EXHIBIT 10.19
CREDIT AND GUARANTY AGREEMENT
DATED AS OF APRIL 25, 2005
AMONG
TALEO CORPORATION,
AS COMPANY,
VARIOUS LENDERS,
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P.
AS ADMINISTRATIVE AGENT, COLLATERAL AGENT, DOCUMENTATION AGENT,
LEAD ARRANGER, AND SYNDICATION AGENT
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$20,000,000 SENIOR SECURED TERM LOAN
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TABLE OF CONTENTS
PAGE
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SECTION 1. DEFINITIONS AND INTERPRETATION........................................................................ 1
1.1. Definitions...................................................................................... 1
1.2. Accounting Terms................................................................................. 22
1.3. Interpretation, etc.............................................................................. 23
SECTION 2. TERMLOAN.............................................................................................. 23
2.1. Term Loan........................................................................................ 23
2.2. Pro Rata Shares; Availability of Funds........................................................... 23
2.3. Use of Proceeds.................................................................................. 24
2.4. Evidence of Debt; Register; Lenders' Books and Records; Term Loan Notes.......................... 24
2.5. Interest on Term Loans........................................................................... 25
2.6. Conversion/Continuation.......................................................................... 26
2.7. Default Interest................................................................................. 26
2.8. Fees............................................................................................. 27
2.9. Scheduled Payments............................................................................... 27
2.10. Voluntary Prepayments........................................................................... 27
2.11. Mandatory Prepayments........................................................................... 29
2.12. Application of Prepayments...................................................................... 30
2.13. General Provisions Regarding Payments........................................................... 31
2.14. Ratable Sharing................................................................................. 32
2.15. Making or Maintaining LIBOR Rate Loans.......................................................... 32
2.16. Increased Costs; Capital Adequacy............................................................... 34
2.17. Taxes; Withholding, etc......................................................................... 35
2.18. Obligation to Mitigate.......................................................................... 36
2.19. Defaulting Lenders.............................................................................. 36
2.20. Removal or Replacement of a Lender.............................................................. 37
SECTION 3. CONDITIONS PRECEDENT.................................................................................. 38
3.1. Closing Date..................................................................................... 38
3.2. Conditions to Credit Extension................................................................... 41
3.3. Conditions Subsequent to the Closing Date........................................................ 42
SECTION 4. REPRESENTATIONS AND WARRANTIES........................................................................ 42
4.1. Organization; Requisite Power and Authority; Qualification....................................... 42
4.2. Capital Stock and Ownership...................................................................... 43
4.3. Due Authorization................................................................................ 43
4.4. No Conflict...................................................................................... 43
4.5. Governmental Consents............................................................................ 43
4.6. Binding Obligation............................................................................... 43
4.7. Historical Financial Statements.................................................................. 43
4.8. Projections...................................................................................... 44
4.9. No Material Adverse Change....................................................................... 44
4.10. No Restricted Junior Payments................................................................... 44
4.11. Adverse Proceedings, etc........................................................................ 44
4.12. Payment of Taxes................................................................................ 44
4.13. Properties...................................................................................... 44
4.14. Environmental Matters........................................................................... 45
4.15. No Defaults..................................................................................... 45
i
4.16. Material Contracts.............................................................................. 45
4.17. Governmental Regulation......................................................................... 45
4.18. Margin Stock.................................................................................... 46
4.19. Employee Matters................................................................................ 46
4.20. Employee Benefit Plans.......................................................................... 46
4.21. Certain Fees.................................................................................... 47
4.22. Solvency........................................................................................ 47
4.23. Compliance with Statutes, etc................................................................... 47
4.24. Disclosure...................................................................................... 47
4.25. Patriot Act..................................................................................... 47
SECTION 5. AFFIRMATIVE COVENANTS................................................................................. 47
5.1. Financial Statements and Other Reports........................................................... 48
5.2. Existence........................................................................................ 52
5.3. Payment of Taxes and Claims...................................................................... 52
5.4. Maintenance of Properties........................................................................ 52
5.5. Insurance........................................................................................ 52
5.6. Inspections...................................................................................... 53
5.7. Lenders Meetings................................................................................. 53
5.8. Compliance with Laws............................................................................. 53
5.9. Environmental.................................................................................... 53
5.10. Subsidiaries.................................................................................... 54
5.11. Additional Material Real Estate Assets.......................................................... 54
5.12. Additional Collateral, etc...................................................................... 55
5.13. Further Assurances.............................................................................. 55
5.14. Miscellaneous Business Covenants................................................................ 55
5.15. Post Closing Matters............................................................................ 58
5.16. Assignability of Contracts...................................................................... 58
5.17. Subsidiary Cash................................................................................. 58
SECTION 6. NEGATIVE COVENANTS.................................................................................... 58
6.1. Indebtedness..................................................................................... 58
6.2. Liens............................................................................................ 60
6.3. Equitable Lien................................................................................... 61
6.4. No Further Negative Pledges...................................................................... 61
6.5. Restricted Junior Payments....................................................................... 62
6.6. Restrictions on Subsidiary Distributions......................................................... 62
6.7. Investments...................................................................................... 63
6.8. Financial Covenants.............................................................................. 64
6.9. Fundamental Changes; Disposition of Assets; Acquisitions......................................... 68
6.10. Disposal of Subsidiary Interests................................................................ 69
6.11. Sales and Lease-Backs........................................................................... 70
6.12. Transactions with Shareholders and Affiliates................................................... 70
6.13. Conduct of Business............................................................................. 70
6.14. Fiscal Year..................................................................................... 70
6.15. Amendments to Organizational Agreements and Material Contracts.................................. 70
6.16. Prepayments of Certain Indebtedness............................................................. 70
6.17. Registration of Intellectual Property........................................................... 70
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SECTION 7. GUARANTY.............................................................................................. 71
7.1. Guaranty of the Obligations...................................................................... 71
7.2. Contribution by Guarantors....................................................................... 71
7.3. Payment by Guarantors............................................................................ 71
7.4. Liability of Guarantors Absolute................................................................. 72
7.5. Waivers by Guarantors............................................................................ 73
7.6. Guarantors' Rights of Subrogation, Contribution, etc............................................. 74
7.7. Subordination of Other Obligations............................................................... 74
7.8. Continuing Guaranty.............................................................................. 75
7.9. Authority of Guarantors or Company............................................................... 75
7.10. Financial Condition of Company.................................................................. 75
7.11. Bankruptcy, etc................................................................................. 75
7.12. Discharge of Guaranty Upon Sale of Guarantor.................................................... 76
SECTION 8. EVENTS OF DEFAULT..................................................................................... 76
8.1. Events of Default................................................................................ 76
SECTION 9. AGENTS................................................................................................ 78
9.1. Appointment of Agents............................................................................ 79
9.2. Powers and Duties................................................................................ 79
9.3. General Immunity................................................................................. 79
9.4. Agents Entitled to Act as Lender................................................................. 80
9.5. Lenders' Representations, Warranties and Acknowledgment.......................................... 80
9.6. Right to Indemnity............................................................................... 80
9.7. Successor Administrative Agent................................................................... 81
9.8. Collateral Documents and Guaranty................................................................ 81
SECTION 10. MISCELLANEOUS........................................................................................ 82
10.1. Notices.......................................................................................... 82
10.2. Expenses......................................................................................... 82
10.3. Indemnity........................................................................................ 83
10.4. Set-Off.......................................................................................... 83
10.5. Amendments and Waivers........................................................................... 84
10.6. Successors and Assigns; Participations........................................................... 85
10.7. Independence of Covenants........................................................................ 87
10.8. Survival of Representations, Warranties and Agreements........................................... 87
10.9. No Waiver; Remedies Cumulative................................................................... 88
10.10. Marshalling; Payments Set Aside................................................................. 88
10.11. Severability.................................................................................... 88
10.12. Obligations Several; Independent Nature of Lenders' Rights...................................... 88
10.13. Headings........................................................................................ 88
10.14. APPLICABLE LAW.................................................................................. 88
10.15. CONSENT TO JURISDICTION......................................................................... 89
10.16. WAIVER OF JURY TRIAL............................................................................ 89
10.17. Confidentiality................................................................................. 89
10.18. Usury Savings Clause............................................................................ 90
10.19. Counterparts.................................................................................... 91
10.20. Effectiveness................................................................................... 91
10.21. Patriot Act..................................................................................... 91
10.22. Certain Representations......................................................................... 91
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APPENDICES: A Term Loan Commitments
B Notice Addresses
SCHEDULES: 1.1 Certain Material Real Estate Assets
4.1 Jurisdictions of Organization and Qualification
4.2 Capital Stock and Ownership
4.13 Real Estate Assets
4.16 Material Contracts
5.14 Deposit Accounts
5.15 Certain Post Closing Matters
6.1 Certain Indebtedness
6.2 Certain Liens
6.7 Certain Investments
6.12 Certain Affiliate Transactions
EXHIBITS: A-1 Funding Notice
A-2 Conversion/Continuation Notice
B Term Loan Note
C Compliance Certificate
D Opinion of Counsel
E Assignment and Assumption Agreement
F Certificate Regarding Non-Bank Status
G-1 Closing Date Certificate
G-2 Solvency Certificate
G-3 Cash Release Compliance Notice and Certificate
G-4 2004 Financial Officer Certification
H-1 Pledge and Security Agreement
H-2 Copyright Security Agreement
H-3 Hypothec on Shares
I Landlord/Operator Consent and Waiver
J Deposit Account Control Agreement
iv
CREDIT AND GUARANTY AGREEMENT
This CREDIT AND GUARANTY AGREEMENT, dated as of April 25, 2005, is entered
into by and among TALEO CORPORATION, a Delaware corporation ("COMPANY"), the
Lenders party hereto from time to time, and ▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING
GROUP, L.P. ("GSSLG"), as Administrative Agent (in such capacity,
"ADMINISTRATIVE AGENT"), Collateral Agent (in such capacity, "COLLATERAL
AGENT"), Lead Arranger, Syndication Agent (in such capacity, "SYNDICATION
AGENT"), and Documentation Agent (in such capacity, "DOCUMENTATION AGENT").
RECITALS:
WHEREAS, capitalized terms used in these Recitals shall have the
respective meanings set forth for such terms in SECTION 1.1 hereof;
WHEREAS, Lenders have agreed to extend a term loan to Company, in an
aggregate amount not to exceed $20,000,000, consisting entirely of aggregate
principal amount of Term Loans, the proceeds of which will be used to repay
Existing Indebtedness, pay Transaction Costs, for Restricted Cash Account
funding, and for general corporate purposes;
WHEREAS, ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC., a California corporation ("GUARANTOR")
has agreed to guarantee the obligations of Company; and
WHEREAS, Company and Guarantor have agreed to secure all of the
Obligations by granting to Collateral Agent, for the benefit of Lenders, a First
Priority Lien on substantially all of their assets, including a pledge of 100%
of the Capital Stock of each of Company's and Guarantor's Domestic Subsidiaries
and 66% of the Capital Stock of each of Company's and Guarantor's Foreign
Subsidiaries.
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
SECTION 1. DEFINITIONS AND INTERPRETATION
1.1. DEFINITIONS. The following terms used herein, including in the
preamble, recitals, exhibits and schedules hereto, shall have the following
meanings:
"ACT" as defined in SECTION 4.25.
"ADJUSTED LIBOR RATE" means, for any Interest Rate Determination
Date with respect to an Interest Period for a LIBOR Rate Loan, the rate per
annum obtained by dividing (and rounding upward to the next whole multiple of
1/16 of 1%) (i)(a) the rate per annum (rounded to the nearest 1/100 of 1%) equal
to the rate determined by Administrative Agent to be the offered rate which
appears on the page of the Telerate Screen which displays an average British
Bankers Association Interest Settlement Rate (such page currently being page
number 3740 or 3750, as applicable) for deposits (for delivery on the first day
of such period) with a term equivalent to such period in Dollars, determined as
of approximately 11:00 a.m. (London, England time) on such Interest Rate
Determination Date, or (b) in the event the rate referenced in the preceding
CLAUSE (a) does not appear on such page or service or if such page or service
shall cease to be available, the rate per annum (rounded to the nearest 1/100 of
1%) equal to the rate determined by Administrative Agent to be the offered rate
on such other page or other service which displays an average British Bankers
Association Interest Settlement Rate for deposits (for delivery on the first day
of such period) with a term equivalent to such period in Dollars, determined as
of approximately 11:00 a.m. (London, England time) on such Interest Rate
Determination Date, or (c) in the event the rates
CREDIT AND GUARANTY AGREEMENT
referenced in the preceding CLAUSES (a) and (b) are not available, the rate per
annum (rounded to the nearest 1/100 of 1%) equal to the offered quotation rate
to first class banks in the London interbank market by GSSLH or any other Lender
selected by Administrative Agent for deposits (for delivery on the first day of
the relevant period) in Dollars of amounts in same day funds comparable to the
principal amount of the applicable Term Loan of GSSLH or any other Lender
selected by Administrative Agent, for which the Adjusted LIBOR Rate is then
being determined with maturities comparable to such period as of approximately
11:00 a.m. (London, England time) on such Interest Rate Determination Date, by
(ii) an amount equal to (a) one, minus (b) the Applicable Reserve Requirement.
"ADMINISTRATIVE AGENT" as defined in the preamble hereto.
"ADVERSE PROCEEDING" means any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration (whether or not purportedly on behalf of Company or any of its
Subsidiaries) at law or in equity, or before or by any Governmental Authority,
domestic or foreign (including any Environmental Claims), whether pending or, to
the knowledge of Company or any of its Subsidiaries, threatened against or
directly affecting Company or any of its Subsidiaries or any property of Company
or any of its Subsidiaries.
"AFFECTED LENDER" as defined in SECTION 2.15(b).
"AFFECTED LOANS" as defined in SECTION 2.15(b).
"AFFILIATE" means, as applied to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with,
that Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling," "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power (i) to vote 10% or more of the Securities having
ordinary voting power for the election of directors of such Person, or (ii) to
direct or cause the direction of the management and policies of that Person,
whether through the ownership of voting securities or by contract or otherwise.
"AGENT" means each of Syndication Agent, Administrative Agent,
Collateral Agent and Documentation Agent.
"AGGREGATE AMOUNTS DUE" as defined in SECTION 2.14.
"AGGREGATE PAYMENTS" as defined in SECTION 7.2.
"AGREEMENT" means this Credit and Guaranty Agreement, dated as of
April 25, 2005, as it may be amended, supplemented or otherwise modified from
time to time.
"APPLICABLE RESERVE REQUIREMENT" means, at any time, for any LIBOR
Rate Loan, the maximum rate, expressed as a decimal, at which reserves
(including, without limitation, any basic marginal, special, supplemental,
emergency or other reserves) are required to be maintained with respect thereto
against "Eurocurrency liabilities" (as such term is defined in Regulation D)
under regulations issued from time to time by the Board of Governors of the
Federal Reserve System or other applicable banking regulator. Without limiting
the effect of the foregoing, the Applicable Reserve Requirement shall reflect
any other reserves required to be maintained by such member banks with respect
to (i) any category of liabilities which includes deposits by reference to which
the applicable Adjusted LIBOR Rate or any other interest rate of a Term Loan is
to be determined, or (ii) any category of extensions of credit or other assets
which include LIBOR Rate Loans. A LIBOR Rate Loan shall be deemed to constitute
Eurocurrency liabilities and as such shall be deemed subject to reserve
requirements without benefits of
2 CREDIT AND GUARANTY AGREEMENT
credit for proration, exceptions or offsets that may be available from time to
time to the applicable Lender. The rate of interest on LIBOR Rate Loans shall be
adjusted automatically on and as of the effective date of any change in the
Applicable Reserve Requirement.
"ASSET SALE" means a sale, lease or sublease (as lessor or
sublessor), sale and leaseback, assignment, conveyance, transfer or other
disposition to, or any exchange of property with, any Person (other than Company
or any Guarantor Subsidiary), in one transaction or a series of transactions, of
all or any part of Company's or any of its Subsidiaries' businesses, assets or
properties of any kind, whether real, personal, or mixed and whether tangible or
intangible, whether now owned or hereafter acquired, including, without
limitation, the Capital Stock of any of Company's Subsidiaries, other than (i)
inventory (or other assets) sold or leased in the ordinary course of business;
(ii) the non-exclusive licensing of intellectual property or know-how on
commercially reasonable terms and in the ordinary course of business; (iii) any
disposition by a Guarantor to Company or by Company or a Guarantor to a
Guarantor; and (iv) any disposition by a non-Guarantor to the Company or a
Guarantor.
"ASSIGNMENT AGREEMENT" means an Assignment and Assumption Agreement
substantially in the form of EXHIBIT E, with such amendments or modifications as
may be approved by Administrative Agent.
"AUTHORIZED OFFICER" means, as applied to any Person, any individual
holding the position of chairman of the board (if an officer), chief executive
officer, president or one of its vice presidents (or the equivalent thereof),
and such Person's chief financial officer or treasurer.
"BANKRUPTCY CODE" means Title 11 of the United States Code entitled
"Bankruptcy," as now and hereafter in effect, or any successor statute.
"BASE RATE" means, for any day, a rate per annum equal to the
greater of (i) the Prime Rate in effect on such day, and (ii) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. Any change in the Base
Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall
be effective on the effective day of such change in the Prime Rate or the
Federal Funds Effective Rate, respectively.
"BASE RATE LOAN" means a Term Loan bearing interest at a rate
determined by reference to the Base Rate.
"BENEFICIARY" means each Agent, Lender and Lender Counterparty.
"BUSINESS DAY" means (i) any day excluding Saturday, Sunday and any
day which is a legal holiday under the laws of the State of New York or the
State of Texas or is a day on which banking institutions located in either such
state are authorized or required by law or other governmental action to close,
and (ii) with respect to all notices, determinations, fundings and payments in
connection with the Adjusted LIBOR Rate or any LIBOR Rate Loans, the term
"BUSINESS DAY" shall mean any day which is a Business Day described in CLAUSE
(i) and which is also a day for trading by and between banks in Dollar deposits
in the London interbank market.
"CAPITAL LEASE" means, as applied to any Person, any lease of any
property (whether real, personal or mixed) by that Person as lessee that, in
conformity with GAAP, is or should be accounted for as a capital lease on the
balance sheet of that Person.
"CAPITAL STOCK" means any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a
3 CREDIT AND GUARANTY AGREEMENT
Person (other than a corporation), including, without limitation, partnership
interests and membership interests, and any and all warrants, rights or options
to purchase or other arrangements or rights to acquire any of the foregoing.
"CASH" means money, currency or a credit balance in any demand or
Deposit Account.
"CASH EQUIVALENTS" means, as at any date of determination, (i)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States Government, or (b) issued by any
agency of the United States the obligations of which are backed by the full
faith and credit of the United States, in each case maturing within one year
after such date; (ii) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof, in each case maturing within one year after such
date and having, at the time of the acquisition thereof, a rating of at least
A-1 from S&P or at least Aaa from Moody's; (iii) commercial paper maturing no
more than one year from the date of creation thereof and having, at the time of
the acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from
Moody's; (iv) certificates of deposit or bankers' acceptances maturing within
one year after such date and issued or accepted by any Lender or by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia that (a) is at least "adequately
capitalized" (as defined in the regulations of its primary Federal banking
regulator), and (b) has Tier 1 capital (as defined in such regulations) of not
less than $100,000,000; and (v) shares of any money market mutual fund that (a)
has substantially all of its assets invested continuously in the types of
investments referred to in CLAUSES (I) and (II) above, (b) has net assets of not
less than $500,000,000, and (c) has the highest rating obtainable from either
S&P or Moody's.
"CASH RELEASE COMPLIANCE NOTICE AND CERTIFICATE" means a certificate
substantially in the form of EXHIBIT G-3.
"CERTIFICATE REGARDING NON-BANK STATUS" means a certificate
substantially in the form of EXHIBIT F.
"CHANGE OF CONTROL" means, at any time, that any of the following
have occurred: (a) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, but excluding any
employee benefit plan of such person or its subsidiaries, and any person or
entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) becomes the "beneficial owner" (as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a
person or group shall be deemed to have "beneficial ownership" of all securities
that such person or group has the right to acquire (such right, an "option
right"), whether such right is exercisable immediately or only after the passage
of time), directly or indirectly, of 35% or more of the equity securities of
such Person entitled to vote for members of the board of directors or equivalent
governing body of such Person on a fully-diluted basis (and taking into account
all such securities that such person or group has the right to acquire pursuant
to any option right); (b) during any period of 24 consecutive months, a majority
of the members of the board of directors or other equivalent governing body of
such Person cease to be composed of individuals (i) who were members of that
board or equivalent governing body on the first day of such period, (ii) whose
election or nomination to that board or equivalent governing body was approved
by individuals referred to in CLAUSE (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body or (iii) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in CLAUSES (i) and (ii)
above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the case of
both CLAUSE (ii) and CLAUSE (iii), any individual whose initial nomination for,
or assumption of office as, a member of that board or equivalent governing body
occurs as a result of an actual or threatened solicitation of proxies or
4 CREDIT AND GUARANTY AGREEMENT
consents for the election or removal of one or more directors by any person or
group other than a solicitation for the election of one or more directors by or
on behalf of the board of directions); or (c) prior to the occurrence of a
Qualified IPO, in addition to clauses (a) and (b) above, ▇▇▇▇ Capital (or any
affiliate of ▇▇▇▇ Capital) shall cease to hold at least 9% of the equity
securities of such Person entitled to vote for members of the board of directors
or equivalent governing body of such Person on a fully-diluted basis.
"CLOSING DATE" means the date on which the Term Loans are made.
"CLOSING DATE CERTIFICATE" means a Closing Date Certificate
substantially in the form of EXHIBIT G-1.
"COLLATERAL" means, collectively, all of the real, personal and
mixed property (including Capital Stock) in which Liens are purported to be
granted pursuant to the Collateral Documents as security for the Obligations.
"COLLATERAL AGENT" as defined in the preamble hereto.
"COLLATERAL DOCUMENTS" means the Pledge and Security Agreement, the
Landlord/Operator Consents and Waivers, the Copyright Security Agreement,
Hypothec on Shares and all other instruments, documents and agreements delivered
by any Credit Party pursuant to this Agreement or any of the other Credit
Documents in order to grant to Collateral Agent, for the benefit of Lenders, a
Lien on any real, personal or mixed property of that Credit Party as security
for the Obligations.
"COLLATERAL QUESTIONNAIRE" means a certificate in form satisfactory
to Collateral Agent that provides information with respect to the real, personal
or mixed property of each Credit Party.
"COMPANY" as defined in the preamble hereto.
"COMPLIANCE CERTIFICATE" means a Compliance Certificate
substantially in the form of EXHIBIT C.
"CONSOLIDATED ADJUSTED EBITDA" means, for any period, an amount
determined for Company and its Subsidiaries on a consolidated basis equal to (i)
the sum, without duplication, of the amounts for such period of (a) Consolidated
Net Income, plus (b) Consolidated Interest Expense, plus (c) provisions for
taxes based on income, plus (d) total depreciation expense, plus (e) total
amortization expense, plus (f) other non-Cash items (including non-Cash
compensation expense) reducing Consolidated Net Income (excluding any such
non-Cash item to the extent that it represents an accrual or reserve for
potential Cash items in any future period or amortization of a prepaid Cash item
that was paid in a prior period), plus (g) losses related to foreign currency
translation adjustments, minus (ii) the sum, without duplication of the amounts
for such period of (a) other non-Cash items increasing Consolidated Net Income
for such period (excluding any such non-Cash item to the extent it represents
the reversal of an accrual or reserve for potential Cash item in any prior
period), plus (b) interest income, plus (c) other non-ordinary course income,
plus (d) gains related to foreign currency translation adjustments; provided,
however, that, for purposes of SECTIONS 3.1(s) and 6.8(b), Consolidated Adjusted
EBITDA shall exclude a one-time restructuring charge in the Fiscal Quarter
ending March 31, 2005 of up to $850,000 relating to headcount reduction and
lease terminations, and shall also exclude two one-time charges of up to
$700,000 each in the Fiscal Quarter ending March 31, 2006 and in the Fiscal
Quarter ending March 31, 2007, relating to compensation paid to the two founders
of ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc. under the Agreement and Plan of Merger, dated as of
March 10, 2005, by and among Company, Butterfly Acquisition
5 CREDIT AND GUARANTY AGREEMENT
Corporation, ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc., and with respect to Article VI only,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ as Stockholder Agent and U.S. Bank, National Association as
Escrow Agent.
"CONSOLIDATED CAPITAL EXPENDITURES" means, for any period, the
aggregate of all expenditures of Company and its Subsidiaries during such period
determined on a consolidated basis that, in accordance with GAAP, are or should
be included in "purchase of property and equipment or which should otherwise be
capitalized" or similar items reflected in the consolidated statement of cash
flows of Company and its Subsidiaries.
"CONSOLIDATED CASH INTEREST EXPENSE" means, for any period,
Consolidated Interest Expense for such period, excluding any amount not payable
in Cash.
"CONSOLIDATED CURRENT ASSETS" means, as at any date of
determination, the total assets of Company and its Subsidiaries on a
consolidated basis that may properly be classified as current assets in
conformity with GAAP, including Cash and Cash Equivalents.
"CONSOLIDATED CURRENT LIABILITIES" means, as at any date of
determination, the total liabilities of Company and its Subsidiaries on a
consolidated basis that may properly be classified as current liabilities in
conformity with GAAP, excluding the current portion of long term debt (including
under Capital Leases).
"CONSOLIDATED EXCESS CASH FLOW" means, for any period, an amount (if
positive) determined for Company and its Subsidiaries on a consolidated basis
equal to: (i) the sum, without duplication, of the amounts for such period of
(a) Consolidated Adjusted EBITDA, plus (b) interest income, plus (c) other
non-ordinary course income, plus (d) the Consolidated Working Capital
Adjustment, minus (ii) the sum, without duplication, of the amounts for such
period of (a) voluntary and scheduled repayments of Consolidated Total Debt,
plus (b) Consolidated Capital Expenditures (net of any proceeds of (x) Net Asset
Sale Proceeds to the extent reinvested in accordance with SECTION 2.11(a), (y)
Net Insurance/Condemnation Proceeds to the extent reinvested in accordance with
SECTION 2.11(b), and (z) any proceeds of related financings with respect to such
expenditures), plus (c) Consolidated Cash Interest Expense, plus (d) provisions
for current taxes based on income of Company and its Subsidiaries and payable in
Cash with respect to such period.
"CONSOLIDATED HOSTED APPLICATION REVENUE" means, for any period, all
revenue from subscription agreements executed with customers relating to access
to Company's products, including application fees, hosting fees and maintenance
fees on a consolidated basis for such period taken as a single accounting period
determined in conformity with GAAP. This shall exclude: (i) revenues from
perpetual license sales entered into after the Closing Date, and (ii) license
fees from that certain contract between the Company and Citigroup Technology,
Inc. and similar agreements that are non-recurring in nature, and (iii) revenues
from business arrangements with the customers associated with "Taleo Contingent"
(the former "▇▇▇▇▇ ▇▇▇▇▇" business division).
"CONSOLIDATED INTEREST EXPENSE" means, for any period, total
interest expense (including that portion attributable to Capital Leases in
accordance with GAAP and capitalized interest) of Company and its Subsidiaries
on a consolidated basis with respect to all outstanding Consolidated Total Debt,
including all commissions, discounts and other fees and charges owed with
respect to letters of credit and net costs under any Interest Rate Agreement,
but excluding, however, any amounts referred to in SECTION 2.8 payable on or
before the Closing Date.
6 CREDIT AND GUARANTY AGREEMENT
"CONSOLIDATED LIQUIDITY" means, for any period an amount determined
for Company and its Subsidiaries on a consolidated basis equal to the Cash and
Cash Equivalents of Company and its Subsidiaries.
"CONSOLIDATED NET INCOME" means, for any period, (i) the net income
(or loss) of Company and its Subsidiaries on a consolidated basis for such
period taken as a single accounting period determined in conformity with GAAP,
minus (ii) the sum of (a) the income (or loss) of any Person (other than a
Subsidiary of Company) in which any other Person (other than Company or any of
its Subsidiaries) has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to Company or any of its
Subsidiaries by such Person during such period, plus (b) the income (or loss) of
any Person accrued prior to the date it becomes a Subsidiary of Company or is
merged into or consolidated with Company or any of its Subsidiaries or that
Person's assets are acquired by Company or any of its Subsidiaries, plus (c) the
income of any Subsidiary of Company to the extent that the declaration or
payment of dividends or similar distributions by that Subsidiary of that income
is not at the time permitted by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Subsidiary, plus (d) any after-tax gains or losses
attributable to Asset Sales or returned surplus assets of any Pension Plan, plus
(e) (to the extent not included in CLAUSES (a) through (d) above) any net
extraordinary gains or net extraordinary losses.
"CONSOLIDATED TOTAL DEBT" means, as at any date of determination,
the aggregate stated balance sheet amount of all Indebtedness of Company and its
Subsidiaries determined on a consolidated basis in accordance with GAAP.
"CONSOLIDATED WORKING CAPITAL" means, as at any date of
determination, the excess or deficiency of Consolidated Current Assets over
Consolidated Current Liabilities.
"CONSOLIDATED WORKING CAPITAL ADJUSTMENT" means, for any period on a
consolidated basis, the amount (which may be a negative number) by which
Consolidated Working Capital as of the beginning of such period exceeds (or is
less than) Consolidated Working Capital as of the end of such period.
"CONTRACTUAL OBLIGATION" means, as applied to any Person, any
provision of any Security issued by that Person or of any indenture, mortgage,
deed of trust, contract, undertaking, agreement or other instrument to which
that Person is a party or by which it or any of its properties is bound or to
which it or any of its properties is subject.
"CONTRIBUTING GUARANTORS" as defined in SECTION 7.2.
"CONVERSION/CONTINUATION DATE" means the effective date of a
continuation or conversion, as the case may be, as set forth in the applicable
Conversion/Continuation Notice.
"CONVERSION/CONTINUATION NOTICE" means a Conversion/Continuation
Notice substantially in the form of EXHIBIT A-2.
"CREDIT DOCUMENT" means any of this Agreement, the Term Loan Notes,
the Collateral Documents, the Disclosure Letter and the Schedules thereto, the
Fee Letter, and all other documents, instruments or agreements executed and
delivered by a Credit Party for the benefit of any Agent or any Lender in
connection herewith, as the same may be modified, amended, or restated from time
to time.
"CREDIT EXTENSION" means the making of a Term Loan.
7 CREDIT AND GUARANTY AGREEMENT
"CREDIT PARTY" means each Person (other than any Agent or any Lender
or any other representative thereof) from time to time party to a Credit
Document.
"CURRENCY AGREEMENT" means any foreign exchange contract, currency
swap agreement, futures contract, option contract, synthetic or other similar
agreement or arrangement, each of which is for the purpose of hedging the
foreign currency risk associated with Company' and its Subsidiaries' operations
and not for speculative purposes.
"CURRENT RATIO" means the ratio as of the last day of any Fiscal
Quarter ending after the Closing Date of (a) Consolidated Current Assets as of
such day, to (b) Consolidated Current Liabilities as of such day.
"DEFAULT" means a condition or event that, after notice or lapse of
time or both, would constitute an Event of Default.
"DEFAULT EXCESS" means, with respect to any Defaulting Lender, the
excess, if any, of such Defaulting Lender's Pro Rata Share of the aggregate
outstanding principal amount of Term Loans of all Lenders (calculated as if all
Defaulting Lenders (other than such Defaulting Lender) had funded all of their
respective Defaulted Loans) over the aggregate outstanding principal amount of
all Term Loans of such Defaulting Lender.
"DEFAULT PERIOD" means, with respect to any Defaulting Lender, the
period commencing on the date of the applicable Funding Default and ending on
the earliest of the following dates: (i) the date on which all Obligations are
indefeasibly paid in full, (ii) the date on which (a) the Default Excess with
respect to such Defaulting Lender shall have been reduced to zero (whether by
the funding by such Defaulting Lender of any Defaulted Loans of such Defaulting
Lender or by the non-pro rata application of any voluntary or mandatory
prepayments of the Term Loans in accordance with the terms of SECTION 2.10 or
SECTION 2.11 or by a combination thereof), and (b) such Defaulting Lender shall
have delivered to Company and Administrative Agent a written reaffirmation of
its intention to honor its obligations hereunder, and (iii) the date on which
Company, Administrative Agent and Requisite Lenders waive all Funding Defaults
of such Defaulting Lender in writing.
"DEFAULT RATE" means any interest payable pursuant to SECTION 2.7.
"DEFAULTED LOAN" as defined in SECTION 2.19.
"DEFAULTING LENDER" as defined in SECTION 2.19.
"DEPOSIT ACCOUNT" means a demand, time, savings, passbook or like
account with a bank, savings and loan association, credit union or like
organization, other than an account evidenced by a negotiable certificate of
deposit.
"DEPOSIT ACCOUNT CONTROL AGREEMENT" means a Deposit Account Control
Agreement substantially in the form of EXHIBIT J with such amendments or
modifications as may be approved by Collateral Agent.
"DISCLOSURE LETTER" means the Disclosure Letter of Company to
Administrative Agent and the Lenders dated the Closing Date.
"DOCUMENTATION AGENT" as defined in the preamble hereto.
8 CREDIT AND GUARANTY AGREEMENT
"DOLLARS" and the sign "$" mean the lawful money of the United
States of America.
"DOMESTIC SUBSIDIARY" means any Subsidiary organized under the laws
of the United States of America, any State thereof or the District of Columbia.
"ELIGIBLE ASSIGNEE" means (a) any Lender, any Affiliate of any
Lender and any Related Fund (any two or more Related Funds being treated as a
single Eligible Assignee for all purposes hereof), (b) any commercial bank,
insurance company, investment or mutual fund or other entity that is an
"accredited investor" (as defined in Regulation D under the Securities Act) and
which extends credit or buys loans as one of its businesses, and (c) any other
Person (other than a natural Person) approved by Company (so long as no Default
or Event of Default has occurred and is continuing) and Administrative Agent;
provided, that in no event shall Company nor any Affiliate of Company be an
Eligible Assignee.
"EMPLOYEE BENEFIT PLAN" means any "employee benefit plan" as defined
in Section 3(3) of ERISA which is or was sponsored, maintained or contributed to
by, or required to be contributed by, Company, any of its Subsidiaries or any of
their respective ERISA Affiliates.
"ENTERPRISE VALUE" means, on or after a Qualified IPO, the sum of:
(i)(a) the amount of all outstanding Obligations of the Company and its
Subsidiaries; and (b) the market value of all outstanding equity of the Company
(which shall be calculated by multiplying the average of the Company's closing
stock price over a trailing 30 calendar-day period by the number of diluted
shares outstanding as indicated by the Company's then-most-recently filed 424B3,
S-1/A, 10Q, or 10K), minus (ii) the aggregate Cash and Cash Equivalents of the
Company and its Subsidiaries.
"ENVIRONMENTAL CLAIM" means any investigation, notice, notice of
violation, claim, action, suit, proceeding, demand, abatement order or other
order or directive (conditional or otherwise), by any Governmental Authority or
any other Person, arising (i) pursuant to or in connection with any actual or
alleged violation of any Environmental Law; (ii) in connection with any
Hazardous Material or any actual or alleged Hazardous Materials Activity; or
(iii) in connection with any actual or alleged damage, injury, threat or harm to
health, safety, natural resources or the environment.
"ENVIRONMENTAL LAWS" means any and all current or future foreign or
domestic, federal or state (or any subdivision of either of them), statutes,
ordinances, orders, rules, regulations, judgments, Governmental Authorizations,
or any other requirements of Governmental Authorities relating to (i)
environmental matters, including those relating to any Hazardous Materials
Activity; (ii) the generation, use, storage, transportation or disposal of
Hazardous Materials; or (iii) occupational safety and health, industrial
hygiene, land use or the protection of human, plant or animal health or welfare,
in any manner applicable to Company or any of its Subsidiaries or any Facility.
"EQUITY INVESTMENTS" is defined in SECTION 6.7(b).
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and any successor thereto.
"ERISA AFFILIATE" means, as applied to any Person, (i) any
corporation which is a member of a controlled group of corporations within the
meaning of Section 414(b) of the Internal Revenue Code of which that Person is a
member; (ii) any trade or business (whether or not incorporated) which is a
member of a group of trades or businesses under common control within the
meaning of Section 414(c) of the Internal Revenue Code of which that Person is a
member; and (iii) any member of an affiliated service group within the meaning
of Section 414(m) or (o) of the Internal Revenue Code of which that Person, any
corporation described in CLAUSE (i) above or any trade or business described in
9 CREDIT AND GUARANTY AGREEMENT
CLAUSE (ii) above is a member. Any former ERISA Affiliate of Company or any of
its Subsidiaries shall continue to be considered an ERISA Affiliate of Company
or any such Subsidiary within the meaning of this definition with respect to the
period such entity was an ERISA Affiliate of Company or such Subsidiary and with
respect to liabilities arising after such period for which Company or such
Subsidiary could be liable under the Internal Revenue Code or ERISA.
"ERISA EVENT" means (i) a "reportable event" within the meaning of
Section 4043 of ERISA and the regulations issued thereunder with respect to any
Pension Plan (excluding those for which the provision for 30-day notice to the
PBGC has been waived by regulation); (ii) the failure to meet the minimum
funding standard of Section 412 of the Internal Revenue Code with respect to any
Pension Plan (whether or not waived in accordance with Section 412(d) of the
Internal Revenue Code) or the failure to make by its due date a required
installment under Section 412(m) of the Internal Revenue Code with respect to
any Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan
pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such
plan in a distress termination described in Section 4041(c) of ERISA; (iv) the
withdrawal by Company, any of its Subsidiaries or any of their respective ERISA
Affiliates from any Pension Plan with two or more contributing sponsors or the
termination of any such Pension Plan resulting in liability to Company, any of
its Subsidiaries or any of their respective Affiliates pursuant to Section 4063
or 4064 of ERISA; (v) the institution by the PBGC of proceedings to terminate
any Pension Plan, or the occurrence of any event or condition which might
constitute grounds under ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan; (vi) the imposition of liability on
Company, any of its Subsidiaries or any of their respective ERISA Affiliates
pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of
Section 4212(c) of ERISA; (vii) the withdrawal of Company, any of its
Subsidiaries or any of their respective ERISA Affiliates in a complete or
partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from
any Multiemployer Plan if there is any potential liability therefor, or the
receipt by Company, any of its Subsidiaries or any of their respective ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
occurrence of an act or omission which could give rise to the imposition on
Company, any of its Subsidiaries or any of their respective ERISA Affiliates of
fines, penalties, taxes or related charges under Chapter 43 of the Internal
Revenue Code or under Section 409, Section 502(c), (i) or (l), or Section 4071
of ERISA in respect of any Employee Benefit Plan; (ix) the assertion of a
material claim (other than routine claims for benefits) against any Employee
Benefit Plan other than a Multiemployer Plan or the assets thereof, or against
Company, any of its Subsidiaries or any of their respective ERISA Affiliates in
connection with any Employee Benefit Plan; (x) receipt from the Internal Revenue
Service of notice of the failure of any Pension Plan (or any other Employee
Benefit Plan intended to be qualified under Section 401(a) of the Internal
Revenue Code) to qualify under Section 401(a) of the Internal Revenue Code, or
the failure of any trust forming part of any Pension Plan to qualify for
exemption from taxation under Section 501(a) of the Internal Revenue Code; or
(xi) the imposition of a Lien pursuant to Section 401(a)(29) or 412(n) of the
Internal Revenue Code or pursuant to ERISA with respect to any Pension Plan.
"EVENT OF DEFAULT" means each of the conditions or events set forth
in SECTION 8.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended
from time to time, and any successor statute.
"EXCLUDED DEPOSIT ACCOUNTS" is defined in SECTION 5.14(b).
"EXISTING INDEBTEDNESS" means all Indebtedness and other obligations
outstanding under that certain Security Agreement dated as of May 7, 2004,
between Company and National Bank of
10 CREDIT AND GUARANTY AGREEMENT
Canada, as amended prior to the Closing Date, or any other agreement evidencing
Indebtedness to National Bank of Canada.
"FACILITY" means any real property (including all buildings,
fixtures or other improvements located thereon) now, hereafter or heretofore
owned, leased, operated or used by Company or any of its Subsidiaries or any of
their respective predecessors or Affiliates.
"FEDERAL FUNDS EFFECTIVE RATE" means for any day, the rate per annum
(expressed, as a decimal, rounded upwards, if necessary, to the next higher
1/100 of 1%) equal to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve Bank of
New York on the Business Day next succeeding such day; provided, (i) if such day
is not a Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (ii) if no such rate is so published on such next
succeeding Business Day, the Federal Funds Rate for such day shall be the
average rate charged to GSSLH or any other Lender selected by Administrative
Agent on such day on such transactions as determined by Administrative Agent.
"FEE LETTER" means the letter agreement dated April 8, 2005, between
Company and Administrative Agent.
"FINANCIAL OFFICER CERTIFICATION" means, with respect to the
financial statements for which such certification is required, the certification
of the chief financial officer of Company that such financial statements fairly
present, in all material respects, the financial condition of Company and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, subject to changes resulting from
audit and normal year-end adjustments and the absence of footnotes in the case
of financial statements covering interim periods.
"FINANCIAL PLAN" as defined in SECTION 5.1(j).
"FIRST PRIORITY" means, with respect to any Lien purported to be
created in any Collateral pursuant to any Collateral Document, that such Lien is
the only Lien to which such Collateral is subject, other than any Permitted
Lien.
"FISCAL QUARTER" means a fiscal quarter of any Fiscal Year.
"FISCAL YEAR" means the fiscal year of Company and its Subsidiaries
ending on December 31 of each calendar year.
"FLOOD HAZARD PROPERTY" means any Real Estate Asset subject to a
mortgage in favor of Collateral Agent, for the benefit of the Lenders, and
located in an area designated by the Federal Emergency Management Agency as
having special flood or mud slide hazards.
"FOREIGN SUBSIDIARY" means any Subsidiary that is not a Domestic
Subsidiary.
"FUNDING DEFAULT" as defined in SECTION 2.19.
"FUNDING GUARANTORS" as defined in SECTION 7.2.
"FUNDING NOTICE" means a notice substantially in the form of EXHIBIT
A-1.
11 CREDIT AND GUARANTY AGREEMENT
"GAAP" means, subject to the limitations on the application thereof
set forth in ▇▇▇▇▇▇▇ ▇.▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ generally accepted accounting principles
in effect as of the date of determination thereof.
"GOVERNMENTAL AUTHORITY" means any federal, state, municipal,
national or other government, governmental department, commission, board,
bureau, court, agency or instrumentality or political subdivision thereof or any
entity or officer exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to any government or any court, in
each case whether associated with a state of the United States, the United
States, or a foreign entity or government.
"GOVERNMENTAL AUTHORIZATION" means any permit, license,
authorization, plan, directive, consent order or consent decree of or from any
Governmental Authority.
"GSSLG" as defined in the preamble hereto.
"GSSLH" means ▇▇▇▇▇▇▇ ▇▇▇▇▇ Specialty Lending Holdings, Inc., a
Delaware corporation.
"GUARANTEED OBLIGATIONS" as defined in SECTION 7.1.
"GUARANTOR" means any Domestic Subsidiary or Foreign Subsidiary of
Company formed in the future, that may, from time to time, guarantee the
Obligations hereunder, if any.
"GUARANTOR SUBSIDIARY" means each Guarantor, if any.
"GUARANTY" means the guaranty of each Guarantor, if any, set forth
in SECTION 7, or otherwise, in form and substance acceptable to Administrative
Agent, and, in each case, as the same may be modified, amended, supplemented or
restated from time to time.
"HAZARDOUS MATERIALS" means any chemical, material or substance,
exposure to which is prohibited, limited or regulated by any Governmental
Authority or which may or could pose a hazard to the health and safety of the
owners, occupants or any Persons in the vicinity of any Facility or to the
indoor or outdoor environment.
"HAZARDOUS MATERIALS ACTIVITY" means any past, current, proposed or
threatened activity, event or occurrence involving any Hazardous Materials,
including the use, manufacture, possession, storage, holding, presence,
existence, location, Release, threatened Release, discharge, placement,
generation, transportation, processing, construction, treatment, abatement,
removal, remediation, disposal, disposition or handling of any Hazardous
Materials, and any corrective action or response action with respect to any of
the foregoing.
"HIGHEST LAWFUL RATE" means the maximum lawful interest rate, if
any, that at any time or from time to time may be contracted for, charged, or
received under the laws applicable to any Lender which are presently in effect
or, to the extent allowed by law, under such applicable laws which may hereafter
be in effect and which allow a higher maximum nonusurious interest rate than
applicable laws now allow.
"HISTORICAL FINANCIAL STATEMENTS" means (i) the audited financial
statements of Company and its Subsidiaries, for the Fiscal Year ended December
31, 2003, consisting of a consolidated balance sheet and the related
consolidated statements of income, stockholders' equity and cash flows for such
Fiscal Year, (ii) the unaudited financial statements of Company and its
Subsidiaries, for the Fiscal
12 CREDIT AND GUARANTY AGREEMENT
Year ended December 31, 2004, consisting of balance sheets and the related
consolidated statements of income, stockholders' equity and cash flows for such
Fiscal Year, and (iii) for the interim period from January 1, 2005, to the
Closing Date, internally prepared, unaudited financial statements of Company and
its Subsidiaries, consisting of a consolidated balance sheet and the related
consolidated statements of income for each quarterly period completed prior to
forty-six (46) calendar-days before the Closing Date and for each monthly period
completed prior to thirty-one (31) calendar-days prior to the Closing Date, in
the case of CLAUSES (i), (ii), and (iii), certified by the chief financial
officer of Company that they fairly present, in all material respects, the
financial condition of Company and its Subsidiaries as at the dates indicated
and the results of their operations and their cash flows for the periods
indicated, subject, if applicable, to changes resulting from audit and normal
year end adjustments.
"HYPOTHEC ON SHARES" means that Hypothec on Shares, to be executed
by Company substantially in the form of EXHIBIT H-3, as it may be amended,
supplemented, or otherwise modified from time to time.
"INCREASED-COST LENDERS" as defined in SECTION 2.20.
"INDEBTEDNESS," as applied to any Person, means, without
duplication, (i) all indebtedness for borrowed money; (ii) that portion of
obligations with respect to Capital Leases that is properly classified as a
liability on a balance sheet in conformity with GAAP; (iii) notes payable and
drafts accepted representing extensions of credit whether or not representing
obligations for borrowed money; (iv) all obligations of such Person to purchase,
redeem, retire, defease or otherwise make any payment in respect of any stock
of, or equity interest in, such Person or any other Person on or prior to the
date that is 180 days following the Term Loan Maturity Date, valued, in the case
of a redeemable preferred interest, at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends; (v) any
obligation owed for all or any part of the deferred purchase price of property
or services (excluding any such obligations incurred under ERISA), which
purchase price is (a) due more than six months from the date of incurrence of
the obligation in respect thereof or (b) evidenced by a note or similar written
instrument; (vi) all indebtedness secured by any Lien on any property or asset
owned or held by that Person regardless of whether the indebtedness secured
thereby shall have been assumed by that Person or is nonrecourse to the credit
of that Person; (vii) the face amount of any letter of credit issued for the
account of that Person or as to which that Person is otherwise liable for
reimbursement of drawings; (viii) the direct or indirect guaranty, endorsement
(otherwise than for collection or deposit in the ordinary course of business),
co-making, discounting with recourse or sale with recourse by such Person of the
obligation of another (of the types specified in CLAUSES (i) through (viii)
above); (ix) any obligation of such Person the primary purpose or intent of
which is to provide assurance to an obligee that the obligation of the obligor
thereof will be paid or discharged, or any agreement relating thereto will be
complied with, or the holders thereof will be protected (in whole or in part)
against loss in respect thereof; (x) any liability of such Person for an
obligation of another through any agreement (contingent or otherwise) (a) to
purchase, repurchase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise) or (b) to maintain the solvency or any balance sheet item, level
of income or financial condition of another if, in the case of any agreement
described under SUBCLAUSES (a) or (b) of this CLAUSE (ix), the primary purpose
or intent thereof is as described in CLAUSE (viii) above; and (xi) all
obligations of such Person in respect of any exchange traded or over the counter
derivative transaction, including, without limitation, any Interest Rate
Agreement and Currency Agreement, whether entered into for hedging or
speculative purposes; provided, in no event shall obligations under any Interest
Rate Agreement and Currency Agreement be deemed "INDEBTEDNESS" for any purpose
under SECTION 6.8.
