such recordation all
amounts owing to the transferor with respect to such Commitments and Loans shall
remain owing to the transferor. The registration of assignment or transfer of
all or part of any Commitments and Loans shall be recorded by the Administrative
Agent on the Register only upon the acceptance by the Administrative Agent of a
properly executed and delivered Assignment and Assumption Agreement pursuant to
Section 13.04(b). Coincident with the delivery of such an Assignment and
Assumption Agreement to the Administrative Agent for acceptance and registration
of assignment or transfer of all or part of a Loan, or as soon thereafter as
practicable, the assigning or transferor Lender shall surrender the Note
evidencing such Loan, and thereupon one or more new Notes in the same aggregate
principal amount shall be issued to the assigning or transferor Lender and/or
the new Lender. The Borrower agrees to indemnify the Administrative Agent from
and against any and all losses, claims, damages and liabilities of whatsoever
nature which may be imposed on,
-99-
106
asserted against or incurred by the Administrative Agent in performing its
duties under this Section 13.16.
13.17 Confidentiality. (a) Subject to the provisions of clause
(b) of this Section 13.17, each Lender agrees that it will use its reasonable
efforts not to disclose without the prior consent of the Borrower (other than to
its employees, auditors, advisors or counsel or to another Lender if the Lender
or such Lender's holding or parent company in its sole discretion determines
that any such party should have access to such information, provided such
Persons shall be subject to the provisions of this Section 13.17 to the same
extent as such Lender) any information with respect to Holdings or any of its
Subsidiaries which is now or in the future furnished pursuant to this Agreement
or any other Credit Document and which is designated by the Borrower to the
Lenders in writing as confidential, provided that any Lender may disclose any
such information (i) as has become generally available to the public other than
by virtue of a breach of this Section 13.17(a) by the respective Lender, (ii) as
may be required or appropriate in any report, statement or testimony submitted
to any municipal, state or Federal Reserve Board, the Federal Deposit Insurance
Corporation or similar organizations (whether in the United States or elsewhere)
or their successors, (iii) as may be required or appropriate in respect to any
summons or subpoena or in connection with any litigation, (iv) in order to
comply with any law, order, regulation or ruling applicable to such Lender, (v)
to the Administrative Agent or the Collateral Agent and (vi) to any prospective
or actual transferee or participant in connection with any contemplated transfer
or participation of any of the Notes or Commitments or any interest therein by
such Lender, provided that such prospective transferee agrees to be bound by the
confidentiality provisions contained in this Section 13.17.
(b) Each of Holdings and the Borrower hereby acknowledges and
agrees that each Lender may share with any of its affiliates any information
related to Holdings or any of its Subsidiaries (including, without limitation,
any nonpublic customer information regarding the creditworthiness of Holdings
and its Subsidiaries), provided such Persons shall be subject to the provisions
of this Section 13.17 to the same extent as such Lender).
SECTION 14. Holdings Guaranty.
14.01 Guaranty. In order to induce the Administrative Agent,
the Collateral Agent, the Issuing Lender and the Lenders to enter into this
Agreement and to extend credit hereunder, and to induce the other Guaranteed
Creditors to enter into Interest Rate Protection Agreements or Other Hedging
Agreements, and in recognition of the direct benefits to be received by Holdings
from the proceeds of the Loans, the issuance of the Letters of Credit and the
entering into of such Interest Rate Protection Agreements or Other Hedging
Agreements, Holdings hereby agrees with the Guaranteed Creditors as follows:
Holdings hereby unconditionally and irrevocably guarantees as primary obligor
and not merely as surety the full and prompt payment when due, whether upon
maturity, acceleration or otherwise, of any and all of the Guaranteed
Obligations of the Borrower to the Guaranteed Creditors. If any or all of the
Guaranteed Obligations of the Borrower to the Guaranteed Creditors becomes due
and payable hereunder, Holdings unconditionally and irrevocably promises to pay
such indebtedness to the Administrative Agent and/or the other Guaranteed
Creditors, or order, on demand, together with any and all expenses which may be
incurred by the Administrative Agent or the other Guaranteed Creditors in
-100-
107
collecting any of the Guaranteed Obligations. If claim is ever made upon any
Guaranteed Creditor for repayment or recovery of any amount or amounts received
in payment or on account of any of the Guaranteed Obligations and any of the
aforesaid payees repays all or part of said amount by reason of (i) any
judgment, decree or order of any court or administrative body having
jurisdiction over such payee or any of its property or (ii) any settlement or
compromise of any such claim effected by such payee with any such claimant
(including the Borrower), then and in such event Holdings agrees that any such
judgment, decree, order, settlement or compromise shall be binding upon
Holdings, notwithstanding any revocation of this Guaranty or other instrument
evidencing any liability of the Borrower, and Holdings shall be and remain
liable to the aforesaid payees hereunder for the amount so repaid or recovered
to the same extent as if such amount had never originally been received by any
such payee.