13 CREDIT AND GUARANTY AGREEMENT
"INDEMNIFIED LIABILITIES" means, collectively, any and all
liabilities, obligations, losses, damages (including natural resource damages),
penalties, claims (including Environmental Claims), costs (including the costs
of any investigation, study, sampling, testing, abatement, cleanup, removal,
remediation or other response action necessary to remove, remediate, clean up or
▇▇▇▇▇ any Hazardous Materials Activity), expenses and disbursements of any kind
or nature whatsoever (including the reasonable fees and disbursements of counsel
for Indemnitees in connection with any investigative, administrative or judicial
proceeding commenced or threatened by any Person, whether or not any such
Indemnitee shall be designated as a party or a potential party thereto, and any
fees or expenses incurred by Indemnitees in enforcing this indemnity), whether
direct, indirect or consequential and whether based on any federal, state or
foreign laws, statutes, rules or regulations (including securities and
commercial laws, statutes, rules or regulations and Environmental Laws), on
common law or equitable cause or on contract or otherwise, that may be imposed
on, incurred by, or asserted against any such Indemnitee, in any manner relating
to or arising out of (i) this Agreement or the other Credit Documents or the
transactions contemplated hereby or thereby (including the Lenders' agreement to
make Credit Extensions or the use or intended use of the proceeds thereof, or
any enforcement of any of the Credit Documents (including any sale of,
collection from, or other realization upon any of the Collateral or the
enforcement of the Guaranty)); (ii) the statements contained in the commitment
letter delivered by any Lender to Company with respect to the transactions
contemplated by this Agreement; or (iii) any Environmental Claim or any
Hazardous Materials Activity relating to or arising from, directly or
indirectly, any past or present activity, operation, land ownership, or practice
of Company or any of its Subsidiaries.
"INDEMNITEE" as defined in SECTION 10.3.
"INDEMNITEE AGENT PARTY" as defined in SECTION 9.6.
"INSTALLMENT" as defined in SECTION 2.9.
"INSTALLMENT DATE" as defined in SECTION 2.9.
"INTEREST PAYMENT DATE" means with respect to (i) any Base Rate
Loan, (a) the last day of each month, commencing on the first such date to occur
after the Closing Date, and (b) the Term Loan Maturity Date; and (ii) any LIBOR
Rate Loan, (a) the last day of each Interest Period applicable to such Term
Loan, (b) if the Interest Period is greater than one month, the last day of each
month commencing on the first such date to occur after the Closing Date, and (c)
the Term Loan Maturity Date.
"INTEREST PERIOD" means, in connection with a LIBOR Rate Loan, an
interest period of one-, two-, three- or six-months, as selected by Company in
the applicable Funding Notice or Conversion/Continuation Notice, (i) initially,
commencing on the Closing Date or Conversion/Continuation Date thereof, as the
case may be; and (ii) thereafter, commencing on the day on which the immediately
preceding Interest Period expires; provided, (a) if an Interest Period would
otherwise expire on a day that is not a Business Day, such Interest Period shall
expire on the next succeeding Business Day unless no further Business Day occurs
in such month, in which case such Interest Period shall expire on the
immediately preceding Business Day; (b) any Interest Period that begins on the
last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period) shall, subject to CLAUSE (c) of this definition, end on the last
Business Day of a calendar month; and (c) no Interest Period with respect to any
portion of any Term Loans shall extend beyond such Term Loan Maturity Date.
"INTEREST RATE AGREEMENT" means any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement, interest rate
hedging agreement or other similar agreement or
14 CREDIT AND GUARANTY AGREEMENT
arrangement, each of which is (i) for the purpose of hedging the interest rate
exposure associated with Company's and its Subsidiaries' operations, (ii)
approved by Administrative Agent, and (iii) not for speculative purposes.
"INTEREST RATE DETERMINATION DATE" means, with respect to any
Interest Period, the date that is two Business Days prior to the first day of
such Interest Period.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as
amended to the date hereof and from time to time hereafter, and any successor
statute.
"INVESTMENT" means (i) any direct or indirect purchase or other
acquisition by Company or any of its Subsidiaries of, or of a beneficial
interest in, any of the Securities of any other Person (other than a Guarantor
Subsidiary); (ii) any direct or indirect redemption, retirement, purchase or
other acquisition for value, by any Subsidiary of Company from any Person (other
than Company or any Guarantor Subsidiary), of any Capital Stock of such Person;
and (iii) any direct or indirect loan, advance (other than advances to employees
for moving, entertainment and travel expenses, drawing accounts and similar
expenditures in the ordinary course of business) or capital contributions by
Company or any of its Subsidiaries to any other Person (other than Company or
any Guarantor Subsidiary), including all indebtedness and accounts receivable
from that other Person that are not current assets or did not arise from sales
to that other Person in the ordinary course of business. The amount of any
Investment shall be the original cost of such Investment plus the cost of all
additions thereto, without any adjustments for increases or decreases in value,
or write-ups, write-downs or write-offs with respect to such Investment.
"JOINT VENTURE" means a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form; provided, in
no event shall any corporate Subsidiary of any Person be considered to be a
Joint Venture to which such Person is a party.
"LANDLORD/OPERATOR CONSENT AND WAIVER" means a Landlord or Operator
Consent and Waiver substantially in the form of EXHIBIT I with such amendments
or modifications as may be approved by Collateral Agent.
"LEAD ARRANGER" as defined in the preamble hereto.
"LEASEHOLD PROPERTY" means any leasehold interest of any Credit
Party as lessee under any lease of real property, other than any such leasehold
interest designated from time to time by Collateral Agent in its sole discretion
as not being required to be included in the Collateral.
"LENDER" means each financial institution listed on the signature
pages hereto as a Lender, and any other Person that becomes a party hereto
pursuant to an Assignment Agreement.
"LENDER COUNTERPARTY" means each Lender or any Affiliate of a Lender
counterparty to an Interest Rate Agreement or Currency Agreement (including any
Person who is a Lender (and any Affiliate thereof) as of the Closing Date but
subsequently, whether before or after entering into an Interest Rate Agreement
or Currency Agreement, ceases to be a Lender) including, without limitation,
each such Affiliate that enters into a joinder agreement with Collateral Agent.
"LIBOR RATE LOAN" means a Term Loan bearing interest at a rate
determined by reference to the Adjusted LIBOR Rate.
"LIEN" means (i) any lien, mortgage, pledge, assignment, security
interest, charge or encumbrance of any kind (including any agreement to give any
of the foregoing, any conditional sale or
15 CREDIT AND GUARANTY AGREEMENT
other title retention agreement, and any lease in the nature thereof) and any
option, trust or other preferential arrangement having the practical effect of
any of the foregoing, and (ii) in the case of Securities issued by any
Subsidiary, any purchase option, call or similar right of a third party with
respect to such Securities.
"LOAN TO VALUE RATIO" means the ratio, as of the last day of any
Fiscal Quarter ending after the Closing Date, of (a) the Company's Obligations
as of such day, to (b) the Company's Enterprise Value as of such day.
"MARGIN STOCK" as defined in Regulation U of the Board of Governors
of the Federal Reserve System as in effect from time to time.
"MATERIAL ADVERSE EFFECT" means whether singly or in conjunction
with any other event, act, condition, or occurrence of any nature, whether or
not related, a material adverse effect on and/or material adverse developments
with respect to (i) the business operations, properties, assets, condition
(financial or otherwise) or prospects of Company and its Subsidiaries taken as a
whole; (ii) a significant portion of the industry or business segment in which
Company or its Subsidiaries operate or rely upon if such effect or development
will have a material adverse effect on Company and its Subsidiaries taken as a
whole; (iii) the ability of any Credit Party to fully and timely perform its
Obligations; (iv) the legality, validity, binding effect, or enforceability
against a Credit Party of a Credit Document to which it is a party; or (v) the
rights, remedies and benefits available to, or conferred upon, any Agent and any
Lender under any Credit Document.
"MATERIAL CONTRACT" means (i) any contract or other arrangement to
which Company or any of its Subsidiaries is a party (other than the Credit
Documents) for which breach, nonperformance, cancellation or failure to renew
could reasonably be expected to have a Material Adverse Effect, and (ii) those
contracts and arrangements required under SECTION 4.16 to be listed on SCHEDULE
4.16 to the Disclosure Letter.
"MATERIAL REAL ESTATE ASSET" means (i)(a) any fee-owned Real Estate
Asset having a fair market value in excess of $500,000 as of the date of the
acquisition thereof, and (b) all Leasehold Properties other than those with
respect to which the aggregate payments under the term of the lease are less
than $100,000 per annum, or (ii) any Real Estate Asset that the Requisite
Lenders have determined (and notified Company of such determination) is material
to the business, operations, properties, assets, condition (financial or
otherwise) or prospects of Company or any Subsidiary thereof, including Company
and any listed on SCHEDULE 1.1.
"MAXIMUM CASH BALANCE" as defined in SECTION 5.17.
"MOODY'S" means ▇▇▇▇▇'▇ Investor Services, Inc.
"MULTIEMPLOYER PLAN" means any Employee Benefit Plan which is a
"multiemployer plan" as defined in Section 3(37) of ERISA.
"NAIC" means The National Association of Insurance Commissioners,
and any successor thereto.
"NARRATIVE REPORT" means, with respect to the financial statements
for which such narrative report is required, a narrative report describing the
operations of Company and its Subsidiaries in the form similar to that which
would be presented as "Management Discussion and Analysis" in a filing with the
Securities and Exchange Commission for the applicable, Fiscal Quarter or Fiscal
Year and
16 CREDIT AND GUARANTY AGREEMENT
for the period from the beginning of the then current Fiscal Year to the end of
such period to which such financial statements relate with comparison to and
variances from the comparable period for the preceding year.
"NET ASSET SALE PROCEEDS" means, with respect to any Asset Sale, an
amount equal to: (i) Cash payments or Cash Equivalents received by Company or
any of its Subsidiaries from such Asset Sale, minus (ii) any bona fide direct
costs incurred in connection with such Asset Sale, including (a) income or gains
taxes payable by the seller as a result of any gain recognized in connection
with such Asset Sale during the tax period the sale occurs, (b) payment of the
outstanding principal amount of, premium or penalty, if any, and interest on any
Indebtedness (other than the Term Loans) that is secured by a Lien on the stock
or assets in question and that is required to be repaid under the terms thereof
as a result of such Asset Sale, and (c) a reasonable reserve for any
indemnification payments (fixed or contingent) attributable to seller's
indemnities and representations and warranties to purchaser in respect of such
Asset Sale undertaken by Company or any of its Subsidiaries in connection with
such Asset Sale; provided that upon release of any such reserve, the amount
released shall be considered Net Asset Sale Proceeds.
"NET INSURANCE/CONDEMNATION PROCEEDS" means an amount equal to: (i)
any Cash payments or proceeds received by Company or any of its Subsidiaries (a)
under any casualty, business interruption or "key man" insurance policies in
respect of any covered loss thereunder, or (b) as a result of the taking of any
assets of Company or any of its Subsidiaries by any Person pursuant to the power
of eminent domain, condemnation or otherwise, or pursuant to a sale of any such
assets to a purchaser with such power under threat of such a taking, minus
(ii)(a) any actual and reasonable costs incurred by Company or any of its
Subsidiaries in connection with the adjustment or settlement of any claims of
Company or such Subsidiary in respect thereof, and (b) any bona fide direct
costs incurred in connection with any sale of such assets as referred to in
CLAUSE (i)(b) of this definition, including income taxes payable as a result of
any gain recognized in connection therewith.
"NON-US LENDER" as defined in SECTION 2.17(c).
"NOTICE" means a Funding Notice or a Conversion/Continuation Notice.
"OBLIGATIONS" means all obligations of every nature of each Credit
Party from time to time owed to the Agents (including former Agents), the
Lenders or any of them and Lender Counterparties, or any other Person required
to be indemnified by Company, that arises under any Credit Document or Interest
Rate Agreement and Currency Agreement (including, without limitation, with
respect to an Interest Rate Agreement or Currency Agreement, obligations owed
thereunder to any person who was a Lender or an Affiliate of a Lender at the
time such Interest Rate Agreement or Currency Agreement was entered into),
whether for principal, interest (including interest which, but for the filing of
a petition in bankruptcy with respect to such Credit Party, would have accrued
on any Obligation, whether or not a claim is allowed against such Credit Party
for such interest in the related bankruptcy proceeding), payments for early
termination of Interest Rate Agreements or Currency Agreements, fees, expenses,
indemnification or otherwise.
"OBLIGEE GUARANTOR" as defined in SECTION 7.7.
"ORGANIZATIONAL DOCUMENTS" means (i) with respect to any
corporation, its certificate or articles of incorporation or organization, as
amended, and its by-laws, as amended, any certificate of determination or
instrument relating to the rights of preferred shareholders of such corporation,
any shareholder rights agreement, and all applicable resolutions of the board of
directors (or any committee thereof) of such corporation, (ii) with respect to
any limited partnership, its certificate of limited
17 CREDIT AND GUARANTY AGREEMENT
partnership, as amended, and its partnership agreement, as amended, (iii) with
respect to any general partnership, its partnership agreement, as amended, and
(iv) with respect to any limited liability company, its articles of
organization, as amended, and its operating agreement, as amended. In the event
any term or condition of this Agreement or any other Credit Document requires
any Organizational Document to be certified by a secretary of state or similar
governmental official, the reference to any such "ORGANIZATIONAL DOCUMENT" shall
only be to a document of a type customarily certified by such governmental
official.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"PENSION PLAN" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to Section 412 of the Internal Revenue Code
or Section 302 of ERISA.
"PERMITTED ACQUISITION" means any acquisition by Company or any of
its wholly-owned Subsidiaries, whether by purchase, merger or otherwise, of all
or substantially all of the assets of, all of the Capital Stock of, or a
business line or unit or a division of, any Person; provided,
(i) immediately prior to, and after giving effect thereto, no
Default or Event of Default shall have occurred and be continuing or would
result therefrom;
(ii) all transactions in connection therewith shall be consummated,
in all material respects, in accordance with all applicable laws and in
conformity with all applicable Governmental Authorizations;
(iii) in the case of the acquisition of Capital Stock, all of the
Capital Stock (except for any such Securities in the nature of directors'
qualifying shares required pursuant to applicable law) acquired or otherwise
issued by such Person or any newly formed Subsidiary of Company in connection
with such acquisition shall be owned 100% by Company or a Guarantor Subsidiary
thereof, and Company shall have taken, or caused to be taken, as of the date
such Person becomes a Subsidiary of Company, each of the actions set forth in
SECTIONS 5.10 and/or 5.11, as applicable;
(iv) Company and its Subsidiaries shall be in compliance with the
financial covenants set forth in SECTION 6.8(a), (b), and (e) on a pro forma
basis after giving effect to such acquisition as of the last day of the Fiscal
Quarter most recently ended;
(v) Company shall have delivered to Administrative Agent at least 20
Business Days prior to such proposed acquisition, a Compliance Certificate
evidencing compliance with SECTION 6.8(a), (b), and (e) as required under CLAUSE
(iv) above, together with all relevant financial information with respect to
such acquired assets, including, without limitation, the aggregate consideration
for such acquisition and any other information required to demonstrate
compliance with SECTION 6.8(a), (b), and (e);
(vi) any Person or assets or division as acquired in accordance
herewith (y) shall be in the business or lines of business specified in SECTION
6.13; and
(vii) the acquisition shall have been approved by the board of
directors or other governing body or controlling Person of the Person acquired
or the Person from whom such assets or division is acquired.
18 CREDIT AND GUARANTY AGREEMENT
"PERMITTED EXCHANGE" means the New York Stock Exchange, the American
Stock Exchange or the Nasdaq National Market.
"PERMITTED LIENS" means each of the Liens permitted pursuant to
SECTION 6.2.
"PERSON" means and includes natural persons, corporations, limited
partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, Joint Ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and Governmental Authorities.
"PHASE I REPORT" means, with respect to any Facility, a report that
(i) conforms to the ASTM Standard Practice for Environmental Site Assessments:
Phase I Environmental Site Assessment Process, E 1527, (ii) was conducted no
more than six months prior to the date such report is required to be delivered
hereunder, by one or more environmental consulting firms reasonably satisfactory
to Administrative Agent, (iii) includes an assessment of asbestos-containing
materials at such Facility, (iv) is accompanied by (a) an estimate of the
reasonable worst-case cost of investigating and remediating any Hazardous
Materials Activity identified in the Phase I Report as giving rise to an actual
or potential material violation of any Environmental Law or as presenting a
material risk of giving rise to a material Environmental Claim, and (b) a
current compliance audit setting forth an assessment of Company's, its
Subsidiaries' and such Facility's current and past compliance with Environmental
Laws and an estimate of the cost of rectifying any non-compliance with current
Environmental Laws identified therein and the cost of compliance with reasonably
anticipated future Environmental Laws identified therein.
"PLEDGE AND SECURITY AGREEMENT" means a Pledge and Security
Agreement, to be executed by Company and each Guarantor, if any, substantially
in the form of EXHIBIT H-1, as it may be amended, supplemented or otherwise
modified from time to time.
"PLEDGOR" as defined in the Pledge and Security Agreement.
"PREPAYMENT PREMIUM" as defined in SECTION 2.10(c).
"PRIME RATE" means the rate of interest quoted in The Wall Street
Journal, Money Rates Section as the Prime Rate (currently defined as the base
rate on corporate loans posted by at least 75% of the nation's thirty (30)
largest banks), as in effect from time to time. The Prime Rate is a reference
rate and does not necessarily represent the lowest or best rate actually charged
to any customer. Agent or any other Lender may make commercial loans or other
loans at rates of interest at, above or below the Prime Rate.
"PRINCIPAL OFFICE" means, for Administrative Agent, such Person's
"PRINCIPAL OFFICE" as set forth on APPENDIX B, or such other office as such
Person may from time to time designate in writing to Company, Administrative
Agent and each Lender.
"PRO RATA SHARE" means (i) with respect to all payments,
computations and other matters relating to the Term Loan of any Lender, the
percentage obtained by dividing (a) the Term Loan Exposure of that Lender, by
(b) the aggregate Term Loan Exposure of all Lenders. For all other purposes with
respect to each Lender, "PRO RATA SHARE" means the percentage obtained by
dividing (A) an amount equal to the sum of the Term Loan Exposure of that
Lender, by (B) an amount equal to the sum of the aggregate Term Loan Exposure of
all Lenders.
"PROJECTIONS" as defined in SECTION 4.8.
19 CREDIT AND GUARANTY AGREEMENT
"QUALIFIED IPO" means a firmly underwritten initial public offering
of common equity securities by the Company: (i) resulting in net aggregate
proceeds to the Company (after accounting for underwriting discounts and
commissions and not including any proceeds to any selling shareholders) of not
less than $50,000,000; (ii) immediately after giving effect to which, the equity
securities are listed for trading on a Permitted Exchange; and (iii) that
results in the conversion, into the Company's common equity securities, of all
of Company's issued and outstanding preferred equity securities.
"REAL ESTATE ASSET" means, at any time of determination, any
interest (fee, leasehold or otherwise) then owned by any Credit Party in any
real property.
"REGISTER" as defined in SECTION 2.4(b).
"REGULATION D" means Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"RELATED FUND" means, with respect to any Lender that is an
investment fund, any other investment fund that invests in commercial loans and
that is managed or advised by the same investment advisor as such Lender or by
an Affiliate of such investment advisor.
"RELEASE" means any release, spill, emission, leaking, pumping,
pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping,
leaching or migration of any Hazardous Material into the indoor or outdoor
environment (including the abandonment or disposal of any barrels, containers or
other closed receptacles containing any Hazardous Material), including the
movement of any Hazardous Material through the air, soil, surface water or
groundwater.
"REPLACEMENT LENDER" as defined in SECTION 2.20.
"REQUIRED PREPAYMENT DATE" as defined in SECTION 2.12(b).
"REQUISITE LENDERS" means one or more Lenders having or holding Term
Loan Exposure representing more than 50% of the sum of the aggregate Term Loan
Exposure of all Lenders.
"RESTRICTED CASH ACCOUNT" means that account established pursuant to
SECTION 5.14(b).
"RESTRICTED JUNIOR PAYMENT" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of stock
of Company now or hereafter outstanding, except a dividend payable solely in
shares of that class of stock to the holders of that class; (ii) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of stock of Company now or
hereafter outstanding; (iii) any payment made to retire, or to obtain the
surrender of, any outstanding warrants, options or other rights to acquire
shares of any class of stock of Company now or hereafter outstanding; and (iv)
management or similar fees payable to any equity investor or any of its
Affiliates.
"S&P" means Standard & Poor's Ratings Group, a division of The
McGraw Hill Corporation.
"SECURITIES" means any stock, shares, partnership interests, voting
trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any
20 CREDIT AND GUARANTY AGREEMENT
certificates of interest, shares or participations in temporary or interim
certificates for the purchase or acquisition of, or any right to subscribe to,
purchase or acquire, any of the foregoing.
"SECURITIES ACT" means the Securities Act of 1933, as amended from
time to time, and any successor statute.
"SERIES C PREFERRED SHAREHOLDER" means the beneficial owner of any
Series C Preferred Shares.
"SERIES C PREFERRED SHARES" means the outstanding shares of Series C
Preferred Stock of the Company.
"SERIES D PREFERRED SHAREHOLDER" means the beneficial owner of any
Series D Preferred Shares.
"SERIES D PREFERRED SHARES" means the outstanding shares of Series D
Preferred Stock of the Company.
"SOLVENCY CERTIFICATE" means a Solvency Certificate of the chief
financial officer of Company substantially in the form of EXHIBIT G-2.
"SOLVENT" means, with respect to any Credit Party, that as of the
date of determination, both (i)(a) the total amount of such Credit Party's debt
(including contingent, disputed, and unliquidated liabilities) does not exceed
the present fair saleable value of such Credit Party's present assets, as such
value is established and liabilities evaluated for purposes of Section 101(3)(A)
of the Bankruptcy Code and, in the alternative, for purposes of the Uniform
Fraudulent Transfer Act; (b) such Credit Party's capital is not unreasonably
small in relation to its business as contemplated on the Closing Date and
reflected in the Projections or with respect to any transaction contemplated or
undertaken after the Closing Date; (c) such Credit Party is able to realize upon
its property and pay its debts and other liabilities (including contingent,
disputed, and unliquidated liabilities) as they mature in the normal course of
business; and (d) such Person has not incurred and does not intend to incur, or
believe (nor should it reasonably believe) that it will incur, debts beyond its
ability to pay such debts as they become due (whether at maturity or otherwise);
and (ii) such Person is "solvent" within the meaning given that term and similar
terms under applicable laws relating to fraudulent transfers and conveyances.
For purposes of this definition, the amount of any contingent liability at any
time shall be computed as the amount that, in light of all of the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability (irrespective of whether
such contingent liabilities meet the criteria for accrual under Statement of
Financial Accounting Standard No.5).
"SUBJECT TRANSACTION" as defined in SECTION 6.8(g).
"SUBSIDIARY" means, with respect to any Person, any corporation,
partnership, limited liability company, association, joint venture or other
business entity of which more than 50% of the total voting power of shares of
stock or other ownership interests entitled (without regard to the occurrence of
any contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination
thereof; provided, in determining the percentage of ownership interests of any
Person controlled by another Person, no ownership interest in the nature of a
"qualifying share" of the former Person shall be deemed to be outstanding.
21 CREDIT AND GUARANTY AGREEMENT
"SYNDICATION AGENT" as defined in the preamble hereto.
"TAX" means any present or future tax, levy, impost, duty,
assessment, charge, fee, deduction or withholding of any nature and whatever
called, by whomsoever, on whomsoever and wherever imposed, levied, collected,
withheld or assessed; provided, "Tax on the overall net income" of a Person
shall be construed as a reference to a tax imposed by the jurisdiction in which
that Person is organized or in which that Person's applicable principal office
(and/or, in the case of a Lender, its lending office) is located or in which
that Person (and/or, in the case of a Lender, its lending office) is deemed to
be doing business on all or part of the net income, profits or gains (whether
worldwide, or only insofar as such income, profits or gains are considered to
arise in or to relate to a particular jurisdiction, or otherwise) of that Person
(and/or, in the case of a Lender, its applicable lending office).
"TERM LOAN" means a Term Loan made by a Lender to Company pursuant
to SECTION 2.1(a).
"TERM LOAN COMMITMENT" means the commitment of a Lender to make or
otherwise fund a Term Loan and "TERM LOAN COMMITMENTS" means such commitments of
all Lenders in the aggregate. The amount of each Lender's Term Loan Commitment
is set forth on APPENDIX A or in the applicable Assignment Agreement, subject to
any adjustment or reduction pursuant to the terms and conditions hereof. The
aggregate amount of the Term Loan Commitments as of the Closing Date is
$20,000,000.
"TERM LOAN EXPOSURE" means, with respect to any Lender, as of any
date of determination, the outstanding principal amount of the Term Loans of
such Lender; provided, at any time prior to the making of the Term Loans, the
Term Loan Exposure of any Lender shall be equal to such Lender's Term Loan
Commitment.
"TERM LOAN MATURITY DATE" means the earlier of (i) April 25, 2008,
and (ii) the date that all Term Loans shall become due and payable in full
hereunder, whether by acceleration or otherwise.
"TERM LOAN NOTE" means a promissory note in the form of EXHIBIT B,
as it may be amended, supplemented or otherwise modified from time to time.
"TERMINATED LENDER" as defined in SECTION 2.20.
"TRANSACTION COSTS" means the fees, costs and expenses payable by
Company or any of Company's Subsidiaries on or before the Closing Date in
connection with the transactions contemplated by the Credit Documents.
"TYPE OF LOAN" means with respect to Term Loans, a Base Rate Loan or
a LIBOR Rate Loan.
"UCC" means the Uniform Commercial Code (or any similar or
equivalent legislation) as in effect in any applicable jurisdiction.
"WAIVABLE MANDATORY PREPAYMENT" as defined in SECTION 2.12(b).
"YIELD MAINTENANCE PREMIUM" as defined in SECTION 2.10(b).
1.2. ACCOUNTING TERMS. Except as otherwise expressly provided herein, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP.
22 CREDIT AND GUARANTY AGREEMENT
Financial statements and other information required to be delivered by Company
to Lenders pursuant to SECTION 5.1(a), 5.1(b), 5.1(c) and 5.1(d) shall be
prepared in accordance with GAAP as in effect at the time of such preparation
(and delivered together with the reconciliation statements provided for in
SECTION 5.1(F), if applicable). Subject to the foregoing, calculations in
connection with the definitions, covenants and other provisions hereof shall
utilize accounting principles and policies in conformity with those used to
prepare the Historical Financial Statements.
1.3. INTERPRETATION, ETC. Any of the terms defined herein may, unless the
context otherwise requires, be used in the singular or the plural, depending on
the reference. References herein to any Section, Appendix, Schedule or Exhibit
shall be to a Section, an Appendix, a Schedule or an Exhibit, as the case may
be, hereof unless otherwise specifically provided. The use herein of the word
"include" or "including," when following any general statement, term or matter,
shall not be construed to limit such statement, term or matter to the specific
items or matters set forth immediately following such word or to similar items
or matters, whether or not no limiting language (such as "without limitation" or
"but not limited to" or words of similar import) is used with reference thereto,
but rather shall be deemed to refer to all other items or matters that fall
within the broadest possible scope of such general statement, term or matter.
SECTION 2. TERM LOAN
2.1. TERM LOAN.
(a) Term Loan Commitments. Subject to the terms and conditions
hereof, each Lender severally agrees to make, on the Closing Date, a Term Loan
to Company in an amount equal to such Lender's Term Loan Commitment.
Company may make only one borrowing under the Term Loan Commitment which shall
be on the Closing Date. Any amount borrowed under this SECTION 2.1(a) and
subsequently repaid or prepaid may not be reborrowed. Subject to SECTIONS 2.9
and 2.10, all amounts owed hereunder with respect to the Term Loan shall be paid
in full no later than the Term Loan Maturity Date. Each Lender's Term Loan
Commitment shall terminate immediately and without further action on the Closing
Date after giving effect to the funding of such Lender's Term Loan Commitment on
such date.
(b) Borrowing Mechanics for Term Loans.
(i) Company shall deliver to Administrative Agent a fully
executed Funding Notice (specifying a Base Rate Loan) on or prior to the
Closing Date with respect to Term Loans made on the Closing Date. Promptly
upon receipt by Administrative Agent of such Funding Notice,
Administrative Agent shall notify each Lender of the proposed borrowing.
(ii) Each Lender shall make its Term Loan available to
Administrative Agent not later than 12:00 p.m. (New York City time) on the
Closing Date, by wire transfer of same day funds in Dollars, at
Administrative Agent's Principal Office. Upon satisfaction or waiver of
the conditions precedent specified herein, Administrative Agent shall make
the proceeds of the Term Loans available to Company on the Closing Date by
causing an amount of same day funds in Dollars equal to the proceeds of
all such Term Loans received by Administrative Agent from Lenders to be
credited to the account of Company at Administrative Agent's Principal
Office or to such other account as may be designated in writing to
Administrative Agent by Company.
2.2. PRO RATA SHARES; AVAILABILITY OF FUNDS.
23 CREDIT AND GUARANTY AGREEMENT
(a) Pro Rata Shares. All Term Loans shall be made by Lenders
simultaneously and proportionately to their respective Pro Rata Shares, it being
understood that no Lender shall be responsible for any default by any other
Lender in such other Lender's obligation to make a Term Loan requested hereunder
nor shall any Term Loan Commitment of any Lender be increased or decreased as a
result of a default by any other Lender in such other Lender's obligation to
make a Term Loan requested hereunder or purchase a participation required
hereby.
(b) Availability of Funds. Unless Administrative Agent shall have
been notified by any Lender prior to the applicable Closing Date that such
Lender does not intend to make available to Administrative Agent the amount of
such Lender's Term Loan requested on the Closing Date, Administrative Agent may
assume that such Lender has made such amount available to Administrative Agent
on the Closing Date and Administrative Agent may, in its sole discretion, but
shall not be obligated to, make available to Company a corresponding amount on
the Closing Date. If such corresponding amount is not in fact made available to
Administrative Agent by such Lender, Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Lender together with
interest thereon, for each day from the Closing Date until the date such amount
is paid to Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three Business Days and
thereafter at the Base Rate. If such Lender does not pay such corresponding
amount forthwith upon Administrative Agent's demand therefor, Administrative
Agent shall promptly notify Company and Company shall immediately pay such
corresponding amount to Administrative Agent together with interest thereon, for
each day from the Closing Date until the date such amount is paid to
Administrative Agent, at the rate payable hereunder for Base Rate Loans. Nothing
in this SECTION 2.2(b) shall be deemed to relieve any Lender from its obligation
to fulfill its Term Loan Commitments hereunder or to prejudice any rights that
Company may have against any Lender as a result of any default by such Lender
hereunder.
2.3. USE OF PROCEEDS. The proceeds of the Term Loan made on the Closing
Date shall be applied by Company to repay Existing Indebtedness, pay Transaction
Costs, and for general corporate purposes. No portion of the proceeds of any
Credit Extension shall be used in any manner that causes or might cause such
Credit Extension or the application of such proceeds to violate Regulation T,
Regulation U or Regulation X of the Board of Governors of the Federal Reserve
System or any other regulation thereof or to violate the Exchange Act.
2.4. EVIDENCE OF DEBT; REGISTER; LENDERS' BOOKS AND RECORDS; TERM LOAN
NOTES.
(a) Lenders' Evidence of Debt. Each Lender shall maintain on its
internal records an account or accounts evidencing the Obligations of Company to
such Lender, including the amounts of the Term Loans made by it and each
repayment and prepayment in respect thereof. Any such recordation shall be
conclusive and binding on Company, absent manifest error; provided, that the
failure to make any such recordation, or any error in such recordation, shall
not affect Company's Obligations in respect of any applicable Term Loans; and
provided further, in the event of any inconsistency between the Register and any
Lender's records, the recordations in the Register shall govern.
(b) Register. Administrative Agent shall maintain at its Principal
Office a register for the recordation of the names and addresses of Lenders and
Term Loans of each Lender from time to time (the "REGISTER"). The Register shall
be available for inspection by Company or any Lender at any reasonable time and
from time to time upon reasonable prior notice. Administrative Agent shall
record in the Register the Term Loans, and each repayment or prepayment in
respect of the principal amount of the Term Loans, and any such recordation
shall be conclusive and binding on Company and each Lender, absent manifest
error; provided, failure to make any such recordation, or any error in such
recordation, shall not affect Company's Obligations in respect of any Term Loan.
Company hereby designates the
24 CREDIT AND GUARANTY AGREEMENT
entity serving as Administrative Agent to serve as Company's agent solely for
purposes of maintaining the Register as provided in this SECTION 2.4, and
Company hereby agrees that, to the extent such entity serves in such capacity,
the entity serving as Administrative Agent and its officers, directors,
employees, agents and affiliates shall constitute "INDEMNITEES."
(c) Term Loan Notes. If so requested by any Lender by written notice
to Company (with a copy to Administrative Agent) at least two Business Days
prior to the Closing Date, or at any time thereafter, Company shall execute and
deliver to such Lender (and/or, if applicable and if so specified in such
notice, to any Person who is an assignee of such Lender pursuant to SECTION
10.6) on the Closing Date (or, if such notice is delivered after the Closing
Date, promptly after Company's receipt of such notice) a Term Loan Note or Notes
to evidence such Lender's Term Loan.
2.5. INTEREST ON TERM LOANS.
(a) Except as otherwise set forth herein, each Term Loan shall bear
interest on the unpaid principal amount thereof from the date made through
repayment (whether by acceleration or otherwise) thereof as follows:
(i) if a Base Rate Loan, at the Base Rate plus 4.50%; or
(ii) if a LIBOR Rate Loan, at the Adjusted LIBOR Rate plus
6.00%.
(b) The basis for determining the rate of interest with respect to
any Term Loan, and the Interest Period with respect to any LIBOR Rate Loan,
shall be selected by Company and notified to Administrative Agent and Lenders
pursuant to the applicable Funding Notice or Conversion/Continuation Notice, as
the case may be. If on any day a Term Loan is outstanding with respect to which
a Funding Notice or Conversion/Continuation Notice has not been delivered to
Administrative Agent in accordance with the terms hereof specifying the
applicable basis for determining the rate of interest, then for that day such
Term Loan shall be a Base Rate Loan.
(c) In the event Company fails to specify between a Base Rate Loan
or a LIBOR Rate Loan in the applicable Funding Notice or Conversion/Continuation
Notice, such Term Loan (if outstanding as a LIBOR Rate Loan) will be
automatically converted into a Base Rate Loan on the last day of the
then-current Interest Period for such Term Loan (or if outstanding as a Base
Rate Loan will remain as, or (if not then outstanding) will be made as, a Base
Rate Loan). In the event Company fails to specify an Interest Period for any
LIBOR Rate Loan in the applicable Funding Notice or Conversion/Continuation
Notice, Company shall be deemed to have selected an Interest Period of one
month. As soon as practicable after 10:00 a.m. (New York City time) on each
Interest Rate Determination Date, Administrative Agent shall determine (which
determination shall, absent manifest error, be final, conclusive and binding
upon all parties) the interest rate that shall apply to the LIBOR Rate Loans for
which an interest rate is then being determined for the applicable Interest
Period and shall promptly give notice thereof (in writing or by telephone
confirmed in writing) to Company and each Lender.
(d) Interest payable pursuant to SECTION 2.5(a) shall be computed on
the basis of a 360-day year, in each case for the actual number of days elapsed
in the period during which it accrues. In computing interest on any Term Loan,
the date of the making of such Term Loan or the first day of an Interest Period
applicable to such Term Loan or, with respect to a Base Rate Loan being
converted from a LIBOR Rate Loan, the date of conversion of such LIBOR Rate Loan
to such Base Rate Loan, as the case may be, shall be included, and the date of
payment of such Term Loan or the expiration date of an Interest Period
applicable to such Term Loan or, with respect to a Base Rate Loan being
converted to a LIBOR
25 CREDIT AND GUARANTY AGREEMENT
Rate Loan, the date of conversion of such Base Rate Loan to such LIBOR Rate
Loan, as the case may be, shall be excluded; provided, if a Term Loan is repaid
on the same day on which it is made, one day's interest shall be paid on that
Term Loan.
(e) Except as otherwise set forth herein, interest on each Term Loan
shall be payable in arrears on and to (i) each Interest Payment Date applicable
to that Term Loan; (ii) upon any prepayment of that Term Loan, whether voluntary
or mandatory, to the extent accrued on the amount being prepaid; and (iii) at
maturity, including final maturity.
2.6. CONVERSION/CONTINUATION.
(a) Subject to SECTION 2.15 and so long as no Default or Event of
Default shall have occurred and then be continuing, Company shall have the
option:
(i) to convert at any time all or any part of any Term Loan
equal to $1,000,000 and integral multiples of $1,000,000 in excess of that
amount from one Type of Loan to another Type of Loan; provided, a LIBOR
Rate Loan may only be converted on the expiration of the Interest Period
applicable to such LIBOR Rate Loan unless Company shall pay all amounts
due under SECTION 2.15 in connection with any such conversion; or
(ii) upon the expiration of any Interest Period applicable to
any LIBOR Rate Loan, to continue all or any portion of such Term Loan
equal to $1,000,000 and integral multiples of $1,000,000 in excess of that
amount as a LIBOR Rate Loan.
(b) Company shall deliver a Conversion/Continuation Notice to
Administrative Agent no later than 10:00 a.m. (New York City time) at least one
Business Day in advance of the proposed conversion date (in the case of a
conversion to a Base Rate Loan) and at least three Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion to, or a
continuation of, a LIBOR Rate Loan). Except as otherwise provided herein, a
Conversion/Continuation Notice for conversion to, or continuation of, any LIBOR
Rate Loans (or telephonic notice in lieu thereof) shall be irrevocable on and
after the related Interest Rate Determination Date, and Company shall be bound
to effect a conversion or continuation in accordance therewith.
2.7. DEFAULT INTEREST. Upon the occurrence and during the continuance of
an Event of Default, the principal amount of all Loans outstanding and, to the
extent permitted by applicable law, any interest payments on the Term Loans or
any fees or other amounts owed hereunder, shall thereafter bear interest
(including post-petition interest in any proceeding under the Bankruptcy Code or
other applicable bankruptcy laws) payable on demand at a rate that is 3% per
annum in excess of the interest rate otherwise payable hereunder with respect to
the applicable Term Loans (or, in the case of any such fees and other amounts,
at a rate which is 3% per annum in excess of the interest rate otherwise payable
hereunder for Base Rate Loans); provided, in the case of LIBOR Rate Loans, upon
the expiration of the Interest Period in effect at the time any such increase in
interest rate is effective such LIBOR Rate Loans shall thereupon become Base
Rate Loans and shall thereafter bear interest payable upon demand at a rate
which is 3% per annum in excess of the interest rate otherwise payable hereunder
for Base Rate Loans. Payment or acceptance of the increased rates of interest
provided for in this SECTION 2.7 is not a permitted alternative to timely
payment and shall not constitute a waiver of any Event of Default or otherwise
prejudice or limit any rights or remedies of Administrative Agent or any Lender.
26 CREDIT AND GUARANTY AGREEMENT
2.8. FEES.
(a) The Company agrees to pay to the Administrative Agent, for its
own account, the fees in the amounts and at the times from time to time agreed
to in writing by the Company (or any Affiliate) and the Administrative Agent,
including pursuant to the Fee Letter.
(b) In addition to any of the foregoing fees, Company agrees to pay
to Agents such other fees in the amounts and at the times separately agreed
upon.
(c) All Fees shall be paid on the dates due, in immediately
available funds, to the Administrative Agent for distribution, if and as
appropriate, among the Lenders. Once paid, none of the Fees shall be refundable
under any circumstances.
2.9. SCHEDULED PAYMENTS.
(a) Installments. The principal amounts of the Term Loans shall be
repaid in consecutive quarterly installments (each, an "INSTALLMENT") in the
aggregate amount of $500,000 on the last day of each Fiscal Quarter (each, an
"INSTALLMENT DATE"), commencing June 30, 2005, and continuing on the last day of
each Fiscal Quarter ending on or prior to the Term Loan Maturity Date, with the
remainder of the Obligation outstanding and unpaid being payable on the Term
Loan Maturity Date.
(b) Waivable Installments. Anything contained herein to the contrary
notwithstanding, not less than two Business Days prior to the Installment Date
on which Company is required to make such Installment, Administrative Agent
shall notify Company of Requisite Lenders' decision to refuse such Installment.
Each Lender may elect whether such Lender would like to exercise such option by
giving written notice to Administrative Agent of its election to exercise its
option not to accept any given Installment on or before the fifth Business Day
prior to the Installment Date (it being understood that any Lender which does
not notify Administrative Agent of its election to exercise such option on or
before the fifth Business Day prior to the Installment Date shall be deemed to
have elected, as of such date, not to exercise its option to refuse such
Installment). Unless Requisite Lenders elect to refuse the Installment on the
Installment Date, Company shall pay to Administrative Agent the amount of the
Installment, which amount shall be applied (i) to prepay the Term Loans of such
Lenders (which prepayment shall be applied to the principal of the Term Loans in
accordance with SECTION 2.12(a)), and (ii) to the extent of any excess, to
Company for working capital and general corporate purposes.
2.10. VOLUNTARY PREPAYMENTS.
(a) Voluntary Prepayments.
(i) Any time and from time to time after the Closing Date:
(1) with respect to Base Rate Loans, Company may
prepay any such Term Loans on any Business Day in whole or in part,
in an aggregate minimum amount of $1,000,000 and integral multiples
of $1,000,000 in excess of that amount; and
(2) with respect to LIBOR Rate Loans, Company may
prepay any such Term Loans on any Business Day in whole or in part
(together with any amounts due pursuant to SECTION 2.15(c)) in an
aggregate minimum amount of $1,000,000 and integral multiples of
$1,000,000 in excess of that amount.
27 CREDIT AND GUARANTY AGREEMENT
(ii) All such prepayments shall be made:
(1) upon not less than one Business Day's prior
written or telephonic notice in the case of Base Rate Loans; and
(2) upon not less than three Business Days' prior
written or telephonic notice in the case of LIBOR Rate Loans,
in each case given to Administrative Agent by 12:00 p.m. (New York City time) on
the date required and, if given by telephone, promptly confirmed in writing to
Administrative Agent (and Administrative Agent will promptly transmit such
telephonic or original notice for Term Loans by telefacsimile or telephone to
each Lender). Upon the giving of any such notice, the principal amount of the
Term Loans specified in such notice shall become due and payable on the
prepayment date specified therein. Any such voluntary prepayment shall be
applied as specified in SECTION 2.12(a) with respect to Term Loans.
(b) Yield Maintenance Premium. If Company prepays, including as a
result of acceleration, for any reason (except as specifically excluded under
SECTION 2.11 below), all or any part of the principal balance of any Term Loan
on or prior to April 25, 2006, Company shall pay to Administrative Agent, for
the benefit of all Lenders entitled to a portion of such prepayment, an amount
(the "YIELD MAINTENANCE PREMIUM") (which such amount shall be in addition to the
Prepayment Premium described below) equal to (1) the aggregate amount of
interest (including, without limitation, interest payable in Cash, in kind or
deferred) which would have otherwise been payable on the amount of the principal
prepayment from the date of prepayment until April 25, 2006, minus (2) the
aggregate amount of interest Lenders would earn if the prepaid principal amount
were reinvested for the period from the date of prepayment until April 25, 2006
at the Treasury Rate. The term "TREASURY RATE" shall mean a rate per annum
(computed on the basis of actual days elapsed over a year of 360 days) equal to
the rate determined by Administrative Agent on the date three (3) Business Days
prior to the date of prepayment, to be the yield expressed as a rate listed in
The Wall Street Journal for United States Treasury securities having a term of
not greater than twelve (12) months. No amount will be payable pursuant to the
foregoing provisions with respect to any prepayment of all or any part of any
Loan after April 25, 2006.
(c) Prepayment Premium. If Company prepays, including as a result of
acceleration, for any reason (except as specifically excluded under SECTION 2.11
below), all or any part of the principal balance of any Term Loan, other than
scheduled payments, on or prior to the Term Loan Maturity Date, Company shall
pay to Administrative Agent (in addition to any Yield Maintenance Premium
required pursuant to CLAUSE (b) above), for the benefit of all Lenders entitled
to a portion of such prepayment, a prepayment premium (the "PREPAYMENT PREMIUM")
on the amount so prepaid as follows:
RELEVANT PERIOD PREPAYMENT PREMIUM
(number of calendar months elapsed since (as a percentage of the amount
the Closing Date) prepaid)
---------------------------------------- ------------------------------
Closing Date through 18 5%
on or after 19; through 24 3%
on or after 24; prior to the end of 36 1%
28 CREDIT AND GUARANTY AGREEMENT
2.11. MANDATORY PREPAYMENTS.
(a) Asset Sales. No later than the first Business Day following the
date of receipt by Company or any of its Subsidiaries of any Net Asset Sale
Proceeds, Company shall prepay the Term Loans (subject to SECTION 2.10) as set
forth in SECTION 2.12(a) in an aggregate amount equal to such Net Asset Sale
Proceeds; provided, so long as no Default or Event of Default shall have
occurred and be continuing, Company shall have the option, directly or through
one or more of its Subsidiaries, to invest Net Asset Sale Proceeds of up to
$250,000 in any Fiscal Year within 180 days of receipt thereof in long-term
productive assets of the general type used in the business of Company and its
Subsidiaries (including any such assets acquired pursuant to a Permitted
Acquisition).
(b) Insurance/Condemnation Proceeds. No later than the first
Business Day following the date of receipt by Company or any of its
Subsidiaries, or Administrative Agent as loss payee, of any Net
Insurance/Condemnation Proceeds, Company shall prepay the Term Loans (subject to
SECTION 2.10) in an aggregate amount equal to such Net Insurance/Condemnation
Proceeds; provided, so long as no Default or Event of Default shall have
occurred and be continuing, Company shall have the option, directly or through
one or more of its Subsidiaries to invest such Net Insurance/Condemnation
Proceeds of up to $250,000 in any Fiscal Year within 180 days of receipt thereof
in long term productive assets of the general type used in the business of
Company and its Subsidiaries, which investment may include the repair,
restoration or replacement of the applicable assets thereof.
(c) Issuance of Equity Securities. On the date of receipt by Company
of any Cash proceeds from a capital contribution to, or the issuance of any
Capital Stock of Company or any of its Subsidiaries in an aggregate amount of
$30,000,000 or more (other than Capital Stock issued (i) in connection with a
Qualified IPO, or (ii) for purposes approved in writing by Administrative
Agent), Company shall prepay the Term Loans (subject to SECTION 2.10) as set
forth in SECTION 2.12(a) in an aggregate amount equal to 100% of such proceeds
in excess of $30,000,000, net of underwriting discounts and commissions and
other reasonable costs and expenses associated therewith, including reasonable
legal fees and expenses.
(d) Issuance of Debt. On the date of receipt by Company or any of
its Subsidiaries of any Cash proceeds from the incurrence of any Indebtedness of
Company or any of its Subsidiaries (other than with respect to any Indebtedness
permitted to be incurred pursuant to SECTION 6.1), Company shall prepay the Term
Loans (subject to SECTION 2.10) as set forth in SECTION 2.12(a) in an aggregate
amount equal to 100% of such proceeds, net of underwriting discounts and
commissions and other reasonable costs and expenses associated therewith,
including reasonable legal fees and expenses.
(e) Consolidated Excess Cash Flow. In the event that there shall be
Consolidated Excess Cash Flow for any Fiscal Year (commencing with Fiscal Year
ending December 31, 2006), Company shall, no later than the date on which
audited annual financial statements must be delivered pursuant to SECTION 5.1,
prepay the Term Loans (subject to SECTION 2.10) as set forth in SECTION 2.12(a)
in an aggregate amount equal to 50% of such Consolidated Excess Cash Flow. Any
amounts prepaid pursuant to this SECTION 2.11(e) with respect to any Fiscal Year
in excess of 50% of Consolidated Excess Cash Flow shall be treated as voluntary
prepayments made pursuant to SECTION 2.12(a), and shall not be subject to the
Yield Maintenance Premium or the Prepayment Premium.
(f) Tax Refunds. On the date of receipt by Company or any of its
Subsidiaries of any tax refunds in excess of $250,000 in the aggregate in any
Fiscal Year, Company shall prepay the Term Loans (subject to SECTION 2.10) as
set forth in SECTION 2.12(a) in the amount of such tax refunds in excess of
$250,000, and shall not be subject to the Yield Maintenance Premium or the
Prepayment Premium.
29 CREDIT AND GUARANTY AGREEMENT
(g) Prepayment Certificate. Concurrently with any prepayment of the
Term Loans pursuant to SECTIONS 2.11(a) through 2.11(f), Company shall deliver
to Administrative Agent a certificate of an Authorized Officer demonstrating the
calculation of the amount of the applicable net proceeds or Consolidated Excess
Cash Flow, as the case may be. In the event that Company shall subsequently
determine that the actual amount received exceeded the amount set forth in such
certificate, Company shall promptly make an additional prepayment of the Term
Loans in an amount equal to such excess, and Company shall concurrently
therewith deliver to Administrative Agent a certificate of an Authorized Officer
demonstrating the derivation of such excess.
2.12. APPLICATION OF PREPAYMENTS.
(a) Application of Prepayments by Type of Loans. Any voluntary
prepayments of Term Loans pursuant to SECTION 2.10 and any mandatory prepayment
of any Term Loan pursuant to SECTION 2.11 shall be applied as follows:
first, to the payment of all due and unpaid expenses and fees to the
full extent thereof;
second, to the payment of any accrued interest at the Current Rate;
third, to the payment of any accrued interest at the Default Rate,
if any;
fourth, to the payment of the Prepayment Premium and Yield
Maintenance Premium, if either is applicable, on any Term Loan;
fifth, except in connection with any Waivable Mandatory Prepayment
in SECTION 2.12(b), to prepay the Term Loans on a pro rata basis (in
accordance with the respective outstanding principal amounts thereof) and
shall be further applied in inverse order of maturity to reduce the
remaining scheduled Installments of principal of the Term Loan; and
sixth, to the payment of any other amounts due to the Agent or the
Lenders under the Credit Documents.
(b) Waivable Mandatory Prepayment. Anything contained herein to the
contrary notwithstanding, in the event Company is required to make any mandatory
prepayment (a "WAIVABLE MANDATORY PREPAYMENT") of the Term Loans, not less than
three Business Days prior to the date (the "REQUIRED PREPAYMENT DATE") on which
Company is required to make such Waivable Mandatory Prepayment, Company shall
notify Administrative Agent of the amount of such prepayment, and Administrative
Agent will promptly thereafter notify each Lender holding an outstanding Term
Loan of the amount of such Lender's Pro Rata Share of such Waivable Mandatory
Prepayment and Requisite Lenders' option to refuse such amount. Each such Lender
may vote on whether such Lender would like to exercise such option by giving
written notice to Administrative Agent of its election to do so on or before the
first Business Day prior to the Required Prepayment Date (it being understood
that any Lender which does not notify Company and Administrative Agent of its
election to exercise such option on or before the first Business Day prior to
the Required Prepayment Date shall be deemed to have elected, as of such date,
not to exercise such option). If Requisite Lenders elect to accept the
prepayment, on the Required Prepayment Date, Company shall pay to Administrative
Agent the amount of the Waivable Mandatory Prepayment, which amount shall be
applied (i) to prepay the Term Loans of such Lenders (which prepayment shall be
applied to the principal of the Term Loans in accordance with SECTION 2.12(a)),
and (ii) to the extent of any excess, to Company for working capital and general
corporate purposes.
30 CREDIT AND GUARANTY AGREEMENT
(c) Application of Prepayments of Term Loans to Base Rate Loans and
LIBOR Rate Loans. Considering any prepayment of Term Loans shall be applied
first to Base Rate Loans to the full extent thereof before application to LIBOR
Rate Loans, in each case in a manner which minimizes the amount of any payments
required to be made by Company pursuant to SECTION 2.15(c).
2.13. GENERAL PROVISIONS REGARDING PAYMENTS.
(a) All payments by Company of principal, interest, fees and other
Obligations shall be made in Dollars in same day funds, without defense,
recoupment, setoff or counterclaim, free of any restriction or condition, and
delivered to Administrative Agent not later than 12:00 p.m. (New York City time)
on the date due at Administrative Agent's Principal Office for the account of
Lenders; funds received by Administrative Agent after that time on such due date
shall be deemed to have been paid by Company on the next Business Day.
(b) All payments in respect of the principal amount of any Term Loan
shall be accompanied by payment of accrued interest on the principal amount
being repaid or prepaid.
(c) Administrative Agent shall promptly distribute to each Lender at
such address as such Lender shall indicate in writing, such Lender's applicable
Pro Rata Share of all payments and prepayments of principal and interest due
hereunder, together with all other amounts due thereto, including, without
limitation, all fees payable with respect thereto, to the extent received by
Administrative Agent.
(d) Notwithstanding the foregoing provisions hereof, if any
Conversion/Continuation Notice is withdrawn as to any Affected Lender or if any
Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any LIBOR
Rate Loans, Administrative Agent shall give effect thereto in apportioning
payments received thereafter.
(e) Subject to the provisos set forth in the definition of "INTEREST
PERIOD," whenever any payment to be made hereunder shall be stated to be due on
a day that is not a Business Day, such payment shall be made on the next
succeeding Business Day and such extension of time shall be included in the
computation of the payment of interest hereunder or of the commitment fees
hereunder.
(f) Administrative Agent shall deem any payment by or on behalf of
Company hereunder that is not made in same day funds prior to 12:00 p.m. (New
York City time) to be a non-conforming payment. Any such payment shall not be
deemed to have been received by Administrative Agent until the later of (i) the
time such funds become available funds, and (ii) the applicable next Business
Day. Administrative Agent shall give prompt telephonic notice to Company and
each applicable Lender (confirmed in writing) if any payment is non-conforming.
Any non-conforming payment may constitute or become a Default or Event of
Default in accordance with the terms of SECTION 8.1(a). Interest shall continue
to accrue on any principal as to which a non-conforming payment is made until
such funds become available funds (but in no event less than the period from the
date of such payment to the next succeeding applicable Business Day) at the
Default Rate determined pursuant to SECTION 2.7 from the date such amount was
due and payable until the date such amount is paid in full.
(g) If an Event of Default shall have occurred and not otherwise
been waived, and the maturity of the Obligations shall have been accelerated
pursuant to SECTION 8.1, all payments or proceeds (whether or not proceeds of
the Collateral) received by Agents hereunder in respect of any of the
Obligations, shall be applied in accordance with the application arrangements
described in Section 7 of the Pledge and Security Agreement.
31 CREDIT AND GUARANTY AGREEMENT
2.14. RATABLE SHARING. Lenders hereby agree among themselves that, except
as otherwise provided in the Collateral Documents with respect to amounts
realized from the exercise of rights with respect to Liens on the Collateral, if
any of them shall, whether by voluntary payment (other than a voluntary
prepayment of Term Loans made and applied in accordance with the terms hereof),
through the exercise of any right of set-off or banker's lien, by counterclaim
or cross action or by the enforcement of any right under the Credit Documents or
otherwise, or as adequate protection of a deposit treated as cash collateral
under the Bankruptcy Code, receive payment or reduction of a proportion of the
aggregate amount of principal, interest, fees and other amounts then due and
owing to such Lender hereunder or under the other Credit Documents
(collectively, the "AGGREGATE AMOUNTS DUE" to such Lender) which is greater than
the proportion received by any other Lender in respect of the Aggregate Amounts
Due to such other Lender, then the Lender receiving such proportionately greater
payment shall (a) notify Administrative Agent and each other Lender of the
receipt of such payment and (b) apply a portion of such payment to purchase
participations (which it shall be deemed to have purchased from each seller of a
participation simultaneously upon the receipt by such seller of its portion of
such payment) in the Aggregate Amounts Due to the other Lenders so that all such
recoveries of Aggregate Amounts Due shall be shared by all Lenders in proportion
to the Aggregate Amounts Due to them; provided, if all or part of such
proportionately greater payment received by such purchasing Lender is thereafter
recovered from such Lender upon the bankruptcy or reorganization of Company or
otherwise, those purchases shall be rescinded and the purchase prices paid for
such participations shall be returned to such purchasing Lender ratably to the
extent of such recovery, but without interest. Company expressly consents to the
foregoing arrangement and agrees that any holder of a participation so purchased
may exercise any and all rights of banker's lien, set-off or counterclaim with
respect to any and all monies owing by Company to that holder with respect
thereto as fully as if that holder were owed the amount of the participation
held by that holder.
2.15. MAKING OR MAINTAINING LIBOR RATE LOANS.
(a) Inability to Determine Applicable Interest Rate. In the event
that Administrative Agent shall have determined (which determination shall be
final and conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any LIBOR Rate Loans, that by reason of
circumstances affecting the London interbank market adequate and fair means do
not exist for ascertaining the interest rate applicable to such LIBOR Rate Loans
on the basis provided for in the definition of Adjusted LIBOR Rate,
Administrative Agent shall on such date give notice (by telefacsimile or by
telephone confirmed in writing) to Company and each Lender of such
determination, whereupon (i) no Term Loans may be made as, or converted to,
LIBOR Rate Loans until such time as Administrative Agent notifies Company and
Lenders that the circumstances giving rise to such notice no longer exist, and
(ii) any Funding Notice or Conversion/Continuation Notice given by Company with
respect to the Term Loans in respect of which such determination was made shall
be deemed to be rescinded by Company.
(b) Illegality or Impracticability of LIBOR Rate Loans. In the event
that on any date any Lender shall have determined (which determination shall be
final and conclusive and binding upon all parties hereto but shall be made only
after consultation with Company and Administrative Agent) that the making,
maintaining or continuation of its LIBOR Rate Loans (i) has become unlawful as a
result of compliance by such Lender in good faith with any law, treaty,
governmental rule, regulation, guideline or order (or would conflict with any
such treaty, governmental rule, regulation, guideline or order not having the
force of law even though the failure to comply therewith would not be unlawful),
or (ii) has become impracticable, as a result of contingencies occurring after
the date hereof which materially and adversely affect the London interbank
market or the position of such Lender in that market, then, and in any such
event, such Lender shall be an "AFFECTED LENDER" and it shall on that day give
notice (by telefacsimile or by telephone confirmed in writing) to Company and
Administrative Agent of such determination (which
32 CREDIT AND GUARANTY AGREEMENT
notice Administrative Agent shall promptly transmit to each other Lender).
Thereafter (1) the obligation of the Affected Lender to make Term Loans as, or
to convert Term Loans to, LIBOR Rate Loans shall be suspended until such notice
shall be withdrawn by the Affected Lender, (2) to the extent such determination
by the Affected Lender relates to a LIBOR Rate Loan then being requested by
Company pursuant to a Funding Notice or a Conversion/Continuation Notice, the
Affected Lender shall make such Term Loan as (or continue such Term Loan as or
convert such Term Loan to, as the case may be) a Base Rate Loan, (3) the
Affected Lender's obligation to maintain its outstanding LIBOR Rate Loans (the
"AFFECTED LOANS") shall be terminated at the earlier to occur of the expiration
of the Interest Period then in effect with respect to the Affected Loans or when
required by law, and (4) the Affected Loans shall automatically convert into
Base Rate Loans on the date of such termination. Notwithstanding the foregoing,
to the extent a determination by an Affected Lender as described above relates
to a LIBOR Rate Loan then being requested by Company pursuant to a Funding
Notice or a Conversion/Continuation Notice, Company shall have the option,
subject to the provisions of SECTION 2.15(c), to rescind such Funding Notice or
Conversion/Continuation Notice as to all Lenders by giving notice (by
telefacsimile or by telephone confirmed in writing) to Administrative Agent of
such rescission on the date on which the Affected Lender gives notice of its
determination as described above (which notice of rescission Administrative
Agent shall promptly transmit to each other Lender). Except as provided in the
immediately preceding sentence, nothing in this SECTION 2.15(b) shall affect the
obligation of any Lender other than an Affected Lender to make or maintain Term
Loans as, or to convert Term Loans to, LIBOR Rate Loans in accordance with the
terms hereof.
(c) Compensation for Breakage or Non-Commencement of Interest
Periods. Company shall compensate each Lender, upon written request by such
Lender (which request shall set forth the basis for requesting such amounts),
for all reasonable losses, expenses and liabilities (including any interest paid
or calculated to be due and payable by such Lender to Lenders of funds borrowed
by it to make or carry its LIBOR Rate Loans and any loss, expense or liability
sustained by such Lender in connection with the liquidation or re-employment of
such funds but excluding loss of anticipated profits) which such Lender may
sustain: (i) if for any reason (other than a default by such Lender) a borrowing
of any LIBOR Rate Loan does not occur on a date specified therefor in a Funding
Notice or a telephonic request for borrowing, or a conversion to or continuation
of any LIBOR Rate Loan does not occur on a date specified therefor in a
Conversion/Continuation Notice or a telephonic request for conversion or
continuation; (ii) if any prepayment or other principal payment of, or any
conversion of, any of its LIBOR Rate Loans occurs on any day other than the last
day of an Interest Period applicable to that Term Loan (whether voluntary,
mandatory, automatic, by reason of acceleration, or otherwise); or (iii) if any
prepayment of any of its LIBOR Rate Loans is not made on any date specified in a
notice of prepayment given by Company.
(d) Booking of LIBOR Rate Loans. Any Lender may make, carry or
transfer LIBOR Rate Loans at, to, or for the account of any of its branch
offices or the office of an Affiliate of such Lender.
(e) Assumptions Concerning Funding of LIBOR Rate Loans. Calculation
of all amounts payable to a Lender under this SECTION 2.15 and under SECTION
2.16 shall be made as though such Lender had actually funded each of its
relevant LIBOR Rate Loans through the purchase of a LIBOR deposit bearing
interest at the rate obtained pursuant to CLAUSE (i) of the definition of
Adjusted LIBOR Rate in an amount equal to the amount of such LIBOR Rate Loan and
having a maturity comparable to the relevant Interest Period and through the
transfer of such LIBOR deposit from an offshore office of such Lender to a
domestic office of such Lender in the United States of America; provided,
however, each Lender may fund each of its LIBOR Rate Loans in any manner it sees
fit and the foregoing assumptions shall be utilized only for the purposes of
calculating amounts payable under this SECTION 2.15 and under SECTION 2.16.
33 CREDIT AND GUARANTY AGREEMENT
2.16. INCREASED COSTS; CAPITAL ADEQUACY.
(a) Compensation For Increased Costs and Taxes. Subject to the
provisions of SECTION 2.17 (which shall be controlling with respect to the
matters covered thereby), in the event that any Lender shall determine (which
determination shall, absent manifest error, be final and conclusive and binding
upon all parties hereto) that any law, treaty or governmental rule, regulation
or order, or any change therein or in the interpretation, administration or
application thereof (including the introduction of any new law, treaty or
governmental rule, regulation or order), or any determination of a court or
governmental authority, in each case that becomes effective after the date
hereof, or compliance by such Lender with any guideline, request or directive
issued or made after the date hereof by any central bank or other governmental
or quasi-governmental authority (whether or not having the force of law): (i)
subjects such Lender (or its applicable lending office) to any additional Tax
(other than any Tax on the overall net income of such Lender) with respect to
this Agreement or any of the other Credit Documents or any of its obligations
hereunder or thereunder or any payments to such Lender (or its applicable
lending office) of principal, interest, fees or any other amount payable
hereunder; (ii) imposes, modifies or holds applicable any reserve (including any
marginal, emergency, supplemental, special or other reserve), special deposit,
compulsory loan, FDIC insurance or similar requirement against assets held by,
or deposits or other liabilities in or for the account of, or advances or loans
by, or other credit extended by, or any other acquisition of funds by, any
office of such Lender (other than any such reserve or other requirements with
respect to LIBOR Rate Loans that are reflected in the definition of Adjusted
LIBOR Rate); or (iii) imposes any other condition (other than with respect to a
Tax matter) on or affecting such Lender (or its applicable lending office) or
its obligations hereunder or the London interbank market; and the result of any
of the foregoing is to increase the cost to such Lender of agreeing to make,
making or maintaining Term Loans hereunder or to reduce any amount received or
receivable by such Lender (or its applicable lending office) with respect
thereto; then, in any such case, Company shall promptly pay to such Lender, upon
receipt of the statement referred to in the next sentence, such additional
amount or amounts (in the form of an increased rate of, or a different method of
calculating, interest or otherwise as such Lender in its sole discretion shall
determine) as may be necessary to compensate such Lender for any such increased
cost or reduction in amounts received or receivable hereunder. Such Lender shall
deliver to Company (with a copy to Administrative Agent) a written statement,
setting forth in reasonable detail the basis for calculating the additional
amounts owed to such Lender under this SECTION 2.16(a), which statement shall be
conclusive and binding upon all parties hereto absent manifest error.
(b) Capital Adequacy Adjustment. In the event that any Lender shall
have determined that the adoption, effectiveness, phase-in or applicability
after the Closing Date of any law, rule or regulation (or any provision thereof)
regarding capital adequacy, or any change therein or in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or its applicable lending office) with any guideline, request or
directive regarding capital adequacy (whether or not having the force of law) of
any such Governmental Authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of, or with reference
to, such Lender's Term Loans, or participations therein or other obligations
hereunder with respect to the Term Loans to a level below that which such Lender
or such controlling corporation could have achieved but for such adoption,
effectiveness, phase-in, applicability, change or compliance (taking into
consideration the policies of such Lender or such controlling corporation with
regard to capital adequacy), then from time to time, within five Business Days
after receipt by Company from such Lender of the statement referred to in the
next sentence, Company shall pay to such Lender such additional amount or
amounts as will compensate such Lender or such controlling corporation on an
after-tax basis for such reduction. Such Lender shall deliver to Company (with a
copy to Administrative Agent) a written statement, setting forth in reasonable
detail
34 CREDIT AND GUARANTY AGREEMENT
the basis for calculating the additional amounts owed to Lender under this
SECTION 2.16(b), which statement shall be conclusive and binding upon all
parties hereto absent manifest error.
2.17. TAXES; WITHHOLDING, ETC.
(a) Payments to Be Free and Clear. All sums payable by any Credit
Party hereunder and under the other Credit Documents shall (except to the extent
required by law) be paid free and clear of, and without any deduction or
withholding on account of, any Tax (other than a Tax on the overall net income
of any Lender) imposed, levied, collected, withheld or assessed by or within the
United States of America or any political subdivision in or of the United States
of America or any other jurisdiction from or to which a payment is made by or on
behalf of any Credit Party or by any federation or organization of which the
United States of America or any such jurisdiction is a member at the time of
payment.
(b) Withholding of Taxes. If any Credit Party or any other Person is
required by law to make any deduction or withholding on account of any such Tax
from any sum paid or payable by any Credit Party to Administrative Agent or any
Lender under any of the Credit Documents: (i) Company shall notify
Administrative Agent of any such requirement or any change in any such
requirement as soon as Company becomes aware of it; (ii) Company shall pay any
such Tax before the date on which penalties attach thereto, such payment to be
made (if the liability to pay is imposed on any Credit Party) for its own
account or (if that liability is imposed on Administrative Agent or such Lender,
as the case may be) on behalf of and in the name of Administrative Agent or such
Lender; (iii) the sum payable by such Credit Party in respect of which the
relevant deduction, withholding or payment is required shall be increased to the
extent necessary to ensure that, after the making of that deduction, withholding
or payment, Administrative Agent or such Lender, as the case may be, receives on
the due date a net sum equal to what it would have received had no such
deduction, withholding or payment been required or made; and (iv) within 30 days
after paying any sum from which it is required by law to make any deduction or
withholding, and within 30 days after the due date of payment of any Tax which
it is required by CLAUSE (ii) above to pay, Company shall deliver to
Administrative Agent evidence satisfactory to the other affected parties of such
deduction, withholding or payment and of the remittance thereof to the relevant
taxing or other authority; provided, no such additional amount shall be required
to be paid to any Lender under CLAUSE (iii) above except to the extent that any
change after the date hereof (in the case of each Lender listed on the signature
pages hereof on the Closing Date) or after the effective date of the Assignment
Agreement pursuant to which such Lender became a Lender (in the case of each
other Lender) in any such requirement for a deduction, withholding or payment as
is mentioned therein shall result in an increase in the rate of such deduction,
withholding or payment from that in effect at the date hereof or at the date of
such Assignment Agreement, in respect of payments to such Lender.
(c) Evidence of Exemption From U.S. Withholding Tax. Each Lender
that is not a United States Person (as such term is defined in Section
7701(a)(30) of the Internal Revenue Code) for U.S. federal income tax purposes
(a "NON-US LENDER") shall deliver to Administrative Agent for transmission to
Company, on or prior to the Closing Date (in the case of each Lender listed on
the signature pages hereof on the Closing Date) or on or prior to the date of
the Assignment Agreement pursuant to which it becomes a Lender (in the case of
each other Lender), and at such other times as may be necessary in the
determination of Company or Administrative Agent (each in the reasonable
exercise of its discretion), (i) two original copies of Internal Revenue Service
Form W-8BEN or W-8ECI (or any successor forms), properly completed and duly
executed by such Lender, and such other documentation required under the
Internal Revenue Code and reasonably requested by Company to establish that such
Lender is not subject to deduction or withholding of United States federal
income tax with respect to any payments to such Lender of principal, interest,
fees or other amounts payable under any of the Credit Documents, or (ii) if such
Lender is not a "bank" or other Person described in Section 881(c)(3) of the
Internal Revenue Code and cannot deliver Internal Revenue Service Form W-8ECI
pursuant to CLAUSE (i)
35 CREDIT AND GUARANTY AGREEMENT
above, a Certificate Regarding Non-Bank Status together with two original copies
of Internal Revenue Service Form W-8BEN (or any successor form), properly
completed and duly executed by such Lender, and such other documentation
required under the Internal Revenue Code and reasonably requested by Company to
establish that such Lender is not subject to deduction or withholding of United
States federal income tax with respect to any payments to such Lender of
interest payable under any of the Credit Documents. Each Lender required to
deliver any forms, certificates or other evidence with respect to United States
federal income tax withholding matters pursuant to this SECTION 2.17(c) hereby
agrees, from time to time after the initial delivery by such Lender of such
forms, certificates or other evidence, whenever a lapse in time or change in
circumstances renders such forms, certificates or other evidence obsolete or
inaccurate in any material respect, that such Lender shall promptly deliver to
Administrative Agent for transmission to Company two new original copies of
Internal Revenue Service Form W-8BEN or W-8ECI, or a Certificate re Non-Bank
Status and two original copies of Internal Revenue Service Form W-8BEN (or any
successor form), as the case may be, properly completed and duly executed by
such Lender, and such other documentation required under the Internal Revenue
Code and reasonably requested by Company to confirm or establish that such
Lender is not subject to deduction or withholding of United States federal
income tax with respect to payments to such Lender under the Credit Documents,
or notify Administrative Agent and Company of its inability to deliver any such
forms, certificates or other evidence. Company shall not be required to pay any
additional amount to any Non-US Lender under SECTION 2.17(b)(iii) if such Lender
shall have failed (1) to deliver the forms, certificates or other evidence
referred to in the first or second sentence of this SECTION 2.17(c), or (2) to
notify Administrative Agent and Company of its inability to deliver any such
forms, certificates or other evidence, as the case may be; provided, if such
Lender shall have satisfied the requirements of the first sentence of this
SECTION 2.17(c) on the Closing Date or on the date of the Assignment Agreement
pursuant to which it became a Lender, as applicable, nothing in this last
sentence of SECTION 2.17(c) shall relieve Company of its obligation to pay any
additional amounts pursuant this SECTION 2.17 in the event that, as a result of
any change in any applicable law, treaty or governmental rule, regulation or
order, or any change in the interpretation, administration or application
thereof, such Lender is no longer properly entitled to deliver forms,
certificates or other evidence at a subsequent date establishing the fact that
such Lender is not subject to withholding as described herein.
2.18. OBLIGATION TO MITIGATE. Each Lender agrees that, as promptly as
practicable after the officer of such Lender responsible for administering its
Term Loans, becomes aware of the occurrence of an event or the existence of a
condition that would cause such Lender to become an Affected Lender or that
would entitle such Lender to receive payments under SECTION 2.15, 2.16 or 2.17,
it will, to the extent not inconsistent with the internal policies of such
Lender and any applicable legal or regulatory restrictions, use reasonable
efforts to (a) make, issue, fund or maintain its Credit Extensions, including
any Affected Loans, through another office of such Lender, or (b) take such
other measures as such Lender may deem reasonable, if as a result thereof the
circumstances which would cause such Lender to be an Affected Lender would cease
to exist or the additional amounts which would otherwise be required to be paid
to such Lender pursuant to SECTION 2.15, 2.16 or 2.17 would be materially
reduced and if, as determined by such Lender in its sole discretion, the making,
issuing, funding or maintaining of such, Term Loans through such other office or
in accordance with such other measures, as the case may be, would not otherwise
adversely affect such Term Loans or the interests of such Lender; provided, such
Lender will not be obligated to utilize such other office pursuant to this
SECTION 2.18 unless Company agrees to pay all incremental expenses incurred by
such Lender as a result of utilizing such other office as described above. A
certificate as to the amount of any such expenses payable by Company pursuant to
this SECTION 2.18 (setting forth in reasonable detail the basis for requesting
such amount) submitted by such Lender to Company (with a copy to Administrative
Agent) shall be conclusive absent manifest error.
2.19. DEFAULTING LENDERS. Anything contained herein to the contrary
notwithstanding, in the event that any Lender, other than at the direction or
request of any regulatory agency or authority, defaults
36 CREDIT AND GUARANTY AGREEMENT
(a "DEFAULTING LENDER") in its obligation to fund (a "FUNDING DEFAULT") any Term
Loan (in each case, a "DEFAULTED LOAN"), then (a) during any Default Period with
respect to such Defaulting Lender, such Defaulting Lender shall be deemed not to
be a Lender for purposes of voting on any matters (including the granting of any
consents or waivers) with respect to any of the Credit Documents; and (b) to the
extent permitted by applicable law, until such time as the Default Excess with
respect to such Defaulting Lender shall have been reduced to zero, (i) any
voluntary prepayment of the Term Loan shall, if Administrative Agent so directs
at the time of making such voluntary prepayment, be applied to the Term Loans of
other Lenders as if such Defaulting Lender had no Term Loans outstanding and the
outstanding Term Loans of such Defaulting Lender were zero, and (ii) any
mandatory prepayment of the Term Loans shall, if Administrative Agent so directs
at the time of making such mandatory prepayment, be applied to the Term Loans of
other Lenders (but not to the Term Loans of such Defaulting Lender) as if such
Defaulting Lender had funded all Defaulted Loans of such Defaulting Lender, it
being understood and agreed that Company shall be entitled to retain any portion
of any mandatory prepayment of the Term Loans that is not paid to such
Defaulting Lender solely as a result of the operation of the provisions of this
CLAUSE (b). No Term Loan Commitment of any Lender shall be increased or
otherwise affected, and, except as otherwise expressly provided in this SECTION
2.19, performance by Company of its obligations hereunder and the other Credit
Documents shall not be excused or otherwise modified as a result of any Funding
Default or the operation of this SECTION 2.19. The rights and remedies against a
Defaulting Lender under this SECTION 2.19 are in addition to other rights and
remedies which Company may have against such Defaulting Lender with respect to
any Funding Default and which Administrative Agent or any Lender may have
against such Defaulting Lender with respect to any Funding Default.
2.20. REMOVAL OR REPLACEMENT OF A LENDER. Anything contained herein to the
contrary notwithstanding, in the event that: (a)(i) any Lender (an
"INCREASED-COST LENDER") shall give notice to Company that such Lender is an
Affected Lender or that such Lender is entitled to receive payments under
SECTION 2.16, 2.17 or 2.18, (ii) the circumstances which have caused such Lender
to be an Affected Lender or which entitle such Lender to receive such payments
shall remain in effect, and (iii) such Lender shall fail to withdraw such notice
within five Business Days after Company's request for such withdrawal; or (b)(i)
any Lender shall become a Defaulting Lender, (ii) the Default Period for such
Defaulting Lender shall remain in effect, and (iii) such Defaulting Lender shall
fail to cure the default as a result of which it has become a Defaulting Lender
within five Business Days after Company's request that it cure such default; or
(c) in connection with any proposed amendment, modification, termination, waiver
or consent with respect to any of the provisions hereof as contemplated by
SECTION 10.5(b), the consent of Administrative Agent and Requisite Lenders shall
have been obtained but the consent of one or more of such other Lenders (each a
"NON-CONSENTING LENDER") whose consent is required shall not have been obtained;
then, with respect to each such Increased-Cost Lender, Defaulting Lender or
Non-Consenting Lender (the "TERMINATED LENDER"), Administrative Agent may
(which, in the case of an Increased-Cost Lender, only after receiving written
request from Company to remove such Increased-Cost Lender), by giving written
notice to Company and any Terminated Lender of its election to do so, elect to
cause such Terminated Lender (and such Terminated Lender hereby irrevocably
agrees) to assign its outstanding Term Loans in full to one or more Eligible
Assignees (each a "REPLACEMENT LENDER") in accordance with the provisions of
SECTION 10.6 and Terminated Lender shall pay any fees payable thereunder in
connection with such assignment; provided, (1) on the date of such assignment,
the Replacement Lender shall pay to Terminated Lender an amount equal to the sum
of (A) an amount equal to the principal of, and all accrued interest on, all
outstanding Term Loans of the Terminated Lender, (B) an amount equal to all
unreimbursed drawings that have been funded by such Terminated 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 such
Terminated Lender pursuant to SECTION 2.8; (2) on the date of such assignment,
Company shall pay any amounts payable to such Terminated Lender pursuant to
SECTION 2.16 or 2.17; and (3) in the event such Terminated Lender is a
Non-Consenting Lender, each Replacement Lender shall consent, at the time of
such assignment, to each matter in respect of which such
37 CREDIT AND GUARANTY AGREEMENT
Terminated Lender was a Non-Consenting Lender. Upon the prepayment of all
amounts owing to any Terminated Lender and the termination of such Terminated
Lender's Term Loan Commitments, such Terminated Lender shall no longer
constitute a Lender for purposes hereof; provided, any rights of such Terminated
Lender to indemnification hereunder shall survive as to such Terminated Lender.
SECTION 3. CONDITIONS PRECEDENT
3.1. CLOSING DATE. The obligation of each Lender to make a Credit
Extension on the Closing Date is subject to the satisfaction, or waiver in
accordance with SECTION 10.5, of the following conditions on or before the
Closing Date:
(a) Credit Documents. Administrative Agent shall have received
sufficient copies of each Credit Document originally executed and delivered by
each applicable Credit Party for each Lender.
(b) Organizational Documents; Incumbency. Administrative Agent shall
have received (i) sufficient copies of each Organizational Document executed and
delivered by each Credit Party, as applicable, and, to the extent applicable,
certified as of a recent date by the appropriate governmental official, for each
Lender, each dated the Closing Date or a recent date prior thereto; (ii)
signature and incumbency certificates of the officers of such Person executing
the Credit Documents to which it is a party; (iii) resolutions of the Board of
Directors or similar governing body of each Credit Party approving and
authorizing the execution, delivery and performance of this Agreement and the
other Credit Documents to which it is a party or by which it or its assets may
be bound as of the Closing Date, certified as of the Closing Date by its
secretary or an assistant secretary as being in full force and effect without
modification or amendment; (iv) a good standing certificate from the applicable
Governmental Authority of each Credit Party's jurisdiction of incorporation,
organization or formation and in each jurisdiction in which it is qualified as a
foreign corporation or other entity to do business, each dated a recent date
prior to the Closing Date; and (v) such other documents as Administrative Agent
may reasonably request.
(c) Organizational and Capital Structure. The organizational
structure and capital structure of Company and its Subsidiaries shall be as set
forth on SCHEDULE 4.2 to the Disclosure Letter.
(d) Series C Preferred Shareholder Letter or Amended Certificate of
Incorporation. Administrative Agent shall have received a letter from all Series
C Preferred Shareholders stating that they shall not redeem or convert any of
their Series C Preferred Shares, or pay any cash dividends (other than a
redemption, conversion or dividend payment in connection with a Qualified IPO)
so long as any of the Obligations remain outstanding hereunder, and which letter
permits the company to incur the Obligations; or, in the alternative, an amended
Certificate of Incorporation prohibiting any redemption, conversion or dividend
payment in relation to the Series C Preferred Shares.
(e) Existing Indebtedness. On the Closing Date, Company and its
Subsidiaries shall have (i) repaid in full all Existing Indebtedness, (ii)
terminated any commitments to lend or make other extensions of credit
thereunder, (iii) delivered to Administrative Agent all documents or instruments
necessary to release all Liens securing Existing Indebtedness or other
obligations of Company and its Subsidiaries thereunder being repaid on the
Closing Date, and (iv) made arrangements satisfactory to Administrative Agent
with respect to the cancellation of any letters of credit outstanding
thereunder.
(f) Transaction Costs. On or prior to the Closing Date, Company
shall have delivered to Administrative Agent Company's reasonable best estimate
of the Transactions Costs (other than fees payable to any Agent).
38 CREDIT AND GUARANTY AGREEMENT
(g) Governmental Authorizations and Consents. Each Credit Party
shall have obtained all Governmental Authorizations and all consents of other
Persons, in each case that are necessary or advisable in connection with the
transactions contemplated by the Credit Documents and each of the foregoing
shall be in full force and effect and in form and substance reasonably
satisfactory to Administrative Agent. All applicable waiting periods shall have
expired without any action being taken or threatened by any competent authority
which would restrain, prevent or otherwise impose adverse conditions on the
transactions contemplated by the Credit Documents or the financing thereof and
no action, request for stay, petition for review or rehearing, reconsideration,
or appeal with respect to any of the foregoing shall be pending, and the time
for any applicable agency to take action to set aside its consent on its own
motion shall have expired.
(h) Collateral. In order to create in favor of Collateral Agent, for
the benefit of the Lenders, a valid, perfected First Priority Lien in the
personal property Collateral, Collateral Agent shall have received:
(i) evidence satisfactory to Collateral Agent of the
compliance by each Credit Party of their obligations under a Pledge and
Security Agreement and the other Collateral Documents (including, without
limitation, their obligations to execute and deliver UCC financing
statements, originals of securities, instruments and chattel paper and any
agreements governing deposit and/or securities accounts as provided
therein);
(ii) A completed Collateral Questionnaire dated the Closing
Date and executed by an Authorized Officer of each Credit Party, together
with all attachments contemplated thereby, including (A) the results of a
recent search, by a Person satisfactory to Collateral Agent, of all
effective UCC financing statements (or equivalent filings) made with
respect to any personal or mixed property of any Credit Party in the
jurisdictions specified in the Collateral Questionnaire, together with
copies of all such filings disclosed by such search, and (B) UCC
termination statements (or similar documents) duly executed by all
applicable Persons for filing in all applicable jurisdictions as may be
necessary to terminate any effective UCC financing statements (or
equivalent filings) disclosed in such search (other than any such
financing statements in respect of Permitted Liens);
(iii) opinions of counsel (which counsel shall be reasonably
satisfactory to Collateral Agent) with respect to the creation and
perfection of the security interests in favor of Collateral Agent in such
Collateral and such other matters governed by the laws of each
jurisdiction in which any Credit Party or any personal property Collateral
is located as Collateral Agent may reasonably request, in each case in
form and substance reasonably satisfactory to Collateral Agent; and
(iv) evidence that each Credit Party shall have taken or
caused to be taken any other action, executed and delivered or caused to
be executed and delivered any other agreement, document and instrument
(including without limitation, (i) a Landlord or Operator Consent and
Waiver executed by the landlord or operator of any Leasehold Property and
by the applicable Credit Party, and (ii) any intercompany notes evidencing
Indebtedness permitted to be incurred pursuant to SECTION 6.1(b)) and made
or caused to be made any other filing and recording (other than as set
forth herein) reasonably required by Collateral Agent.
(i) Environmental Reports. Administrative Agent shall have received
reports and other information, in form, scope and substance satisfactory to
Administrative Agent, regarding environmental matters relating to the
Facilities.
39 CREDIT AND GUARANTY AGREEMENT
(j) Financial Statements; Projections. Lenders shall have received
from Company: (i) confirmatory diligence with the Company's auditors regarding
the 2004 audit and the draft unaudited financial statements for the Fiscal Year
ended December 31, 2004, together with a Financial Officer Certification in the
form attached as EXHIBIT G-4; (ii) pro forma consolidated and consolidating
balance sheets of Company and its Subsidiaries as at the Closing Date, the
related financings and the other transactions contemplated by the Credit
Documents to occur on or prior to the Closing Date, which pro forma financial
statements shall be in form and substance satisfactory to Administrative Agent;
and (iii) the Projections.
(k) Evidence of Insurance. Collateral Agent shall have received a
certificate from Company's insurance broker or other evidence satisfactory to it
that all insurance required to be maintained pursuant to SECTION 5.5 is in full
force and effect, together with endorsements naming the Collateral Agent, for
the benefit of the Lenders, as additional insured and loss payee thereunder to
the extent required under SECTION 5.5.
(l) Opinion of Counsel to Credit Parties. Lenders and their
respective counsel shall have received originally executed copies of the
favorable written opinions of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, Professional
Corporation, counsel for the Company, in the form of EXHIBIT D and as to such
other matters as Administrative Agent may reasonably request, dated as of the
Closing Date and otherwise in form and substance reasonably satisfactory to
Administrative Agent (and each Credit Party hereby instructs such counsel to
deliver such opinions to Agents and Lenders).
(m) Fees. Company shall have paid to Syndication Agent,
Administrative Agent and Documentation Agent the fees payable on the Closing
Date referred to in SECTION 2.8.
(n) Solvency Certificate. On the Closing Date, Administrative Agent
shall have received a Solvency Certificate from Company dated as of the Closing
Date and addressed to Administrative Agent and Lenders, and in form, scope and
substance satisfactory to Administrative Agent, with appropriate attachments and
demonstrating that after giving effect to the consummation of the Term Loan to
be made on the Closing Date, Company and its Subsidiaries are and will be
Solvent.
(o) Closing Date Certificate. Company shall have delivered to
Administrative Agent an originally executed Closing Date Certificate, together
with all attachments thereto.
(p) Closing Date. Lenders shall have made the Term Loans to Company
on or before April 25, 2005.
(q) No Litigation. There shall not exist any action, suit,
investigation, litigation or proceeding or other legal or regulatory
developments, pending or threatened in any court or before any arbitrator or
Governmental Authority that, in the reasonable opinion of Administrative Agent,
singly or in the aggregate, materially impairs the financing thereof or any of
the other transactions contemplated by the Credit Documents, or that could have
a Material Adverse Effect.
(r) Due Diligence. Other than changes occurring in the ordinary
course of business, no information or materials are or should have been
available to Company and its Subsidiaries as of the Closing Date that are
materially inconsistent with the material previously provided to Administrative
Agent for its due diligence review of Company and its Subsidiaries.
(s) Minimum EBITDA. The pro forma income statement delivered
pursuant to SECTION 3.1(j) shall demonstrate in form and substance reasonably
satisfactory to Administrative Agent that on the Closing Date and immediately
after giving effect to any Term Loans to be made on the
40 CREDIT AND GUARANTY AGREEMENT
Closing Date, including the payment of all Transaction Costs required to be paid
in Cash, the Company shall have generated trailing twelve month Consolidated
Adjusted EBITDA of at least $1,000,000.
(t) Minimum Liquidity. The pro forma balance sheet delivered
pursuant to SECTION 3.1(j) shall demonstrate in form and substance reasonably
satisfactory to Administrative Agent that on the Closing Date and immediately
after giving effect to any Term Loans to be made on the Closing Date, including
the payment of all Transaction Costs required to be paid in Cash, the Company
shall have Consolidated Liquidity of at least $18,000,000.
(u) Landlord and Operator Consents and Waivers. Receipt of consent,
access, and lien subordination agreements satisfactory to Agent for each of
Company's hosting sites and designated leasehold locations.
(v) Establishment of Restricted Cash Account. On or prior to the
Closing Date, Company shall have a cash management system in place which is
acceptable to Administrative Agent and shall have funded a Restricted Cash
Account in the amount set forth opposite the applicable period in SECTION
5.14(b).
(w) No Material Adverse Change. Since December 31, 2003, no event,
circumstance or change shall have occurred that has caused or evidences, either
in any case or in the aggregate, a Material Adverse Effect.
(x) Completion of Proceedings. All partnership, corporate and other
proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by Administrative Agent and its counsel shall be satisfactory in form
and substance to Administrative Agent and such counsel, and Administrative
Agent, and such counsel shall have received all such counterpart originals or
certified copies of such documents as Administrative Agent may reasonably
request.
Each Lender, by delivering its signature page to this Agreement and funding a
Term Loan on the Closing Date, shall be deemed to have acknowledged receipt of,
and consented to and approved, each Credit Document and each other document
required to be approved by any Agent, Requisite Lenders or Lenders, as
applicable on the Closing Date.
3.2. CONDITIONS TO CREDIT EXTENSION.
(a) Conditions Precedent. The obligation of each Lender to make any
Term Loan on the Closing Date, are subject to the satisfaction, or waiver in
accordance with SECTION 10.5, of the following conditions precedent:
(i) Administrative Agent shall have received a fully executed
and delivered Funding Notice;
(ii) as of the Closing Date, the representations and
warranties contained herein and in the other Credit Documents shall be
true and correct in all material respects on and as of the Closing Date to
the same extent as though made on and as of that date, except to the
extent such representations and warranties specifically relate to an
earlier date, in which case such representations and warranties shall have
been true and correct in all material respects on and as of such earlier
date;
41 CREDIT AND GUARANTY AGREEMENT
(iii) as of the Closing Date, no event shall have occurred and
be continuing or would result from the consummation of the applicable
Credit Extension that would constitute an Event of Default or a Default;
and
(iv) the Chief Financial Officer of the Company shall have
delivered an Officer's Certificate representing and warranting and
otherwise demonstrating to the satisfaction of Agent that, as of the
Closing Date, Company reasonably expects, after giving effect to the
proposed borrowing and based upon good faith determinations and
projections consistent with the Financial Plan, to be in compliance with
all operating and financial covenants set forth in this Agreement as of
the last day of each Fiscal Quarter ending prior to the Term Loan Maturity
Date.
Any Agent or Requisite Lenders shall be entitled, but not obligated to, request
and receive, prior to the making of any Credit Extension, additional information
reasonably satisfactory to the requesting party confirming the satisfaction of
any of the foregoing if, in the good faith judgment of such Agent or Requisite
Lender such request is warranted under the circumstances.
(b) Notices. Any Notice shall be executed by an Authorized Officer
in a writing delivered to Administrative Agent. In lieu of delivering a Notice,
Company may give Administrative Agent telephonic notice by the required time of
any proposed borrowing or conversion/continuation, as the case may be; provided
each such notice shall be promptly confirmed in writing by delivery of the
applicable Notice to Administrative Agent on or before the applicable date of
borrowing, continuation/conversion. Neither Administrative Agent nor any Lender
shall incur any liability to Company in acting upon any telephonic notice
referred to above that Administrative Agent believes in good faith to have been
given by a duly authorized officer or other person authorized on behalf of
Company or for otherwise acting in good faith.
3.3. CONDITIONS SUBSEQUENT TO THE CLOSING DATE. Company shall fulfill, on
or before the date applicable thereto (which date can be extended in writing by
the Administrative Agent in its sole discretion), each of the conditions
subsequent set forth below (the failure by Company to so perform or cause to be
performed constituting a Event of Default).
(a) Establishment of Cash Management Systems. Within 60 calendar
days of the Closing Date, Company shall have a revised cash management system in
place that is reasonably acceptable to Administrative Agent and Company.
SECTION 4. REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to make each
Credit Extension to be made thereby, each Credit Party represents and warrants
to each Lender, on the Closing Date, that the following statements are true and
correct:
4.1. ORGANIZATION; REQUISITE POWER AND AUTHORITY; QUALIFICATION. Each of
Company and its Subsidiaries (a) is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization as identified in
SCHEDULE 4.1 to the Disclosure Letter, (b) has all requisite power and authority
to own and operate its properties, to carry on its business as now conducted and
as proposed to be conducted, to enter into the Credit Documents to which it is a
party and to carry out the transactions contemplated thereby, and (c) is
qualified to do business and in good standing in every jurisdiction where its
assets are located and wherever necessary to carry out its business and
operations, except in jurisdictions where the failure to be so qualified or in
good standing has not had, and could not be reasonably expected to have, a
Material Adverse Effect.
42 CREDIT AND GUARANTY AGREEMENT
4.2. CAPITAL STOCK AND OWNERSHIP. The Capital Stock of each of Company and
its Subsidiaries has been duly authorized and validly issued and is fully paid
and non-assessable. Except as set forth on SCHEDULE 4.2 to the Disclosure
Letter, as of the date hereof, there is no existing option, warrant, call,
right, commitment or other agreement to which Company or any of its Subsidiaries
is a party requiring, and there is no membership interest or other Capital Stock
of Company or any of its Subsidiaries outstanding which upon conversion or
exchange would require, the issuance by Company or any of its Subsidiaries of
any additional membership interests or other Capital Stock of Company or any of
its Subsidiaries or other Securities convertible into, exchangeable for or
evidencing the right to subscribe for or purchase, a membership interest or
other Capital Stock of Company or any of its Subsidiaries. SCHEDULE 4.2 to the
Disclosure Letter correctly sets forth the ownership interest of Company and
each of its Subsidiaries in their respective Subsidiaries as of the Closing
Date.
4.3. DUE AUTHORIZATION. The execution, delivery and performance of the
Credit Documents have been duly authorized by all necessary action on the part
of each Credit Party that is a party thereto.
4.4. NO CONFLICT. The execution, delivery and performance by Credit
Parties of the Credit Documents to which they are parties and the consummation
of the transactions contemplated by the Credit Documents do not and will not (a)
violate any provision of any law or any governmental rule or regulation
applicable to Company or any of its Subsidiaries, any of the Organizational
Documents of Company or any of its Subsidiaries, or any order, judgment or
decree of any court or other agency of government binding on Company or any of
its Subsidiaries; (b) conflict with, result in a breach of or constitute (with
due notice or lapse of time or both) a default under any Contractual Obligation
of Company or any of its Subsidiaries; (c) result in or require the creation or
imposition of any Lien upon any of the properties or assets of Company or any of
its Subsidiaries (other than any Liens created under any of the Credit Documents
in favor of Collateral Agent, on behalf of Lenders); or (d) require any approval
of stockholders, members or partners or any approval or consent of any Person
under any Contractual Obligation of Company or any of its Subsidiaries, except
for such approvals or consents which will be obtained on or before the Closing
Date and disclosed in writing to Lenders.
4.5. GOVERNMENTAL CONSENTS. The execution, delivery and performance by
Credit Parties of the Credit Documents to which they are parties and the
consummation of the transactions contemplated by the Credit Documents do not and
will not require any registration with, consent or approval of, or notice to, or
other action to, with or by, any Governmental Authority except for filings and
recordings with respect to the Collateral to be made, or otherwise delivered to
Collateral Agent for filing and/or recordation, as of the Closing Date, and
except for the filing of the Credit Documents with the Securities and Exchange
Commission as exhibits to Company's registration statement on Form S-1.
4.6. BINDING OBLIGATION. Each Credit Document has been duly executed and
delivered by each Credit Party that is a party thereto and is the legally valid
and binding obligation of such Credit Party, enforceable against such Credit
Party in accordance with its respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditors' rights generally or by equitable principles relating to
enforceability.
4.7. HISTORICAL FINANCIAL STATEMENTS. The Historical Financial Statements
were prepared in conformity with GAAP and fairly present, in all material
respects, the financial position, on a consolidated basis, of the Persons
described in such financial statements as at the respective dates thereof and
the results of operations and cash flows, on a consolidated basis, of the
entities described therein for each of the periods then ended, subject, in the
case of any such unaudited financial statements, (i) to changes resulting from
audit and normal year-end adjustments, and (ii) to the absence of footnotes in
the case of financial statements for interim periods. As of the Closing Date,
neither Company nor any of its Subsidiaries has any contingent liability or
liability for taxes, long-term lease or unusual forward or long-
43 CREDIT AND GUARANTY AGREEMENT
term commitment that is not reflected in the Historical Financial Statements or
the notes thereto and which in any such case is material in relation to the
business, operations, properties, assets, condition (financial or otherwise) or
prospects of Company and any of its Subsidiaries taken as a whole.
4.8. PROJECTIONS. On and as of the Closing Date, the Projections of
Company and its Subsidiaries for the period of Fiscal Year 2005 through and
including Fiscal Year 2007, including monthly projections for each month during
the Fiscal Year in which the Closing Date takes place, (the "PROJECTIONS") are
based on good faith estimates and assumptions made by the management of Company;
provided, the Projections are not to be viewed as facts and that actual results
during the period or periods covered by the Projections may differ from such
Projections and that the differences may be material; provided further, as of
the Closing Date, management of Company believed that the Projections were
reasonable and attainable.
4.9. NO MATERIAL ADVERSE CHANGE. Since December 31, 2003, no event,
circumstance or change has occurred that has caused or evidences, either in any
case or in the aggregate, a Material Adverse Effect.
4.10. NO RESTRICTED JUNIOR PAYMENTS. Since December 31, 2003, neither
Company nor any of its Subsidiaries has directly or indirectly declared,
ordered, paid or made, or set apart any sum or property for, any Restricted
Junior Payment or agreed to do so except as permitted pursuant to SECTION 6.5.
4.11. ADVERSE PROCEEDINGS, ETC. Except as disclosed on SCHEDULE 4.11 to
the Disclosure Letter, there are no Adverse Proceedings, individually or in the
aggregate, that could reasonably be expected to have a Material Adverse Effect.
Neither Company nor any of its Subsidiaries (a) is in violation of any
applicable laws (including Environmental Laws) that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect, or
(b) is subject to or in default with respect to any final judgments, writs,
injunctions, decrees, rules or regulations of any court or any federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, that, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.
4.12. PAYMENT OF TAXES. Except as otherwise permitted under SECTION 5.3,
all tax returns and reports of Company and its Subsidiaries required to be filed
by any of them have been timely filed, and all taxes shown on such tax returns
to be due and payable and all assessments, fees and other governmental charges
upon Company and its Subsidiaries and upon their respective properties, assets,
income, businesses and franchises which are due and payable have been paid when
due and payable. Company knows of no proposed tax assessment against Company or
any of its Subsidiaries which is not being actively contested by Company or such
Subsidiary in good faith and by appropriate proceedings; provided, such reserves
or other appropriate provisions, if any, as shall be required in conformity with
GAAP shall have been made or provided therefor.