14.02 Bankruptcy. Additionally, Holdings unconditionally and
irrevocably guarantees the payment of any and all of the Guaranteed Obligations
of the Borrower to the Guaranteed Creditors whether or not due or payable by the
Borrower upon the occurrence of any of the events specified in Section 10.05,
and irrevocably and unconditionally promises to pay such indebtedness to the
Guaranteed Creditors, or order, on demand, in lawful money of the United States.
14.03 Nature of Liability. The liability of Holdings hereunder
is exclusive and independent of any security for or other guaranty of the
Guaranteed Obligations of the Borrower whether executed by Holdings, any other
guarantor or by any other party, and the liability of Holdings hereunder is not
affected or impaired by (a) any direction as to application of payment by the
Borrower or by any other party, or (b) any other continuing or other guaranty,
undertaking or maximum liability of a guarantor or of any other party as to the
Guaranteed Obligations of the Borrower, or (c) any payment on or in reduction of
any such other guaranty or undertaking, or (d) any dissolution, termination or
increase, decrease or change in personnel by the Borrower, or (e) any payment
made to any Guaranteed Creditor on the Guaranteed Obligations which any such
Guaranteed Creditor repays to the Borrower pursuant to court order in any
bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceeding, and Holdings waives any right to the deferral or modification of its
obligations hereunder by reason of any such proceeding.
14.04 Independent Obligation. The obligations of Holdings
hereunder are independent of the obligations of any other guarantor, any other
party or the Borrower, and a separate action or actions may be brought and
prosecuted against Holdings whether or not action is brought against any other
guarantor, any other party or the Borrower and whether or not any other
guarantor, any other party or the Borrower be joined in any such action or
actions. Holdings waives, to the fullest extent permitted by law, the benefit of
any statute of limitations affecting its liability hereunder or the enforcement
thereof. Any payment by the Borrower or other circumstance which operates to
toll any statute of limitations as to the Borrower shall operate to toll the
statute of limitations as to Holdings.
-101-
108
14.05 Authorization. Holdings authorizes the Guaranteed
Creditors without notice or demand (except as shall be required by applicable
statute and cannot be waived), and without affecting or impairing its liability
hereunder, from time to time to:
(a) change the manner, place or terms of payment of, and/or
change or extend the time of payment of, renew, increase, accelerate or
alter, any of the Guaranteed Obligations (including any increase or
decrease in the rate of interest or fees thereon), any security
therefor, or any liability incurred directly or indirectly in respect
thereof, and the Guaranty herein made shall apply to the Guaranteed
Obligations as so changed, extended, renewed or altered;
(b) take and hold security for the payment of the Guaranteed
Obligations and sell, exchange, release, impair, surrender, realize
upon or otherwise deal with in any manner and in any order any property
by whomsoever at any time pledged or mortgaged to secure, or howsoever
securing, the Guaranteed Obligations or any liabilities (including any
of those hereunder) incurred directly or indirectly in respect thereof
or hereof, and/or any offset thereagainst;
(c) exercise or refrain from exercising any rights against the
Borrower, any other Credit Party or others or otherwise act or refrain
from acting;
(d) release or substitute any one or more endorsers,
guarantors, the Borrower, other Credit Parties or other obligors;
(e) settle or compromise any of the Guaranteed Obligations,
any security therefor or any liability (including any of those
hereunder) incurred directly or indirectly in respect thereof or
hereof, and may subordinate the payment of all or any part thereof to
the payment of any liability (whether due or not) of the Borrower to
its creditors other than the Guaranteed Creditors;
(f) apply any sums by whomsoever paid or howsoever realized to
any liability or liabilities of the Borrower to the Guaranteed
Creditors regardless of what liability or liabilities of the Borrower
remain unpaid;
(g) consent to or waive any breach of, or any act, omission or
default under, this Agreement, any other Credit Document or any of the
instruments or agreements referred to herein or therein, or otherwise
amend, modify or supplement this Agreement, any other Credit Document
or any of such other instruments or agreements; and/or
(h) take any other action which would, under otherwise
applicable principles of common law, give rise to a legal or equitable
discharge of Holdings from its liabilities under this Guaranty.