4.13. PROPERTIES.
(a) Title. Each of Company and its Subsidiaries has (i) good,
sufficient and legal title to (in the case of fee interests in real property),
(ii) valid leasehold interests in (in the case of leasehold interests in real or
personal property), and (iii) good title to (in the case of all other personal
property), all of their respective properties and assets reflected in their
respective Historical Financial Statements referred to in SECTION 4.5 and in the
most recent financial statements delivered pursuant to SECTION 5.1, in each case
except for assets disposed of since the date of such financial statements in the
ordinary course of business or as otherwise permitted under SECTION 6.9. Except
as permitted by this Agreement, all such properties and assets are free and
clear of Liens.
44 CREDIT AND GUARANTY AGREEMENT
(b) Real Estate. As of the Closing Date, SCHEDULE 4.13 to the
Disclosure Letter contains a true, accurate and complete list of (i) all Real
Estate Assets, and (ii) all leases, subleases or assignments of leases (together
with all amendments, modifications, supplements, renewals or extensions of any
thereof) affecting each Real Estate Asset of any Credit Party, regardless of
whether such Credit Party is the landlord or tenant (whether directly or as an
assignee or successor in interest) under such lease, sublease or assignment.
Each agreement listed in CLAUSE (ii) of the immediately preceding sentence is in
full force and effect and Company does not have knowledge of any default that
has occurred and is continuing thereunder, and each such agreement constitutes
the legally valid and binding obligation of each applicable Credit Party,
enforceable against such Credit Party in accordance with its terms, except as
enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or limiting creditors' rights generally or by
equitable principles.
4.14. ENVIRONMENTAL MATTERS. Neither Company nor any of its Subsidiaries
nor any of their respective Facilities or operations are subject to any
outstanding written order, consent decree or settlement agreement with any
Person relating to any Environmental Law, any Environmental Claim, or any
Hazardous Materials Activity that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect. Neither Company nor
any of its Subsidiaries has received any letter or request for information under
Section 104 of the Comprehensive Environmental Response, Compensation, and
Liability Act (42 U.S.C. Section 9604) or any comparable state law. There are
and, to each of Company' and its Subsidiaries' knowledge, have been, no
conditions, occurrences, or Hazardous Materials Activities which could
reasonably be expected to form the basis of an Environmental Claim against
Company or any of its Subsidiaries that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect. Neither Company nor
any of its Subsidiaries nor, to any Credit Party's knowledge, any predecessor of
Company or any of its Subsidiaries has filed any notice under any Environmental
Law indicating past or present treatment of Hazardous Materials at any Facility,
and none of Company' or any of its Subsidiaries' operations involves the
generation, transportation, treatment, storage or disposal of hazardous waste,
as defined under 40 C.F.R. Parts 260-270 or any state equivalent. Compliance
with all current or reasonably foreseeable future requirements pursuant to or
under Environmental Laws could not be reasonably expected to have, individually
or in the aggregate, a Material Adverse Effect. No event or condition has
occurred or is occurring with respect to Company or any of its Subsidiaries
relating to any Environmental Law, any Release of Hazardous Materials, or any
Hazardous Materials Activity which individually or in the aggregate has had, or
could reasonably be expected to have, a Material Adverse Effect.
4.15. NO DEFAULTS. Neither Company nor any of its Subsidiaries is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any of its Contractual Obligations, and no
condition exists which, with the giving of notice or the lapse of time or both,
could constitute such a default, except where the consequences, direct or
indirect, of such default or defaults, if any, could not reasonably be expected
to have a Material Adverse Effect.
4.16. MATERIAL CONTRACTS. SCHEDULE 4.16 to the Disclosure Letter contains
a true, correct and complete list of all the Material Contracts specified in
CLAUSE (i) of the definition of Material Contract, including, without
limitation, all hosting arrangements, in effect on the Closing Date, which,
together with any updates provided pursuant to SECTION 5.1(n), are in full force
and effect and no material defaults currently exist thereunder (other than as
described in SCHEDULE 4.16 to the Disclosure Letter or in such updates).
4.17. GOVERNMENTAL REGULATION. Neither Company nor any of its Subsidiaries
is subject to regulation under the Public Utility Holding Company Act of 1935,
the Federal Power Act or the Investment Company Act of 1940 or under any other
federal or state statute or regulation which may limit its ability to incur
Indebtedness or which may otherwise render all or any portion of the Obligations
45 CREDIT AND GUARANTY AGREEMENT
unenforceable. Neither Company nor any of its Subsidiaries is a "registered
investment company" or a company "controlled" by a "registered investment
company" or a "principal underwriter" of a "registered investment company" as
such terms are defined in the Investment Company Act of 1940.
4.18. MARGIN STOCK. Neither Company nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock. No part of
the proceeds of the Term Loans made to such Credit Party will be used to
purchase or carry any such Margin Stock or to extend credit to others for the
purpose of purchasing or carrying any such Margin Stock or for any purpose that
violates, or is inconsistent with, the provisions of Regulation T, U or X of the
Board of Governors of the Federal Reserve System.
4.19. EMPLOYEE MATTERS. Neither Company nor any of its Subsidiaries is
engaged in any unfair labor practice that could reasonably be expected to have a
Material Adverse Effect. There is (a) no unfair labor practice complaint pending
against Company or any of its Subsidiaries, or to the best knowledge of Company,
threatened against any of them before the National Labor Relations Board and no
grievance or arbitration proceeding arising out of or under any collective
bargaining agreement that is so pending against Company or any of its
Subsidiaries or to the best knowledge of Company, threatened against any of
them, (b) no strike or work stoppage in existence or threatened involving
Company or any of its Subsidiaries that could reasonably be expected to have a
Material Adverse Effect, and (c) to the best knowledge of Company, no union
representation question existing with respect to the employees of Company or any
of its Subsidiaries and, to the best knowledge of Company, no union organization
activity that is taking place, except (with respect to any matter specified in
CLAUSE (a), (b) or (c) above, either individually or in the aggregate) such as
is not reasonably likely to have a Material Adverse Effect.
4.20. EMPLOYEE BENEFIT PLANS. Company, each of its Subsidiaries and each
of their respective ERISA Affiliates are in compliance in all material respects
with all applicable provisions and requirements of ERISA and the Internal
Revenue Code and the regulations and published interpretations thereunder with
respect to each Employee Benefit Plan, and have performed in all material
respects all their obligations under each Employee Benefit Plan. Each Employee
Benefit Plan which is intended to qualify under Section 401(a) of the Internal
Revenue Code has received a favorable determination or opinion letter from the
Internal Revenue Service indicating that such Employee Benefit Plan is so
qualified and nothing has occurred subsequent to the issuance of such
determination or opinion letter which would cause such Employee Benefit Plan to
lose its qualified status. No liability to the PBGC (other than required premium
payments), the Internal Revenue Service, any Employee Benefit Plan or any trust
established under Title IV of ERISA has been or is expected to be incurred by
Company, any of its Subsidiaries or any of their ERISA Affiliates. No ERISA
Event has occurred or is reasonably expected to occur. Except to the extent
required under Section 4980B of the Internal Revenue Code or similar state laws,
no Employee Benefit Plan provides health or welfare benefits (through the
purchase of insurance or otherwise) for any retired or former employee of
Company, any of its Subsidiaries or any of their respective ERISA Affiliates.
The present value of the aggregate benefit liabilities under each Pension Plan
sponsored, maintained or contributed to by Company, any of its Subsidiaries or
any of their ERISA Affiliates (determined as of the end of the most recent plan
year on the basis of the actuarial assumptions specified for funding purposes in
the most recent actuarial valuation for such Pension Plan), did not exceed the
aggregate current value of the assets of such Pension Plan. As of the most
recent valuation date for each Multiemployer Plan for which the actuarial report
is available, the potential liability of Company, its Subsidiaries and their
respective ERISA Affiliates for a complete withdrawal from such Multiemployer
Plan (within the meaning of Section 4203 of ERISA), when aggregated with such
potential liability for a complete withdrawal from all Multiemployer Plans,
based on information available pursuant to Section 4221(e) of ERISA is zero.
Company, each of its Subsidiaries and each of their ERISA Affiliates have
complied with the requirements of Section 515 of ERISA with respect to each
46 CREDIT AND GUARANTY AGREEMENT
Multiemployer Plan and are not in material "default" (as defined in Section
4219(c)(5) of ERISA) with respect to payments to a Multiemployer Plan.
4.21. CERTAIN FEES. No broker's or finder's fee or commission will be
payable with respect hereto or any of the transactions contemplated hereby.
4.22. SOLVENCY. Each Credit Party is and, upon the incurrence of any
Credit Extension by such Credit Party on any date on which this representation
and warranty is made, will be, Solvent.
4.23. COMPLIANCE WITH STATUTES, ETC. Each of Company and its Subsidiaries
is in compliance with all applicable statutes, regulations and orders of, and
all applicable restrictions imposed by, all Governmental Authorities, in respect
of the conduct of its business and the ownership of its property (including
compliance with all applicable Environmental Laws with respect to any Real
Estate Asset or governing its business and the requirements of any permits
issued under such Environmental Laws with respect to any such Real Estate Asset
or the operations of Company or any of its Subsidiaries), except such
non-compliance that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
4.24. DISCLOSURE. No representation or warranty of any Credit Party
contained in any Credit Document or in any other documents, certificates or
written statements furnished to Lenders by or on behalf of Company or any of its
Subsidiaries for use in connection with the transactions contemplated hereby
contains any untrue statement of a material fact or omits to state a material
fact (known to Company, in the case of any document not furnished by either of
them) necessary in order to make the statements contained herein or therein not
misleading in light of the circumstances in which the same were made. Any
projections and pro forma financial information contained in such materials are
based upon good faith estimates and assumptions believed by Company to be
reasonable at the time made, it being recognized by Lenders that such
projections as to future events are not to be viewed as facts and that actual
results during the period or periods covered by any such projections may differ
from the projected results. There are no facts known (or which should upon the
reasonable exercise of diligence be known) to Company (other than matters of a
general economic nature) that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect and that have not
been disclosed herein or in such other documents, certificates and statements
furnished to Lenders for use in connection with the transactions contemplated
hereby.
4.25. PATRIOT ACT. To the extent applicable, each Credit Party is in
compliance, in all material respects, with the (i) Trading with the Enemy Act,
as amended, and each of the foreign assets control regulations of the Untied
States Treasury Department (31 C.F.R., Subtitle B, Chapter V, as amended) and
any other enabling legislation or executive order relating thereto, and (ii)
Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism (USA Patriot Act of 2001) (the "ACT"). No part
of the proceeds of the Term Loans will be used, directly or indirectly, for any
payments to any governmental official or employee, political party, official of
a political party, candidate for political office, or anyone else acting in an
official capacity, in order to obtain, retain or direct business or obtain any
improper advantage, in violation of the United States Foreign Corrupt Practices
Act of 1977, as amended.
SECTION 5. AFFIRMATIVE COVENANTS
Each Credit Party covenants and agrees that so long as any Term Loan
Commitment is in effect and until payment in full of all Obligations (other than
inchoate indemnity obligations), each Credit Party shall perform, and shall
cause each of its Subsidiaries to perform, all covenants in this SECTION 5.
47 CREDIT AND GUARANTY AGREEMENT
5.1. FINANCIAL STATEMENTS AND OTHER REPORTS. Unless otherwise provided
below, Company will deliver to Administrative Agent and Lenders:
(a) 2004 Audited Financial Statements. As soon as available, and in
any event no later than May 31, 2005, the audited financial statements of
Company and its Subsidiaries, for the Fiscal Year ended December 31, 2004,
consisting of balance sheets and the related consolidated statements of income,
stockholders' equity and cash flows of Company and its Subsidiaries for such
Fiscal Year, setting forth in each case in comparative form the corresponding
figures for the previous Fiscal Year and the corresponding figures from the
Financial Plan for the Fiscal Year covered by such financial statements, in
reasonable detail, together with a Financial Officer Certification and a
Narrative Report with respect thereto; and (ii) with respect to such
consolidated financial statements a report thereon of Deloitte & Touche, LLP or
other independent certified public accountants of recognized national standing
selected by Company, and reasonably satisfactory to Administrative Agent (which
report shall be unqualified as to going concern and scope of audit, and shall
state that such consolidated financial statements fairly present, in all
material respects, the consolidated financial position of Company and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated in conformity with GAAP applied on a
basis consistent with prior years (except as otherwise disclosed in such
financial statements) and that the examination by such accountants in connection
with such consolidated financial statements has been made in accordance with
generally accepted auditing standards) together with a written statement by such
independent certified public accountants stating (1) that they have audited the
consolidated financial statements of Company, and (2) whether, in connection
therewith, it has come to their attention that Company is not in compliance with
the terms of SECTION 6.8; provided that such statement may further state that
the audit was not directed primarily toward obtaining knowledge of noncompliance
with SECTION 6.8;
(b) Monthly Reports. As soon as available, and in any event within
30 days after the end of each calendar month (including months which began prior
to the Closing Date), (i) the consolidated balance sheet of Company and its
Subsidiaries as at the end of such month and the related consolidated statements
of income, and cash flows of Company and its Subsidiaries for such month and for
the period from the beginning of the then current Fiscal Year to the end of such
month, setting forth in each case in comparative form the corresponding figures
for the corresponding periods of the previous Fiscal Year and the corresponding
figures from the Financial Plan for the current Fiscal Year, all in reasonable
detail, together with a Financial Officer Certification and a Narrative Report
with respect thereto and any other operating reports prepared by management for
such period; and (ii) a summary report detailing all new customer contracts for
the immediately preceding calendar month, and detailing all cancelled customer
contracts and existing customer contracts that were not renewed for another
term;
(c) Quarterly Financial Statements. As soon as available, and in any
event within 45 days after the end of each Fiscal Quarter of each Fiscal Year
(including the fourth Fiscal Quarter), the consolidated and consolidating
balance sheets of Company and its Subsidiaries as at the end of such Fiscal
Quarter and the related consolidated (and with respect to statements of income,
consolidating) statements of income, stockholders' equity and cash flows of
Company and its Subsidiaries for such Fiscal Quarter and for the period from the
beginning of the then current Fiscal Year to the end of such Fiscal Quarter,
setting forth in each case in comparative form the corresponding figures for the
corresponding periods of the previous Fiscal Year and the corresponding figures
from the Financial Plan for the current Fiscal Year, all in reasonable detail,
together with a Financial Officer Certification and a Narrative Report with
respect thereto;
(d) Annual Financial Statements. As soon as available, and, if prior
to a Qualified IPO, within 135 days after the end of each Fiscal Year, or, if
after a Qualified IPO, within 90 days after the end of each Fiscal Year (except
for fiscal year 2004, which shall be delivered as provided in SECTION 5.1(a)
48 CREDIT AND GUARANTY AGREEMENT
above) (i) the consolidated and consolidating balance sheets of Company and its
Subsidiaries as at the end of such Fiscal Year and the related consolidated (and
with respect to statements of income, consolidating) statements of income,
stockholders' equity and cash flows of Company and its Subsidiaries for such
Fiscal Year, setting forth in each case in comparative form the corresponding
figures for the previous Fiscal Year and the corresponding figures from the
Financial Plan for the Fiscal Year covered by such financial statements, in
reasonable detail, together with a Financial Officer Certification and a
Narrative Report with respect thereto; and (ii) with respect to such
consolidated financial statements a report thereon of Deloitte & Touche, LLP or
other independent certified public accountants of recognized national standing
selected by Company, and reasonably satisfactory to Administrative Agent (which
report shall be unqualified as to going concern and scope of audit, and shall
state that such consolidated financial statements fairly present, in all
material respects, the consolidated financial position of Company and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated in conformity with GAAP applied on a
basis consistent with prior years (except as otherwise disclosed in such
financial statements) and that the examination by such accountants in connection
with such consolidated financial statements has been made in accordance with
generally accepted auditing standards) together with a written statement by such
independent certified public accountants stating (1) that they have audited the
consolidated financial statements of Company, and (2) whether, in connection
therewith, it has come to their attention that Company is not in compliance with
the terms of SECTION 6.8; provided that such statement may further state that
the audit was not directed primarily toward obtaining knowledge of noncompliance
with SECTION 6.8;
(e) Compliance Certificate. Together with each delivery of financial
statements of Company and its Subsidiaries pursuant to SECTIONS 5.1(b), 5.1(c)
and 5.1(d), a duly executed and completed Compliance Certificate (provided that
the Compliance Certificate for monthly financial statements shall address only
SECTION 6.8(e));
(f) Statements of Reconciliation after Change in Accounting
Principles. If, as a result of any change in accounting principles and policies
from those used in the preparation of the Historical Financial Statements, the
consolidated financial statements of Company and its Subsidiaries delivered
pursuant to SECTION 5.1(a), 5.1(b), 5.1(c) or 5.1(d) will differ in any material
respect from the consolidated financial statements that would have been
delivered pursuant to such subdivisions had no such change in accounting
principles and policies been made, then, together with the first delivery of
such financial statements after such change, one or more statements of
reconciliation for all such prior financial statements in form and substance
satisfactory to Administrative Agent;
(g) Notice of Default. Promptly upon any officer of Company
obtaining knowledge (i) of any condition or event that constitutes a Default or
an Event of Default or that notice has been given to Company with respect
thereto; (ii) that any Person has given any notice to Company or any of its
Subsidiaries or taken any other action with respect to any event or condition
set forth in SECTION 8.1(b); or (iii) of the occurrence of any event or change
that has caused or evidences, either in any case or in the aggregate, a Material
Adverse Effect, a certificate of its Authorized Officers specifying the nature
and period of existence of such condition, event or change, or specifying the
notice given and action taken by any such Person and the nature of such claimed
Event of Default, Default, default, event or condition, and what action Company
has taken, is taking and proposes to take with respect thereto;
(h) Notice of Litigation. Promptly upon any officer of Company
obtaining knowledge of (i) the institution of, or non-frivolous threat of, any
Adverse Proceeding not previously disclosed in writing by Company to Lenders, or
(ii) any material development in any Adverse Proceeding that, in the case of
either CLAUSE (i) or (ii) if adversely determined, could be reasonably expected
to have a Material Adverse Effect, or seeks to enjoin or otherwise prevent the
consummation of, or to recover any damages or obtain relief as a result of, the
transactions contemplated hereby, written notice thereof together with
49 CREDIT AND GUARANTY AGREEMENT
such other information as may be reasonably available to Company to enable
Lenders and their counsel to evaluate such matters;
(i) ERISA. (i) Promptly upon becoming aware of the occurrence of or
forthcoming occurrence of any ERISA Event, a written notice specifying the
nature thereof, what action Company, any of its Subsidiaries or any of their
respective ERISA Affiliates has taken, is taking or proposes to take with
respect thereto and, when known, any action taken or threatened by the Internal
Revenue Service, the Department of Labor or the PBGC with respect thereto; and
(ii) with reasonable promptness, copies of (1) each SCHEDULE B (Actuarial
Information) to the annual report (Form 5500 Series) filed by Company, any of
its Subsidiaries or any of their respective ERISA Affiliates with the Internal
Revenue Service with respect to each Pension Plan; (2) all notices received by
Company, any of its Subsidiaries or any of their respective ERISA Affiliates
from a Multiemployer Plan sponsor concerning an ERISA Event; and (3) copies of
such other documents or governmental reports or filings relating to any Employee
Benefit Plan as Administrative Agent shall reasonably request;
(j) Financial Plan. As soon as practicable and in any event no later
than January 15th of each Fiscal Year, a consolidated plan and financial
forecast for such Fiscal Year and each Fiscal Year (or portion thereof) through
the Term Loan Maturity Date (a "FINANCIAL PLAN"), including (i) a forecasted
consolidated balance sheet and forecasted consolidated statements of income and
cash flows of Company and its Subsidiaries for each such Fiscal Year, together
with pro forma Compliance Certificates for each such Fiscal Year and an
explanation of the assumptions on which such forecasts are based, (ii)
forecasted consolidated statements of income and cash flows of Company and its
Subsidiaries for each month of each such Fiscal Year, (iii) forecasts
demonstrating projected compliance with the requirements of SECTION 6.8 through
the Term Loan Maturity Date, and (iv) forecasts demonstrating adequate liquidity
through the Term Loan Maturity Date, together, in each case, with an explanation
of the assumptions on which such forecasts are based all in form and substance
reasonably satisfactory to Agents;
(k) Insurance Report. As soon as practicable and in any event by the
last day of each Fiscal Year, a report in form and substance satisfactory to
Administrative Agent outlining all material insurance coverage maintained as of
the date of such report by Company and its Subsidiaries and all material
insurance coverage planned to be maintained by Company and its Subsidiaries in
the immediately succeeding Fiscal Year;
(l) Notice of Change in Board of Directors. With reasonable
promptness, written notice of any change in the board of directors (or similar
governing body) of Company;
(m) Notice of Conversion. Promptly upon receipt, Company will notify
Administrative Agent of its receipt of a notice by any Series D Preferred
Shareholder of its intention to convert any of its Series D Preferred Shares
into common equity securities of Company.
(n) Notice Regarding Material Contracts. Promptly, and in any event
within ten Business Days (i) after any Material Contract of Company or any of
its Subsidiaries is terminated or amended in a manner that is materially adverse
to Company or such Subsidiary, as the case may be, (ii) any new Material
Contract is entered into, a written statement describing such event, with copies
of such material amendments or new contracts, delivered to Administrative Agent
(to the extent such delivery is permitted by the terms of any such Material
Contract, provided, no such prohibition on delivery shall be effective if it
were bargained for by Company or its applicable Subsidiary with the intent of
avoiding compliance with this SECTION 5.1(n)), and an explanation of any actions
being taken with respect thereto, or (iii) after any contracts, which when
aggregated over a rolling period of 12 months, constitute 10% of the
Consolidated Hosted Application Revenue of the Company are terminated, not
renewed, or amended in a manner that is materially adverse to Company or any
Subsidiary;
50 CREDIT AND GUARANTY AGREEMENT
(o) Environmental Reports and Audits. As soon as practicable
following receipt thereof, copies of all environmental audits and reports with
respect to environmental matters at any Facility or which relate to any
environmental liabilities of Company or its Subsidiaries which, in any such
case, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect;
(p) Information Regarding Collateral. Company will furnish to
Collateral Agent prompt written notice of any change (i) in any Credit Party's
corporate name, (ii) in any Credit Party's identity or corporate structure, or
(iii) in any Credit Party's Federal Taxpayer Identification Number. Company
agrees not to effect or permit any change referred to in the preceding sentence
unless all filings have been made under the Uniform Commercial Code or otherwise
that are required in order for Collateral Agent to continue at all times
following such change to have a valid, legal and perfected security interest in
all the Collateral and for the Collateral at all times following such change to
have a valid, legal and perfected security interest as contemplated in the
Collateral Documents. Company also agrees promptly to notify Collateral Agent if
any material portion of the Collateral is damaged or destroyed;
(q) Quarterly Collateral Verification. Concurrently with the
delivery of the Compliance Certificate pursuant to SECTION 5.1(e), at the end of
each Fiscal Quarter, Company shall deliver to Collateral Agent an Officer's
Certificate confirming: (i) that there has been no change in such information
since the date of the Collateral Questionnaire delivered on the Closing Date or
the date of the most recent certificate delivered pursuant to this Section, (ii)
that Company has not made any applications on any of its unpatented but
patentable inventions or any of its registrable but unregistered copyrights and
trademarks in the United States Patent and Trademark Office, the United States
Copyright Office or in any similar office or agency of the United States, any
state thereof or any other country or any political subdivision thereof, and
(iii) certifying that all Uniform Commercial Code financing statements
(including fixtures filings, as applicable) or other appropriate filings,
recordings or registrations, have been filed of record in each governmental,
municipal or other appropriate office in each jurisdiction identified in the
Collateral Questionnaire to the extent necessary to protect and perfect the
security interests under the Collateral Documents for a period of not less than
18 months after the date of such certificate (except as noted therein with
respect to any continuation statements to be filed within such period);
(r) Aging Reports. Within 30 days of the end of each Fiscal Quarter,
or more often as may be reasonably requested by Administrative Agent: (i) a
summary of the accounts receivable aging report of each Credit Party as of the
end of such period; and (ii) a summary of accounts payable aging report of each
Credit Party as of the end of such period;
(s) Tax Returns. As soon as practicable and in any event within 15
days following the filing thereof, copies of each federal income tax return
filed by or on behalf of any Credit Party; and
(t) Other Information. (A) Promptly upon their becoming available,
copies of (i) all financial statements, reports, notices and proxy statements
sent or made available generally by Company to its security holders acting in
such capacity or by any Subsidiary of Company to its security holders other than
Company or another Subsidiary of Company, (ii) all regular and periodic reports
and all registration statements and prospectuses filed by Company or any of its
Subsidiaries with any securities exchange or with the Securities and Exchange
Commission or any governmental or private regulatory authority, (iii) all press
releases and other statements made available generally by Company or any of its
Subsidiaries to the public concerning material developments in the business of
Company or any of its Subsidiaries, and (B) such other information and data with
respect to Company or any of its Subsidiaries as from time to time may be
reasonably requested by Administrative Agent. Notwithstanding the foregoing, the
Company shall be deemed to have complied with the foregoing requirements if it
shall have made the items publicly available through its filings with the
Securities and Exchange Commission
51 CREDIT AND GUARANTY AGREEMENT
and shall have notified Administrative Agent, within the time periods specified
above, electronically of such filings including a link to such filings.
5.2. EXISTENCE. Except as otherwise permitted under SECTION 6.9, each
Credit Party will, and will cause each of its Subsidiaries to, at all times
preserve and keep in full force and effect its existence and all rights and
franchises, licenses and permits material to its business; provided, no Credit
Party or any of its Subsidiaries shall be required to preserve any such
existence, right or franchise, licenses and permits if such Person's board of
directors (or similar governing body) shall determine that the preservation
thereof is no longer desirable in the conduct of the business of such Person,
and that the loss thereof is not disadvantageous in any material respect to such
Person or to Lenders.
5.3. PAYMENT OF TAXES AND CLAIMS. Each Credit Party will, and will cause
each of its Subsidiaries to, pay all Taxes imposed upon it or any of its
properties or assets or in respect of any of its income, businesses or
franchises before any penalty or fine accrues thereon, and all claims (including
claims for labor, services, materials and supplies) for sums that have become
due and payable and that by law have or may become a Lien upon any of its
properties or assets, prior to the time when any penalty or fine shall be
incurred with respect thereto; provided, no such Tax or claim need be paid if it
is being contested in good faith by appropriate proceedings promptly instituted
and diligently conducted, so long as (a) adequate reserve or other appropriate
provision, as shall be required in conformity with GAAP shall have been made
therefor, and (b) in the case of a Tax or claim which has or may become a Lien
against any of the Collateral, such contest proceedings conclusively operate to
stay the sale of any portion of the Collateral to satisfy such Tax or claim. No
Credit Party will, nor will it permit any of its Subsidiaries to, file or
consent to the filing of any consolidated income tax return with any Person
(other than Company or any of its Subsidiaries).
5.4. MAINTENANCE OF PROPERTIES. Each Credit Party will, and will cause
each of its Subsidiaries to, maintain or cause to be maintained in good repair,
working order and condition, ordinary wear and tear excepted, all material
properties used or useful in the business of Company and its Subsidiaries and
from time to time will make or cause to be made all appropriate repairs,
renewals and replacements thereof.
5.5. INSURANCE. Company will maintain or cause to be maintained, with
financially sound and reputable insurers, (i) business interruption insurance
reasonably satisfactory to Administrative Agent, and (ii) casualty insurance,
such public liability insurance, third party property damage insurance with
respect to liabilities, losses or damage in respect of the assets, properties
and businesses of Company and its Subsidiaries as may customarily be carried or
maintained under similar circumstances by Persons of established reputation
engaged in similar businesses, in each case in such amounts (giving effect to
self-insurance), with such deductibles, covering such risks and otherwise on
such terms and conditions as shall be customary for such Persons. Without
limiting the generality of the foregoing, Company will maintain or cause to be
maintained (a) flood insurance with respect to each Flood Hazard Property that
is located in a community that participates in the National Flood Insurance
Program, in each case in compliance with any applicable regulations of the Board
of Governors of the Federal Reserve System, and (b) replacement value casualty
insurance on the Collateral under such policies of insurance, with such
insurance companies, in such amounts, with such deductibles, and covering such
risks as are at all times carried or maintained under similar circumstances by
Persons of established reputation engaged in similar businesses. Each such
policy of insurance shall (i) name Collateral Agent, on behalf of Lenders as an
additional insured thereunder as its interests may appear, and (ii) in the case
of each casualty insurance policy, contain a loss payable clause or endorsement,
satisfactory in form and substance to Collateral Agent, that names Collateral
Agent, on behalf of Lenders as the loss payee thereunder and provides for at
least 30 days' prior written notice to Collateral Agent of any modification or
cancellation of such policy.
52 CREDIT AND GUARANTY AGREEMENT
5.6. INSPECTIONS. Each Credit Party will, and will cause each of its
Subsidiaries to, permit any authorized representatives designated by any Lender
to visit and inspect any of the properties of any Credit Party and any of its
respective Subsidiaries, to inspect, copy and take extracts from its and their
financial and accounting records, and to discuss its and their affairs, finances
and accounts with its and their officers and independent public accountants, all
upon reasonable notice and at such reasonable times during normal business hours
and as often as may reasonably be requested.
5.7. LENDERS MEETINGS. Company will, upon the request of Administrative
Agent or Requisite Lenders, participate in a meeting of Administrative Agent and
Lenders once during each Fiscal Year to be held at Company's corporate offices
(or at such other location as may be agreed to by Company and Administrative
Agent) at such time as may be agreed to by Company and Administrative Agent.
5.8. COMPLIANCE WITH LAWS. Each Credit Party will comply, and shall cause
each of its Subsidiaries and all other Persons, if any, on or occupying any
Facilities to comply, with the requirements of all applicable laws, rules,
regulations and orders of any Governmental Authority (including all
Environmental Laws), noncompliance with which could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.
5.9. ENVIRONMENTAL.
(a) Environmental Disclosure. Company will deliver to Administrative
Agent and Lenders:
(i) as soon as practicable following receipt thereof, copies
of all environmental audits, investigations, analyses and reports of any
kind or character, whether prepared by personnel of Company or any of its
Subsidiaries or by independent consultants, governmental authorities or
any other Persons, with respect to significant environmental matters at
any Facility or with respect to any Environmental Claims;
(ii) promptly upon the occurrence thereof, written notice
describing in reasonable detail (1) any Release required to be reported to
any federal, state or local governmental or regulatory agency under any
applicable Environmental Laws, (2) any remedial action taken by Company or
any other Person in response to (A) any Hazardous Materials Activities the
existence of which has a reasonable possibility of resulting in one or
more Environmental Claims having, individually or in the aggregate, a
Material Adverse Effect, or (B) any Environmental Claims that,
individually or in the aggregate, have a reasonable possibility of
resulting in a Material Adverse Effect, and (3) Company or Company's
discovery of any occurrence or condition on any real property adjoining or
in the vicinity of any Facility that could cause such Facility or any part
thereof to be subject to any material restrictions on the ownership,
occupancy, transferability or use thereof under any Environmental Laws;
(iii) as soon as practicable following the sending or receipt
thereof by Company or any of its Subsidiaries, a copy of any and all
written communications with respect to (1) any Environmental Claims that,
individually or in the aggregate, have a reasonable possibility of giving
rise to a Material Adverse Effect, (2) any Release required to be reported
to any federal, state or local governmental or regulatory agency, and (3)
any request for information from any governmental agency that suggests
such agency is investigating whether Company or any of its Subsidiaries
may be potentially responsible for any Hazardous Materials Activity;
(iv) prompt written notice describing in reasonable detail (1)
any proposed acquisition of stock, assets, or property by Company or any
of its Subsidiaries that could
53 CREDIT AND GUARANTY AGREEMENT
reasonably be expected to (A) expose Company or any of its Subsidiaries
to, or result in, Environmental Claims that could reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect or
(B) affect the ability of Company or any of its Subsidiaries to maintain
in full force and effect all material Governmental Authorizations required
under any Environmental Laws for their respective operations and (2) any
proposed action to be taken by Company or any of its Subsidiaries to
modify current operations in a manner that could reasonably be expected to
subject Company or any of its Subsidiaries to any additional material
obligations or requirements under any Environmental Laws; and
(v) with reasonable promptness, such other documents and
information as from time to time may be reasonably requested by
Administrative Agent in relation to any matters disclosed pursuant to this
SECTION 5.9(a).
(b) Hazardous Materials Activities, Etc. Each Credit Party shall
promptly take, and shall cause each of its Subsidiaries promptly to take, any
and all actions necessary to (i) cure any violation of applicable Environmental
Laws by such Credit Party or its Subsidiaries that could reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect, and (ii)
make an appropriate response to any Environmental Claim against such Credit
Party or any of its Subsidiaries and discharge any obligations it may have to
any Person thereunder where failure to do so could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.
5.10. SUBSIDIARIES. In the event that any Person becomes a Domestic
Subsidiary of Company, Company shall (a) concurrently with such Person becoming
a Domestic Subsidiary cause such Domestic Subsidiary to become a Guarantor of
the Obligations hereunder and a "Pledgor" under a Pledge and Security Agreement
by executing and delivering to Administrative Agent and Collateral Agent a
Guaranty and a Pledge and Security Agreement in form and substance acceptable to
Administrative Agent, and (b) take all such actions and execute and deliver, or
cause to be executed and delivered, all such documents, instruments, agreements,
and certificates as are similar to those described in SECTIONS 3.1(b), 3.1(h),
3.1(i), and 3.1(j). In the event that any Person becomes a Foreign Subsidiary of
Company, and the ownership interests of such Foreign Subsidiary are owned by
Company or by any Domestic Subsidiary thereof, Company shall, or shall cause
such Domestic Subsidiary to, deliver, all such documents, instruments,
agreements, and certificates as are similar to those described in SECTION
3.1(b), and Company shall take, or shall cause such Domestic Subsidiary to take,
all of the actions referred to in SECTION 3.1(h)(i) necessary to grant and to
perfect a First Priority Lien in favor of Collateral Agent, for the benefit of
Lenders, under the Pledge and Security Agreement in 66% of such ownership
interests. Requisite Lenders reserve the right to require Company to cause any
Foreign Subsidiary that may be formed in the future to become a Guarantor of the
Obligations hereunder and to pledge 100% of the outstanding ownership interests
in any such Foreign Subsidiary. With respect to each such Subsidiary, Company
shall promptly send to Administrative Agent written notice setting forth with
respect to such Person (i) the date on which such Person became a Subsidiary of
Company, and (ii) all of the data required to be set forth in SCHEDULES 4.1 and
4.2 to the Disclosure Letter with respect to all Subsidiaries of Company;
provided, such written notice shall be deemed to supplement SCHEDULE 4.1 and 4.2
to the Disclosure Letter for all purposes hereof.
5.11. ADDITIONAL MATERIAL REAL ESTATE ASSETS. In the event that any Credit
Party acquires a Material Real Estate Asset or a Real Estate Asset owned or
leased on the Closing Date becomes a Material Real Estate Asset and such
interest has not otherwise been made subject to the Lien of the Collateral
Documents in favor of Collateral Agent, for the benefit of Lenders, then such
Credit Party, contemporaneously with acquiring such Material Real Estate Asset,
or promptly after a Real Estate Asset owned or leased on the Closing Date
becomes a Material Real Estate Asset, shall take all such actions and execute
and deliver, or cause to be executed and delivered, all such mortgages,
documents, instruments,
54 CREDIT AND GUARANTY AGREEMENT
agreements, opinions and certificates (including any Phase I's that may be
requested) similar to those described in SECTIONS 3.1(h), and 3.1(i) with
respect to each such Material Real Estate Asset that Collateral Agent shall
reasonably request to create in favor of Collateral Agent, for the benefit of
Lenders, a valid and, subject to any filing and/or recording referred to herein,
perfected Landlord/Operator Consent and Waiver (in the case of leased sites) and
a First Priority Lien (in the case of owned sites) in such Material Real Estate
Assets. In addition to the foregoing, Company shall, at the request of Requisite
Lenders, deliver, from time to time, to Administrative Agent such appraisals as
are required by law or regulation of Real Estate Assets with respect to which
Collateral Agent has been granted a Lien.
5.12. ADDITIONAL COLLATERAL, ETC.. With respect to any Collateral acquired
after the Closing Date by Company or any other Credit Party as to which the
Collateral Agent, for the benefit of the Lenders, does not have a First Priority
Lien (subject to any Permitted Liens), promptly (and, in any event, within 10
days following the date of such acquisition or such latter date approved by the
Administrative Agent) (i) execute and deliver to the Administrative Agent and
the Collateral Agent such Guaranty or such other Credit Documents as the
Collateral Agent deems necessary or advisable to grant to the Collateral Agent,
for the benefit of the Lenders, a security interest in such Collateral and (ii)
take all actions necessary or advisable to grant to, or continue on behalf of,
the Collateral Agent, for the benefit of the Lenders, a perfected First Priority
Lien in such Collateral (subject to Permitted Liens), including the execution
and delivery of a Deposit Account Control Agreement with respect to each Deposit
Account or securities account that is established by a Credit Party after the
Closing Date.
5.13. FURTHER ASSURANCES. At any time or from time to time upon the
request of Administrative Agent, each Credit Party will, at its expense,
promptly execute, acknowledge and deliver such further documents and do such
other acts and things as Administrative Agent or Collateral Agent may reasonably
request in order to effect fully the purposes of the Credit Documents, including
providing Lenders with any information reasonably requested pursuant to SECTION
10.21. In furtherance and not in limitation of the foregoing, each Credit Party
shall take such actions as Administrative Agent or Collateral Agent may
reasonably request from time to time to ensure that the Obligations are
guarantied by the Guarantors, if any, and are secured by substantially all of
the assets of Company, and its Subsidiaries and all of the outstanding Capital
Stock of Company and its Subsidiaries (subject to limitations contained in the
Credit Documents with respect to Foreign Subsidiaries).
5.14. MISCELLANEOUS BUSINESS COVENANTS. Unless otherwise consented to by
Agents and Requisite Lenders:
(a) Non-Consolidation. Company will and will cause each of its
Subsidiaries to: (i) maintain entity records and books of account separate from
those of any other entity which is an Affiliate of such entity; (ii) not
commingle its funds or assets with those of any other entity which is an
Affiliate of such entity; and (iii) provide that its board of directors or other
analogous governing body will hold all appropriate meetings to authorize and
approve such entity's actions, which meetings will be separate from those of
other entities.
55 CREDIT AND GUARANTY AGREEMENT
(b) Cash Management.
(i) At all times on and after the Closing Date, Company's
Deposit Accounts and securities accounts shall be subject to Deposit
Account Control Agreements in form and substance satisfactory to the
Administrative Agent, other than those Deposit Accounts ("EXCLUDED DEPOSIT
ACCOUNTS") (A) set forth on SCHEDULE 5.14 to the Disclosure Letter
describing the Deposit Account specifically and the nature of the funds in
such Deposit Account, or (B) established after the Closing Date with
Administrative Agent's written consent (such consent not to be
unreasonably withheld) for the same or similar purposes as those specified
in CLAUSE (A) above and of which Company has given Administrative Agent
notice describing such Deposit Accounts specifically and the nature of the
funds in such Deposit Account. Neither Company nor its Subsidiaries shall
deposit funds in Excluded Deposit Accounts other than funds of the nature
described on SCHEDULE 5.14 to the Disclosure Letter or with written
consent from Administrative Agent (such consent not to be unreasonably
withheld). In addition, the Company shall deposit and maintain in a
restricted account (the "RESTRICTED CASH ACCOUNT"), minimum Cash amounts,
as shown below:
MINIMUM CASH SUBJECT
PERIOD TO CONTROL
-------------------------------------------- --------------------
Closing through April 30, 2005 $8,125,000
May 1, 2005 through May 31, 2005 $8,175,000
June 1, 2005 through June 30, 2005 $8,200,000
July 1, 2005 through July 31, 2005 $6,600,000
August 1, 2005 through August 31, 2005 $6,150,000
September 1, 2005 through September 30, 2005 $5,700,000
October 1, 2005 through October 31, 2005 $5,825,000
November 1, 2005 through November 30, 2005 $5,875,000
December 1, 2005 through December 31, 2005 $5,900,000
January 1, 2006 through January 31, 2006 $4,925,000
February 1, 2006 through February 28, 2006 $5,200,000
March 1, 2006 through March 31, 2006 $5,500,000
April 1, 2006 through April 31, 2006 $5,550,000
May 1, 2006 through May 31, 2006 $5,575,000
June 1, 2006 through June 30, 2006 $5,625,000
July 1, 2006 through July 31, 2006 $5,650,000
August 1, 2006 through August 31, 2006 $5,675,000
September 1, 2006 through September 30, 2006 $5,725,000
56 CREDIT AND GUARANTY AGREEMENT
MINIMUM CASH SUBJECT
PERIOD TO CONTROL
-------------------------------------------- --------------------
October 1, 2006 through October 31, 2006 $1,250,000
November 1, 2006 through November 30, 2006 $1,300,000
December 1, 2006 through December 31, 2006 $1,325,000
January 1, 2007 through January 31, 2007 $1,350,000
February 1, 2007 through February 28, 2007 $1,400,000
March 1, 2007 through March 31, 2007 $1,425,000
April 1, 2007 through April 31, 2007 $1,475,000
May 1, 2007 through May 31, 2007 $1,500,000
June 1, 2007 through June 30, 2007 $1,525,000
July 1, 2007 through July 31, 2007 $1,575,000
August 1, 2007 through August 31, 2007 $1,600,000
September 1, 2007 through September 30, 2007 $1,625,000
October 1, 2007 through October 31, 2007 $1,675,000
November 1, 2007 through November 30, 2007 $1,700,000
December 1, 2007 through December 31, 2007 $1,750,000
January 1, 2008 through January 31, 2008 $1,775,000
February 1, 2008 through February 29, 2008 $1,800,000
March 1, 2008 through March 31, 2008 $1,850,000
April 1, 2008 through Maturity $1,925,000
Company shall deliver to Administrative Agent a Cash Release Compliance
Notice and Certificate 3 Business Days prior to Company's requested
release of Cash from the Restricted Cash Account. Company shall deposit
additional funds into the Restricted Cash Account on or prior to the first
day of each period referenced in the chart above such that, in no event,
will the balance of such Restricted Cash Account be less than the amount
referenced opposite such referenced period. Balance decreases in the
Restricted Cash Account shall be effected by Agent on or before the third
Business Day following receipt of an acceptable Cash Release Compliance
Notice and Certificate; provided, however, that no Cash shall be released
from the Restricted Cash Account in accordance with the step-downs
referenced above in this SECTION 5.14(b) for the period commencing October
1, 2006 until Company has delivered a Compliance Certificate evidencing
compliance for the Fiscal Quarter ending September 30, 2006, and
evidencing compliance with the Minimum Consolidated Liquidity covenant set
forth in SECTION 6.8(e) for the period commencing October 1, 2006. Accrued
interest on the funds in the Restricted Cash Account shall be distributed
to Company only in connection with the step-downs referenced
57 CREDIT AND GUARANTY AGREEMENT
above. To the extent (x) Company is required to pay a dividend in
connection with the Series D Preferred Shares, (y) Company actually pays
such required dividend; and (z) Company provides Administrative Agent and
Lenders with a Cash Release Compliance Notice and Certificate
demonstrating compliance with the Credit Agreement, on the date that is
three Business Days following receipt of such certificate, Administrative
Agent shall reduce the balance in the Restricted Cash Account by the
amount of such dividend actually paid, all the amounts required for
subsequent periods shall be reduced by a corresponding amount, and
Administrative Agent may, but shall not be required to, prepare a
replacement chart evidencing the Restricted Cash Account required
balances. After consummation of a Qualified IPO and Company's
demonstration of compliance with the Credit Agreement, Administrative
Agent shall release any remaining Cash from the Restricted Cash Account.
(ii) From and after the date specified in SECTION 3.3(a),
Company and its Subsidiaries shall establish and maintain cash management
systems reasonably acceptable to Administrative Agent and Company.
5.15. POST CLOSING MATTERS. Company shall, and shall cause each of the
Credit Parties to, satisfy the requirements set forth on SCHEDULE 5.15 on or
before the date specified for such requirement or such later date to be
determined by the Agent.
5.16. ASSIGNABILITY OF CONTRACTS. Company shall, and shall cause each of
its Subsidiaries to, use its commercially reasonable efforts to ensure that all
customer contracts executed after the Closing Date be assignable by Company or
such Subsidiary.
5.17. SUBSIDIARY CASH. Company shall cause its Subsidiaries to transfer to
Company any Cash or Cash Equivalents held by its Subsidiaries to the extent that
the Subsidiaries, when taken as a whole, have Cash and Cash Equivalents in an
aggregate amount in excess of $2,000,000 ("MAXIMUM CASH BALANCE"); provided,
that, to the extent the Maximum Cash Balance exceeds $2,000,000 at any time, all
amounts in excess of the Maximum Cash Balance shall be transferred to Company if
the aggregate amount of Cash and Cash Equivalents described above still exceed
the Maximum Cash Balance at the close of business on the second Business Day
following the date that the Maximum Cash Balance was initially exceeded;
provided further that Company shall not permit the Maximum Cash Balance to be
exceeded more often than 3 times per calendar month.
SECTION 6. NEGATIVE COVENANTS
Each Credit Party covenants and agrees that, so long as any Term Loan
Commitment is in effect and until payment in full of all Obligations (other than
inchoate indemnity obligations), such Credit Party shall perform, and shall
cause each of its Subsidiaries to perform, all covenants in this SECTION 6.
6.1. INDEBTEDNESS. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or guaranty, or
otherwise become or remain directly or indirectly liable with respect to any
Indebtedness, except:
(a) the Obligations;
(b) (1) Indebtedness of any Guarantor Subsidiary to Company or to
any other Guarantor Subsidiary, or of Company to any Guarantor Subsidiary,
provided (i) all such Indebtedness shall be unsecured and subordinated in right
of payment to the payment in full of the Obligations pursuant to the terms of
the applicable promissory notes or an intercompany subordination agreement that
in any such case, is reasonably satisfactory to Administrative Agent, and (ii)
any payment by any such Guarantor
58 CREDIT AND GUARANTY AGREEMENT
Subsidiary under any Guaranty of the Obligations shall result in a pro tanto
reduction of the amount of any Indebtedness owed by such Subsidiary to Company
or to any of its Subsidiaries for whose benefit such payment is made, (2)
Indebtedness of any Subsidiary that is not a Guarantor to any other Subsidiary
that is not a Guarantor in the amounts listed on SCHEDULE 6.1 to the Disclosure
Letter, which may be reduced only (i) in compliance with this Agreement,
including, without limitation SECTION 5.17, and (ii) within 30 days following
the Closing Date; or otherwise with written consent of Administrative Agent, and
(3) Indebtedness (i) for working capital purposes, (ii) to be used by a
Subsidiary for repayment of Indebtedness existing between Subsidiaries that are
not Guarantors (x) in compliance with this Agreement, including, without
limitation SECTION 5.17, and (y) within 30 days following the Closing Date, or
(iii) for Permitted Acquisitions made in accordance with SECTION 6.9, in each
case, of any Subsidiary that is not a Guarantor, to Company or a Guarantor not
to exceed, at any time outstanding, in the aggregate, $17,500,000 during Fiscal
Year 2005, $22,500,000 during Fiscal Year 2006, $27,500,000 during Fiscal Year
2007, and $32,500,000 during Fiscal Year 2008 (as each amount shall be reduced
by outstanding Equity Investments made under SECTION 6.7(b)(iii)); provided
further that, in the case of Indebtedness under CLAUSE (3) above, that all such
Indebtedness shall be evidenced by promissory notes and all such notes shall be
subject to a First Priority Lien pursuant to a Pledge and Security Agreement;
(c) Indebtedness incurred by Company or any of its Subsidiaries
arising from agreements providing for indemnification, adjustment of purchase
price or similar obligations, or from guaranties or letters of credit, surety
bonds or performance bonds securing the performance of Company or any such
Subsidiary pursuant to such agreements, in connection with Permitted
Acquisitions or permitted dispositions of any business, assets or Subsidiary of
Company or any of its Subsidiaries;
(d) Indebtedness which may be deemed to exist pursuant to any
guaranties, performance, surety, statutory, appeal or similar obligations
incurred in the ordinary course of business;
(e) Indebtedness in respect of netting services, overdraft
protections and otherwise in connection with Deposit Accounts;
(f) guaranties in the ordinary course of business of the obligations
of suppliers, customers, franchisees and licensees of Company and its
Subsidiaries;
(g) Indebtedness described in SCHEDULE 6.1, to the Disclosure Letter
including any extensions, renewals or replacements of such Indebtedness so long
as (i) such refinancings, extensions, renewals or replacements of any such
Indebtedness are on terms and conditions not less favorable to the obligor
thereon or to the Lenders than the Indebtedness being refinanced or extended,
and the average life to maturity thereof is greater than or equal to that of the
Indebtedness being refinanced or extended; provided, such Indebtedness shall not
(A) include Indebtedness of an obligor that was not an obligor with respect to
the Indebtedness being extended, renewed or refinanced, (B) exceed in a
principal amount the Indebtedness being renewed, extended or refinanced, or (C)
be incurred, created or assumed if any Default or Event of Default has occurred
and is continuing or would result therefrom;
(h) Indebtedness with respect to Capital Leases (including leases of
software) in an aggregate amount not to exceed $5,000,000 at any time
outstanding, when taken together with Indebtedness incurred pursuant to CLAUSE
(i) below;
(i) purchase money Indebtedness (including software financing) in an
aggregate amount not to exceed $5,000,000 at any time outstanding, when taken
together with Indebtedness incurred pursuant to CLAUSE (h) above; provided, any
such Indebtedness shall be secured only to the asset acquired in connection with
the incurrence of such Indebtedness;
59 CREDIT AND GUARANTY AGREEMENT
(j) Indebtedness of a Subsidiary outstanding on the date such
Subsidiary was acquired by Company or any of its Subsidiaries or assumed in
connection with the acquisition of assets from a Person (other than Indebtedness
incurred as consideration in, or to provide all or any portion of the funds or
credit support utilized to consummate, the transaction or series of transactions
pursuant to which such Subsidiary became a Subsidiary of Company or was
otherwise acquired by Company); provided that the aggregate principal amount (or
accreted value, as applicable) of all such Indebtedness incurred pursuant to
this CLAUSE (j) shall not exceed $500,000;
(k) Indebtedness incurred in connection with Interest Rate
Agreements or Currency Agreements entered into in the ordinary course of
business and not for speculative purposes;
(l) Indebtedness to the two founders of ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc. in
connection with the Agreement and Plan of Merger, dated as of March 10, 2005, by
and among Company, Butterfly Acquisition Corporation, ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc.,
and with respect to Article VI only, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ as Stockholder Agent and
U.S. Bank, National Association as Escrow Agent; and
(m) other unsecured Indebtedness of Company and its Subsidiaries,
which is unsecured and subordinated to the Obligations in a manner satisfactory
to Administrative Agent in an aggregate amount not to exceed $500,000 at any
time outstanding.