14.06 Reliance. It is not necessary for any Guaranteed
Creditor to inquire into the capacity or powers of Holdings or any of its
Subsidiaries or the officers, directors, partners or agents acting or purporting
to act on their behalf, and any Guaranteed Obligations made or created in
reliance upon the professed exercise of such powers shall be guaranteed
hereunder.
-102-
109
14.07 Subordination. Any indebtedness of the Borrower now or
hereafter owing to Holdings is hereby subordinated to the Guaranteed Obligations
of the Borrower owing to the Guaranteed Creditors; and if the Administrative
Agent so requests at a time when an Event of Default exists, all such
indebtedness of the Borrower to Holdings shall be collected, enforced and
received by Holdings for the benefit of the Guaranteed Creditors and be paid
over to the Administrative Agent on behalf of the Guaranteed Creditors on
account of the Guaranteed Obligations of the Borrower to the Guaranteed
Creditors, but without affecting or impairing in any manner the liability of
Holdings under the other provisions of this Guaranty. Prior to the transfer by
Holdings of any note or negotiable instrument evidencing any such indebtedness
of the Borrower to Holdings, Holdings shall ▇▇▇▇ such note or negotiable
instrument with a legend that the same is subject to this subordination. Without
limiting the generality of the foregoing, Holdings hereby agrees with the
Guaranteed Creditors that it will not exercise any right of subrogation which it
may at any time otherwise have as a result of this Guaranty (whether
contractual, under Section 509 of the Bankruptcy Code or otherwise) until all
Guaranteed Obligations have been irrevocably paid in full in cash.
14.08 Waiver. (a) Holdings waives any right (except as shall
be required by applicable statute and cannot be waived) to require any
Guaranteed Creditor to (i) proceed against the Borrower, any other guarantor or
any other party, (ii) proceed against or exhaust any security held from the
Borrower, any other guarantor or any other party or (iii) pursue any other
remedy in any Guaranteed Creditor's power whatsoever. Holdings waives any
defense based on or arising out of any defense of the Borrower, any other
guarantor or any other party, other than payment in full of the Guaranteed
Obligations, based on or arising out of the disability of the Borrower, any
other guarantor or any other party, or the validity, legality or
unenforceability of the Guaranteed Obligations or any part thereof from any
cause, or the cessation from any cause of the liability of the Borrower other
than payment in full of the Guaranteed Obligations. The Guaranteed Creditors
may, at their election, foreclose on any security held by the Administrative
Agent, the Collateral Agent or any other Guaranteed Creditor by one or more
judicial or nonjudicial sales, whether or not every aspect of any such sale is
commercially reasonable (to the extent such sale is permitted by applicable
law), or exercise any other right or remedy the Guaranteed Creditors may have
against the Borrower or any other party, or any security, without affecting or
impairing in any way the liability of Holdings hereunder except to the extent
the Guaranteed Obligations have been paid. Holdings waives any defense arising
out of any such election by the Guaranteed Creditors, even though such election
operates to impair or extinguish any right of reimbursement or subrogation or
other right or remedy of Holdings against the Borrower or any other party or any
security.