6.2. LIENS. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or permit to
exist any Lien on or with respect to any property or asset of any kind
(including any document or instrument in respect of goods or accounts
receivable) of Company or any of its Subsidiaries, whether now owned or
hereafter acquired, or any income or profits therefrom, or file or permit the
filing of, or permit to remain in effect, any financing statement or other
similar notice of any Lien with respect to any such property, asset, income or
profits under the UCC of any State or under any similar recording or notice
statute, except:
(a) Liens in favor of Collateral Agent for the benefit of Lenders
granted pursuant to any Credit Document;
(b) Liens for Taxes if obligations with respect to such Taxes are
being contested in good faith by appropriate proceedings promptly instituted and
diligently conducted;
(c) statutory, common law, or contractual Liens of landlords,
creditor depository institutions and financial institutions maintaining
securities accounts (including rights of set-off), of carriers, warehousemen,
mechanics, repairmen, workmen and materialmen, and other Liens imposed by law
(other than any such Lien imposed pursuant to Section 401 (a)(29) or 412(n) of
the Internal Revenue Code or by ERISA), in each case incurred in the ordinary
course of business (i) for amounts not yet overdue, or (ii) for amounts that are
overdue and that (in the case of any such amounts overdue for a period in excess
of 5 days) are being contested in good faith by appropriate proceedings, so long
as such reserves or other appropriate provisions, if any, as shall be required
by GAAP shall have been made for any such contested amounts;
(d) Liens incurred in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations, surety
and appeal bonds, bids, leases, government contracts, trade contracts,
performance and return-of-money bonds and other similar obligations (exclusive
of obligations for the payment of borrowed money or other Indebtedness), so long
as no foreclosure, sale or similar proceedings have been commenced with respect
to any portion of the Collateral on account thereof;
60 CREDIT AND GUARANTY AGREEMENT
(e) easements, rights-of-way, restrictions, encroachments, and other
minor defects or irregularities in title, in each case which do not and cannot
reasonably be expected to interfere in any material respect with the ordinary
conduct of the business of Company or any of its Subsidiaries;
(f) any interest or title of a lessor or sublessor under any lease
of real estate permitted hereunder;
(g) Liens solely on any ▇▇▇▇ ▇▇▇▇▇▇▇ money deposits made by Company
or any of its Subsidiaries in connection with any letter of intent or purchase
agreement permitted hereunder;
(h) purported Liens evidenced by the filing of precautionary UCC
financing statements relating solely to operating leases of personal property
entered into in the ordinary course of business;
(i) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;
(j) any zoning or similar law or right reserved to or vested in any
governmental office or agency to control or regulate the use of any real
property;
(k) licenses of patents, trademarks and other intellectual property
rights granted by Company or any of its Subsidiaries in the ordinary course of
business and not interfering in any respect with the ordinary conduct of the
business of Company or such Subsidiary;
(l) Liens securing Indebtedness permitted pursuant to SECTION 6.1(h)
and (i); provided, any such Lien shall encumber only the asset acquired with the
proceeds of such Indebtedness; together with accessions thereto, and
replacements and proceeds thereof;
(m) Liens described on SCHEDULE 6.2 to the Disclosure Letter;
(n) Liens on Cash not to exceed $200,000 in the aggregate, securing
reimbursement obligations under letters of credit and Liens on cash deposits
made in the ordinary course of business; and
(o) Liens securing judgments, writs, warrants or similar processes
not constituting an Event of Default under SECTION 8.1(i).
6.3. EQUITABLE LIEN. If any Credit Party or any of its Subsidiaries shall
create or assume any Lien upon any of its properties or assets, whether now
owned or hereafter acquired, other than Permitted Liens, it shall make or cause
to be made effective provisions whereby the Obligations will be secured by such
Lien equally and ratably with any and all other Indebtedness secured thereby as
long as any such Indebtedness shall be so secured; provided, notwithstanding the
foregoing, this covenant shall not be construed as a consent by Requisite
Lenders to the creation or assumption of any such Lien not otherwise permitted
hereby.
6.4. NO FURTHER NEGATIVE PLEDGES. Except with respect to (a) specific
property encumbered to secure payment of particular Indebtedness or to be sold
pursuant to an executed agreement with respect to a permitted Asset Sale or
other sale of property not constituting an Asset Sale that is not prohibited
hereunder, (b) restrictions by reason of customary provisions restricting Liens,
assignments, subletting or other transfers contained in leases, licenses and
similar agreements entered into in the ordinary course of business (provided
that such restrictions are limited to the property or assets secured by such
Liens or the property or assets subject to such leases, licenses or similar
agreements, as the case may be), (c) restrictions and conditions, applicable to
any Subsidiary acquired after the date hereof, if such
61 CREDIT AND GUARANTY AGREEMENT
restrictions and conditions existed at the time such Subsidiary was acquired,
were not created in anticipation of such acquisition and apply solely to such
acquired Subsidiary, no Credit Party nor any of its Subsidiaries shall enter
into any agreement prohibiting the creation or assumption of any Lien upon any
of its properties or assets, whether now owned or hereafter acquired.
6.5. RESTRICTED JUNIOR PAYMENTS
(a) No Credit Party shall, nor shall it permit any of its
Subsidiaries through any manner or means or through any other Person to,
directly or indirectly, declare, order, pay, make or set apart, or agree to
declare, order, pay, make or set apart, any sum for any Restricted Junior
Payment, except for (i) cash dividends in connection with a Qualified IPO; (ii)
stock or cash dividends payable to the Series D Preferred Shareholders pursuant
to existing rights of the Series D Preferred Shareholders and in connection with
conversion to common equity securities of Company not to exceed $2,000,000;
(iii) payments of Cash in lieu of fractional shares upon conversion of
convertible preferred stock or upon any stock dividend, stock split or
combination or business combination; (iv) acquisitions of Capital Stock of
Company, solely by issuance of Capital Stock, in connection with either (A) the
exercise of stock options or warrants by way of cashless exercise, or (B) in
connection with the satisfaction of withholding tax obligations related to the
exercise of stock options; (v) so long as no Default or Event of Default has
occurred and is continuing or would result therefrom, purchase, repurchase,
redeem, defease, acquire or retire for value Capital Stock of Company or any of
its Subsidiaries from any officer, director, employee or consultant of Company
or its Subsidiaries upon the resignation, termination, or death of such
employees, directors, board members, or consultants in an aggregate amount not
to exceed $500,000 in the aggregate; and (vi) in connection with any Permitted
Acquisition or acquisition that occurred prior to the Closing Date, the Company
or any of its Subsidiaries may, (A) receive or accept the return of Capital
Stock of Company constituting a portion of the purchase price in settlement of
indemnification claims, or (B) subject to SECTION 6.9(e), make payments or
distributions to dissenting stockholders pursuant to applicable law.
(b) No Subsidiary of Company shall (i) pay a dividend in cash or
make a distribution in Cash to any holder of any class of stock or other equity
security of such Subsidiary, unless the holder is the Company or another
Subsidiary of Company, or (ii) redeem, retire, make any sinking payment or
purchase or otherwise acquire for value, in each case in Cash, any class of
stock or other equity security of such Subsidiary from the holder thereof,
unless the holder is Company or another Subsidiary of Company.
6.6. RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS. Except as provided herein,
no Credit Party shall, nor shall it permit any of its Subsidiaries to, create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of any Subsidiary of
Company to (a) pay dividends or make any other distributions on any of such
Subsidiary's Capital Stock owned by Company or any other Subsidiary of Company
(other than permitted stock dividends payable solely in shares of that class of
stock to the holders of that class), (b) repay or prepay any Indebtedness owed
by such Subsidiary to Company or any other Subsidiary of Company, (c) make loans
or advances to Company or any other Subsidiary of Company, or (d) transfer any
of its property or assets to Company or any other Subsidiary of Company other
than restrictions (i) in agreements evidencing Indebtedness permitted by SECTION
6.1(h) or (i) that impose restrictions on the property so acquired or leased,
(ii) by reason of customary provisions restricting assignments, subletting or
other transfers contained in leases, licenses, joint venture agreements and
similar agreements entered into in the ordinary course of business, (iii) that
are or were created by virtue of any transfer of, agreement to transfer or
option or right with respect to any property, assets or Capital Stock not
otherwise prohibited under this Agreement,
62 CREDIT AND GUARANTY AGREEMENT
(iv) imposed on a Subsidiary and existing at the time it became a Subsidiary if
such restrictions were not created in connection with or in anticipation of the
transaction or series of transactions pursuant to which such Subsidiary became a
Subsidiary or was acquired by Company and only to the extent applying to such
Subsidiary; (v) under any agreement, instrument or contract affecting property
or a Person at the time such property or Person was acquired by Company or any
of its Subsidiaries, so long as such restriction relates solely to the property
or Person so acquired and was not created in connection with or in anticipation
of such acquisition; and (vi) existing by virtue of, or arising under,
applicable law, regulation, order, approval, license, permit, grant or similar
restriction, in each case mandatory and imposed by a Governmental Authority.
6.7. INVESTMENTS. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, make or own any Investment in any
Person, including without limitation any Joint Venture, except:
(a) Investments in Cash and Cash Equivalents;
(b) (i) Investments owned as of the Closing Date in any Subsidiary;
(ii) Investments in any wholly-owned Guarantor Subsidiary of Company or in
Company, and (iii) Investments by Company or any Guarantor in a Subsidiary that
is not a Guarantor, provided that such Investments (whether or not constituting
Indebtedness and including Investments permitted under clause (i) above) shall
be limited by the purpose and to the amounts provided in SECTION 6.1(b)(3) and
Investments not constituting Indebtedness ("EQUITY INVESTMENTS") shall reduce
the amount of Indebtedness permitted to be incurred under SECTION 6.1(b)(3) by
the same amount.
(c) Investments (i) in any Securities received in satisfaction or
partial satisfaction thereof from financially troubled account debtors, and (ii)
deposits, prepayments and other credits to suppliers made in the ordinary course
of business consistent with the past practices of Company and its Subsidiaries;
(d) intercompany loans to the extent permitted under SECTION 6.1(b);
(e) Consolidated Capital Expenditures permitted by SECTION 6.8(c);
(f) loans and advances to employees of Company and its Subsidiaries
(i) made in the ordinary course of business and described on SCHEDULE 6.7 to the
Disclosure Letter, and any refinancings of such loans after the Closing Date,
and (ii) made in the ordinary course of business after the Closing Date in an
aggregate amount not to exceed $250,000;
(g) Investments made in connection with Permitted Acquisitions
permitted pursuant to SECTION 6.9;
(h) Investments described in SCHEDULE 6.7 to the Disclosure Letter;
(i) Investments arising in connection with Interest Rate Agreements
or Currency Agreements entered into in the ordinary course of business and not
for speculative purposes;
(j) guarantees and similar obligations permitted by SECTION 6.1;
(k) Investments received in partial or full satisfaction of an
account receivable from financially troubled account debtors to the extent
reasonably necessary to prevent or limit loss; and
63 CREDIT AND GUARANTY AGREEMENT
(l) other Investments in an aggregate amount not to exceed at any
time $100,000.
Notwithstanding the foregoing, in no event shall any Credit Party make any
Investment which results in or facilitates in any manner any Restricted Junior
Payment not otherwise permitted under the terms of SECTION 6.5.
6.8. FINANCIAL COVENANTS.
(a) Current Ratio. Company shall not permit the Current Ratio as of
the last day of any Fiscal Quarter, beginning with the Fiscal Quarter ending
March 31, 2005, to be less than the correlative ratio indicated:
FISCAL QUARTER CURRENT RATIO
-------------- -------------
March 31, 2005 1.15:1.00
June 30, 2005 1.10:1.00
September 30, 2005 1.15:1.00
December 31, 2005 1.10:1.00
March 31, 2006 1.00:1.00
June 30, 2006 1.05:1.00
September 30, 2006 1.10:1.00
December 31, 2006 1.10:1.00
March 31, 2007 1.10:1.00
June 30, 2007 1.20:1.00
September 30, 2007 1.20:1.00
December 31, 2007 1.20:1.00
March 31, 2008 1.10:1.00
With respect to the Fiscal Quarter ended March 31, 2005, for the purposes of
determining compliance with the financial covenant set forth above, the Current
Ratio shall be calculated with respect to such period on a pro forma basis using
the Historical Financial Statements of Company and its Subsidiaries which shall
be reformulated as if the Closing Date had occurred and the Term Loan had been
made.
(b) Minimum Consolidated Adjusted EBITDA. Company shall not permit
Consolidated Adjusted EBITDA as at the end of any Fiscal Quarter, beginning with
the Fiscal Quarter ending March 31, 2005, for the Fiscal Quarter period then
ended, to be less than the correlative amount indicated:
MINIMUM
CONSOLIDATED
FISCAL QUARTER ADJUSTED EBITDA
------------------ ---------------
March 31, 2005 $ 1,000,000
June 30, 2005 $ 1,100,000
September 30, 2005 $ 2,850,000
December 31, 2005 $ 3,900,000
March 31, 2006 $ 4,500,000
June 30, 2006 $ 6,500,000
September 30, 2006 $ 9,000,000
64 CREDIT AND GUARANTY AGREEMENT
MINIMUM
CONSOLIDATED
FISCAL QUARTER ADJUSTED EBITDA
------------------ ---------------
December 31, 2006 $10,000,000
March 31, 2007 $11,000,000
June 30, 2007 $11,500,000
September 30, 2007 $12,000,000
December 31, 2007 $12,500,000
March 31, 2008 $13,000,000
For purposes of calculating compliance with the financial covenants in this
SECTION 6.8(b), the calculations for the Fiscal Quarter periods ending March 31,
2005, June 30, 2005 and September 30, 2005, shall be calculated as follows: (i)
for the calculation period ending March 31, 2005, the amount of each item to be
used in the calculation shall be equal to the actual amount of such item for the
three-calendar month period from January 1, 2005 through March 31, 2005; (ii)
for the calculation period ending June 30, 2005, the amount of each item to be
used in the calculation shall be equal to the actual amount of such item for the
two-Fiscal Quarter period from January 1, 2005 through June 30, 2005; (iii) for
the calculation period ending September 30, 2005, the amount of each item to be
used in the calculation shall be equal to the actual amount of such item for the
three-Fiscal Quarter period from January 1, 2005, through September 30, 2005;
and (iv) thereafter, the amount of each item to be used in the calculation shall
be equal to the actual amount of such item for the trailing four-Fiscal Quarter
period most recently ended.
(c) Maximum Consolidated Capital Expenditures. Company shall not,
and shall not permit its Subsidiaries to, make or incur Consolidated Capital
Expenditures for the Fiscal Quarter period then ended, in an aggregate amount
for Company and its Subsidiaries in excess of the corresponding amount set forth
below opposite such Fiscal Quarter period then ended:
MAXIMUM
CONSOLIDATED CAPITAL
FISCAL QUARTER EXPENDITURES
------------------ --------------------
March 31, 2005 $2,900,000
June 30, 2005 $5,000,000
September 30, 2005 $5,800,000
December 31, 2005 $6,100,000
March 31, 2006 $4,750,000
June 30, 2006 $4,750,000
September 30, 2006 $4,750,000
December 31, 2006 $5,500,000
March 31, 2007 $5,500,000
June 30, 2007 $5,500,000
September 30, 2007 $5,500,000
December 31, 2007 $5,500,000
March 31, 2008 $5,500,000
65 CREDIT AND GUARANTY AGREEMENT
For purposes of calculating compliance with the financial covenants in this
SECTION 6.8(c), the calculations for the Fiscal Quarter periods ending March 31,
2005, June 30, 2005, September 30, 2005, shall be calculated as follows: (i) for
the calculation period ending March 31, 2005, the amount of each item to be used
in the calculation shall be equal to the actual amount of such item for the
three-calendar month period from January 1, 2005 through March 31, 2005; (ii)
for the calculation period ending June 30, 2005, the amount of each item to be
used in the calculation shall be equal to the actual amount of such item for the
two-Fiscal Quarter period from January 1, 2005 through June 30, 2005; (iii) for
the calculation period ending September 30, 2005, the amount of each item to be
used in the calculation shall be equal to the actual amount of such item for the
three-Fiscal Quarter period from January 1, 2005, through September 30, 2005;
and (iv) thereafter, the amount of each item to be used in the calculation shall
be equal to the actual amount of such item for the trailing four-Fiscal Quarter
period most recently ended.
(d) Minimum Hosted Application Revenue. Company shall not permit
Consolidated Hosted Application Revenue as at the end of any Fiscal Quarter,
beginning with the Fiscal Quarter ending March 31, 2005, for the Fiscal Quarter
period then ended, to be less than the correlative amount indicated:
MINIMUM HOSTED
FISCAL QUARTER APPLICATION REVENUE
-------------- -------------------
March 31, 2005 $10,700,000
June 30, 2005 $20,400,000
September 30, 2005 $33,100,000
December 31, 2005 $43,800,000
March 31, 2006 $46,300,000
June 30, 2006 $48,800,000
September 30, 2006 $53,800,000
December 31, 2006 $53,800,000
March 31, 2007 $58,800,000
June 30, 2007 $61,300,000
September 30, 2007 $63,800,000
December 31, 2007 $66,050,000
March 31, 2008 $68,800,000
For purposes of calculating compliance with the financial covenants in this
SECTION 6.8(d), the calculations for the Fiscal Quarter periods ending March 31,
2005, June 30, 2005, September 30, 2005, shall be calculated as follows: (i) for
the calculation period ending March 31, 2005, the amount of each item to be used
in the calculation shall be equal to the actual amount of such item for the
three-calendar month period from January 1, 2005 through March 31, 2005; (ii)
for the calculation period ending June 30, 2005, the amount of each item to be
used in the calculation shall be equal to the actual amount of such item for the
two-Fiscal Quarter period from January 1, 2005 through June 30, 2005; (iii) for
the calculation period ending September 30, 2005, the amount of each item to be
used in the calculation shall be equal to the actual amount of such item for the
three-Fiscal Quarter period from January 1, 2005, through September 30, 2005;
and (iv) thereafter, the amount of each item to be used in the calculation shall
be equal to the actual amount of such item for the trailing four-Fiscal Quarter
period most recently ended.
66 CREDIT AND GUARANTY AGREEMENT
(e) Minimum Consolidated Liquidity. Company shall not permit
Consolidated Liquidity to be less than the amounts specified below for the
correlative periods indicated:
MINIMUM
CONSOLIDATED
PERIOD LIQUIDITY
-------------------------------------------- ------------
Closing through April 30, 2005 $15,625,000
May 1, 2005 through May 31, 2005 $15,675,000
June 1, 2005 through June 30, 2005 $ 8,700,000
July 1, 2005 through July 31, 2005 $ 6,850,000
August 1, 2005 through August 31, 2005 $ 6,900,000
September 1, 2005 through September 30, 2005 $ 6,450,000
October 1, 2005 through October 31, 2005 $ 6,825,000
November 1, 2005 through November 30, 2005 $ 6,875,000
December 1, 2005 through December 31, 2005 $ 6,900,000
January 1, 2006 through January 31, 2006 $ 6,200,000
February 1, 2006 through February 28, 2006 $ 6,980,000
March 1, 2006 through March 31, 2006 $ 7,000,000
April 1, 2006 through April 31, 2006 $ 6,050,000
May 1, 2006 through May 31, 2006 $ 6,075,000
June 1, 2006 through June 30, 2006 $ 6,125,000
July 1, 2006 through July 31, 2006 $ 6,150,000
August 1, 2006 through August 31, 2006 $ 6,175,000
September 1, 2006 through September 30, 2006 $ 6,225,000
October 1, 2006 through October 31, 2006 $ 3,250,000
November 1, 2006 through November 30, 2006 $ 3,300,000
December 1, 2006 through December 31, 2006 $ 3,325,000
January 1, 2007 through January 31, 2007 $ 3,350,000
February 1, 2007 through February 28, 2007 $ 3,400,000
March 1, 2007 through March 31, 2007 $ 3,425,000
April 1, 2007 through April 31, 2007 $ 3,475,000
May 1, 2007 through May 31, 2007 $ 3,500,000
June 1, 2007 through June 30, 2007 $ 3,525,000
July 1, 2007 through July 31, 2007 $ 3,575,000
67 CREDIT AND GUARANTY AGREEMENT
MINIMUM
CONSOLIDATED
PERIOD LIQUIDITY
-------------------------------------------- ------------
August 1, 2007 through August 31, 2007 $ 3,600,000
September 1, 2007 through September 30, 2007 $ 3,625,000
October 1, 2007 through October 31, 2007 $ 3,675,000
November 1, 2007 through November 30, 2007 $ 3,700,000
December 1, 2007 through December 31, 2007 $ 3,750,000
January 1, 2008 through January 31, 2008 $ 3,775,000
February 1, 2008 through February 29, 2008 $ 3,800,000
March 1, 2008 through March 31, 2008 $ 3,850,000
April 1, 2008 through Maturity $ 3,850,000
To the extent that Company has satisfied the requirements set forth in SECTION
5.14(b)(i) with respect to the reduction of the Restricted Cash Account upon
actual payment of a dividend in connection with the Series D Preferred Shares,
the required Minimum Consolidated Liquidity shall be reduced for corresponding
periods by the amount of the dividend actually paid. Administrative Agent may,
but shall not be required to, prepare a replacement chart evidencing the
required Minimum Consolidated Liquidity amounts.
(f) Loan to Value Ratio. At all times following the thirtieth
calendar day following a Qualified IPO, Company shall not permit its Loan to
Value Ratio to be more than 0.20:1.00.
(g) Certain Calculations. With respect to any period during which a
Permitted Acquisition or an Asset Sale has occurred (each, a "SUBJECT
TRANSACTION"), for purposes of determining compliance with the financial
covenants set forth in this SECTION 6.8, Consolidated Adjusted EBITDA shall be
calculated with respect to such period on a pro forma basis (including pro forma
adjustments approved by Administrative Agent in its sole discretion) using the
historical audited financial statements of any business so acquired or to be
acquired or sold or to be sold and the consolidated financial statements of
Company and its Subsidiaries which shall be reformulated as if such Subject
Transaction, and any Indebtedness incurred or repaid in connection therewith,
had been consummated or incurred or repaid at the beginning of such period (and
assuming that such Indebtedness bears interest during any portion of the
applicable measurement period prior to the relevant acquisition at the weighted
average of the interest rates applicable to outstanding Term Loan s incurred
during such period).
6.9. FUNDAMENTAL CHANGES; DISPOSITION OF ASSETS; ACQUISITIONS. No Credit
Party shall, nor shall it permit any of its Subsidiaries to, enter into any
transaction of merger or consolidation, or liquidate, wind-up or dissolve itself
(or suffer any liquidation or dissolution), or convey, sell, lease or sub-lease
(as lessor or sublessor), exchange, transfer or otherwise dispose of, in one
transaction or a series of transactions, all or any part of its business, assets
or property of any kind whatsoever, whether real, personal or mixed and whether
tangible or intangible, whether now owned or hereafter acquired, or acquire by
purchase or otherwise (other than purchases or other acquisitions of inventory,
materials and equipment and Consolidated Capital Expenditures in the ordinary
course of business) the business,
68 CREDIT AND GUARANTY AGREEMENT
property or fixed assets of, or stock or other evidence of beneficial ownership
of, any Person or any division or line of business or other business unit of any
Person, except:
(a) with the exception of any Subsidiary organized under the laws of
Canada or any of its Provinces (i) any Subsidiary of Company may be merged with
or into Company or any Guarantor Subsidiary (provided that the Company shall
always be the surviving Person of any merger to which it is a party and a
Guarantor Subsidiary shall be the surviving Person of any merger to which a
Guarantor Subsidiary is a party except a merger into Company), and any
Subsidiary that is not a Guarantor may be merged with or into any Subsidiary
that is not a Guarantor (provided if the parent of a party to any such merger
has pledged all or a portion of the stock of such party under the Credit
Documents then such party shall be the surviving Person of any such merger or,
if the other party is the surviving Person the parent of such surviving Person
shall pledge the same proportion of the stock of the surviving Person); and (ii)
any Subsidiary of Company may be liquidated, wound up or dissolved, or all or
any part of its business, property or assets may be conveyed, sold, leased,
transferred or otherwise disposed of, in one transaction or a series of
transactions, to Company or any Guarantor Subsidiary or, if such Subsidiary is
not a Guarantor, to the Subsidiary that is its parent;
(b) sales or other dispositions of assets that do not constitute
Asset Sales;
(c) Asset Sales for fair value, the proceeds of which (i) are less
than $150,000 with respect to any single Asset Sale or series of related Asset
Sales, and (ii) when aggregated with the proceeds of all other Asset Sales made
within the same Fiscal Year, are less than $250,000; provided (1) the
consideration received for such assets shall be in an amount at least equal to
the fair market value thereof, (2) no less than 100% thereof shall be paid in
Cash, and (3) the Net Asset Sale Proceeds thereof shall be applied as required
by SECTION 2.11(a);
(d) disposals of obsolete or worn out property;
(e) Permitted Acquisitions, the aggregate consideration for which,
to the extent consisting of (i) Cash (including any Cash paid to dissenting
shareholders), Indebtedness of the acquiring Person, or Indebtedness of the
Person being acquired, or other consideration besides Capital Stock of the
Company, is not more than $1,500,000, in the aggregate, and (ii) Capital Stock
of the Company, is not more than $5,000,000;
(f) Investments made in accordance with SECTION 6.7; and
(g) the execution of either (i) a letter of intent, term sheet, or
similar document (A) that provides for fees (including breakup or similar fees,
legal, and other fees and expenses) payable by the Company of no more than
$250,000 in the aggregate, and (B) for which prompt notice of the execution
thereof has been given to Administrative Agent) or (ii)an agreement (with prompt
notice upon execution to be given by Company to the Administrative Agent) for
(i) any merger of Company with or into a Person, or (ii) a sale of all or
substantially all of the assets of Company to a Person that is, in the case of
either CLAUSE (i) and (ii) above, in the opinion of the Company's board of
directors, reasonably likely to be consummated and, if consummated, will result
in the concurrent payment in full of all Obligations.
6.10. DISPOSAL OF SUBSIDIARY INTERESTS. Except for any sale of all of its
interests in the Capital Stock of any of its Subsidiaries in compliance with the
provisions of SECTION 6.9, no Credit Party shall, nor shall it permit any of its
Subsidiaries to, (a) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any Capital Stock of any of its Subsidiaries, except to
qualify directors if required by applicable law; or (b) permit any of its
Subsidiaries directly or indirectly to sell, assign, pledge or otherwise
encumber or dispose of any Capital Stock of any of its Subsidiaries, except to
another Credit
69 CREDIT AND GUARANTY AGREEMENT
Party (subject to the restrictions on such disposition otherwise imposed
hereunder), or to qualify directors if required by applicable law.
6.11. SALES AND LEASE-BACKS. No Credit Party shall, nor shall it permit
any of its Subsidiaries to, directly or indirectly, become or remain liable as
lessee or as a guarantor or other surety with respect to any lease of any
property (whether real, personal or mixed), whether now owned or hereafter
acquired, which such Credit Party (a) has sold or transferred or is to sell or
to transfer to any other Person (other than Company or any of its Subsidiaries),
or (b) intends to use for substantially the same purpose as any other property
which has been or is to be sold or transferred by such Credit Party to any
Person (other than Company or any of its Subsidiaries) in connection with such
lease.
6.12. TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES. No Credit Party
shall, nor shall it permit any of its Subsidiaries to, directly or indirectly,
enter into or permit to exist any transaction (including the purchase, sale,
lease or exchange of any property or the rendering of any service) with any
holder of 10% or more of any class of Capital Stock of Company or any of its
Subsidiaries or with any Affiliate of Company or of any such holder, on terms
that are less favorable to Company or that Subsidiary, as the case may be, than
those that might be obtained at the time from a Person who is not such a holder
or Affiliate; provided, the foregoing restriction shall not apply to (a) any
transaction between Company and any Guarantor Subsidiary; (b) reasonable and
customary fees paid to members of the board of directors (or similar governing
body) of Company and its Subsidiaries; (c) compensation arrangements for
officers and other employees of Company and its Subsidiaries entered into in the
ordinary course of business; and (d) transactions described in SCHEDULE 6.12.
Company shall disclose in writing each transaction with any holder of 10% or
more of any class of Capital Stock of Company or any of its Subsidiaries or with
any Affiliate of Company or of any such holder to Administrative Agent.
6.13. CONDUCT OF BUSINESS. From and after the Closing Date, no Credit
Party shall, nor shall it permit any of its Subsidiaries to, engage in any
business other than (i) the enterprise software business and businesses that are
reasonably related or incidental thereto, and (ii) such other lines of business
as may be consented to by the Administrative Agent and Requisite Lenders.
6.14. FISCAL YEAR. No Credit Party shall, nor shall it permit any of its
Subsidiaries to change its Fiscal Year-end from December 31.
6.15. AMENDMENTS TO ORGANIZATIONAL AGREEMENTS AND MATERIAL CONTRACTS. No
Credit Party shall (a) amend or permit any amendments to any Credit Party's
Organizational Documents if such amendment would be adverse to Administrative
Agent or the Lenders; or (b) amend or permit any amendments to, or terminate or
waive any provision of, any Material Contract if such amendment, termination, or
waiver would be materially adverse to Administrative Agent or the Lenders.
6.16. PREPAYMENTS OF CERTAIN INDEBTEDNESS. No Credit Party shall, directly
or indirectly, voluntarily purchase, redeem, defease or prepay any principal of,
premium, if any, interest or other amount payable in respect of any Indebtedness
prior to its scheduled maturity, other than (i) the Obligations, and (ii)
Indebtedness secured by a Permitted Liens if the asset securing such
Indebtedness has been sold or otherwise disposed of in accordance with SECTION
6.9.
6.17. REGISTRATION OF INTELLECTUAL PROPERTY. No Credit Party shall, nor
shall it permit any of its Subsidiaries to, make any applications on any of its
unpatented but patentable inventions or any of its registrable but unregistered
copyrights and trademarks in the United States Patent and Trademark Office, the
United States Copyright Office or in any similar office or agency of the United
States, any state thereof or any other country or any political subdivision
thereof, unless it shall have given 60 days' prior written notice thereof to
Administrative Agent.
70 CREDIT AND GUARANTY AGREEMENT
SECTION 7. GUARANTY
7.1. GUARANTY OF THE OBLIGATIONS. Guarantors jointly and severally hereby
irrevocably and unconditionally guaranty to Administrative Agent for the ratable
benefit of the Beneficiaries the due and punctual payment in full of all
Obligations when the same shall become due, whether at stated maturity, by
required prepayment, declaration, acceleration, demand or otherwise (including
amounts that would become due but for the operation of the automatic stay under
Section 362(a) of the Bankruptcy Code, 11 U.S.C. Section 362(a)) (collectively,
the "GUARANTEED OBLIGATIONS"). Notwithstanding the preceding, the obligations of
each Guarantor hereunder shall be limited to an aggregate amount equal to the
largest amount that would not render its obligations hereunder subject to
avoidance under Section 548 of the United States Bankruptcy Code or any
comparable provisions of any applicable state or federal law. Should any
provision in or obligation under this SECTION 7 be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, all with respect to any Guarantor, shall not in any way
be affected or impaired thereby.
7.2. CONTRIBUTION BY GUARANTORS. All Guarantors desire to allocate among
themselves (collectively, the "CONTRIBUTING GUARANTORS"), in a fair and
equitable manner, their obligations arising under this Guaranty. Accordingly, in
the event any payment or distribution is made on any date by a Guarantor (a
"FUNDING GUARANTOR") under this Guaranty such that its Aggregate Payments
exceeds its Fair Share as of such date, such Funding Guarantor shall be entitled
to a contribution from each of the other Contributing Guarantors in an amount
sufficient to cause each Contributing Guarantor's Aggregate Payments to equal
its Fair Share as of such date. "FAIR SHARE" means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to (a)
the ratio of (i) the Fair Share Contribution Amount with respect to such
Contributing Guarantor, to (ii) the aggregate of the Fair Share Contribution
Amounts with respect to all Contributing Guarantors multiplied by, (b) the
aggregate amount paid or distributed on or before such date by all Funding
Guarantors under this Guaranty in respect of the obligations Guaranteed. "FAIR
SHARE CONTRIBUTION AMOUNT" means, with respect to a Contributing Guarantor as of
any date of determination, the maximum aggregate amount of the obligations of
such Contributing Guarantor under this Guaranty that would not render its
obligations hereunder or thereunder subject to avoidance as a fraudulent
transfer or conveyance under Section 548 of Title 11 of the United States Code
or any comparable applicable provisions of state law; provided, solely for
purposes of calculating the Fair Share Contribution Amount with respect to any
Contributing Guarantor for purposes of this SECTION 7.2, any assets or
liabilities of such Contributing Guarantor arising by virtue of any rights to
subrogation, reimbursement or indemnification or any rights to or obligations of
contribution hereunder shall not be considered as assets or liabilities of such
Contributing Guarantor. "AGGREGATE PAYMENTS" means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to (1)
the aggregate amount of all payments and distributions made on or before such
date by such Contributing Guarantor in respect of this Guaranty (including,
without limitation, in respect of this SECTION 7.2), minus (2) the aggregate
amount of all payments received on or before such date by such Contributing
Guarantor from the other Contributing Guarantors as contributions under this
SECTION 7.2. The amounts payable as contributions hereunder shall be determined
as of the date on which the related payment or distribution is made by the
applicable Funding Guarantor. The allocation among Contributing Guarantors of
their obligations as set forth in this SECTION 7.2 shall not be construed in any
way to limit the liability of any Contributing Guarantor hereunder. Each
Guarantor is a third party beneficiary to the contribution agreement set forth
in this SECTION 7.2.
7.3. PAYMENT BY GUARANTORS. Subject to SECTION 7.2, Guarantors hereby
jointly and severally agree, in furtherance of the foregoing and not in
limitation of any other right which any Beneficiary may have at law or in equity
against any Guarantor by virtue hereof, that upon the failure of Company to pay
any of the Guaranteed Obligations when and as the same shall become due, whether
at stated maturity, by
71 CREDIT AND GUARANTY AGREEMENT
required prepayment, declaration, acceleration, demand or otherwise (including
amounts that would become due but for the operation of the automatic stay under
Section 362(a) of the Bankruptcy Code, 11 U.S.C. Section 362(a)), Guarantors
will upon demand pay, or cause to be paid, in Cash, to Administrative Agent for
the ratable benefit of Beneficiaries, an amount equal to the sum of the unpaid
principal amount of all Guaranteed Obligations then due as aforesaid, accrued
and unpaid interest on such Guaranteed Obligations (including interest which,
but for Company's becoming the subject of a case under the Bankruptcy Code,
would have accrued on such Guaranteed Obligations, whether or not a claim is
allowed against Company for such interest in the related bankruptcy case) and
all other Guaranteed Obligations then owed to Beneficiaries as aforesaid.
7.4. LIABILITY OF GUARANTORS ABSOLUTE. Each Guarantor agrees that its
obligations hereunder are irrevocable, absolute, independent and unconditional
and shall not be affected by any circumstance which constitutes a legal or
equitable discharge of a guarantor or surety other than payment in full of the
Guaranteed Obligations. In furtherance of the foregoing and without limiting the
generality thereof, each Guarantor agrees as follows:
(a) this Guaranty is a guaranty of payment when due and not of
collectability. This Guaranty is a primary obligation of each Guarantor and not
merely a contract of surety;
(b) Administrative Agent may enforce this Guaranty upon the
occurrence of an Event of Default notwithstanding the existence of any dispute
between Company and any Beneficiary with respect to the existence of such Event
of Default;
(c) the obligations of each Guarantor hereunder are independent of
the obligations of Company and the obligations of any other guarantor (including
any other Guarantor) of the obligations of Company, and a separate action or
actions may be brought and prosecuted against such Guarantor whether or not any
action is brought against Company or any of such other guarantors and whether or
not Company is joined in any such action or actions;
(d) payment by any Guarantor of a portion, but not all, of the
Guaranteed Obligations shall in no way limit, affect, modify or abridge any
Guarantor's liability for any portion of the Guaranteed Obligations which has
not been paid. Without limiting the generality of the foregoing, if
Administrative Agent is awarded a judgment in any suit brought to enforce any
Guarantor's covenant to pay a portion of the Guaranteed Obligations, such
judgment shall not be deemed to release such Guarantor from its covenant to pay
the portion of the Guaranteed Obligations that is not the subject of such suit,
and such judgment shall not, except to the extent satisfied by such Guarantor,
limit, affect, modify or abridge any other Guarantor's liability hereunder in
respect of the Guaranteed Obligations;
(e) any Beneficiary, upon such terms as it deems appropriate,
without notice or demand and without affecting the validity or enforceability
hereof or giving rise to any reduction, limitation, impairment, discharge or
termination of any Guarantor's liability hereunder, from time to time may (i)
renew, extend, accelerate, increase the rate of interest on, or otherwise change
the time, place, manner or terms of payment of the Guaranteed Obligations; (ii)
settle, compromise, release or discharge, or accept or refuse any offer of
performance with respect to, or substitutions for, the Guaranteed Obligations or
any agreement relating thereto and/or subordinate the payment of the same to the
payment of any other obligations; (iii) request and accept other guaranties of
the Guaranteed Obligations and take and hold security for the payment hereof or
the Guaranteed Obligations; (iv) release, surrender, exchange, substitute,
compromise, settle, rescind, waive, alter, subordinate or modify, with or
without consideration, any security for payment of the Guaranteed Obligations,
any other guaranties of the Guaranteed Obligations, or any other obligation of
any Person (including any other Guarantor) with respect to the Guaranteed
Obligations; (v) enforce and apply any security now or hereafter held by or for
the benefit of
72 CREDIT AND GUARANTY AGREEMENT
such Beneficiary in respect hereof or the Guaranteed Obligations and direct the
order or manner of sale thereof, or exercise any other right or remedy that such
Beneficiary may have against any such security, in each case as such Beneficiary
in its discretion may determine consistent herewith or the applicable Interest
Rate Agreement and Currency Agreement and any applicable security agreement,
including foreclosure on any such security pursuant to one or more judicial or
nonjudicial sales, whether or not every aspect of any such sale is commercially
reasonable, and even though such action operates to impair or extinguish any
right of reimbursement or subrogation or other right or remedy of any Guarantor
against Company or any security for the Guaranteed Obligations; and (vi)
exercise any other rights available to it under the Credit Documents or Interest
Rate Agreements and Currency Agreements; and
(f) this Guaranty and the obligations of Guarantors hereunder shall
be valid and enforceable and shall not be subject to any reduction, limitation,
impairment, discharge or termination for any reason (other than payment in full
of the Guaranteed Obligations), including the occurrence of any of the
following, whether or not any Guarantor shall have had notice or knowledge of
any of them: (i) any failure or omission to assert or enforce or agreement or
election not to assert or enforce, or the stay or enjoining, by order of court,
by operation of law or otherwise, of the exercise or enforcement of, any claim
or demand or any right, power or remedy (whether arising under the Credit
Documents or any Interest Rate Agreement or Currency Agreement, at law, in
equity or otherwise) with respect to the Guaranteed Obligations or any agreement
relating thereto, or with respect to any other guaranty of or security for the
payment of the Guaranteed Obligations; (ii) any rescission, waiver, amendment or
modification of, or any consent to departure from, any of the terms or
provisions (including provisions relating to events of default) hereof, any of
the other Credit Documents, any of the Interest Rate Agreements or Currency
Agreements or any agreement or instrument executed pursuant thereto, or of any
other guaranty or security for the Guaranteed Obligations, in each case whether
or not in accordance with the terms hereof or such Credit Document, such
Interest Rate Agreement or Currency Agreement or any agreement relating to such
other guaranty or security; (iii) the Guaranteed Obligations, or any agreement
relating thereto, at any time being found to be illegal, invalid or
unenforceable in any respect; (iv) the application of payments received from any
source (other than payments received pursuant to the other Credit Documents or
any of the Interest Rate Agreements or Currency Agreements or from the proceeds
of any security for the Guaranteed Obligations, except to the extent such
security also serves as collateral for indebtedness other than the Guaranteed
Obligations) to the payment of indebtedness other than the Guaranteed
Obligations, even though any Beneficiary might have elected to apply such
payment to any part or all of the Guaranteed Obligations; (v) any Beneficiary's
consent to the change, reorganization or termination of the corporate structure
or existence of Company or any of its Subsidiaries and to any corresponding
restructuring of the Guaranteed Obligations; (vi) any failure to perfect or
continue perfection of a security interest in any collateral which secures any
of the Guaranteed Obligations; (vii) any defenses, set-offs or counterclaims
which Company may allege or assert against any Beneficiary in respect of the
Guaranteed Obligations, including failure of consideration, breach of warranty,
payment, statute of frauds, statute of limitations, accord and satisfaction and
usury; and (viii) any other act or thing or omission, or delay to do any other
act or thing, which may or might in any manner or to any extent vary the risk of
any Guarantor as an obligor in respect of the Guaranteed Obligations.
7.5. WAIVERS BY GUARANTORS. Each Guarantor hereby waives, for the benefit
of Beneficiaries: (a) any right to require any Beneficiary, as a condition of
payment or performance by such Guarantor, to (i) proceed against Company, any
other guarantor (including any other Guarantor) of the Guaranteed Obligations or
any other Person, (ii) proceed against or exhaust any security held from
Company, any such other guarantor or any other Person, (iii) proceed against or
have resort to any balance of any Deposit Account or credit on the books of any
Beneficiary in favor of Company or any other Person, or (iv) pursue any other
remedy in the power of any Beneficiary whatsoever; (b) any defense arising by
reason of the incapacity, lack of authority or any disability or other defense
of Company or any other Guarantor including any defense based on or arising out
of the lack of validity or the unenforceability of
73 CREDIT AND GUARANTY AGREEMENT
the Guaranteed Obligations or any agreement or instrument relating thereto or by
reason of the cessation of the liability of Company or any other Guarantor from
any cause other than payment in full of the Guaranteed Obligations; (c) any
defense based upon any statute or rule of law which provides that the obligation
of a surety must be neither larger in amount nor in other respects more
burdensome than that of the principal; (d) any defense based upon any
Beneficiary's errors or omissions in the administration of the Guaranteed
Obligations, except behavior which amounts to gross negligence or bad faith;
(e)(i) any principles or provisions of law, statutory or otherwise, which are or
might be in conflict with the terms hereof and any legal or equitable discharge
of such Guarantor's obligations hereunder, (ii) the benefit of any statute of
limitations affecting such Guarantor's liability hereunder or the enforcement
hereof, (iii) any rights to set-offs, recoupments and counterclaims, and (iv)
promptness, diligence and any requirement that any Beneficiary protect, secure,
perfect or insure any security interest or lien or any property subject thereto;
(f) notices, demands, presentments, protests, notices of protest, notices of
dishonor and notices of any action or inaction, including acceptance hereof,
notices of default hereunder, the Interest Rate Agreements or Currency
Agreements or any agreement or instrument related thereto, notices of any
renewal, extension or modification of the Guaranteed Obligations or any
agreement related thereto, notices of any extension of credit to Company and
notices of any of the matters referred to in SECTION 7.4 and any right to
consent to any thereof; and (g) any defenses or benefits that may be derived
from or afforded by law which limit the liability of or exonerate guarantors or
sureties, or which may conflict with the terms hereof.
7.6. GUARANTORS' RIGHTS OF SUBROGATION, CONTRIBUTION, ETC. Until the
Guaranteed Obligations shall have been indefeasibly paid in full, each Guarantor
hereby waives any claim, right or remedy, direct or indirect, that such
Guarantor now has or may hereafter have against Company or any other Guarantor
or any of its assets in connection with this Guaranty or the performance by such
Guarantor of its obligations hereunder, in each case whether such claim, right
or remedy arises in equity, under contract, by statute, under common law or
otherwise and including without limitation (a) any right of subrogation,
reimbursement or indemnification that such Guarantor now has or may hereafter
have against Company with respect to the Guaranteed Obligations, (b) any right
to enforce, or to participate in, any claim, right or remedy that any
Beneficiary now has or may hereafter have against Company, and (c) any benefit
of, and any right to participate in, any collateral or security now or hereafter
held by any Beneficiary. In addition, until the Guaranteed Obligations shall
have been indefeasibly paid in full, each Guarantor shall withhold exercise of
any right of contribution such Guarantor may have against any other guarantor
(including any other Guarantor) of the Guaranteed Obligations, including,
without limitation, any such right of contribution as contemplated by SECTION
7.2. Each Guarantor further agrees that, to the extent the waiver or agreement
to withhold the exercise of its rights of subrogation, reimbursement,
indemnification and contribution as set forth herein is found by a court of
competent jurisdiction to be void or voidable for any reason, any rights of
subrogation, reimbursement or indemnification such Guarantor may have against
Company or against any collateral or security, and any rights of contribution
such Guarantor may have against any such other guarantor, shall be junior and
subordinate to any rights any Beneficiary may have against Company, to all
right, title and interest any Beneficiary may have in any such collateral or
security, and to any right any Beneficiary may have against such other
guarantor. If any amount shall be paid to any Guarantor on account of any such
subrogation, reimbursement, indemnification or contribution rights at any time
when all Guaranteed Obligations shall not have been finally and indefeasibly
paid in full, such amount shall be held in trust for Administrative Agent on
behalf of Beneficiaries and shall forthwith be paid over to Administrative Agent
for the benefit of Beneficiaries to be credited and applied against the
Guaranteed Obligations, whether matured or unmatured, in accordance with the
terms hereof.
7.7. SUBORDINATION OF OTHER OBLIGATIONS. Any Indebtedness of Company or
any Guarantor now or hereafter held by any Guarantor (the "OBLIGEE GUARANTOR")
is hereby subordinated in right of payment to the Guaranteed Obligations, and
any such indebtedness collected or received by the Obligee
74 CREDIT AND GUARANTY AGREEMENT
Guarantor after an Event of Default has occurred and is continuing shall be held
in trust for Administrative Agent on behalf of Beneficiaries and shall forthwith
be paid over to Administrative Agent for the benefit of Beneficiaries to be
credited and applied against the Guaranteed Obligations but without affecting,
impairing or limiting in any manner the liability of the Obligee Guarantor under
any other provision hereof.
7.8. CONTINUING GUARANTY. This Guaranty is a continuing guaranty and shall
remain in effect until all of the Guaranteed Obligations shall have been
indefeasibly paid in full. Each Guarantor hereby irrevocably waives any right to
revoke this Guaranty as to future transactions giving rise to any Guaranteed
Obligations.
7.9. AUTHORITY OF GUARANTORS OR COMPANY. It is not necessary for any
Beneficiary to inquire into the capacity or powers of any Guarantor or Company
or the officers, directors or any agents acting or purporting to act on behalf
of any of them.
7.10. FINANCIAL CONDITION OF COMPANY. Any Credit Extension may be made to
Company or continued from time to time, and any Interest Rate Agreements or
Currency Agreements may be entered into from time to time, in each case without
notice to or authorization from any Guarantor regardless of the financial or
other condition of Company at the time of any such grant or continuation or at
the time such Interest Rate Agreement or Currency Agreement is entered into, as
the case may be. No Beneficiary shall have any obligation to disclose or discuss
with any Guarantor its assessment, or any Guarantor's assessment, of the
financial condition of Company. Each Guarantor has adequate means to obtain
information from Company on a continuing basis concerning the financial
condition of Company and its ability to perform its obligations under the Credit
Documents and the Interest Rate Agreements and Currency Agreements, and each
Guarantor assumes the responsibility for being and keeping informed of the
financial condition of Company and of all circumstances bearing upon the risk of
nonpayment of the Guaranteed Obligations. Each Guarantor hereby waives and
relinquishes any duty on the part of any Beneficiary to disclose any matter,
fact or thing relating to the business, operations or conditions of Company now
known or hereafter known by any Beneficiary.
7.11. BANKRUPTCY, ETC.
(a) So long as any Guaranteed Obligations remain outstanding, no
Guarantor shall, without the prior written consent of Administrative Agent
acting pursuant to the instructions of Requisite Lenders, commence or join with
any other Person in commencing any bankruptcy, reorganization or insolvency case
or proceeding of or against Company or any other Guarantor. The obligations of
Guarantors hereunder shall not be reduced, limited, impaired, discharged,
deferred, suspended or terminated by any case or proceeding, voluntary or
involuntary, involving the bankruptcy, insolvency, receivership, reorganization,
liquidation or arrangement of Company or any other Guarantor or by any defense
which Company or any other Guarantor may have by reason of the order, decree or
decision of any court or administrative body resulting from any such proceeding.
(b) Each Guarantor acknowledges and agrees that any interest on any
portion of the Guaranteed Obligations which accrues after the commencement of
any case or proceeding referred to in CLAUSE (a) above (or, if interest on any
portion of the Guaranteed Obligations ceases to accrue by operation of law by
reason of the commencement of such case or proceeding, such interest as would
have accrued on such portion of the Guaranteed Obligations if such case or
proceeding had not been commenced) shall be included in the Guaranteed
Obligations because it is the intention of Guarantors and Beneficiaries that the
Guaranteed Obligations which are guaranteed by Guarantors pursuant hereto should
be determined without regard to any rule of law or order which may relieve
Company of any portion of such Guaranteed Obligations. Guarantors will permit
any trustee in bankruptcy, receiver, debtor in
75 CREDIT AND GUARANTY AGREEMENT
possession, assignee for the benefit of creditors or similar person to pay
Administrative Agent, or allow the claim of Administrative Agent in respect of,
any such interest accruing after the date on which such case or proceeding is
commenced.
(c) In the event that all or any portion of the Guaranteed
Obligations are paid by Company, the obligations of Guarantors hereunder shall
continue and remain in full force and effect or be reinstated, as the case may
be, in the event that all or any part of such payment(s) are rescinded or
recovered directly or indirectly from any Beneficiary as a preference,
fraudulent transfer or otherwise, and any such payments which are so rescinded
or recovered shall constitute Guaranteed Obligations for all purposes hereunder.
7.12. DISCHARGE OF GUARANTY UPON SALE OF GUARANTOR. If all of the Capital
Stock of any Guarantor or any of its successors in interest hereunder shall be
sold or otherwise disposed of (including by merger or consolidation) in
accordance with the terms and conditions hereof, the Guaranty of such Guarantor
or such successor in interest, as the case may be, hereunder shall automatically
be discharged and released without any further action by any Beneficiary or any
other Person effective as of the time of such Asset Sale.
SECTION 8. EVENTS OF DEFAULT
8.1. EVENTS OF DEFAULT. If any one or more of the following conditions or
events shall occur:
(a) Failure to Make Payments When Due. Failure by Company to pay (i)
when due, the principal of and premium, if any, on any Term Loan (other than any
Excess Cash Flow payment) whether at stated maturity, by acceleration or
otherwise; (ii) when due any installment of principal of any Term Loan, by
notice of voluntary prepayment, by mandatory prepayment or otherwise; (iii) when
due, or within one Business Day of when due, any interest on any Term Loan; or
(iv) when due, or within 15 days of when Company has received notice of any fee
or any other amount due hereunder, except when such amounts are payable upon the
closing of any given transaction; or
(b) Default in Other Agreements. (i) Failure of any Credit Party or
any of their respective Subsidiaries to pay when due any principal of or
interest on or any other amount payable in respect of one or more items of
Indebtedness (other than Indebtedness referred to in SECTION 8.1(a)) in an
individual principal amount of $250,000 or more or with an aggregate principal
amount of $500,000 or more, in each case beyond the grace period, if any,
provided therefor; or (ii) breach or default by any Credit Party with respect to
any other material term of (1) one or more items of Indebtedness in the
individual or aggregate principal amounts referred to in CLAUSE (i) above, or
(2) any loan agreement, mortgage, indenture or other agreement relating to such
item(s) of Indebtedness, in each case beyond the grace period, if any, provided
therefor, if the effect of such breach or default is to cause, or to permit the
holder or holders of that Indebtedness (or a trustee on behalf of such holder or
holders), to cause, that Indebtedness to become or be declared due and payable
(or subject to a compulsory repurchase or redeemable) prior to its stated
maturity or the stated maturity of any underlying obligation, as the case may
be; or
(c) Breach of Certain Covenants. Failure of any Credit Party to
perform or comply with any term or condition contained in SECTION 2.3, SECTION
5.1, SECTION 5.2, SECTION 5.14(b), SECTION 5.17 or SECTION 6; or
(d) Breach of Representations, etc. Any representation, warranty,
certification or other statement made or deemed made by any Credit Party in any
Credit Document or in any statement or certificate at any time given by any
Credit Party or any of its Subsidiaries in writing pursuant hereto or
76 CREDIT AND GUARANTY AGREEMENT
thereto or in connection herewith or therewith shall be false in any material
respect as of the date made or deemed made (unless any such representation or
warranty is already qualified with respect to materiality, in which event it
shall have been correct in any respect); or
(e) Other Defaults Under Credit Documents. Any Credit Party shall
default in the performance of or compliance with any term contained herein or
any of the other Credit Documents, other than any such term referred to in any
other Section of this SECTION 8.1, and such default shall not have been remedied
or waived within 30 days (or, in the case of SECTION 5.17, 2 Business Days)
after the earlier of (i) an officer of such Credit Party becoming aware of such
default, or (ii) receipt by Company of notice from Administrative Agent or any
Lender of such default; or
(f) Involuntary Bankruptcy; Appointment of Receiver, etc. (i) A
court of competent jurisdiction shall enter a decree or order for relief in
respect of Company or any of its Subsidiaries in an involuntary case under the
Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar
law now or hereafter in effect, which decree or order is not stayed; or any
other similar relief shall be granted under any applicable federal or state law
or non-U.S. law; or (ii) an involuntary case shall be commenced against Company
or any of its Subsidiaries under the Bankruptcy Code or under any other
applicable bankruptcy, insolvency or similar law now or hereafter in effect
whether a law of the United States or another country; or a decree or order of a
court having jurisdiction in the premises for the appointment of a receiver,
liquidator, sequestrator, trustee, custodian or other officer having similar
powers over Company or any of its Subsidiaries, or over all or a substantial
part of its property, shall have been entered; or there shall have occurred the
involuntary appointment of an interim receiver, trustee or other custodian of
Company or any of its Subsidiaries for all or a substantial part of its
property; or a warrant of attachment, execution or similar process shall have
been issued against any substantial part of the property of Company or any of
its Subsidiaries, and any such event described in this CLAUSE (ii) shall
continue for 60 days without having been dismissed, bonded or discharged; or
(g) Voluntary Bankruptcy; Appointment of Receiver, etc. (i) Company
or any of its Subsidiaries shall have an order for relief entered with respect
to it or shall commence a voluntary case under the Bankruptcy Code or under any
other applicable bankruptcy, insolvency or similar law now or hereafter in
effect, whether a law of the United States or another country, or shall consent
to the entry of an order for relief in an involuntary case, or to the conversion
of an involuntary case to a voluntary case, under any such law, or shall consent
to the appointment of or taking possession by a receiver, trustee or other
custodian for all or a substantial part of its property; or Company or any of
its Subsidiaries shall make any assignment for the benefit of creditors; or (ii)
Company or any of its Subsidiaries shall be unable, or shall fail generally, or
shall admit in writing its inability, to pay its debts as such debts become due;
or the board of directors (or similar governing body) of Company or any of its
Subsidiaries (or any committee thereof) shall adopt any resolution or otherwise
authorize any action to approve any of the actions referred to herein or in
SECTION 8.1(f); or
(h) Judgments and Attachments. Any money judgment, writ or warrant
of attachment or similar process involving (i) in any individual case or related
series of transactions, incidents, or conditions an amount in excess of $250,000
or (ii) in the aggregate at any time an amount in excess of $500,000 (in either
case to the extent not adequately covered by insurance as to which a solvent and
unaffiliated insurance company has acknowledged coverage) shall be entered or
filed against Company or any of its Subsidiaries or any of their respective
assets and shall remain undischarged, unvacated, unbonded or unstayed for a
period of 60 days (or in any event later than 5 days prior to the date of any
proposed sale thereunder); or
(i) Non Monetary Judgments. One (1) or more non-monetary judgments,
orders, decrees, permanent injunctions, temporary restraining orders, or similar
judicial action shall be rendered
77 CREDIT AND GUARANTY AGREEMENT
against the Company or any of its Subsidiaries which does or would reasonably be
expected to (i) enjoin, restrain, or prevent Company or any Subsidiary from
conducting all or any material part of its business or operations, including the
use of, and provision of services through the use of, software, or (ii) have,
either individually or in the aggregate, a Material Adverse Effect, and there
shall be any period of 15 consecutive days during which a stay of enforcement of
such judgment, injunction, restraint, or order, by reason of a pending appeal or
otherwise, shall not be in effect; or
(j) Dissolution. Any order, judgment or decree shall be entered
against any Credit Party decreeing the dissolution or split up of such Credit
Party and such order shall remain undischarged or unstayed for a period in
excess of 30 days; or
(k) Employee Benefit Plans. (i) There shall occur one or more ERISA
Events which individually or in the aggregate results in or might reasonably be
expected to result in liability of Company, any of its Subsidiaries or any of
their respective ERISA Affiliates in excess of $100,000 during the term hereof;
or (ii) there exists any fact or circumstance that reasonably could be expected
to result in the imposition of a Lien or security interest under Section 412(n)
of the Internal Revenue Code or under ERISA; or
(l) Failure to Redeem Preferred Shares. In connection with a
Qualified IPO, less than all of Company's and its Subsidiaries' issued and
outstanding preferred equity securities are converted into common equity
securities of Company; or
(m) Change of Control. A Change of Control shall occur; or
(n) Guaranties, Collateral Documents and other Credit Documents. At
any time after the execution and delivery thereof, (i) any Guaranty for any
reason, other than the satisfaction in full of all Obligations, shall cease to
be in full force and effect (other than in accordance with its terms) or shall
be declared to be null and void or any Guarantor shall repudiate its obligations
thereunder, (ii) this Agreement or any Collateral Document ceases to be in full
force and effect (other than by reason of a release of Collateral in accordance
with the terms hereof or thereof or the satisfaction in full of the Obligations
in accordance with the terms hereof) or shall be declared null and void, or
Collateral Agent shall not have or shall cease to have a valid and perfected
Lien in any Collateral purported to be covered by the Collateral Documents with
the priority required by the relevant Collateral Document, in each case for any
reason other than the failure of Collateral Agent or any Lender to take any
action within its control, or (iii) any Credit Party shall contest the validity
or enforceability of any Credit Document in writing or deny in writing that it
has any further liability, including with respect to future advances by Lenders,
under any Credit Document to which it is a party;
THEN, (1) upon the occurrence of any Event of Default described in SECTION
8.1(f) or 8.1(g), automatically, and (2) upon the occurrence of any other Event
of Default, at the request of (or with the consent of) Requisite Lenders, upon
notice to Company by Administrative Agent, (A) the Term Loan Commitments of each
Lender shall immediately terminate; (B) each of the following shall immediately
become due and payable, in each case without presentment, demand, protest or
other requirements of any kind, all of which are hereby expressly waived by each
Credit Party: (I) the unpaid principal amount of and accrued interest on the
Term Loans, and (II) all other Obligations; and (C) Administrative Agent may
cause Collateral Agent to enforce any and all Liens and security interests
created pursuant to Collateral Documents.
SECTION 9. AGENTS
78 CREDIT AND GUARANTY AGREEMENT
9.1. APPOINTMENT OF AGENTS. GSSLG is hereby appointed Administrative
Agent, Collateral Agent, Syndication Agent and Documentation Agent hereunder and
under the other Credit Documents and each Lender hereby authorizes GSSLG, in
such capacity, to act as its agent in accordance with the terms hereof and the
other Credit Documents. Each Agent hereby agrees to act upon the express
conditions contained herein and the other Credit Documents, as applicable. The
provisions of this SECTION 9 are solely for the benefit of Agents and Lenders
and no Credit Party shall have any rights as a third party beneficiary of any of
the provisions thereof. In performing its functions and duties hereunder, each
Agent shall act solely as an agent of Lenders and does not assume and shall not
be deemed to have assumed any obligation towards or relationship of agency or
trust with or for Company or any of its Subsidiaries. Each of Syndication Agent
and Documentation Agent, without consent of or notice to any party hereto, may
assign any and all of its rights or obligations hereunder to any of its
Affiliates. As of the Closing Date, GSSLG, in its capacity as Syndication Agent
and Documentation Agent, shall have no obligations but shall be entitled to all
benefits of this SECTION 9.
9.2. POWERS AND DUTIES. Each Lender irrevocably authorizes each Agent to
take such action on such Lender's behalf and to exercise such powers, rights and
remedies hereunder and under the other Credit Documents as are specifically
delegated or granted to such Agent by the terms hereof and thereof, together
with such powers, rights and remedies as are reasonably incidental thereto. Each
Agent shall have only those duties and responsibilities that are expressly
specified herein and the other Credit Documents. Each Agent may exercise such
powers, rights and remedies and perform such duties by or through its agents or
employees. No Agent shall have, by reason hereof or any of the other Credit
Documents, a fiduciary relationship in respect of any Lender; and nothing herein
or any of the other Credit Documents, expressed or implied, is intended to or
shall be so construed as to impose upon any Agent any obligations in respect
hereof or any of the other Credit Documents except as expressly set forth herein
or therein.
9.3. GENERAL IMMUNITY.
(a) No Responsibility for Certain Matters. No Agent shall be
responsible to any Lender for the execution, effectiveness, genuineness,
validity, enforceability, collectability or sufficiency hereof or any other
Credit Document or for any representations, warranties, recitals or statements
made herein or therein or made in any written or oral statements or in any
financial or other statements, instruments, reports or certificates or any other
documents furnished or made by any Agent to Lenders or by or on behalf of any
Credit Party to any Agent or any Lender in connection with the Credit Documents
and the transactions contemplated thereby or for the financial condition or
business affairs of any Credit Party or any other Person liable for the payment
of any Obligations, nor shall any Agent be required to ascertain or inquire as
to the performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained in any of the Credit Documents or as to the
use of the proceeds of the Term Loans or as to the existence or possible
existence of any Event of Default or Default or to make any disclosures with
respect to the foregoing. Anything contained herein to the contrary
notwithstanding, Administrative Agent shall not have any liability arising from
confirmations of the amount of outstanding Term Loans or the component amounts
thereof.
(b) Exculpatory Provisions. No Agent nor any of its officers,
partners, directors, employees or agents shall be liable to Lenders for any
action taken or omitted by any Agent under or in connection with any of the
Credit Documents except to the extent caused by such Agent's gross negligence or
willful misconduct. Each Agent shall be entitled to refrain from any act or the
taking of any action (including the failure to take an action) in connection
herewith or any of the other Credit Documents or from the exercise of any power,
discretion or authority vested in it hereunder or thereunder unless and until
such Agent shall have received instructions in respect thereof from Requisite
Lenders (or such other Lenders as may be required to give such instructions
under SECTION 10.5) and, upon receipt of
79 CREDIT AND GUARANTY AGREEMENT
such instructions from Requisite Lenders (or such other Lenders, as the case may
be), such Agent shall be entitled to act or (where so instructed) refrain from
acting, or to exercise such power, discretion or authority, in accordance with
such instructions. Without prejudice to the generality of the foregoing, (i)
each Agent shall be entitled to rely, and shall be fully protected in relying,
upon any communication, instrument or document believed by it to be genuine and
correct and to have been signed or sent by the proper Person or Persons, and
shall be entitled to rely and shall be protected in relying on opinions and
judgments of attorneys (who may be attorneys for Company and its Subsidiaries),
accountants, experts and other professional advisors selected by it; and (ii) no
Lender shall have any right of action whatsoever against any Agent as a result
of such Agent acting or (where so instructed) refraining from acting hereunder
or any of the other Credit Documents in accordance with the instructions of
Requisite Lenders (or such other Lenders as may be required to give such
instructions under SECTION 10.5).
9.4. AGENTS ENTITLED TO ACT AS LENDER. The agency hereby created shall in
no way impair or affect any of the rights and powers of, or impose any duties or
obligations upon, any Agent in its individual capacity as a Lender hereunder.
With respect to its participation in the Term Loans, each Agent shall have the
same rights and powers hereunder as any other Lender and may exercise the same
as if it were not performing the duties and functions delegated to it hereunder,
and the term Lender shall, unless the context clearly otherwise indicates,
include each Agent in its individual capacity. Any Agent and its Affiliates may
accept deposits from, lend money to, own securities of, and generally engage in
any kind of banking, trust, financial advisory or other business with Company or
any of its Affiliates as if it were not performing the duties specified herein,
and may accept fees and other consideration from Company for services in
connection herewith and otherwise without having to account for the same to
Lenders.
9.5. LENDERS' REPRESENTATIONS, WARRANTIES AND ACKNOWLEDGMENT.
(a) Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of Company and
its Subsidiaries in connection with Credit Extensions hereunder and that it has
made and shall continue to make its own appraisal of the creditworthiness of
Company and its Subsidiaries. No Agent shall have any duty or responsibility,
either initially or on a continuing basis, to make any such investigation or any
such appraisal on behalf of Lenders or to provide any Lender with any credit or
other information with respect thereto, whether coming into its possession
before the making of the Term Loans or at any time or times thereafter, and no
Agent shall have any responsibility with respect to the accuracy of or the
completeness of any information provided to Lenders.
(b) Each Lender, by delivering its signature page to this Agreement
and funding its Term Loan on the Closing Date, shall be deemed to have
acknowledged receipt of, and consented to and approved, each Credit Document and
each other document required to be approved by any Agent, Requisite Lenders or
Lenders, as applicable on the Closing Date.
9.6. RIGHT TO INDEMNITY. Each Lender, in proportion to its Pro Rata Share,
severally agrees to indemnify each Agent, their Affiliates and their respective
officers, partners, directors, trustees, employees and agents of each Agent
(each, an "INDEMNITEE AGENT PARTY"), to the extent that such Indemnitee Agent
Party shall not have been reimbursed by any Credit Party, for and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses (including counsel fees and disbursements) or
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by or asserted against such Indemnitee Agent Party in exercising its powers,
rights and remedies or performing its duties hereunder or under the other Credit
Documents or otherwise in its capacity as such Indemnitee Agent Party in any way
relating to or arising out of this Agreement or the other Credit Documents, IN
ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN
80 CREDIT AND GUARANTY AGREEMENT
WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY, OR SOLE NEGLIGENCE OF
SUCH AGENT; provided, no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from such Indemnitee Agent Party's
gross negligence or willful misconduct. If any indemnity furnished to any
Indemnitee Agent Party for any purpose shall, in the opinion of such Indemnitee
Agent Party, be insufficient or become impaired, such Indemnitee Agent Party may
call for additional indemnity and cease, or not commence, to do the acts
indemnified against until such additional indemnity is furnished; provided, in
no event shall this sentence require any Lender to indemnify any Indemnitee
Agent Party against any liability, obligation, loss, damage, penalty, action,
judgment, suit, cost, expense or disbursement in excess of such Lender's Pro
Rata Share thereof; and provided further, this sentence shall not be deemed to
require any Lender to indemnify any Indemnitee Agent Party against any
liability, obligation, loss, damage, penalty, action, judgment, suit, cost,
expense or disbursement described in the proviso in the immediately preceding
sentence.
9.7. SUCCESSOR ADMINISTRATIVE AGENT.
(a) Administrative Agent and Collateral Agent may resign at any time
by giving 30 days' prior written notice thereof to Lenders and Company. Upon any
such notice of resignation, Requisite Lenders shall have the right, upon five
Business Days' notice to Company, to appoint a successor Administrative Agent
and Collateral Agent. Upon the acceptance of any appointment as Administrative
Agent and Collateral Agent hereunder by a successor Administrative Agent and
Collateral Agent, that successor Administrative Agent and Collateral Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent and Collateral Agent and the
retiring Administrative Agent and Collateral Agent shall promptly (i) transfer
to such successor Administrative Agent and Collateral Agent all sums, Securities
and other items of Collateral held under the Collateral Documents, together with
all records and other documents necessary or appropriate in connection with the
performance of the duties of the successor Administrative Agent and Collateral
Agent under the Credit Documents, and (ii) execute and deliver to such successor
Administrative Agent and Collateral Agent such amendments to financing
statements, and take such other actions, as may be necessary or appropriate in
connection with the assignment to such successor Administrative Agent and
Collateral Agent of the security interests created under the Collateral
Documents, whereupon such retiring Administrative Agent and Collateral Agent
shall be discharged from its duties and obligations hereunder. After any
retiring Administrative Agent's and Collateral Agent's resignation hereunder as
Administrative Agent and Collateral Agent, the provisions of this SECTION 9
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent hereunder.
(b) Notwithstanding anything herein to the contrary, Administrative
Agent may assign its rights and duties as Administrative Agent hereunder to an
Affiliate of GSSLG without the prior written consent of, or prior written notice
to, Company or the Lenders; provided that Company and the Lenders may deem and
treat such assigning Administrative Agent as the Administrative Agent for all
purposes hereof, unless and until such assigning Administrative Agent provides
written notice to Company and the Lenders of such assignment. Upon such
assignment such Affiliate shall succeed to and become vested with all rights,
powers, privileges and duties as Administrative Agent hereunder and under the
other Credit Documents.
9.8. COLLATERAL DOCUMENTS AND GUARANTY.
(a) Agents under Collateral Documents and Guaranty. Each Lender
hereby further authorizes Administrative Agent or Collateral Agent, as
applicable, on behalf of and for the benefit of Lenders, to be the agent for and
representative of Lenders with respect to any Guaranty, the Collateral and
81 CREDIT AND GUARANTY AGREEMENT
the Collateral Documents. Subject to SECTION 10.5, without further written
consent or authorization from Lenders, Administrative Agent or Collateral Agent,
as applicable may execute any documents or instruments necessary to (i) release
any Lien encumbering any item of Collateral that is the subject of a sale or
other disposition of assets permitted hereby or to which Requisite Lenders (or
such other Lenders as may be required to give such consent under SECTION 10.5)
have otherwise consented, or (ii) release any Guarantor from any Guaranty or
with respect to which Requisite Lenders (or such other Lenders as may be
required to give such consent under SECTION 10.5) have otherwise consented.
(b) Right to Realize on Collateral and Enforce Guaranty. Anything
contained in any of the Credit Documents to the contrary notwithstanding,
Company, Administrative Agent, Collateral Agent and each Lender hereby agree
that (i) no Lender shall have any right individually to realize upon any of the
Collateral or to enforce any Guaranty, it being understood and agreed that all
powers, rights and remedies hereunder may be exercised solely by Administrative
Agent, on behalf of Lenders in accordance with the terms hereof and all powers,
rights and remedies under the Collateral Documents may be exercised solely by
Collateral Agent, and (ii) in the event of a foreclosure by Collateral Agent on
any of the Collateral pursuant to a public or private sale, Collateral Agent or
any Lender may be the purchaser of any or all of such Collateral at any such
sale and Collateral Agent, as agent for and representative of the Lenders (but
not any Lender or Lenders in its or their respective individual capacities
unless Requisite Lenders shall otherwise agree in writing) shall be entitled,
for the purpose of bidding and making settlement or payment of the purchase
price for all or any portion of the Collateral sold at any such public sale, to
use and apply any of the Obligations as a credit on account of the purchase
price for any collateral payable by Collateral Agent at such sale.
SECTION 10. MISCELLANEOUS
10.1. NOTICES. Unless otherwise specifically provided herein, any notice
or other communication herein required or permitted to be given to a Credit
Party, Syndication Agent, Collateral Agent, Administrative Agent or
Documentation Agent shall be sent to such Person's address as set forth on
APPENDIX B or in the other relevant Credit Document, and in the case of any
Lender, the address as indicated on APPENDIX B or otherwise indicated to
Administrative Agent in writing. Each notice hereunder shall be in writing and
may be personally served, telexed or sent by telefacsimile or United States mail
or courier service and shall be deemed to have been given when delivered in
person or by courier service and signed for against receipt thereof, upon
receipt of telefacsimile or telex, or upon receipt if deposited in the United
States mail with postage prepaid and properly addressed; provided, no notice to
any Agent shall be effective until received by such Agent.
10.2. EXPENSES. Whether or not the transactions contemplated hereby shall
be consummated, Company agrees to pay promptly (a) all the actual and reasonable
costs and expenses of preparation of the Credit Documents and any consents,
amendments, waivers or other modifications thereto; (b) all the costs of
furnishing all opinions by counsel for Company and the other Credit Parties; (c)
the reasonable fees, expenses and disbursements of counsel to Agents in
connection with the negotiation, preparation, execution and administration of
the Credit Documents and any consents, amendments, waivers or other
modifications thereto and any other documents or matters requested by Company;
(d) all the actual costs and reasonable expenses of creating and perfecting
Liens in favor of Collateral Agent, for the benefit of Lenders pursuant hereto,
including filing and recording fees, expenses and taxes, stamp or documentary
taxes, search fees, title insurance premiums and reasonable fees, expenses and
disbursements of counsel to each Agent and of counsel providing any opinions
that any Agent or Requisite Lenders may request in respect of the Collateral or
the Liens created pursuant to the Collateral Documents; (e) all the actual costs
and reasonable fees, expenses and disbursements of any auditors, accountants,
consultants or appraisers whether internal or external; (f) all the actual costs
and reasonable expenses (including the reasonable fees, expenses and
disbursements of any appraisers, consultants, advisors and agents employed or
retained
82 CREDIT AND GUARANTY AGREEMENT
by Collateral Agent and its counsel) in connection with the custody or
preservation of any of the Collateral; (g) all other actual and reasonable costs
and expenses incurred by each Agent in connection with the syndication of the
Term Loans and Term Loan Commitments and the negotiation, preparation and
execution of the Credit Documents and any consents, amendments, waivers or other
modifications thereto and the transactions contemplated thereby; and (h) after
the occurrence of a Default or an Event of Default, all costs and expenses,
including reasonable attorneys' fees (including allocated costs of internal
counsel) and costs of settlement, incurred by any Agent and Lenders in enforcing
any Obligations of or in collecting any payments due from any Credit Party
hereunder or under the other Credit Documents by reason of such Default or Event
of Default (including in connection with the sale of, collection from, or other
realization upon any of the Collateral or the enforcement of any Guaranty) or in
connection with any refinancing or restructuring of the credit arrangements
provided hereunder in the nature of a "work-out" or pursuant to any insolvency
or bankruptcy cases or proceedings.
10.3. INDEMNITY.
(a) In addition to the payment of expenses pursuant to SECTION 10.2,
whether or not the transactions contemplated hereby shall be consummated, each
Credit Party agrees to defend (subject to Indemnitees' selection of counsel),
indemnify, pay and hold harmless, each Agent and Lender, their Affiliates and
their respective officers, partners, directors, trustees, employees and agents
of each Agent and each Lender (each, an "INDEMNITEE"), from and against any and
all Indemnified Liabilities, IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING,
IN WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY, OR SOLE NEGLIGENCE OF
SUCH AGENT; provided, no Credit Party shall have any obligation to any
Indemnitee hereunder with respect to any Indemnified Liabilities to the extent
such Indemnified Liabilities arise from the gross negligence or willful
misconduct of that Indemnitee. To the extent that the undertakings to defend,
indemnify, pay and hold harmless set forth in this SECTION 10.3 may be
unenforceable in whole or in part because they are violative of any law or
public policy, the applicable Credit Party shall contribute the maximum portion
that it is permitted to pay and satisfy under applicable law to the payment and
satisfaction of all Indemnified Liabilities incurred by Indemnitees or any of
them.
(b) To the extent permitted by applicable law, no Credit Party shall
assert, and each Credit Party hereby waives, any claim against Lenders, Agents
and their respective Affiliates, directors, employees, attorneys or agents, on
any theory of liability, for special, indirect, consequential or punitive
damages (as opposed to direct or actual damages) (whether or not the claim
therefor is based on contract, tort or duty imposed by any applicable legal
requirement) arising out of, in connection with, arising out of, as a result of,
or in any way related to, this Agreement or any Credit Document or any agreement
or instrument contemplated hereby or thereby or referred to herein or therein,
the transactions contemplated hereby or thereby, any Term Loan or the use of the
proceeds thereof or any act or omission or event occurring in connection
therewith, and Company hereby waives, releases and agrees not to ▇▇▇ upon any
such claim or any such damages, whether or not accrued and whether or not known
or suspected to exist in its favor.
10.4. SET-OFF. In addition to any rights now or hereafter granted under
applicable law and not by way of limitation of any such rights, upon the
occurrence and during the continuance of any Event of Default each Lender and
their respective Affiliates each of is hereby authorized by each Credit Party at
any time or from time to time subject to the consent of Administrative Agent
(such consent not to be unreasonably withheld or delayed), without notice to any
Credit Party or to any other Person (other than Administrative Agent), any such
notice being hereby expressly waived, to set off and to appropriate and to apply
any and all deposits (general or special, including Indebtedness evidenced by
certificates of deposit, whether matured or unmatured, but not including trust
accounts (in whatever currency and other Excluded Deposit Accounts)) and any
other Indebtedness at any time held or owing by such Lender to or
83 CREDIT AND GUARANTY AGREEMENT
for the credit or the account of any Credit Party (in whatever currency) against
and on account of the obligations and liabilities of any Credit Party to such
Lender hereunder, the participations therein and under the other Credit
Documents, including all claims of any nature or description arising out of or
connected hereto, the participations therein or with any other Credit Document,
irrespective of whether or not (a) such Lender shall have made any demand
hereunder, (b) the principal of or the interest on the Term Loans or any other
amounts due hereunder shall have become due and payable pursuant to SECTION 2
and although such obligations and liabilities, or any of them, may be contingent
or unmatured or (c) such obligation or liability is owed to a branch or office
of such Lender different from the branch or office holding such deposit or
obligation or such Indebtedness.
10.5. AMENDMENTS AND WAIVERS.
(a) Requisite Lenders' Consent. Subject to SECTIONS 10.5(b) and
10.5(c), no amendment, modification, termination or waiver of any provision of
the Credit Documents, or consent to any departure by any Credit Party therefrom,
shall in any event be effective without the written concurrence of
Administrative Agent and the Requisite Lenders.
(b) Affected Lenders' Consent. Without the written consent of each
Lender (other than a Defaulting Lender) that would be affected thereby, no
amendment, modification, termination, or consent shall be effective if the
effect thereof would:
(i) extend the scheduled final maturity of any Term Loan or
Term Loan Note;
(ii) waive, reduce or postpone any scheduled repayment (but
not prepayments which shall be subject to SECTION 2.11(b));
(iii) reduce the rate of interest on any Term Loan (other than
any waiver of any increase in the interest rate applicable to any Term
Loan pursuant to SECTION 2.7) or any fee payable hereunder;
(iv) extend the time for payment of any such interest or fees;
(v) reduce the principal amount of any Term Loan;
(vi) amend, modify, terminate or waive any provision of this
SECTION 10.5(b) or SECTION 10.5(c);
(vii) amend the definition of "REQUISITE LENDERS" or "PRO RATA
SHARE"; provided, with the consent of Administrative Agent and the
Requisite Lenders, additional extensions of credit pursuant hereto may be
included in the determination of "REQUISITE LENDERS" or "PRO RATA SHARE"
on substantially the same basis as the Term Loan Commitments and the Term
Loans are included on the Closing Date;
(viii) release all or substantially all of the Collateral or
any Guarantors from any Guaranty except as expressly provided in the
Credit Documents; or
(ix) consent to the assignment or transfer by any Credit Party
of any of its rights and obligations under any Credit Document.
(c) Other Consents. No amendment, modification, termination or
waiver of any provision of the Credit Documents, or consent to any departure by
any Credit Party therefrom, shall:
84 CREDIT AND GUARANTY AGREEMENT
(i) amend, modify, terminate or waive any provision of SECTION
3.2(a) with regard to any Credit Extension without the consent of
Requisite Lenders;
(ii) amend, modify, terminate or waive any provision of
SECTION 9 as the same applies to any Agent, or any other provision hereof
as the same applies to the rights or obligations of any Agent, in each
case without the consent of such Agent.
(d) Execution of Amendments, etc. Administrative Agent may, but
shall have no obligation to, with the concurrence of any Lender, execute
amendments, modifications, waivers or consents on behalf of such Lender. Any
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which it was given. No notice to or demand on any Credit
Party in any case shall entitle any Credit Party to any other or further notice
or demand in similar or other circumstances. Any amendment, modification,
termination, waiver or consent effected in accordance with this SECTION 10.5
shall be binding upon each Lender at the time outstanding, each future Lender
and, if signed by a Credit Party, on such Credit Party.
10.6. SUCCESSORS AND ASSIGNS; PARTICIPATIONS.
(a) Generally. This Agreement shall be binding upon the parties
hereto and their respective successors and assigns and shall inure to the
benefit of the parties hereto and the successors and assigns of Lenders. No
Credit Party's rights or obligations hereunder nor any interest therein may be
assigned or delegated by any Credit Party without the prior written consent of
all Lenders. Nothing in this Agreement, expressed or implied, shall be construed
to confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, Affiliates of each of the Agents and Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.
(b) Register. Company, Administrative Agent and Lenders shall deem
and treat the Persons listed as Lenders in the Register as the holders and
owners of the corresponding Term Loan Commitments and Term Loans listed therein
for all purposes hereof, and no assignment or transfer of any such Term Loan
Commitment or Term Loan shall be effective, in each case, unless and until an
Assignment Agreement effecting the assignment or transfer thereof shall have
been delivered to and accepted by Administrative Agent and recorded in the
Register as provided in SECTION 10.6(e). Prior to such recordation, all amounts
owed with respect to the applicable Term Loan Commitment or Term Loan shall be
owed to the Lender listed in the Register as the owner thereof, and any request,
authority or consent of any Person who, at the time of making such request or
giving such authority or consent, is listed in the Register as a Lender shall be
conclusive and binding on any subsequent holder, assignee or transferee of the
corresponding Term Loan Commitments or Term Loans.
(c) Right to Assign. Each Lender shall have the right at any time to
sell, assign or transfer all or a portion of its rights and obligations under
this Agreement, including, without limitation, all or a portion of its Term Loan
Commitment or Term Loans owing to it or other Obligations (provided, however,
that each such assignment shall be of a uniform, and not varying, percentage of
all rights and obligations under and in respect of any Term Loan and any related
Term Loan Commitments):
(i) to any Person meeting the criteria of CLAUSE (a) or CLAUSE
(b) of the definition of the term of "Eligible Assignee" upon the giving
of notice to Company and Administrative Agent; and
(ii) to any Person otherwise constituting an Eligible Assignee
with the consent of Administrative Agent; provided, each such assignment
pursuant to this SECTION 10.6(c)(ii) shall
85 CREDIT AND GUARANTY AGREEMENT
be in an aggregate amount of not less than $1,000,000 (or such lesser
amount as may be agreed to by Company and Administrative Agent or as shall
constitute the aggregate amount of the Term Loans of the assigning Lender)
with respect to the assignment of Term Loans.
(d) Mechanics. The assigning Lender and the assignee thereof shall
execute and deliver to Administrative Agent an Assignment Agreement, together
with such forms, certificates or other evidence, if any, with respect to United
States federal income tax withholding matters as the assignee under such
Assignment Agreement may be required to deliver to Administrative Agent pursuant
to SECTION 2.17(c).
(e) Notice of Assignment. Upon its receipt and acceptance of a duly
executed and completed Assignment Agreement, together with any forms,
certificates or other evidence required by this Agreement in connection
therewith, Administrative Agent shall record the information contained in such
Assignment Agreement in the Register, shall give prompt notice thereof to
Company and shall maintain a copy of such Assignment Agreement.
(f) Representations and Warranties of Assignee. Each Lender, upon
execution and delivery hereof or upon executing and delivering an Assignment
Agreement, as the case may be, represents and warrants as of the Closing Date or
as of the applicable Effective Date (as defined in the applicable Assignment
Agreement) that (i) it is an Eligible Assignee; (ii) it has experience and
expertise in the making of or investing in commitments or loans such as the
applicable Term Loan Commitments or Term Loans, as the case may be; and (iii) it
will make or invest in, as the case may be, its Term Loan Commitments or Term
Loans for its own account in the ordinary course of its business and without a
view to distribution of such Term Loan Commitments or Term Loans within the
meaning of the Securities Act or the Exchange Act or other federal securities
laws (it being understood that, subject to the provisions of this SECTION 10.6,
the disposition of such Term Loans or any interests therein shall at all times
remain within its exclusive control).
(g) Effect of Assignment. Subject to the terms and conditions of
this SECTION 10.6, as of the "Effective Date" (as defined in the applicable
Assignment Agreement) (i) the assignee thereunder shall have the rights and
obligations of a Lender hereunder to the extent such rights and obligations
hereunder have been assigned to it pursuant to such Assignment Agreement and
shall thereafter be a party hereto and a Lender for all purposes hereof; (ii)
the assigning Lender thereunder shall, to the extent that rights and obligations
hereunder have been assigned thereby pursuant to such Assignment Agreement,
relinquish its rights (other than any rights which survive the termination
hereof under SECTION 10.8) and be released from its obligations hereunder (and,
in the case of an Assignment Agreement covering all or the remaining portion of
an assigning Lender's rights and obligations hereunder, such Lender shall cease
to be a party hereto; provided, anything contained in any of the Credit
Documents to the contrary notwithstanding, and (y) such assigning Lender shall
continue to be entitled to the benefit of all indemnities hereunder as specified
herein with respect to matters arising out of the prior involvement of such
assigning Lender as a Lender hereunder); (iii) the Term Loan Commitments shall
be modified to reflect the Term Loan Commitment of such assignee and any Term
Loan Commitment of such assigning Lender, if any; and (iv) if any such
assignment occurs after the issuance of any Term Loan Note hereunder, the
assigning Lender shall, upon the effectiveness of such assignment or as promptly
thereafter as practicable, surrender its applicable Term Loan Notes to
Administrative Agent for cancellation, and thereupon Company shall issue and
deliver new Term Loan Notes, if so requested by the assignee and/or assigning
Lender, to such assignee and/or to such assigning Lender, with appropriate
insertions, to reflect the new Term Loan Commitments and/or outstanding Term
Loans of the assignee and/or the assigning Lender. Notwithstanding the
foregoing, an assignee, including an Eligible Assignee, shall not be entitled to
receive any greater payment under SECTION 2.16 or SECTION 2.17 than the
applicable Lender making
86 CREDIT AND GUARANTY AGREEMENT
such assignment would have been entitled to receive with respect to the assigned
portion of the rights and obligations under this Agreement.
(h) Participations. Each Lender shall have the right at any time to
sell one or more participations to any Person (other than Company, any of its
Subsidiaries or any of its Affiliates) in all or any part of its Term Loan
Commitments, Term Loans or in any other Obligation. The holder of any such
participation, other than an Affiliate of the Lender granting such
participation, shall not be entitled to require such Lender to take or omit to
take any action hereunder except with respect to any amendment, modification or
waiver that would (i) extend the final scheduled maturity of any Term Loan or
Term Loan Note 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 shall not constitute
a change in the terms of such participation, and that an increase in any Term
Loan Commitment or Term 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 any Credit Party of any
of its rights and obligations under this Agreement, or (iii) release all or
substantially all of the Collateral under the Collateral Documents or any
Guarantors from any Guaranty (in each case, except as expressly provided in the
Credit Documents) supporting the Term Loans hereunder in which such participant
is participating. Company agrees that each participant shall be entitled to the
benefits of SECTIONS 2.15(c), 2.16 and 2.17 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to CLAUSE (c) of
this Section; provided, (i) a participant shall not be entitled to receive any
greater payment under SECTION 2.16 or 2.17 than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
participant, unless the sale of the participation to such participant is made
with Company's prior written consent, and (ii) a participant that would be a
Non-US Lender if it were a Lender shall not be entitled to the benefits of
SECTION 2.17 unless Company is notified of the participation sold to such
participant and such participant agrees, for the benefit of Company, to comply
with SECTION 2.17 as though it were a Lender. To the extent permitted by
applicable law, each participant also shall be entitled to the benefits of
SECTION 10.4 as though it were a Lender, provided such Participant agrees to be
subject to SECTION 2.14 as though it were a Lender.
(i) Certain Other Assignments. In addition to any other assignment
permitted pursuant to this SECTION 10.6, any Lender may assign, pledge and/or
grant a security interest in, all or any portion of its Term Loans, the other
Obligations owed by or to such Lender, and its Term Loan Notes, if any, to
secure obligations of such Lender including, without limitation, any Federal
Reserve Bank as collateral security pursuant to Regulation A of the Board of
Governors of the Federal Reserve System and any operating circular issued by
such Federal Reserve Bank; provided, no Lender, as between Company and such
Lender, shall be relieved of any of its obligations hereunder as a result of any
such assignment and pledge, and provided further, in no event shall the
applicable Federal Reserve Bank, pledgee or trustee be considered to be a Lender
or be entitled to require the assigning Lender to take or omit to take any
action hereunder.
10.7. INDEPENDENCE OF COVENANTS. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any of such covenants, the fact that it would be permitted by an exception
to, or would otherwise be within the limitations of, another covenant shall not
avoid the occurrence of a Default or an Event of Default if such action is taken
or condition exists.
10.8. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. All
representations, warranties and agreements made herein shall survive the
execution and delivery hereof and the making of any Credit Extension.
Notwithstanding anything herein or implied by law to the contrary, the
agreements of each Credit Party set forth in SECTIONS 2.15(c), 2.16, 2.17, 10.2,
10.3 and 10.4 and the agreements of
87 CREDIT AND GUARANTY AGREEMENT
Lenders set forth in SECTIONS 2.14, 9.3(b) and 9.6 shall survive the payment of
the Term Loans, and the termination hereof.
10.9. NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on the part of
any Agent or any Lender in the exercise of any power, right or privilege
hereunder or under any other Credit Document shall impair such power, right or
privilege or be construed to be a waiver of any default or acquiescence therein,
nor shall any single or partial exercise of any such power, right or privilege
preclude other or further exercise thereof or of any other power, right or
privilege. The rights, powers and remedies given to each Agent and each Lender
hereby are cumulative and shall be in addition to and independent of all rights,
powers and remedies existing by virtue of any statute or rule of law or in any
of the other Credit Documents or any of the Interest Rate Agreements and
Currency Agreements. Any forbearance or failure to exercise, and any delay in
exercising, any right, power or remedy hereunder shall not impair any such
right, power or remedy or be construed to be a waiver thereof, nor shall it
preclude the further exercise of any such right, power or remedy.
10.10. MARSHALLING; PAYMENTS SET ASIDE. Neither any Agent nor any Lender
shall be under any obligation to marshal any assets in favor of any Credit Party
or any other Person or against or in payment of any or all of the Obligations.
To the extent that any Credit Party makes a payment or payments to
Administrative Agent or Lenders (or to Administrative Agent, on behalf of
Lenders), or Administrative Agent, Collateral Agent or Lenders enforce any
security interests or exercise their rights of setoff, and such payment or
payments or the proceeds of such enforcement or setoff or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, any other state or federal law, common law or any equitable
cause, then, to the extent of such recovery, the obligation or part thereof
originally intended to be satisfied, and all Liens, rights and remedies therefor
or related thereto, shall be revived and continued in full force and effect as
if such payment or payments had not been made or such enforcement or setoff had
not occurred.
10.11. SEVERABILITY. In case any provision in or obligation hereunder or
any Term Loan Note or other Credit Document shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired thereby.
10.12. OBLIGATIONS SEVERAL; INDEPENDENT NATURE OF LENDERS' RIGHTS. The
obligations of Lenders hereunder are several and no Lender shall be responsible
for the obligations or Term Loan Commitment of any other Lender hereunder.
Nothing contained herein or in any other Credit Document, and no action taken by
Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders as a
partnership, an association, a joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights arising out hereof and it shall not be necessary for any other Lender to
be joined as an additional party in any proceeding for such purpose.
10.13. HEADINGS. Section headings herein are included herein for
convenience of reference only and shall not constitute a part hereof for any
other purpose or be given any substantive effect.
10.14. APPLICABLE LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT
OF LAWS PRINCIPLES (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK
GENERAL OBLIGATIONS LAW) THEREOF.
88 CREDIT AND GUARANTY AGREEMENT
10.15. CONSENT TO JURISDICTION. ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST
ANY CREDIT PARTY ARISING OUT OF OR RELATING HERETO OR ANY OTHER CREDIT DOCUMENT,
OR ANY OF THE OBLIGATIONS, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION IN ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇. BY EXECUTING
AND DELIVERING THIS AGREEMENT, EACH CREDIT PARTY, FOR ITSELF AND IN CONNECTION
WITH ITS PROPERTIES, IRREVOCABLY (a) ACCEPTS GENERALLY AND UNCONDITIONALLY THE
NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (b) WAIVES ANY DEFENSE OF
FORUM NON CONVENIENS; (c) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH
PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO THE APPLICABLE CREDIT PARTY AT ITS ADDRESS PROVIDED IN
ACCORDANCE WITH SECTION 10.1; (d) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (c)
ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE APPLICABLE CREDIT
PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (e) AGREES THAT AGENTS AND
LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO BRING PROCEEDINGS AGAINST ANY CREDIT PARTY IN THE COURTS OF ANY OTHER
JURISDICTION.
10.16. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY AGREES TO
WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER CREDIT DOCUMENTS OR
ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN
TRANSACTION OR THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. THE
SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS
TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND
ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES THAT
THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT
EACH HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT
EACH WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS. EACH
PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER
WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY
TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS
IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING
(OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SECTION
10.16 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY
TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR
ANY OF THE OTHER CREDIT DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS
RELATING TO THE LOANS MADE HEREUNDER. IN THE EVENT OF LITIGATION, THIS AGREEMENT
MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
10.17. CONFIDENTIALITY. Each Lender shall use commercially reasonable
standards to hold confidential all non-public information regarding Company and
its Subsidiaries and their businesses identified as such by Company and obtained
by such Lender pursuant to the requirements hereof, it being understood and
agreed by Company that, in any event, a Lender may make (i) disclosures of such
89 CREDIT AND GUARANTY AGREEMENT
information to Affiliates of such Lender and to their agents and advisors (and
to other persons authorized by a Lender or Agent to organize, present or
disseminate such information in connection with disclosures otherwise made in
accordance with this SECTION 10.17), each of whom has agreed to keep the same
confidential, (ii) disclosures of such information reasonably required by any
bona fide or potential assignee, transferee or participant in connection with
the contemplated assignment, transfer or participation by such Lender of any
Term Loans or any participations therein or by any direct or indirect
contractual counterparties (or the professional advisors thereto) in Interest
Rate Agreements and Currency Agreements (provided, that each of such Persons are
advised of and agree to be bound by the provisions of this SECTION 10.17), (iii)
disclosure to any rating agency when required by it, provided that, prior to any
disclosure, such rating agency shall undertake in writing to preserve the
confidentiality of any confidential information relating to the Credit Parties
received by it from any of the Agents or any Lender, (iv) to any Lender's
financing sources, provided that prior to any disclosure, such financing source
is informed of the confidential nature of the information and agrees to keep the
same confidential, and (v) disclosures required or requested by any governmental
agency or representative thereof or by the NAIC or pursuant to legal or judicial
process; provided, unless specifically prohibited by applicable law or court
order, each Lender shall make reasonable efforts to notify Company of any
request by any governmental agency or representative thereof (other than any
such request in connection with any examination of the financial condition or
other routine examination of such Lender by such governmental agency) for
disclosure of any such non-public information prior to disclosure of such
information. Notwithstanding the foregoing, on or after the Closing Date and
after the Company has completed a public offering of its equity securities or
has withdrawn its registration statement with the Securities and Exchange
Commission, Administrative Agent may, at its own expense, issue news releases
and publish "tombstone" advertisements and other announcements relating to this
transaction in newspapers, trade journals and other appropriate media.