(b) Holdings waives all presentments, demands for performance,
protests and notices, including without limitation notices of nonperformance,
notices of protest, notices of dishonor, notices of acceptance of this Guaranty,
and notices of the existence, creation or incurring of new or additional
Guaranteed Obligations. Holdings assumes all responsibility for being and
keeping itself informed of the Borrower's financial condition and assets, and of
all other circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations and the nature, scope and extent of the risks which Holdings assumes
and incurs hereunder, and agrees that the Administrative Agent and the Lenders
shall have no duty to advise Holdings of information known to them regarding
such circumstances or risks.
-103-
110
(c) Holdings hereby acknowledges and affirms that it
understands that to the extent the Guaranteed Obligations are secured by Real
Property located in California, Holdings shall be liable for the full amount of
the liability hereunder notwithstanding the foreclosure on such Real Property by
trustee sale or any other reason impairing Holdings' or any Guaranteed
Creditor's right to proceed against the Borrower or any other guarantor of the
Guaranteed Obligations. In accordance with Section 2856 of the California Civil
Code, Holdings hereby waives:
(i) all rights of subrogation, reimbursement, indemnification,
and contribution and any other rights and defenses that are or may
become available to Holdings by reason of Sections 2787 to 2855,
inclusive, 2899 and 3433 of the California Civil Code;
(ii) all rights and defenses that Holdings may have because
the Guaranteed Obligations are secured by Real Property located in
California. This means, among other things: (A) the Guaranteed
Creditors may collect from Holdings without first foreclosing on any
real or personal property collateral pledged by the Borrower or any
other Credit Party; and (B) if the Guaranteed Creditors foreclose on
any Real Property collateral pledged by the Borrower or any other
Credit Party, (1) the amount of the Guaranteed Obligations may be
reduced only by the price for which that collateral is sold at the
foreclosure sale, even if the collateral is worth more than the sale
price, and (2) the Guaranteed Creditors may collect from Holdings even
if the Guaranteed Creditors, by foreclosing on the Real Property
collateral, have destroyed any right Holdings may have to collect from
the Borrower. This is an unconditional and irrevocable waiver of any
rights and defenses Holdings may have because the Guaranteed
Obligations are secured by Real Property. These rights and defenses
include, but are not limited to, any rights or defenses based upon
Section 580a, 580b, 580d or 726 of the California Code of Civil
Procedure; and
(iii) all rights and defenses arising out of an election of
remedies by the Guaranteed Creditors, even though that election of
remedies, such as a nonjudicial foreclosure with respect to security
for the Guaranteed Obligations, has destroyed Holdings' rights of
subrogation and reimbursement against the Borrower by the operation of
Section 580d of the Code of Civil Procedure or otherwise.
Holdings warrants and agrees that each of the waivers set
forth above is made with full knowledge of its significance and consequences and
that if any of such waivers are determined to be contrary to any applicable law
or public policy, such waivers shall be effective only to the maximum extent
permitted by law.
14.09 Nature of Liability. It is the desire and intent of
Holdings and the Guaranteed Creditors that this Guaranty shall be enforced
against Holdings to the fullest extent permissible under the laws and public
policies applied in each jurisdiction in which enforcement is sought. If,
however, and to the extent that, the obligations of Holdings under this Guaranty
shall be adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers), then the amount of Holdings obligations
under this Guaranty shall be deemed to be reduced and
-104-
111
Holdings shall pay the maximum amount of the Guaranteed Obligations which would
be permissible under applicable law.
* * *
-105-
112
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
Address:
4440 Brittmoore UNIVERSAL COMPRESSION HOLDINGS, INC.
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn.: President
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
By
------------------------------------------
Title:
UNIVERSAL COMPRESSION, INC.
By
------------------------------------------
Title:
BANKERS TRUST COMPANY,
Individually and as Administrative Agent
By
------------------------------------------
Title:
113
SCHEDULE I
COMMITMENTS
Lender Commitment
------ ----------
Bankers Trust Company --
------------
TOTAL: $ 50,000,000
114
SCHEDULE II
ERISA
115
SCHEDULE VIII
LENDER ADDRESSES
Lender Addresses
------ ---------
Bankers Trust Company ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn.: ___________________
Tel: (212) 250-____
Fax: (212) 250-____