10.18. USURY SAVINGS CLAUSE. Notwithstanding any other provision herein,
the aggregate interest rate charged or agreed to be paid with respect to any of
the Obligations, including all charges or fees in connection therewith deemed in
the nature of interest under applicable law shall not exceed the Highest Lawful
Rate. If the rate of interest (determined without regard to the preceding
sentence) under this Agreement at any time exceeds the Highest Lawful Rate, the
outstanding amount of the Term Loans made hereunder shall bear interest at the
Highest Lawful Rate until the total amount of interest due hereunder equals the
amount of interest which would have been due hereunder if the stated rates of
interest set forth in this Agreement had at all times been in effect. In
addition, if when the Term Loans made hereunder are repaid in full the total
interest due hereunder (taking into account the increase provided for above) is
less than the total amount of interest which would have been due hereunder if
the stated rates of interest set forth in this Agreement had at all times been
in effect, then to the extent permitted by law, Company shall pay to
Administrative Agent an amount equal to the difference between the amount of
interest paid and the amount of interest which would have been paid if the
Highest Lawful Rate had at all times been in effect. Notwithstanding the
foregoing, it is the intention of Lenders and Company to conform strictly to any
applicable usury laws. Accordingly, if any Lender contracts for, charges, or
receives any consideration which constitutes interest in excess of the Highest
Lawful Rate, then any such excess shall be cancelled automatically and, if
previously paid, shall at such Lender's option be applied to the outstanding
amount of the Term Loans made hereunder or be refunded to Company. In
determining whether the interest contracted for, charged, or received by
Administrative Agent or a Lender exceeds the Highest Lawful Rate, such Person
may, to the extent permitted by applicable law, (a) characterize any payment
that is not principal as an expense, fee, or premium rather than interest, (b)
exclude voluntary prepayments and the effects thereof, and (c) amortize,
prorate, allocate, and spread in equal or unequal parts the total amount of
interest, throughout the contemplated term of the Obligations hereunder.
90 CREDIT AND GUARANTY AGREEMENT
10.19. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument.
10.20. EFFECTIVENESS. This Agreement shall become effective upon the
execution of a counterpart hereof by each of the parties hereto and receipt by
Company and Administrative Agent of written or telephonic notification of such
execution and authorization of delivery thereof.
10.21. PATRIOT ACT. Each Lender and Administrative Agent (for itself and
not on behalf of any Lender) hereby notifies Company that pursuant to the
requirements of the Act, it is required to obtain, verify and record information
that identifies Company, which information includes the name and address of
Company and other information that will allow such Lender or Administrative
Agent, as applicable, to identify Company in accordance with the Act.
10.22. CERTAIN REPRESENTATIONS.
(a) Each Lender has substantial experience in evaluating loan
transactions with companies similar to Company and has such knowledge and
experience in financial and business matters that Lender has the capacity to
protect its own interests in making the Term Loan to Company.
(b) Company and each Guarantor have substantial experience in
evaluating loan transactions with companies similar to Lenders and have such
knowledge and experience in financial and business matters that each of Company
and each Guarantor has the capacity to protect its own interests in receiving or
guaranteeing, as the case may be, the Term Loan from Lenders to Company.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES FOLLOW.
91 CREDIT AND GUARANTY AGREEMENT
IN WITNESS WHEREOF, the parties hereto have caused this Credit and
Guaranty Agreement to be duly executed and delivered by their respective
officers thereunto duly authorized as of the date first written above.
TALEO CORPORATION,
a Delaware corporation, as Company
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
_______________________________________
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Chief Financial Officer
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC.,
a California corporation, as Guarantor
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
_______________________________________
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Chief Financial Officer
SIGNATURE PAGE TO
CREDIT AND GUARANTY AGREEMENT
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P.,
as Administrative Agent, Lead Arranger, Collateral
Agent, Documentation Agent, and Syndication Agent
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
By: ______________________________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING HOLDINGS, INC.,
as a Lender
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
By: ______________________________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
SIGNATURE PAGE TO
CREDIT AND GUARANTY AGREEMENT
APPENDIX A
TERM LOAN COMMITMENT
PRO
LENDER TERM LOAN COMMITMENT RATA SHARE
--------------------------------------------- -------------------- ----------
▇▇▇▇▇▇▇ ▇▇▇▇▇ Specialty Lending Holdings, Inc. $ 20,000,000.00 100%
TOTAL $ 20,000,000.00 100%
APPENDIX A
APPENDIX B
NOTICE ADDRESSES
TALEO CORPORATION
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC.,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
in each case, with a copy to:
TALEO CORPORATION
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Counsel
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P.,
as Administrative Agent, Collateral Agent,
Documentation Agent, Lead Arranger, and Syndication Agent
▇▇▇▇▇▇▇ Sachs Specialty Lending Group, L.P.
▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ Hosanna, Account Manager
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING HOLDINGS, INC.
as a Lender,
▇▇▇▇▇▇▇ ▇▇▇▇▇ Specialty Lending Holdings, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Managing Director
APPENDIX B
with copies to:
▇▇▇▇▇▇▇ Sachs Specialty Lending Holdings, Inc.
▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ Hosanna, Account Manager
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
and
▇▇▇▇▇▇▇ Sachs Specialty Lending Group, L.P.
▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇, GSSLG In-House Counsel
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
2 APPENDIX B
EXHIBIT A-1
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P., AS AGENT
FUNDING NOTICE
Reference is made to that certain Credit and Guaranty Agreement, dated as
of April 25, 2005 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"; capitalized terms used but not otherwise
defined herein shall have the respective meanings ascribed to such terms in the
Credit Agreement), by and among TALEO CORPORATION, a Delaware corporation (the
"COMPANY"), the Lenders party thereto from time to time, and ▇▇▇▇▇▇▇ ▇▇▇▇▇
SPECIALTY LENDING GROUP, L.P., as Administrative Agent, Collateral Agent, Lead
Arranger, Syndication Agent, and Documentation Agent (in such capacities,
"AGENT").
1. Pursuant to Section 2.1 of the Credit Agreement, Company desires that
Lenders make the following Term Loans to Company on April 25, 2005 (the "CLOSING
DATE") in accordance with the applicable terms and conditions of the Credit
Agreement:
(a) Term Loan:
[ ] Base Rate Loans: $[___,___,___]
[ ] LIBOR Rate Loans, with an initial Interest
Period of ________ month(s): $[___,___,___]
2. Company hereby certifies to Agent and each Lender that:
(a) as of the Closing Date, (i) all Term Loans shall not exceed the Term
Loan Commitments then in effect, and (ii) all of the conditions precedent
specified in Section 3 of the Credit Agreement shall have been satisfied or
waived; and
(b) the representations and warranties contained in each of the Credit
Documents are true and correct in all material respects on and as of the Closing
Date, both before and after giving effect to the borrowing contemplated hereby,
except to the extent such representations and warranties specifically relate to
an earlier date, in which case such representations and warranties were true and
correct in all material respects on and as of such earlier date; and
(c) as of the Closing Date, no event has occurred and is continuing or
would result from the consummation of the borrowing contemplated hereby that
would constitute a Default or an Event of Default; and
(d) the Chief Financial Officer of the Company shall have delivered an
Officer's Certificate representing and warranting and otherwise demonstrating to
the satisfaction of Agent that, as of the Closing Date, Company reasonably
expects, after giving effect to the proposed borrowing and based upon good faith
determinations and projections consistent with the Financial Plan, to be in
compliance with all
EXHIBIT A-1
operating and financial covenants set forth in the Credit Agreement as of the
last day of each Fiscal Quarter ending prior to the Term Loan Maturity Date.
3. Any Agent or Requisite Lenders shall be entitled, but not obligated to,
request and receive, prior to the making of any Credit Extension, additional
information reasonably satisfactory to the requesting party confirming the
satisfaction of any of the foregoing if, in the good faith judgment of such
Agent or Requisite Lender such request is warranted under the circumstances.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGE FOLLOWS.
2 EXHIBIT A-1
IN WITNESS WHEREOF, Company has caused this Funding Notice to be executed
and delivered by its duly authorized representative as of the date set forth
below.
TALEO CORPORATION,
as Company
By:_________________________________
Name:______________________________
Title:_______________________________
Date:______________________, 200__
3 EXHIBIT ▇-▇
▇▇▇▇▇▇▇ ▇-▇
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P., AS AGENT
CONVERSION/CONTINUATION NOTICE
Reference is made to that certain Credit and Guaranty Agreement, dated as
of April 25, 2005 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"; capitalized terms used but not otherwise
defined herein shall have the respective meanings ascribed to such terms in the
Credit Agreement), by and among Taleo Corporation, a Delaware corporation
("COMPANY"), the Lenders party thereto from time to time, and ▇▇▇▇▇▇▇ ▇▇▇▇▇
SPECIALTY LENDING GROUP, L.P., as Administrative Agent, Collateral Agent, Lead
Arranger, Syndication Agent, and Documentation Agent (in such capacities,
"AGENT").
1. Subject to Section 2.15 of the Credit Agreement and pursuant to Section
2.6 of the Credit Agreement, Company desires to convert or to continue the
following Term Loans, each such conversion and/or continuation to be effective
as of ____________________, 20_____:
(a) Term Loan:
$[___,___,___] LIBOR Rate Loans to be continued with an Interest
Period of ____ month(s)
$[___,___,___] Base Rate Loans to be converted to LIBOR Rate Loans
with an Interest Period of ____ month(s)
$[___,___,___] LIBOR Rate Loans to be converted to Base Rate Loans
2. Company hereby certifies to Agent and each Lender that, as of the date
hereof, no event has occurred and is continuing or would result from the
consummation of the conversion and/or continuation contemplated hereby that
would constitute a Default or an Event of Default.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGE FOLLOWS.
1 EXHIBIT A-2
IN WITNESS WHEREOF, Company has caused this Conversion/Continuation Notice
to be executed and delivered by its duly authorized representative as of the
date set forth below.
TALEO CORPORATION,
as Company
By:_________________________________
Name:______________________________
Title:_______________________________
Date:______________________, 20______
2 EXHIBIT A-2
EXHIBIT B
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P., AS AGENT
TERM LOAN NOTE
$20,000,000.00 April __, ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
FOR VALUE RECEIVED, TALEO CORPORATION, a Delaware corporation ("COMPANY"),
hereby promises to pay to ▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING HOLDINGS, INC., a
Delaware corporation, or its registered assigns ("PAYEE"), on or before the Term
Loan Maturity Date, TWENTY MILLION DOLLARS AND ZERO CENTS ($20,000,000.00) under
the Credit Agreement referred to below.
Company also hereby promises to pay interest on the unpaid principal
amount hereof, from the date hereof until paid in full, at the rates and at the
times which shall be determined in accordance with the provisions of that
certain Credit Agreement, dated as of April 25, 2005 (as amended, restated,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT";
capitalized terms used but not otherwise defined herein shall have the
respective meanings ascribed to such terms in the Credit Agreement), by and
among Company, Payee, the Lenders party thereto from time to time, and ▇▇▇▇▇▇▇
SACHS SPECIALTY LENDING GROUP, L.P., as Administrative Agent, Collateral Agent,
Lead Arranger, Syndication Agent, and Documentation Agent (in such capacities,
"AGENT").
This Term Loan Note (this "NOTE") is the "Term Loan Note" in the aggregate
principal amount of $20,000,000.00 referred to in, and is issued pursuant to and
entitled to the benefits of, the Credit Agreement, to which reference is hereby
made for a more complete statement of the terms and conditions under which the
Term Loan evidenced hereby was made and is to be repaid.
All payments of principal and interest in respect of this Note shall be
made in lawful money of the United States of America in same day funds at the
Principal Office of Agent or at any other place that shall be designated in
writing for such payments in accordance with the terms of the Credit Agreement.
Unless and until an Assignment Agreement effecting the assignment or transfer of
the obligations evidenced hereby shall have been accepted by Agent and recorded
in the Register, Company, Agent and Lenders shall be entitled to deem and treat
Payee as the owner and holder of this Note and the obligations evidenced hereby.
Payee hereby agrees, by its acceptance hereof, that before disposing of this
Note or any part hereof, it will make a notation hereon of all principal
payments previously made hereunder and of the date to which interest hereon has
been paid; provided, the failure to make a notation of any payment made on this
Note shall not limit or otherwise affect the obligations of Company hereunder
with respect to payments of principal of or interest on this Note.
This Note is subject to mandatory prepayment and to voluntary prepayment
at the option of Company, in each case as provided in the Credit Agreement.
THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF COMPANY AND PAYEE HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES THEREOF.
1 EXHIBIT B
Upon the occurrence of an Event of Default, the unpaid balance of the
principal amount of this Note, together with all accrued and unpaid interest
thereon, may become, or may be declared to be, due and payable in the manner,
upon the conditions and with the effect provided in the Credit Agreement.
The terms of this Note are subject to amendment only in the manner
provided in the Credit Agreement.
No reference herein to the Credit Agreement and no provision of this Note
or the Credit Agreement shall alter or impair the obligations of Company, which
are absolute and unconditional, to pay the principal of and interest on this
Note at the place, at the respective times, and in the currency herein
prescribed.
Company promises to pay all costs and expenses (including, without
limitation, reasonable attorneys' fees), all as provided in the Credit
Agreement, incurred in the collection and enforcement of this Note. Company and
any endorsers of this Note hereby consent to renewals and extensions of time at
or after the maturity hereof, without notice, and hereby waive diligence,
presentment, protest, demand notice of every kind and, to the full extent
permitted by law, the right to plead any statute of limitations as a defense to
any demand hereunder.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGE FOLLOWS.
2 EXHIBIT B
IN WITNESS WHEREOF, each Company has caused this Term Loan Note to be
executed and delivered by its duly authorized representative as of the date and
at the place first written above.
COMPANY:
TALEO CORPORATION
By:______________________
Name:____________________
Title:___________________
3 EXHIBIT B
EXHIBIT C
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P., AS AGENT
COMPLIANCE CERTIFICATE
Pursuant to the Credit Agreement referred to below, the undersigned hereby
certifies as follows:
1. I am the [Chief Financial Officer/Treasurer/President] of TALEO
CORPORATION, a Delaware corporation ("COMPANY").
2. I have reviewed the terms of that certain Credit Agreement, dated as of
April 25, 2005 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"; capitalized terms used but not otherwise
defined herein shall have the respective meanings ascribed to such terms in the
Credit Agreement), by and among Company, the Lenders party thereto from time to
time, and ▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P., as Administrative Agent,
Collateral Agent, Lead Arranger, Syndication Agent, and Documentation Agent, and
I have made, or have caused to be made under my supervision, a review in
reasonable detail of the transactions and condition of the Credit Parties during
the accounting period covered by the attached financial statements.
3. The examination described in SECTION 2 above did not disclose, and I
have no knowledge of, the existence of any condition or event which constitutes
a Default or an Event of Default during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Compliance Certificate (this "CERTIFICATE"), except as set forth in a separate
attachment, if any, to this Certificate, describing in detail, the nature of the
condition or event, the period during which it has existed and the action which
the Credit Parties have taken, are taking, or propose to take with respect to
each such condition or event.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGE FOLLOWS.
1 EXHIBIT C
IN WITNESS WHEREOF, Company has caused this Certificate to be executed and
delivered by its duly authorized representative as of the date set forth below.
TALEO CORPORATION,
as Company
By:_________________________________
Name:______________________________
Title: [Chief Financial Officer/Treasurer/
President]
Date:______________________, 20______
2 EXHIBIT C
Annex A
For the fiscal [quarter] [year] ending _____________________, 20_____:
1. Current Ratio: (i)/(ii) =
(i) Consolidated Current Assets: $[___,___,___]
(ii) Consolidated Current Liabilities: $[___,___,___]
Actual: [____:1.00]
Required:: [____:1.00]
2. Consolidated Adjusted EBITDA: (i) - (ii) =
(i) (a) Consolidated Net Income: $[___,___,___]
(b) Consolidated Interest Expense: $[___,___,___]
(c) provisions for taxes based on income: $[___,___,___]
(d) total depreciation expense: $[___,___,___]
(e) total amortization expense: $[___,___,___]
(f) other non-cash items reducing
Consolidated Net Income[*]: $[___,___,___]
(g) Phase I Development Costs, if any: $[___,___,___]
(ii) (a) other non-cash items increasing
Consolidated Net Income[**]: $[___,___,___]
(b) interest income: $[___,___,___]
(c) other non-ordinary course income: $[___,___,___]
Actual: $[___,___,___]
Minimum: >= $[___,___,___]
------------------------------
[*] Excluding any such non-Cash item to the extent that it represents an
accrual or reserve for potential Cash items in any future period or
amortization of a prepaid Cash item that was paid in a prior period.
[**] Excluding any such non-Cash item to the extent that it represents an
accrual or reserve for potential Cash items in any future period or
amortization of a prepaid Cash item that was paid in a prior period.
3 EXHIBIT C
3. Consolidated Capital Expenditures: Actual: $[___,___,___]
Maximum: <= $[___,___,___]
4. Hosted Application Revenue: Actual: $[___,___,___]
Minimum: >= $[___,___,___]
5. Consolidated Liquidity: Actual: $[___,___,___]
Minimum: >= $[___,___,___]
6. Loan to Value Ratio***: (i)/(ii) =
(i) Company's Obligations as of
the Date hereof: $[___,___,___]
(ii) Company's Enterprise Value as of
the Date hereof: $[___,___,___]
Actual: _.__:1.00
Required: 0.20:1.00
-------------------------
*** Only measured after Qualified IPO
4 EXHIBIT C
EXHIBIT D
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P., AS AGENT
FORM OF OPINION OF COUNSEL
1 EXHIBIT D
EXHIBIT E
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P., AS AGENT
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement (this "ASSIGNMENT") is dated as
of the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the "ASSIGNOR") and [Insert name of Assignee] (the
"ASSIGNEE"). Capitalized terms used but not otherwise defined herein shall have
the respective meanings ascribed to such terms in the Credit Agreement
identified below, receipt of a copy of which is hereby acknowledged by the
Assignee. The Standard Terms and Conditions set forth in ANNEX 1 attached hereto
are hereby agreed to, incorporated herein by reference and made a part of this
Assignment as if set forth herein in full.
For good and valuable consideration, the receipt, sufficiency and adequacy
of which are hereby acknowledged, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Standard Terms
and Conditions and the Credit Agreement, as of the Effective Date set forth
below, the interest in and to all of the Assignor's rights and obligations under
the Credit Agreement and the other Credit Documents that represent the amount
and percentage interest identified below of all of the Assignor's outstanding
rights and obligations under the respective facilities identified below (the
"ASSIGNED INTEREST"). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment, the Credit
Agreement and the other Credit Documents, without representation or warranty by
the Assignor.
1. ASSIGNOR: ______________________
2. ASSIGNEE: ______________________, who is an Eligible Assignee
3. COMPANY: TALEO CORPORATION, a Delaware corporation
4. AGENT: ▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P.,
as as Administrative Agent, Collateral Agent, Lead
Arranger, Syndication Agent, and Documentation
Agent.
5. CREDIT AGREEMENT: Credit Agreement, dated as of April 25, 2005, by
and among Taleo Corporation, a Delaware corporation
("COMPANY"), the Lenders party thereto from time to
time, and ▇▇▇▇▇▇▇ Sachs Specialty Lending Group,
L.P., as Administrative Agent, Collateral Agent,
Lead Arranger, Syndication Agent, and Documentation
Agent (in such capacities, "AGENT"), as amended,
restated, supplemented or otherwise modified from
time to time
1 EXHIBIT E
6. ASSIGNED INTEREST:
Aggregate Amount Percentage of Term
of Term Loans for Amount of Term Loans Assigned
Term Loan Commitment Assigned all Lenders Loans Assigned [******]
----------------------------- ----------------- -------------- ------------------
____________________ $ _____________ $ ___________ _____________%
7. EFFECTIVE DATE: __________________, 20_____ [TO BE
INSERTED BY AGENT AND WHICH SHALL BE THE
EFFECTIVE DATE OF RECORDATION OF TRANSFER
ON THE REGISTER.]
8. NOTICE AND WIRE INSTRUCTIONS:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
Notices: Notices:
_______________________ __________________________
_______________________ __________________________
_______________________ __________________________
Attention:_____________ Attention:________________
Facsimile:_____________ Facsimile:________________
with a copy to: with a copy to:
_______________________ __________________________
_______________________ __________________________
_______________________ __________________________
Attention:_____________ Attention:________________
Facsimile:_____________ Facsimile:________________
Wire Instructions: Wire Instructions:
_______________________ __________________________
_______________________ __________________________
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGE FOLLOWS.
-----------------------------
[******]Set forth, to at least 9 decimals, as a percentage of the Loans of all
Lenders thereunder.
2 EXHIBIT E
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Assignment to be executed and delivered by their respective duly authorized
representatives as of the Effective Date.
ASSIGNOR:
[NAME OF ASSIGNOR]
By:__________________________________
Name:________________________________
Title:_______________________________
ASSIGNEE:
[NAME OF ASSIGNEE]
By:__________________________________
Name:________________________________
Title:_______________________________
REMAINDER OF PAGE INTENTIONALLY BLANK.
ACKNOWLEDGEMENT FOLLOWS.
3 EXHIBIT E
[CONSENTED TO][********]:
AGENT:
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING
GROUP, L.P.
By:_______________________________
Name:_____________________________
Title:____________________________
--------------------------
[********]To be added only if the consent of Agent is required by the terms of
the Credit Agreement.
4 EXHIBIT E
Annex 1
Standard Terms and Conditions for
Assignment and Assumption Agreement
1. Representations and Warranties.
(a) Assignor. The Assignor (a) represents and warrants that (i) it is the
legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest
is free and clear of any Lien, and (iii) it has full power and authority, and
has taken all action necessary, to execute and deliver this Assignment and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, representations and/or
warranties made in or in connection with any Credit Document, (ii) the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of any Credit Document, or any Collateral thereunder, (iii) the financial
condition of any Credit Party or any other Person obligated in respect of any
Credit Document, or (iv) the performance or observance by any Credit Party or
any other Person of any of their respective obligations under any Credit
Document.
(b) Assignee. The Assignee (a) represents and warrants that (i) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and to consummate the transactions contemplated hereby
and to become a Lender under the Credit Agreement, (ii) it meets all
requirements of an Eligible Assignee under the Credit Agreement, (iii) from and
after the Effective Date, it shall be bound by the provisions of the Credit
Agreement and, to the extent of the Assigned Interest, shall have the
obligations of a Lender thereunder, (iv) it has received a copy of the Credit
Agreement and any other documents and information that it has deemed appropriate
to make its own credit analysis and decision to enter into this Assignment and
to purchase the Assigned Interest on the basis of which it has made such
analysis and decision, (v) it has substantial experience in evaluating loan
transactions with companies similar to Company and has such knowledge and
experience in financial and business matters such that it has the capacity to
protect its own interests in purchasing the Assigned Interest; and (vi) if it is
a Non-US Lender, attached to the Assignment is any documentation required to be
delivered by it pursuant to the terms of the Credit Agreement, duly completed
and executed by the Assignee; and (b) agrees that (i) it will, independently and
without reliance on Agent, the Assignor or any other Lender, and based on any
documents and information that it shall deem appropriate at that time, continue
to make its own credit decisions in taking or not taking action under the Credit
Documents, and (ii) it will perform in accordance with their respective terms
all of the obligations which by the terms of the Credit Documents are required
to be performed by it as a Lender.
2. Payments. From and after the Effective Date, Agent shall make all
payments in respect of the Assigned Interest (including payments of principal,
interest, fees and other amounts) to the Assignor for amounts which have accrued
up to but excluding the Effective Date and to the Assignee for amounts which
have accrued from and after the Effective Date.
3. General Provisions. This Assignment shall be binding upon, and inure to
the benefit of, the parties hereto and their respective successors and assigns.
This Assignment may be executed in multiple counterparts (any of which may be
delivered by facsimile), each of which shall be an original and all of which
taken together shall constitute one and the same Assignment. This Assignment
shall be governed by, and construed and enforced in accordance with, the laws of
the State of New York, without regard to the conflicts of laws principles
thereof.
5 EXHIBIT E
EXHIBIT F
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P., AS AGENT
CERTIFICATE RE NON-BANK STATUS
Reference is made to that certain Credit Agreement, dated as of April 25,
2005 (as amended, restated, supplemented or otherwise modified from time to
time, the "CREDIT AGREEMENT"; capitalized terms used but not otherwise defined
herein shall have the respective meanings ascribed to such terms in the Credit
Agreement), by and among TALEO CORPORATION, a Delaware corporation ("COMPANY"),
the Lenders party thereto from time to time, and ▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING
GROUP, L.P., as Administrative Agent, Collateral Agent, Lead Arranger,
Syndication Agent, and Documentation Agent (in such capacities, "AGENT").
Pursuant to Section 2.17(c) of the Credit Agreement, the undersigned hereby
certifies that it is not a "bank" or other Person described in Section 881(c)(3)
of the Internal Revenue Code.
[NAME OF LENDER]
By:______________________
Name:____________________
Title:___________________
1 EXHIBIT F
EXHIBIT G-1
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P., AS AGENT
CLOSING DATE CERTIFICATE
The undersigned hereby certifies as follows:
1. Pursuant to Section 3.1(o) of that certain Credit Agreement, dated as
of April 25, 2005 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"; capitalized terms used but not otherwise
defined herein shall have the respective meanings ascribed to such terms in the
Credit Agreement), by and among TALEO CORPORATION, a Delaware corporation
("COMPANY"), the Lenders party thereto from time to time, and ▇▇▇▇▇▇▇ SACHS
SPECIALTY LENDING GROUP, L.P., as Administrative Agent, Collateral Agent, Lead
Arranger, Syndication Agent, and Documentation Agent (in such capacities,
"AGENT"), Company hereby requests that Lenders make the following Term Loans to
Company on the Closing Date:
(a) Term Loan: $20,000,000
2. Each Credit Party has reviewed the terms of Section 4 of the Credit
Agreement and the definitions and provisions contained in the Credit Agreement
relating thereto, and in each Credit Party's opinion, it has made, or has caused
to be made under its supervision, any examination or investigation that is
necessary to enable it to express an informed opinion as to the matters referred
to herein.
3. Based upon each Credit Party's review and examination described in
SECTION 2 above, each Credit Party certifies to Agent and each Lender that, as
of the Closing Date:
(a) the representations and warranties of such Credit Party contained in
each Credit Document to which it is a party are true and correct in all material
respects on and as of the Closing Date, both before and after giving effect to
the borrowing contemplated hereby, to the same extent as though made on and as
of the Closing Date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case such representations and
warranties were true and correct in all material respects on and as of such
earlier date; and
(b) no injunction or other restraining order has been issued and no
hearing to cause an injunction or other restraining order to be issued is
pending or has been noticed with respect to any action, suit or proceeding
seeking to enjoin or otherwise prevent the consummation of, to recover any
damages or to obtain relief as a result of, the borrowing contemplated hereby;
and
(c) no event has occurred and is continuing or would result from the
consummation of the borrowing contemplated hereby that would constitute a
Default or an Event of Default.
4. Each Credit Party has requested ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇,
Professional Corporation to deliver to Agent and Lenders on the Closing Date
favorable written opinions setting forth substantially the matters in the
opinions designated in Exhibit D annexed to the Credit Agreement and any other
matters that Agent may reasonably request.
1 EXHIBIT G-1
5. Each Credit Party has obtained all Governmental Authorizations and all
consents of other Persons, in each case that are necessary or advisable in
connection with the transactions contemplated by the Credit Documents, and each
of the foregoing is in full force and effect. All applicable waiting periods
have expired without any action being taken or threatened by any Governmental
Authority or other Person which would restrain, prevent or otherwise impose
adverse conditions on the transactions contemplated by the Credit Documents. No
action, request for stay, petition for review or rehearing, reconsideration or
appeal with respect to any of the foregoing is pending, and the time for any
Governmental Authority or other Person to take action to set aside its consent
on its own motion shall have expired.
6. Attached hereto as ANNEX A are true, correct and complete copies of:
(a) the Historical Financial Statements, (b) pro forma consolidated and
consolidating balance sheets of Company and its Subsidiaries as at the Closing
Date, prepared in accordance with GAAP and reflecting the related financings and
the other transactions contemplated by the Credit Documents, and (c) the
Projections.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGE FOLLOWS.
2 EXHIBIT G-1
IN WITNESS WHEREOF, Company has caused this Closing Date Certificate to be
executed and delivered by its duly authorized representative as of the Closing
Date.
TALEO CORPORATION,
as Company
By:_________________________
Name:_______________________
Title:______________________
3 EXHIBIT G-1
Annex A
Attached hereto are copies of: (a) the Historical Financial Statements, (b) pro
forma consolidated and consolidating balance sheets of Company and its
Subsidiaries as at the Closing Date, prepared in accordance with GAAP and
reflecting the related financings and the other transactions contemplated by the
Credit Documents, and (c) the Projections.
4 EXHIBIT G-1
EXHIBIT G-2
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P., AS AGENT
SOLVENCY CERTIFICATE
The undersigned hereby certifies as follows:
1. I am the [Chief Financial Officer/Treasurer/President] of Taleo
Corporation, a Delaware corporation ("COMPANY").
2. Reference is made to that certain Credit Agreement, dated as of April
25, 2005 (as amended, restated, supplemented or otherwise modified from time to
time, the "CREDIT AGREEMENT"; capitalized terms used but not otherwise defined
herein shall have the respective meanings ascribed to such terms in the Credit
Agreement), by and among Company, the Lenders party thereto from time to time,
and ▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P., as Administrative Agent,
Collateral Agent, Lead Arranger, Syndication Agent, and Documentation Agent (in
such capacities, "AGENT").
3. I have reviewed the terms of Section 4 of the Credit Agreement and the
definitions and provisions contained in the Credit Agreement relating thereto
and, in my opinion, have made, or have caused to be made under my supervision,
any examination or investigation that is necessary to enable me to express an
informed opinion as to the matters referred to herein.
4. Based upon my review and examination described in SECTION 3 above, I
certify that, as of the Closing Date, after giving effect to the consummation of
the financings and the other transactions contemplated by the Credit Documents,
each of Company and its Subsidiaries, on a consolidated basis, are and will be
Solvent.
1 EXHIBIT G-2
IN WITNESS WHEREOF, the undersigned has caused this Solvency Certificate
to be executed and delivered by its duly authorized representative as of the
Closing Date.
TALEO CORPORATION,
as Company
By:_________________________________
Name:______________________________
Title:[Chief Financial Officer/ Treasurer/ President]
1 EXHIBIT G-2
EXHIBIT G-3
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P., AS AGENT
CASH RELEASE COMPLIANCE NOTICE AND CERTIFICATE
Reference is made to that certain Credit and Guaranty Agreement, dated as
of April 25, 2005 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"; capitalized terms used but not otherwise
defined herein shall have the respective meanings ascribed to such terms in the
Credit Agreement), by and among TALEO CORPORATION, a Delaware corporation (the
"COMPANY"), the Lenders party thereto from time to time, and ▇▇▇▇▇▇▇ ▇▇▇▇▇
SPECIALTY LENDING GROUP, L.P., as Administrative Agent, Collateral Agent, Lead
Arranger, Syndication Agent, and Documentation Agent (in such capacities,
"AGENT").
1. Pursuant to Section 5.14(b) of the Credit Agreement, Company desires
that Agent release any excess funds from the Restricted Cash Account to Company
on ___________, 200__ (the "STEP-DOWN DATE") to reduce the Funds or deposit in
the Restricted Cash Account to the amount opposite the Step-Down Date in
accordance with the applicable terms and conditions of the Credit Agreement, as
set forth below:
MINIMUM CASH
PERIOD SUBJECT TO CONTROL
-------------------------------------------- ------------------
Closing through June 30, 2005 $7,500,000
July 1, 2005 through July 31, 2005 $6,250,000
August 1, 2005 through August 31, 2005 $5,750,000
September 1, 2005 through September 30, 2005 $5,250,000
October 1, 2005 through December 31, 2005 $5,000,000
January 1, 2006 through September 30, 2006 $4,500,000
October 1, 2006 through March 31, 2008 $ 0
2. Company hereby certifies to Agent and each Lender that:
(a) as of the date of this Certificate and the Step-Down Date, the
representations and warranties contained in each of the Credit Documents are
true and correct in all material respects, both before and after giving effect
to the balance reduction contemplated hereby, except to the extent such
representations and warranties specifically relate to an earlier date, in which
case such representations and warranties were true and correct in all material
respects on and as of such earlier date; and
1 EXHIBIT G-3
(b) as of the date of this Certificate and the Step-Down Date, no event
has occurred and is continuing or would result from the consummation of the
borrowing contemplated hereby that would constitute a Default or an Event of
Default.
3. Agent shall be entitled, but not obligated to, request and receive,
prior to the making of any balance reduction in the Restricted Cash Account,
additional information reasonably satisfactory to the requesting party
confirming the satisfaction of any of the foregoing if, in the good faith
judgment of Agent, such request is warranted under the circumstances.
4. No cash shall be released from the Restricted Cash Account in
accordance with the step-downs referenced above for the period commencing
October 1, 2006 until Company has delivered a compliance certificate evidencing
compliance for the Fiscal Quarter ending September 30, 2006, and evidencing
compliance with the Minimum Consolidated Liquidity covenant set forth in Section
6.8(e) of the Credit Agreement for the period commencing October 1, 2006.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGE FOLLOWS.
2 EXHIBIT G-3
IN WITNESS WHEREOF, Company has caused this Cash Release Compliance Notice
and Certificate to be executed and delivered by its duly authorized
representative as of the date set forth below.
TALEO CORPORATION,
as Company
By:_________________________________
Name:______________________________
Title:_______________________________
Date:______________________, 200_***
------------------------------
*** Date must be at least 3 Business Days prior to Step-Down Date referenced
above.
3 EXHIBIT G-3
EXHIBIT G-4
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P., AS AGENT
2004 FINANCIAL OFFICER CERTIFICATION
Pursuant to the Credit Agreement referred to below, the undersigned hereby
certifies as follows:
1. I am the [Chief Financial Officer/Treasurer/President] of TALEO
CORPORATION, a Delaware corporation ("COMPANY").
2. I have reviewed the terms of that certain Credit and Guaranty
Agreement, dated as of April 25, 2005 (as amended, restated, supplemented or
otherwise modified from time to time, the "CREDIT AGREEMENT"; capitalized terms
used but not otherwise defined herein shall have the respective meanings
ascribed to such terms in the Credit Agreement), by and among Company, the
Lenders party thereto from time to time, and ▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING
GROUP, L.P., as Administrative Agent, Collateral Agent, Lead Arranger,
Syndication Agent, and Documentation Agent, and I have made, or have caused to
be made under my supervision, a review in reasonable detail of the transactions
and condition of the Credit Parties during the accounting period covered by the
attached 2004 draft unaudited financial statements.
3. The examination described in SECTION 2 has revealed that:
(a) the 2004 audited consolidated financial statements will not be
materially different from the draft 2004 unaudited consolidated financial
statements covering the same accounting period attached as Exhibit A (the "2004
UNAUDITED FINANCIALS") to this Financial Officer Certification (this
"CERTIFICATION"), except for non-cash compensation charges, if any, relating to
granting stock options at less than fair market value that may be reflected in
the final audited financial statements after consultation with Deloitte and
Touche and the Securities and Exchange Commission;
(b) the 2004 Unaudited Financials have been presented to the audit
committee of Company; and
(c) The 2004 Unaudited Financials are free of material misstatements and
fairly present, in all material respects, the financial position, on a
consolidated basis, of the Persons described in such financial statements as at
the respective dates thereof and the results of operations and cash flows, on a
consolidated basis, of the entities described therein for each of the periods
then ended.
4. I hereby certify to Agent and each Lender that Company has provided to
Deloitte & Touche, LLP, copies of any and all materials, reports, notices, and
statements necessary to complete any examinations by such accountants in
connection with the audit of the 2004 Unaudited Financials in accordance with
generally accepted auditing standards.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGE FOLLOWS.
1 EXHIBIT G-4
IN WITNESS WHEREOF, Company has caused this Certification to be executed
and delivered by its duly authorized representative as of the date set forth
below.
TALEO CORPORATION,
as Company
By:_________________________________
Name:______________________________
Title:[Chief Financial Officer/Treasurer/
President]
Date:______________________, 20______
2 EXHIBIT G-4
EXHIBIT H-1
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P., AS AGENT
PLEDGE AND SECURITY AGREEMENT
[to be attached]
1 EXHIBIT ▇-▇
▇▇▇▇▇▇▇ ▇-▇
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P., AS AGENT
COPYRIGHT SECURITY AGREEMENT
This COPYRIGHT SECURITY AGREEMENT (the "AGREEMENT") is executed as of
__________, 200_, by TALEO CORPORATION, a Delaware corporation ("DEBTOR"), whose
address is ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇▇
▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P., as Collateral Agent for the Lenders
described below ("SECURED PARTY") whose address is ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇.
RECITALS
A. Debtor, the Lenders party thereto from time to time, and Secured Party
have entered into a Credit and Guaranty Agreement dated as of April 25, 2005 (as
amended, modified, supplemented, or restated from time to time, the "CREDIT
AGREEMENT");
B. In connection with the Credit Agreement, a Pledge and Security
Agreement (as amended, modified, supplemented, or restated from time to time,
the "SECURITY AGREEMENT") has been entered into by and among Debtor and Secured
Party whereby Debtor granted to Secured Party a security interest in certain
assets of Debtor, including, without limitation, the Copyright Collateral (as
defined below) to secure the payment of the Obligations;
C. Subject to the terms and conditions set forth below, Debtor and Secured
Party desire to enter into this Agreement in order to further evidence the
security interest of Secured Party in the Copyright Collateral (as defined
below); and
D. This Agreement is integral to the transactions contemplated by the Loan
Documents.
ACCORDINGLY, for valuable consideration, the receipt and adequacy of which
are hereby acknowledged, Debtor and Secured Party hereby agree as follows:
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1 Defined Terms. Capitalized terms used and not otherwise defined
herein shall have the same meanings as set forth in the Credit Agreement. Terms
used herein which are defined in the UCC, unless otherwise defined herein or in
the Credit Agreement, shall have their meanings as set forth in the UCC.
SECTION 2 Security Interest. In order to secure the full and complete
payment and performance of the Obligations when due, Debtor hereby grants to
Secured Party a security interest in all of Debtor's rights, titles, and
interests in and to the Copyright Collateral (defined below) and pledges the
Copyright Collateral to Secured Party, all upon and subject to the terms and
conditions of this Agreement. Such security interest is granted and pledge is
made as security only and shall not subject Secured Party to, or transfer or in
any way affect or modify, any obligation of Debtor with respect to any of the
Copyright Collateral or any transaction involving or giving rise thereto. If the
grant or pledge of any specific item of the Copyright Collateral is expressly
prohibited by any contract, then the security interest
1 EXHIBIT H-2
and pledge created hereby nonetheless remain effective to the extent allowed by
the UCC or other applicable Law, but are otherwise limited by that prohibition.
SECTION 3. Copyright Collateral. As used herein, the term "COPYRIGHT
COLLATERAL" means the following items and types of property, wherever located,
now owned or in the future existing or acquired by Debtor, and all proceeds and
products thereof, and any substitutes or replacements therefor:
(a) All copyrights (whether statutory or common law, registered or
unregistered), works protectable by copyright, copyright registrations,
copyright licenses, and copyright applications of Debtor, including,
without limitation, all of Debtor's rights, titles, and interests in and
to all copyrights registered in the United States Copyright Office or
anywhere else in the world and also including, without limitation, the
registered copyrights set forth on SCHEDULE 1; (b) all renewals,
extensions, and modifications thereof; (c) all income, licenses,
royalties, damages, profits, and payments relating to or payable under any
of the foregoing; (d) the right to ▇▇▇ for past, present, or future
infringements of any of the foregoing; and (e) all other rights and
benefits relating to any of the foregoing throughout the world; in each
case, whether now owned or hereafter acquired by Debtor.
SECTION 4. Security Agreement. This Agreement has been executed and
delivered by the Debtor for the purpose of registering the security interest of
the Secured Party in the Copyright Collateral with the United States Copyright
Office and corresponding offices in other countries of the world. The security
interest granted hereby has been granted as a supplement to, and not in
limitation of, the security interest granted to the Secured Party for its
benefit and the benefit of the Banks under the Security Agreement. The Security
Agreement (and all rights and remedies of Secured Party and the Banks
thereunder) shall remain in full force and effect in accordance with its terms.
SECTION 5. Acknowledgment. The Debtor does hereby further acknowledge and
affirm that the rights and remedies of Secured Party with respect to the
security interest in the Copyright Collateral granted hereby are more fully set
forth in the Security Agreement, the terms and provisions of which (including
the remedies provided for therein) are incorporated by reference herein as if
fully set forth herein.
SECTION 6. Loan Document, etc. This Agreement is a Collateral Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions of the Credit Agreement.
SECTION 8. Counterparts. This Agreement may be executed by parties hereto
in several counterparts, each of which shall be deemed to be an original and all
of which shall constitute together but one and the same agreement.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGES FOLLOW.
2 EXHIBIT H-2
IN WITNESS WHEREOF, the Debtor has duly executed this Copyright Security
Agreement as of the day and year first written above.
TALEO CORPORATION, a Delaware corporation,
as Debtor
By: __________________________________
Name:_____________________________
Title:____________________________
3 EXHIBIT H-2
IN WITNESS WHEREOF, Secured Party has duly executed this Copyright
Security Agreement as of the day and year first written above.
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P.,
as Secured Party
By: __________________________________
Name:_______
Title:______
4 EXHIBIT H-2
SCHEDULE 1
COPYRIGHTS
U.S. COPYRIGHTS
REGISTRATION
OWNER NO. TITLE COUNTRY
_______ ____________ _____ _______
_______ ____________ _____ _______
_______ ____________ _____ _______
5 EXHIBIT ▇-▇
▇▇▇▇▇▇▇ ▇-▇
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P., AS AGENT
HYPOTHEC ON SHARES
GRANTED BY: TALEO CORPORATION, a Delaware corporation, whose address is ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇; ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇;
(the "GRANTOR");
IN FAVOUR OF: ▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P, having a
place of business at ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇;
(the "COLLATERAL AGENT").
A. WHEREAS, the Grantor, the lenders party thereto from time to time (the
"LENDERS"), and the Collateral Agent have entered into a Credit and Guaranty
Agreement dated as of April 25, 2005 (as amended, modified, supplemented, or
restated from time to time, the "Credit Agreement").
B. WHEREAS, the Grantor has provided a security interest and pledge over the
Collateral (as such term is defined in the Pledge and Security Agreement) to the
Collateral Agent by virtue of a Pledge and Security Agreement dated as of April
25, 2005 (as amended, modified, supplemented, or restated from time to time, the
"Pledge and Security Agreement")
C. WHEREAS, this Hypothec on Shares is integral to the transactions contemplated
by the Credit Documents (as such term is defined in the Credit Agreement), and
the execution and delivery hereof are conditions precedent to any Lender's
obligations to extend credit under the Credit Documents.
D. NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby conclusively acknowledged by the parties hereto,
the parties hereto agree as follows:
1. INTERPRETATION
The terms defined in the Credit Agreement shall have the same meaning when used
hereunder unless there be something in the subject or the context inconsistent
therewith or unless otherwise defined herein.
"OBLIGATIONS" means, collectively, (a) the "Obligations" as defined in the
Credit Agreement, and (b) all indebtedness, liabilities, and obligations of the
Grantor arising under the Pledge and Security Agreement, this Hypothec on Shares
or any guaranty assuring payment of the Obligations; it being the intention and
contemplation of the Grantor and the Collateral Agent that the Grantor may
guarantee (or otherwise become directly or contingently obligated with respect
to) the obligations of others to the Collateral Agent, that from time to time
overdrafts of the Grantor's accounts with the Collateral Agent may occur, and
that the Collateral Agent may from time to time acquire from others obligations
of the Grantor to such others, and that payment and repayment of all of the
foregoing are intended to and shall be part of the Obligations secured hereby.
The Obligations shall include, without limitation, future, as well as existing,
advances, indebtedness, liabilities, and obligations owed by the Grantor to the
Collateral Agent arising under the Credit Documents or otherwise.
1 EXHIBIT H-3
All representations, warranties and covenants of the Pledge and Security
Agreement not contained herein shall apply to this Hypothec on Shares, mutatis
mutandis, as if reproduced herein.
In the event of any inconsistency, contradiction or conflict between the
provisions hereof and the provisions of the Pledge and Security Agreement, the
provisions of the Pledge and Security Agreement shall prevail to the extent of
such inconsistency, contradiction or conflict.
2. DESCRIPTION OF THE CHARGED PROPERTY
The Grantor hypothecates, delivers and pledges, the whole in favour of the
Collateral Agent for its benefit and the benefit of the Lenders (the hypothec
hereby constituted being hereinafter referred to as the "HYPOTHEC"), all rights,
titles, and interests of the Grantor in and to all outstanding stock, equity, or
other investment securities owned by the Grantor, including without limitation,
all such stock, equity, or other investment securities set forth on EXHIBIT 1
(the "PLEDGED SHARES"); provided that (i) not more than 66% of the capital stock
or other ownership interest of the Grantor in any Foreign Subsidiary directly
held by Grantor, and (ii) no outstanding equity of any Foreign Subsidiary not
directly held by Grantor is, or is required to be, pledged to the Collateral
Agent under any provision hereof, and any capital stock or ownership interest
held by Collateral Agent in excess of 66% shall be held in trust for the benefit
of Grantor.
3. SECURED OBLIGATIONS
The Hypothec shall secure payment and performance of the Obligations.
The Hypothec further secures the payment of all sums due or to become due
pursuant to the present deed and the performance of all obligations provided for
under the present deed.
Any future obligation hereby secured shall be deemed to be one in respect of
which the Grantor has once again obligated itself hereunder according to the
provisions of Article 2797 of the Civil Code of Quebec.
4. AMOUNT OF THE HYPOTHEC
The amount for which the Hypothec is granted is a principal amount of
CDN$40,000,000, with an additional hypothec equal to 20% of the principal
amount, the whole plus interest thereon from the date hereof at the rate of 25%
per annum.
The rate of interest mentioned herein before is a notional interest rate only
and for the purposes of the creation of the hypothec only. The effective rate or
rates of interest payable by the Grantor shall be the rate or rates set forth in
the Credit Agreement and not the aforementioned rate.
5. RIGHTS OF COLLATERAL AGENT
5.1 The Grantor hereby expressly acknowledges and agrees that for the
purposes hereof, the Collateral Agent shall be the sole holder of
the Pledged Shares and hold same as the Collateral Agent, on behalf
and for the benefit of itself and the Lenders.
5.2 The Collateral Agent shall have all other rights granted to it under
the Pledge and Security Agreement, the Credit Agreement and the
Credit Documents.
2 EXHIBIT H-3
6. DELIVERY OF SHARES
The certificates representing the Pledged Shares endorsed in blank for transfer
or accompanied by stock powers of attorney satisfactory to the Collateral Agent
shall forthwith be delivered to and remain in the custody of the Collateral
Agent or its nominee. Delivery of the Pledged Shares shall be deemed to have
occurred simultaneously hereunder and under the Pledge and Security Agreement.
7. EVENT OF DEFAULT
An "Event of Default" shall have the same meaning as ascribed thereto under the
Security and Pledge Agreement, the Credit Agreement or under any Credit
Documents. Upon the occurrence of any Event of Default the Collateral Agent
shall have all the rights of a hypothecary creditor provided under Quebec law.
8. MISCELLANEOUS
8.1 The Hypothec on Shares is in addition to and not in substitution of
or in replacement for any other hypothec, pledge, security interest,
guarantee or other right held by or for the benefit of the
Collateral Agent.
8.2 This agreement shall be governed by the laws applicable in the
Province of Quebec and the federal laws of Canada applicable
therein.
8.3 This agreement shall be binding upon each of the Grantor, the
Collateral Agent and the Lenders, and their successors and assigns.
8.4 This agreement may be executed in any number of counterparts and all
such counterparts taken together shall be deemed to constitute one
and the same instrument.
8.5 The parties hereto expressly request and require that this agreement
and all deeds, documents or instruments supplemental or ancillary
hereto be drafted in English. Les parties aux presentes conviennent
et exigent que cette convention ainsi que tous les documents qui s'y
rattachent soient rediges en anglais.
SIGNED this - day of April, 2005.
TALEO CORPORATION
____________________________________________
Name:
Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING
GROUP, L.P.,
as Collateral Agent
Per: _______________________________________
Name:
Title:
3 EXHIBIT H-3
EXHIBIT 1
Pledged Shares
1. Six Hundred and Sixty (660) Class A Common Shares of ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇ Inc.,
(formerly Viasite Inc.).
1 EXHIBIT H-3
NOTE: Form Landlord/Operator Consent and Waiver for information purposes only.
Documents being individually negotiated with Company's landlords and hosting
partners.
EXHIBIT I
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P., AS AGENT
LANDLORD/OPERATOR CONSENT AND WAIVER
This [Landlord/Operator] Consent and Waiver ("CONSENT AND WAIVER") is
executed as of the ____ day of ____________, 2005, by [______________], a
[______________________] ("[LANDLORD/ OPERATOR]").
RECITALS:
A. [Landlord/Operator] and TALEO CORPORATION, a Delaware corporation
("LESSEE/CLIENT") have entered into the [lease/hosting agreement] (as renewed,
extended, amended, or substituted, the ["LEASE/HOSTING AGREEMENT"]) described in
EXHIBIT A attached hereto, covering certain premises (the "PREMISES") described
in the [Lease/Hosting Agreement].
B. [Landlord/Operator] understands that [Lessee/Client] has or will incur
certain indebtedness, obligations, and liabilities (collectively, as amended,
extended, renewed, and modified from time to time, the "INDEBTEDNESS") pursuant
to that certain Credit and Guaranty Agreement, dated as of April 25, 2005 (as
amended, modified, restated, supplemented, or refinanced from time to time, the
"CREDIT AGREEMENT") among Taleo Corporation, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Specialty Lending
Group, L.P., as Administrative Agent, Collateral Agent, Lead Arranger,
Syndication Agent, and Documentation Agent (in such capacities, "AGENT"), and
the Lenders named therein ("LENDERS"), which requires [Lessee/Client] to grant
to Agent, for and on behalf of the Lenders a security interest and first lien
(the "SECURITY INTEREST") in, among other things, all assets, including but not
limited to all present and future accounts, contract rights, general
intangibles, chattel paper, documents, instruments, inventory, investment
property, equipment, other goods, money, and deposit accounts, of
[Lessee/Client] now or in the future located at the Premises and all rights
under the [Lease/Hosting Agreement] (together with all cash and non-cash
proceeds thereof, the "COLLATERAL").
C. [Landlord/Operator] is willing to consent to the Security Interest to
secure the Indebtedness on the terms and conditions set forth herein.
AGREEMENTS:
In consideration of the foregoing, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
[Landlord/Operator] hereby certifies to and agrees with Agent, for and on behalf
of Lenders, as follows:
1. CONSENT TO GRANT. [Landlord/Operator] specifically consents to the
execution and delivery by [Lessee/Client] of any documents evidencing the
Security Interest (the "SECURITY DOCUMENTS").
2. CONSENT TO FORECLOSURE. In the event of foreclosure of the Security
Documents (by any means, including judicial foreclosure), [Landlord/Operator]
shall recognize Agent, for and on behalf of
1 EXHIBIT I
the Lenders, as the [Lessee/Client] for all purposes under the [Lease/Hosting
Agreement]. In such event, [Landlord/Operator] shall accept performance by Agent
in lieu of [Lessee/Client] in the [Lease/Hosting Agreement]. Additionally,
notwithstanding anything to the contrary or apparently to the contrary contained
in the [Lease/Hosting Agreement], [Lessee/Client] hereby consents to foreclosure
by Agent, for and on behalf of the Lenders, in the event of default under the
terms of the Security Documents, the Credit Agreement, or any other documents
executed in connection therewith (the "LOAN DOCUMENTS") and consents to the
assignment of the [Lease/Hosting Agreement] by Agent, subject to the [Landlord's
Operator's] consent which shall not be unreasonably withheld, if the Agent,
either by virtue of the enforcement of the Agent's rights under the Security
Documents, the Loan Documents, or otherwise, or in any capacity whatsoever,
becomes the owner of [Lessee's/Client's] interest under the [Lease/Hosting
Agreement]. The [Landlord/Operator] agrees to execute a memorandum or short form
of the [Lease/Hosting Agreement] in recordable form and in such form as is
reasonably required by the Agent and containing terms consistent with the terms
of the [Lease/Hosting Agreement] and this Consent and Waiver.
3. SUBORDINATION OF LIENS. All Liens, security interests, and other rights
to which [Landlord/Operator] might be entitled in the Collateral, whether
arising by operation of law or otherwise, whether now existing or hereafter to
arise, are subordinate and inferior in every respect to all of the terms,
provisions, and conditions of the Security Documents, the Credit Agreement, and
the Loan Documents, regardless of the order in which any liens, security
interests, and rights in the Collateral were or will be created, attached,
pledged, filed, recorded, registered, or perfected. Specifically, and not in
limitation of the foregoing, the security interest granted by [Lessee/Client] to
[Landlord/Operator] under Section __ of the [Lease/Hosting Agreement] is
subordinated to the Security Interest of the Agent in the Collateral for the
benefit of the Lenders under the Credit Agreement and Security Documents. Upon a
default or event of default under the [Lease/Hosting Agreement],
[Landlord/Operator] shall not exercise any rights or remedies or take any
enforcement action otherwise available to [Landlord/Operator] upon such default
with respect to the Collateral until (i) all of the obligations and indebtedness
of [Lessee/Client] to the Lenders under the Credit Agreement has been paid in
full, and (ii) all obligations of Lenders to make any revolving credit loans or
other extensions of credit to [Lessee/Client] under the Credit Agreement have
been terminated.
4. COLLATERAL NOT FIXTURES. The Collateral may be installed in or located
on the Premises and is not and shall not be deemed a fixture or part of the real
estate but shall at all times be considered personal property, notwithstanding
the manner of their annexation to the Premises, their adaptability to the uses
and purposes for which the Premises are used, and the intentions of the party
making the annexation.
5. ENTRY UPON PREMISES. Notwithstanding anything contained in the
[Lease/Hosting Agreement] to the contrary or apparently to the contrary, in the
event Agent, for and on behalf of the Lenders, forecloses the Security
Documents, or exercises any other right granted to it in connection with the
Security Documents, the Credit Agreement, or other Loan Documents, the Agent or
its representatives may enter upon the Premises upon three (3) days' prior
written notice to [Landlord/Operator] (provided that no prior notice will be
required if all or any material part of the Collateral is subject to imminent
harm or loss) for the purposes of inspecting, preserving, maintaining, taking
possession of, removing or disposing of the Collateral or taking possession of
the Premises in the exercise of its rights and remedies under the Security
Documents, the other Loan Documents, and may utilize the Premises for the
purposes expressed in the [Lease/Hosting Agreement]. In addition, the Agent or
its representatives may advertise and conduct a public or private auction on the
Premises. Any Collateral which is removed from the Premises by Agent in
accordance with the Security Documents shall be removed within a reasonable time
after the exercise of rights in the Collateral by Agent under the Security
Documents, and will in any event be removed within thirty (30) days after the
termination of the [Lease/Hosting Agreement].
2 EXHIBIT I
Provided that the use of the Premises is not in violation of the Permitted
Use set forth in the [Lease/Hosting Agreement], [Landlord/Operator] consents to
temporary occupancy of the Premises for a period of up to thirty (30) days by
Agent or its designee or a purchaser of all or a substantial portion of the
Collateral at or following a foreclosure, provided the obligations of
[Lessee/Client] under the [Lease/Hosting Agreement] are timely paid and
performed. [Landlord/Operator] agrees that following a foreclosure of the
Collateral by Agent, [Lessee's/Client's] failure to occupy the Premises shall
not, of itself, be a default under the [Lease/Hosting Agreement] during any time
that Agent or its designee (including any purchaser of all or a substantial
portion of the Collateral at or following a foreclosure) is in possession of the
Premises. Further, if Agent or its designee (including any purchaser of all or a
substantial portion of the Collateral at or following a foreclosure) shall
succeed to the interest of [Lessee/Client] under the [Lease/Hosting Agreement],
[Landlord/Operator] shall, at the option of the successor, recognize such
successor as the assignee of the [Lease/Hosting Agreement], provided (i) such
successor assumes in writing the obligations of [Lessee/Client] under the
[Lease/Hosting Agreement], to the extent such obligations first accrue from and
after the date such successor succeeds to the interest of [Lessee/Client] under
the [Lease/Hosting Agreement]; (ii) the creditworthiness of the successor is
reasonably comparable to or better than the creditworthiness of [Lessee/Client]
on the date hereof; and (iii) the number of persons regularly occupying the
Premises would not be materially greater than the number of persons the Premises
are designed to accommodate.
6. RIGHTS UPON DEFAULT. [Landlord/Operator] agrees to give Agent notice:
(a) of any default under the terms of the [Lease/Hosting Agreement],
concurrently with giving notice of such default to [Lessee/Client];
(b) of any legal action which the [Landlord/Operator] may commence to
evict the [Lessee/Client] from the Premises or to terminate or limit the
[Lessee's/Client's] right to use, possess, or lease the Premises, promptly upon
the commencement of any such action; or
(c) of any cancellation of the [Lease/Hosting Agreement], at least thirty
(30) days before such cancellation, stating the grounds for cancellation or
termination.
After receipt of any notice described in this SECTION 6, the Agent shall have
the right to remedy any default of the [Lessee/Client] under the [Lease/Hosting
Agreement], or to cause any default of the [Lessee/Client] under the
[Lease/Hosting Agreement] to be remedied, and for such purpose the
[Landlord/Operator] hereby grants Agent forty-five (45) days for remedying, or
causing to be remedied, any such default which is a non-monetary default, or
such longer period of time as may be needed to complete such remedying (provided
that the Agent has commenced to remedy such default within such forty-five (45)
days and continues diligent prosecution of such remedying), and twenty (20) days
for remedying, or causing to be remedied, any such default which is a monetary
default. The [Landlord/Operator] shall not exercise any remedies under the
[Lease/Hosting Agreement] or terminate the [Lease/Hosting Agreement] on account
of a default by the [Lessee/Client], until the applicable grace period described
in the foregoing sentence has expired. Any payment made or act done by Agent to
cure any such default shall not constitute any assumption of the [Lease/Hosting
Agreement] or any obligations of [Lessee/Client].
(d) All notices hereunder shall be by certified or registered mail, return
receipt requested, and shall be effective three (3) days after the same is
deposited in the United States mail and shall be addressed to the Agent as
follows: ▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P.; ▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.,
▇▇▇▇▇ ▇▇▇; ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇; Attention: ▇▇▇▇ ▇▇▇▇▇▇.
3 EXHIBIT I
7. STATUS OF [LEASE/HOSTING AGREEMENT]. [Landlord/Operator] hereby
represents that (i) the granting of the Security Interest by [Lessee/Client]
will not constitute an event of default under the [Lease/Hosting Agreement];
(ii) there are no events or conditions existing which, with or without notice or
through the lapse of time could constitute a monetary or other default of
[Lessee/Client] under the [Lease/Hosting Agreement]; (iii) the [Lease/Hosting
Agreement] is valid and in full force and effect and has not been modified,
supplemented, or amended; and (iv) all rents due and payable as of the date
hereof under the [Lease/Hosting Agreement] have been paid in full.
8. INDEMNIFICATION. As a condition to exercising any remedies referenced
in this Consent and Waiver, Agent and Lenders shall indemnify and hold harmless
[Landlord/Operator] and its mortgagees from any and all claims, demands,
liabilities, or expenses which may accrue or arise out of any wrongful or
negligent act by them in exercising any rights or remedies under the Security
Documents, the Credit Agreement, or the Loan Documents, any wrongful or
negligent act by the Agent or Lenders in exercising any action authorized
herein, or any damage to or use of the Premises by Agent or Lenders. No
provision, qualification, or limitation of this Consent and Waiver shall be
deemed to limit any right of indemnification otherwise available to the
[Landlord/Operator] or its lender.
9. COUNTERPARTS. This Consent and Waiver may be executed in any number of
counterparts, each of which, when so executed and delivered, shall be deemed to
be an original and all of which counterparts taken together shall constitute but
one and the same instrument. Signature and acknowledgment pages may be detached
from the counterparts and attached to a single copy of this Consent and Waiver
to physically form one document, which may be recorded.
10. GOVERNING LAW. THIS CONSENT AND WAIVER AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW
YORK GENERAL OBLIGATIONS LAW) THEREOF.
11. SUCCESSORS AND ASSIGNS. This Consent and Waiver inures to the benefit
of the Agent, on behalf of the Lenders, and binds the [Landlord/Operator], and
its respective successors, transferees, endorsees, and assigns.
[Landlord/Operator] agrees to give Agent notice of any change in ownership of
the Premises and the name and address of each new owner [and lessor] of the
Premises, at least fifteen (15) days before any such change in ownership.
12. ESTOPPEL CERTIFICATES. [Landlord/Operator] agrees that within ten (10)
days after written request by [Lessee/Client], [Landlord/Operator] will provide
an estoppel certificate setting forth (a) the name of the [Lessee/Client] under
the [Lease/Hosting Agreement], (b) that the [Lease/Hosting Agreement] has not
been modified or, if it has been modified, the date of each modification
(together with copies of each such modification), (c) the basic rent payable
under the [Lease/Hosting Agreement], (d) the date to which all rental charges
have been paid by the [Lessee/Client] under the [Lease/Hosting Agreement], and
(e) whether to the best of [Landlord's/Operator's] current actual knowledge
there are any alleged defaults of the [Lessee/Client] under the [Lease/Hosting
Agreement] and, if there are, setting forth the nature thereof in reasonable
detail.
13. WAIVER OF JURY TRIAL. THE PARTIES WAIVE ANY RIGHT TO TRIAL BY JURY IN
ANY ACTION OR PROCEEDING BASED ON OR PERTAINING TO THIS CONSENT AND WAIVER.
4 EXHIBIT I
14. [Landlord's/Operator's] current address for notices and payments under
the [Lease/Hosting Agreement] is as follows:
[______________]
[______________]
[______________]
[Landlord/Operator] understands that the Agent and the Lenders will rely on this
Consent and Waiver in making or continuing loans under the Credit Agreement.
[REMAINDER OF PAGE INTENTIONALLY BLANK;
SIGNATURE PAGES FOLLOW.]
5 EXHIBIT I
IN WITNESS WHEREOF, [Landlord/Operator] has executed this Consent and
Waiver as of the date first stated above.
[LANDLORD/OPERATOR]:
[____________________],
a [______________]
By:________________________
Name:
Title:
[LESSEE/CLIENT]:
TALEO CORPORATION,
a Delaware corporation
By:________________________
Name:
Title:
STATE OF [_________] Section
Section
COUNTY OF [______________] Section
Before me, a Notary Public, on this day personally appeared
______________________, known to me to be the person and officer whose name is
subscribed to the foregoing instrument and acknowledged to me that the same was
the act of [Landlord/Operator], a [______________________], and that s/he has
executed the same on behalf of said limited partnership for the purposes and
consideration therein expressed, and in the capacity therein stated.
Given under my hand and seal of office this ____ day of _______________,
2005.
______________________________________________
Notary Public in and for the State of [________]
(PERSONALIZED SEAL)
6 EXHIBIT I
STATE OF [_________] Section
Section
COUNTY OF [_________] Section
Before me, a Notary Public, on this day personally appeared
______________________, known to me to be the person and officer whose name is
subscribed to the foregoing instrument and acknowledged to me that the same was
the act of Taleo Corporation, a Delaware corporation and that s/he has executed
the same on behalf of said corporation for the purposes and consideration
therein expressed, and in the capacity therein stated.
Given under my hand and seal of office this ____ day of _______________,
2005.
______________________________________________
Notary Public in and for the State of [________]
(PERSONALIZED SEAL)
7 EXHIBIT I
ACKNOWLEDGED AND ACCEPTED:
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P.,
as Agent
By:___________________________
Name:
Title:
8 EXHIBIT I
NOTE: Form of Deposit Account Control Agreement for information purposes only.
Documents being individually negotiated with Company's banks.
EXHIBIT J
TO CREDIT AGREEMENT
BY AND AMONG
TALEO CORPORATION AND
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P., AS AGENT
DEPOSIT ACCOUNT CONTROL AGREEMENT
This Deposit Account Control Agreement (this "AGREEMENT"), is dated as of
April __, 2005, by and between TALEO CORPORATION (the "COMPANY"), ▇▇▇▇▇▇▇ ▇▇▇▇▇
SPECIALTY LENDING GROUP, L.P., as Collateral Agent for the Secured Parties (in
such capacity, "AGENT"), and ____________, in its capacity as a "bank" as
defined in Section 9-102 of the UCC (in such capacity, the "FINANCIAL
INSTITUTION"). Capitalized terms used but not otherwise defined herein shall
have the respective meanings ascribed to such terms in that certain Pledge and
Security Agreement, dated on or about the date hereof, by and among the Company,
the other Grantors party thereto and Agent (as amended, restated, supplemented
or otherwise modified from time to time, the "SECURITY AGREEMENT"). All
references herein to the "UCC" shall mean the Uniform Commercial Code as in
effect in the State of New York.
1. ESTABLISHMENT OF DEPOSIT ACCOUNT. The Financial Institution hereby
confirms and agrees that:
(a) The Financial Institution has established account number [IDENTIFY
ACCOUNT NUMBER] in the name "[IDENTIFY EXACT TITLE OF ACCOUNT]" (such account
and any successor account, the "DEPOSIT ACCOUNT") and the Financial Institution
shall not change the name or account number of the Deposit Account without the
prior written consent of Agent; and
(b) The Deposit Account is a "deposit account" within the meaning of
Section 9-102(a)(29) of the UCC.
2. CONTROL OF THE DEPOSIT ACCOUNT. If at any time the Financial
Institution shall receive any instructions originated by Agent directing the
disposition of funds with respect to the Deposit Account, the Financial
Institution shall comply with such instructions without further consent by the
Company or any other Person. Until such time as Agent notifies Financial
Institution otherwise in writing, Financial Institution shall comply with
instructions directing the disposition of funds with respect to the Deposit
Account originated by Company or its authorized representatives. In the event
that any instructions originated by Agent with respect to the Deposit Account
conflict with any instructions given by the Company or any other Person with
respect thereto, the instructions given by Agent shall control. The Financial
Institution hereby acknowledges that it has received notice of the security
interest of Agent, on behalf of the Secured Parties, in the Deposit Account and
hereby acknowledges and consents to such security interest.
3. SUBORDINATION OF LIEN; WAIVER OF SET-OFF. In the event that the
Financial Institution has or subsequently obtains, by agreement, by operation of
law or otherwise, a security interest in the Deposit Account or any funds
credited thereto, the Financial Institution hereby agrees that such security
interest shall be subordinate to the security interest of Agent, on behalf of
the Secured Parties. Money and other
1 EXHIBIT J
items credited to the Deposit Account will not be subject to deduction, set-off,
banker's lien or any other right in favor of any Person other than Agent (except
that the Financial Institution may set off: (a) all amounts due to the Financial
Institution in respect of customary fees and expenses for the routine
maintenance and operation of the Deposit Account, and (b) the face amount of any
checks which have been credited to such Deposit Account but are subsequently
returned unpaid because of uncollected or insufficient funds).
4. CHOICE OF LAW. This Agreement and the Deposit Account shall each be
governed by the laws of the State of New York. Regardless of any provision in
any other agreement, for purposes of the UCC, New York shall be deemed to be the
Financial Institution's jurisdiction (within the meaning of Section 9-304 of the
UCC) and the Deposit Account shall be governed by the laws of the State of New
York.
5. CONFLICT WITH OTHER AGREEMENTS.
(a) In the event of any conflict between the terms of this Agreement (or
any instructions hereunder) and the terms of any other agreement (or any
instructions thereunder), the terms of this Agreement shall prevail; and
(b) No amendment or modification of this Agreement or waiver of any right
hereunder shall be binding on any party hereto unless it is in writing and is
signed by all of the parties hereto; and
(c) The Financial Institution hereby confirms and agrees that:
(i) No agreement (other than this Agreement) has been entered into
between the Financial Institution and the Company with respect to the
Deposit Account; and
(ii) It has not entered into, and until the termination of this
Agreement, will not enter into, any agreement (other than this Agreement)
relating the Deposit Account and/or any funds credited thereto pursuant to
which it has agreed to comply with instructions originated by any Person
(other than Agent) as contemplated by Section 9-104 of the UCC.
6. ADVERSE CLAIMS. The Financial Institution does not know of any liens,
encumbrances or adverse claims relating to the Deposit Account. If any Person
asserts any lien, encumbrance or adverse claim (including any writ, garnishment,
judgment, warrant of attachment, execution or similar process) against the
Deposit Account, the Financial Institution will promptly notify Agent and the
Company thereof.
7. MAINTENANCE OF DEPOSIT ACCOUNT. In addition to, and not in lieu of, the
obligation of the Financial Institution to honor instructions from Agent as set
forth in Section 2 hereof, the Financial Institution agrees to maintain the
Deposit Account as follows:
(a) Statements and Confirmations. The Financial Institution will promptly
send copies of all statements, confirmations and other correspondence concerning
the Deposit Account simultaneously to each of the Company and Agent at the
address for each set forth in Section 11 of this Agreement; and
(b) Tax Reporting. All interest, if any, relating to the Deposit Account,
shall be reported to the Internal Revenue Service and all state and local taxing
authorities under the name and taxpayer identification number of the Company.
2 EXHIBIT J
8. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE FINANCIAL INSTITUTION.
The Financial Institution hereby makes the following representations, warranties
and covenants to and with Agent and the Company:
(a) The Deposit Account has been established as set forth in Section 1 and
the Deposit Account will be maintained in the manner set forth herein until
termination of this Agreement; and
(b) The Financial Institution shall not, during the term of this
Agreement, amend or otherwise modify either the account agreement, if any, or
its policies and procedures with respect to the Deposit Account in derogation of
Agent's rights hereunder without Agent's prior written consent; and
(c) This Agreement is the valid and legally binding obligation of the
Financial Institution.
9. INDEMNIFICATION OF FINANCIAL INSTITUTION. The Company and Agent hereby
agree that (a) the Financial Institution is released from any and all
liabilities to the Company and Agent arising from the terms of this Agreement
and the compliance by the Financial Institution with the terms hereof, except to
the extent that such liabilities arise from the Financial Institution's
negligence, willful misconduct or the breach of any of its obligations under
this Agreement, and (b) the Company, its successors and assigns shall at all
times indemnify and save harmless the Financial Institution from and against any
and all claims, actions and suits of other Persons arising out of the terms of
this Agreement or the compliance by the Financial Institution with the terms
hereof and from and against any and all liabilities, losses, damages, costs,
charges, counsel fees and other expenses of every nature and character arising
by reason of the same, until the termination of this Agreement, except to the
extent that any of the same arise from the Financial Institution's negligence,
willful misconduct or the breach of any of its obligations under this Agreement.
10. SUCCESSORS; ASSIGNMENT. The terms of this Agreement shall be binding
upon, and shall inure to the benefit of, the parties hereto and their respective
successors who obtain such rights solely by operation of law. Agent may assign
its rights hereunder only with the written consent of the Financial Institution
and by sending written notice of such assignment to the Company.
11. NOTICES. Any notice, request or other communication required or
permitted to be given under this Agreement shall be in writing and deemed to
have been properly given (a) when delivered in person, (b) when sent by telecopy
or other electronic means and electronic confirmation of error free receipt is
received, or (c) two (2) Business Days after being sent by certified or
registered United States mail, return receipt requested, postage prepaid,
addressed to the party at the address set forth below.
Company: TALEO CORPORATION
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Mr. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Chief Executive Officer and President
Telecopier:________________________________
Agent: ▇▇▇▇▇▇▇ Sachs Specialty Lending Group, L.P.
▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention:_________________________________
Telecopier:________________________________
3 EXHIBIT J
Financial Institution: ______________________________
______________________________
______________________________
Attention:____________________
Telecopier:___________________
Any party may change its address for notices in the manner set forth above.
12. TERMINATION. The Company covenants with Agent that the Company shall
not close or otherwise terminate the Deposit Account without Agent's prior
written consent. The obligations of the Financial Institution to Agent pursuant
to this Agreement shall continue in effect until the security interest of Agent
in the Deposit Account has been terminated pursuant to the terms of the Security
Agreement and Agent has notified the Financial Institution of such termination
in writing. Agent agrees to provide Notice of Termination in substantially the
form of EXHIBIT A hereto to the Financial Institution upon the request of the
Company on or after the termination of Agent's security interest in the Deposit
Account pursuant to the terms of the Security Agreement. The termination of this
Agreement shall not terminate the Deposit Account or alter the obligations of
the Financial Institution to the Company pursuant to any other agreement with
respect to the Deposit Account.
13. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY AGREES TO
WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING UNDER THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING
TO THE SUBJECT MATTER OF THIS AGREEMENT. THE SCOPE OF THIS WAIVER IS INTENDED TO
BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND
THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION (INCLUDING, WITHOUT
LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER
COMMON LAW AND STATUTORY CLAIMS). EACH PARTY HERETO ACKNOWLEDGES THAT (A) THIS
WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, (B) IT
HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND (C) IT
WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS. EACH PARTY
HERETO FURTHER REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS
LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF ANY LITIGATION, THIS
AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
14. COUNTERPARTS. This Agreement may be executed in multiple counterparts
(any of which may be delivered by facsimile signature), each of which shall
constitute an original and all of which taken together shall constitute one and
the same Agreement.
[REMAINDER OF PAGE INTENTIONALLY BLANK;
SIGNATURE PAGE FOLLOWS.]
4 EXHIBIT J
IN WITNESS WHEREOF, the Company, Agent and the Financial Institution have
caused this Agreement to be executed and delivered by their respective duly
authorized representatives as of the date first above written.
TALEO CORPORATION,
as Company
By:________________________________
Name:______________________________
Title:_____________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING
GROUP, L.P.,
as Agent
By:________________________________
Name:______________________________
Title:_____________________________
[NAME OF FINANCIAL INSTITUTION],
as Financial Institution
By:________________________________
Name:______________________________
Title:_____________________________
5 EXHIBIT J
Exhibit A
to Deposit Account Control Agreement
[LETTERHEAD OF AGENT]
[DATE]
[NAME AND ADDRESS OF FINANCIAL INSTITUTION]
_____________________________
_____________________________
Attention:___________________
Re: Termination of Deposit Account Control Agreement
You are hereby notified that the Deposit Account Control Agreement, dated
as of _______________________, 2005, by and among TALEO CORPORATION, you and the
undersigned (the "CONTROL AGREEMENT") is terminated and you have no further
obligations to the undersigned pursuant to the Control Agreement.
Notwithstanding any previous instructions given to you by the undersigned, you
are hereby instructed to accept all future directions with respect to the
Deposit Account (as defined in the Control Agreement) from TALEO CORPORATION.
This notice terminates any obligations you may have to the undersigned with
respect to the Deposit Account under the Control Agreement; provided, however,
that nothing contained in this notice shall alter any obligations which you may
otherwise owe to TALEO CORPORATION pursuant to any other agreement.
You are instructed to deliver a copy of this notice by facsimile
transmission to TALEO CORPORATION.
Very truly yours,
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING
GROUP, L.P., as Agent
By:_________________________________
Name:_______________________________
Title:______________________________
6 EXHIBIT J
FIRST AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AND GUARANTY AGREEMENT (this "AMENDMENT")
is entered into as of May 31, 2005, among TALEO CORPORATION, a Delaware
corporation ("COMPANY"), the Lenders party hereto from time to time, and ▇▇▇▇▇▇▇
▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P. ("GSSLG"), as Administrative Agent (in such
capacity, "ADMINISTRATIVE AGENT"), Collateral Agent (in such capacity,
"COLLATERAL AGENT"), Lead Arranger, Syndication Agent (in such capacity,
"SYNDICATION AGENT"), and Documentation Agent (in such capacity, "DOCUMENTATION
AGENT").
Reference is made to the Credit and Guaranty Agreement dated as of April
25, 2005 (the "CREDIT AGREEMENT") among Borrowers, Administrative Agent, the
Syndication Agent, the Documentation Agent, and the Lenders party thereto.
Unless otherwise defined in this Amendment, capitalized terms used herein shall
have the meaning set forth in the Credit Agreement; all Section and Schedule
references herein are to Sections and Schedules in the Credit Agreement; and all
Paragraph references herein are to Paragraphs in this Amendment.
RECITALS
A. Borrowers have requested that Administrative Agent and Lenders
extend the initial delivery date for the audited financial statements for up to
an additional 30 days.
B. Subject to the terms and conditions of this Amendment, the
Administrative Agent and the undersigned Lenders are willing to agree to such
amendment.
Accordingly, for adequate and sufficient consideration, the parties hereto
agree, as follows:
PARAGRAPH 1. AMENDMENT.
(a) In the first sentence of SECTION 5.1(A), the reference to "May 31,
2005" is amended to read "June 30, 2005, or such other date as the
Administrative Agent and Requisite Lenders shall agree to in writing.."
PARAGRAPH 2. EFFECTIVE DATE. Notwithstanding any contrary provision, this
Amendment is not effective until the date (the "EFFECTIVE DATE") the
Administrative Agent shall have received (A) counterparts of this Amendment,
executed by Administrative Agent, Company, and Lenders, and (B) a completed and
executed (i) Officer's Certificate in the form attached as EXHIBIT A-1, and (ii)
Incumbency Certificate in the form attached as EXHIBIT A-2.
PARAGRAPH 3. ACKNOWLEDGMENT AND RATIFICATION. As a material inducement to
the Administrative Agent and the Lenders to execute and deliver this Amendment,
Company (a) consents to the agreements in this Amendment and (b) agrees and
acknowledges that the execution, delivery, and performance of this Amendment
shall in no way release, diminish, impair, reduce, or otherwise affect the
respective obligations of the Company under the Credit Documents to which it is
a party, which Credit Documents shall remain in full force and effect, and all
guaranties and Rights thereunder are hereby ratified and confirmed.
FIRST AMENDMENT TO
CREDIT AND GUARANTY AGREEMENT
PARAGRAPH 4. REPRESENTATIONS. As a material inducement to the
Administrative Agent and the Lenders to execute and deliver this Amendment,
Company represents and warrants to the Administrative Agent and the Lenders that
as of the Effective Date of this Amendment and as of the date of execution of
this Amendment, (a) all representations and warranties in the Credit Documents
are true and correct in all material respects as though made on the date hereof,
except to the extent that any of them speak to a different specific date, and
(b) no Default or Event of Default exists.
PARAGRAPH 5. EXPENSES. Company shall be liable to pay all reasonable
costs, fees, and expenses paid or incurred by the Administrative Agent incident
to this Amendment, including, without limitation, the fees and expenses of the
Administrative Agent's counsel in connection with the negotiation, preparation,
delivery, and execution of this Amendment and any related documents.
PARAGRAPH 6. MISCELLANEOUS. This Amendment is a "Credit Document" referred
to in the Credit Agreement. The provisions relating to Credit Documents in
SECTION 10 of the Credit Agreement are incorporated in this Amendment by
reference. Unless stated otherwise (a) the singular number includes the plural
and vice versa and words of any gender include each other gender, in each case,
as appropriate, (b) headings and captions may not be construed in interpreting
provisions, (c) this Amendment must be construed, and its performance enforced,
under New York law, (d) if any part of this Amendment is for any reason found to
be unenforceable, all other portions of it nevertheless remain enforceable, and
(e) this Amendment may be executed in any number of counterparts with the same
effect as if all signatories had signed the same document, and all of those
counterparts must be construed together to constitute the same document.
PARAGRAPH 7. ENTIRE AGREEMENT. THIS AMENDMENT REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES ABOUT THE SUBJECT MATTER OF THIS AMENDMENT AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
PARAGRAPH 8. PARTIES. This Amendment binds and inures to the benefit of
Company, Administrative Agent, Syndication Agent, Documentation Agent, Lenders,
and their respective successors and assigns.
PARAGRAPH 9. FURTHER ASSURANCES. The parties hereto each agree to execute
from time to time such further documents as may be necessary to implement the
terms of this Agreement.
The parties hereto have executed this Amendment in multiple counterparts
to be effective as of the Effective Date.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGES TO FOLLOW.
FIRST AMENDMENT TO
CREDIT AND GUARANTY AGREEMENT
2
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
TALEO CORPORATION, a Delaware corporation
By: /s/ ▇▇▇▇▇▇ Sisodraker
------------------------
Name: ▇▇▇▇▇▇ Sisodraker
Title: CFO
SIGNATURE PAGE TO
FIRST AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP,
as Administrative Agent and Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING
HOLDINGS, INC., as a Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
SIGNATURE PAGE TO
FIRST AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
CONSENT OF GUARANTOR
To induce Lenders to enter into this Amendment, the undersigned (a)
consents and agrees to execution and delivery of the Amendment, (b) ratifies and
confirms that all guaranties, assurances, and Liens granted, conveyed, or
assigned to Lender under the Credit Documents are not released, diminished,
impaired, reduced, or otherwise adversely affected by this Amendment and
continue to guarantee, assure, and secure the full payment and performance of
all present and future Obligations, (c) that any liens and security interests in
any collateral created under the Credit Documents secure, among other
indebtedness, Borrower's obligations under the Credit Agreement, as amended by
the Amendment, (d) all liabilities and obligations guaranteed by the undersigned
pursuant to any guaranty executed by the undersigned include, without
limitation, the indebtedness evidenced by the Credit Agreement, as amended by
the Amendment, (e) agrees to perform such acts and duly authorize, execute,
acknowledge, deliver, file, and record such additional guaranties, assignments,
security agreements, deeds of trust, mortgages, and other agreements, documents,
instruments, and certificates as Administrative Agent may reasonably deem
necessary or appropriate in order to create, perfect, preserve, and protect
those guaranties, assurances, and Liens, (f) represents and warrants to
Administrative Agent and the Lenders that (i) the value of the consideration
received and to be received by the undersigned in respect of those guaranties,
assurances, and Liens are reasonably worth at least as much as the liability and
obligation of the undersigned thereunder, (ii) the liability and obligation may
reasonably be expected to directly or indirectly benefit the undersigned, and
(iii) the undersigned is and after giving effect to those guaranties,
assurances, Liens, and the Credit Documents, in light of all existing facts and
circumstances (including, without limitation, collateral for and other obligors
in respect of the Obligations and various components of it and various rights of
subrogation and contribution), will be solvent, and (g) waives notice of
acceptance of this consent and agreement, which consent and agreement binds the
undersigned and its successors and permitted assigns and inures to Lenders and
their successors and permitted assigns.
Executed effective as of May 31, 2005.
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC.
A California corporation
By:
--------------------------
Name:
Title:
SIGNATURE PAGE TO
FIRST AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
EXHIBIT A-1
OFFICER'S CERTIFICATE
EXHIBIT ▇-▇
▇▇▇▇▇▇▇ ▇-▇
INCUMBENCY CERTIFICATE
EXHIBIT A-2
SECOND AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AND GUARANTY AGREEMENT (this "AMENDMENT")
is entered into as of June 24, 2005, among TALEO CORPORATION, a Delaware
corporation ("COMPANY"), the Lenders party hereto from time to time, and ▇▇▇▇▇▇▇
▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P. ("GSSLG"), as Administrative Agent (in such
capacity, "ADMINISTRATIVE AGENT"), Collateral Agent (in such capacity,
"COLLATERAL AGENT"), Lead Arranger, Syndication Agent (in such capacity,
"SYNDICATION AGENT"), and Documentation Agent (in such capacity, "DOCUMENTATION
AGENT").
Reference is made to the Credit and Guaranty Agreement dated as of April
25, 2005 (the "CREDIT AGREEMENT") among Company, Administrative Agent, the
Syndication Agent, the Documentation Agent, and the Lenders party thereto.
Unless otherwise defined in this Amendment, capitalized terms used herein shall
have the meaning set forth in the Credit Agreement; all Section and Schedule
references herein are to Sections and Schedules in the Credit Agreement; and all
Paragraph references herein are to Paragraphs in this Amendment.
RECITALS
A. Company has requested that Administrative Agent and Lenders extend
the time to establish a cash management system.
B. Subject to the terms and conditions of this Amendment, the
Administrative Agent and the undersigned Lenders are willing to agree to such
amendment.
Accordingly, for adequate and sufficient consideration, the parties hereto
agree, as follows:
PARAGRAPH 1. AMENDMENT.
(a) In the first sentence of SECTION 3.3(A), the reference to "60
calendar days" is amended to read "105 calendar days, or such other date as the
Administrative Agent and Requisite Lenders shall agree to in writing."
PARAGRAPH 2. EFFECTIVE DATE. Notwithstanding any contrary provision, this
Amendment is not effective until the date (the "EFFECTIVE DATE") the
Administrative Agent shall have received counterparts of this Amendment,
executed by Administrative Agent, Company, and Lenders.
PARAGRAPH 3. ACKNOWLEDGMENT AND RATIFICATION. As a material inducement to
the Administrative Agent and the Lenders to execute and deliver this Amendment,
Company (a) consents to the agreements in this Amendment and (b) agrees and
acknowledges that the execution, delivery, and performance of this Amendment
shall in no way release, diminish, impair, reduce, or otherwise affect the
respective obligations of the Company under the Credit Documents to which it is
a party, which Credit Documents shall remain in full force and effect, and all
guaranties and Rights thereunder are hereby ratified and confirmed.
SECOND AMENDMENT TO
CREDIT AND GUARANTY AGREEMENT
PARAGRAPH 4. REPRESENTATIONS. As a material inducement to the
Administrative Agent and the Lenders to execute and deliver this Amendment,
Company represents and warrants to the Administrative Agent and the Lenders that
as of the Effective Date of this Amendment and as of the date of execution of
this Amendment, (a) all representations and warranties in the Credit Documents
are true and correct in all material respects as though made on the date hereof,
except to the extent that any of them speak to a different specific date, and
(b) no Default or Event of Default exists.
PARAGRAPH 5. EXPENSES. Company shall be liable to pay all reasonable
costs, fees, and expenses paid or incurred by the Administrative Agent incident
to this Amendment, including, without limitation, the fees and expenses of the
Administrative Agent's counsel in connection with the negotiation, preparation,
delivery, and execution of this Amendment and any related documents.
PARAGRAPH 6. MISCELLANEOUS. This Amendment is a "Credit Document" referred
to in the Credit Agreement. The provisions relating to Credit Documents in
SECTION 10 of the Credit Agreement are incorporated in this Amendment by
reference. Unless stated otherwise (a) the singular number includes the plural
and vice versa and words of any gender include each other gender, in each case,
as appropriate, (b) headings and captions may not be construed in interpreting
provisions, (c) this Amendment must be construed, and its performance enforced,
under New York law, (d) if any part of this Amendment is for any reason found to
be unenforceable, all other portions of it nevertheless remain enforceable, and
(e) this Amendment may be executed in any number of counterparts with the same
effect as if all signatories had signed the same document, and all of those
counterparts must be construed together to constitute the same document.
PARAGRAPH 7. ENTIRE AGREEMENT. THIS AMENDMENT REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES ABOUT THE SUBJECT MATTER OF THIS AMENDMENT AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
PARAGRAPH 8. PARTIES. This Amendment binds and inures to the benefit of
Company, Administrative Agent, Syndication Agent, Documentation Agent, Lenders,
and their respective successors and assigns.
PARAGRAPH 9. FURTHER ASSURANCES. The parties hereto each agree to execute
from time to time such further documents as may be necessary to implement the
terms of this Agreement.
The parties hereto have executed this Amendment in multiple counterparts
to be effective as of the Effective Date.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGES TO FOLLOW.
SECOND AMENDMENT TO
CREDIT AND GUARANTY AGREEMENT
2
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
TALEO CORPORATION, a Delaware corporation
By: /s/ ▇▇▇▇▇▇ Sisodraker
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. Sisodraker
Title: CFO
SIGNATURE PAGE TO
SECOND AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING GROUP, L.P.,
as Administrative Agent
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: ▇.▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING HOLDINGS,
INC., as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: V.P.
SIGNATURE PAGE TO
SECOND AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
CONSENT OF GUARANTOR
To induce Lenders to enter into this Amendment, the undersigned (a)
consents and agrees to execution and delivery of the Amendment, (b) ratifies and
confirms that all guaranties, assurances, and Liens granted, conveyed, or
assigned to Lender under the Credit Documents are not released, diminished,
impaired, reduced, or otherwise adversely affected by this Amendment and
continue to guarantee, assure, and secure the full payment and performance of
all present and future Obligations, (c) that any liens and security interests in
any collateral created under the Credit Documents secure, among other
indebtedness, Company's obligations under the Credit Agreement, as amended by
the Amendment, (d) all liabilities and obligations guaranteed by the undersigned
pursuant to any guaranty executed by the undersigned include, without
limitation, the indebtedness evidenced by the Credit Agreement, as amended by
the Amendment, (e) agrees to perform such acts and duly authorize, execute,
acknowledge, deliver, file, and record such additional guaranties, assignments,
security agreements, deeds of trust, mortgages, and other agreements, documents,
instruments, and certificates as Administrative Agent may reasonably deem
necessary or appropriate in order to create, perfect, preserve, and protect
those guaranties, assurances, and Liens, (f) represents and warrants to
Administrative Agent and the Lenders that (i) the value of the consideration
received and to be received by the undersigned in respect of those guaranties,
assurances, and Liens are reasonably worth at least as much as the liability and
obligation of the undersigned thereunder, (ii) the liability and obligation may
reasonably be expected to directly or indirectly benefit the undersigned, and
(iii) the undersigned is and after giving effect to those guaranties,
assurances, Liens, and the Credit Documents, in light of all existing facts and
circumstances (including, without limitation, collateral for and other obligors
in respect of the Obligations and various components of it and various rights of
subrogation and contribution), will be solvent, and (g) waives notice of
acceptance of this consent and agreement, which consent and agreement binds the
undersigned and its successors and permitted assigns and inures to Lenders and
their successors and permitted assigns.
Executed effective as of June 24, 2005.
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC.,
a California corporation, as Guarantor
By:
-----------------------------------------
Name:
Title:
SIGNATURE PAGE TO
SECOND AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
THIRD AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AND GUARANTY AGREEMENT (this "AMENDMENT")
is entered into as of June 30, 2005, among TALEO CORPORATION, a Delaware
corporation ("COMPANY"), the Lenders party hereto from time to time, and ▇▇▇▇▇▇▇
▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P. ("GSSLG"), as Administrative Agent (in such
capacity, "ADMINISTRATIVE AGENT"), Collateral Agent (in such capacity,
"COLLATERAL AGENT"), Lead Arranger, Syndication Agent (in such capacity,
"SYNDICATION AGENT"), and Documentation Agent (in such capacity, "DOCUMENTATION
AGENT").
Reference is made to the Credit and Guaranty Agreement dated as of April
25, 2005 (the "CREDIT AGREEMENT") among Company, Administrative Agent, the
Syndication Agent, the Documentation Agent, and the Lenders party thereto.
Unless otherwise defined in this Amendment, capitalized terms used herein shall
have the meaning set forth in the Credit Agreement; all Section and Schedule
references herein are to Sections and Schedules in the Credit Agreement; and all
Paragraph references herein are to Paragraphs in this Amendment.
RECITALS
A. Company has requested that Administrative Agent and Lenders extend
the time to deliver their audited financial statements.
B. Administrative Agent and Lenders will agree to Borrower's requested
extension to deliver its 2004 audited financial statements to Administrative
Agent and Lenders as required pursuant to SECTION 5.1(A) on or before July 31,
2005 (or such other date as Administrative Agent and Lenders agree to in
writing), in consideration for Borrower's acknowledgment that the Restricted
Cash Account will remain at its current level pending actual delivery of such
audited financials.
C. Subject to the terms and conditions of this Amendment, the
Administrative Agent and the undersigned Lenders are willing to agree to such
amendment.
Accordingly, for adequate and sufficient consideration, the parties hereto
agree, as follows:
PARAGRAPH 1. AMENDMENTS.
(a) In the first sentence of SECTION 5.1(a), the reference to "June 30,
2005" is amended to read "July 31, 2005."
(b) In SECTION 5.14(b), the clause following the proviso in the
paragraph immediately following the table is amended to read in its entirety as
follows:
provided, however, that no Cash shall be released from the Restricted Cash
Account in accordance with the step-downs referenced above in this SECTION
5.14(b) (A) until Company has delivered its 2004 audited financial
statements to Administrative Agent and Lenders as required pursuant to
SECTION 5.1(a), at which time the Cash on deposit in the Restricted Cash
Account shall be adjusted to correspond with the applicable period, and
(B) for the period commencing October 1, 2006 until Company has delivered
a Compliance Certificate evidencing compliance
THIRD AMENDMENT TO
CREDIT AND GUARANTY AGREEMENT
for the Fiscal Quarter ending September 30, 2006, and evidencing
compliance with the Minimum Consolidated Liquidity covenant set forth in
SECTION 6.8(e) for the period commencing October 1, 2006.
PARAGRAPH 2. EFFECTIVE DATE. Notwithstanding any contrary provision, this
Amendment is not effective until the date (the "EFFECTIVE DATE") the
Administrative Agent shall have received counterparts of this Amendment,
executed by Administrative Agent, Company, and Lenders.
PARAGRAPH 3. ACKNOWLEDGMENT AND RATIFICATION. As a material inducement to
the Administrative Agent and the Lenders to execute and deliver this Amendment,
Company (a) consents to the agreements in this Amendment and (b) agrees and
acknowledges that the execution, delivery, and performance of this Amendment
shall in no way release, diminish, impair, reduce, or otherwise affect the
respective obligations of the Company under the Credit Documents to which it is
a party, which Credit Documents shall remain in full force and effect, and all
guaranties and Rights thereunder are hereby ratified and confirmed.
PARAGRAPH 4. REPRESENTATIONS. As a material inducement to the
Administrative Agent and the Lenders to execute and deliver this Amendment,
Company represents and warrants to the Administrative Agent and the Lenders that
as of the Effective Date of this Amendment and as of the date of execution of
this Amendment, (a) all representations and warranties in the Credit Documents
are true and correct in all material respects as though made on the date hereof,
except to the extent that any of them speak to a different specific date, and
(b) no Default or Event of Default exists.
PARAGRAPH 5. EXPENSES. Company shall be liable to pay all reasonable
costs, fees, and expenses paid or incurred by the Administrative Agent incident
to this Amendment, including, without limitation, the fees and expenses of the
Administrative Agent's counsel in connection with the negotiation, preparation,
delivery, and execution of this Amendment and any related documents.
PARAGRAPH 6. MISCELLANEOUS. This Amendment is a "Credit Document" referred
to in the Credit Agreement. The provisions relating to Credit Documents in
SECTION 10 of the Credit Agreement are incorporated in this Amendment by
reference. Unless stated otherwise (a) the singular number includes the plural
and vice versa and words of any gender include each other gender, in each case,
as appropriate, (b) headings and captions may not be construed in interpreting
provisions, (c) this Amendment must be construed, and its performance enforced,
under New York law, (d) if any part of this Amendment is for any reason found to
be unenforceable, all other portions of it nevertheless remain enforceable, and
(e) this Amendment may be executed in any number of counterparts with the same
effect as if all signatories had signed the same document, and all of those
counterparts must be construed together to constitute the same document.
PARAGRAPH 7. ENTIRE AGREEMENT. THIS AMENDMENT REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES ABOUT THE SUBJECT MATTER OF THIS AMENDMENT AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
PARAGRAPH 8. PARTIES. This Amendment binds and inures to the benefit of
Company, Administrative Agent, Syndication Agent, Documentation Agent, Lenders,
and their respective successors and assigns.
THIRD AMENDMENT TO
CREDIT AND GUARANTY AGREEMENT
2
PARAGRAPH 9. FURTHER ASSURANCES. The parties hereto each agree to execute
from time to time such further documents as may be necessary to implement the
terms of this Agreement.
The parties hereto have executed this Amendment in multiple counterparts
to be effective as of the Effective Date.
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGES TO FOLLOW.
Third Amendment to
Credit and Guaranty Agreement
3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
TALEO CORPORATION, a Delaware corporation
By: /s/ ▇▇▇▇▇▇ Sisodraker
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Name: ▇▇▇▇▇▇ Sisodraker
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Title: CFO
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SIGNATURE PAGE TO
THIRD AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
▇▇▇▇▇▇▇ ▇▇▇▇▇ SPECIALTY LENDING GROUP, L.P.,
as Administrative Agent
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
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Title: V.P.
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▇▇▇▇▇▇▇ SACHS SPECIALTY LENDING HOLDINGS,
INC., as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
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Title: V.P.
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SIGNATURE PAGE TO
THIRD AMENDMENT TO CREDIT AND GUARANTY AGREEMENT
CONSENT OF GUARANTOR
To induce Lenders to enter into this Amendment, the undersigned (a)
consents and agrees to execution and delivery of the Amendment, (b) ratifies and
confirms that all guaranties, assurances, and Liens granted, conveyed, or
assigned to Lender under the Credit Documents are not released, diminished,
impaired, reduced, or otherwise adversely affected by this Amendment and
continue to guarantee, assure, and secure the full payment and performance of
all present and future Obligations, (c) that any liens and security interests in
any collateral created under the Credit Documents secure, among other
indebtedness, Company's obligations under the Credit Agreement, as amended by
the Amendment, (d) all liabilities and obligations guaranteed by the undersigned
pursuant to any guaranty executed by the undersigned include, without
limitation, the indebtedness evidenced by the Credit Agreement, as amended by
the Amendment, (e) agrees to perform such acts and duly authorize, execute,
acknowledge, deliver, file, and record such additional guaranties, assignments,
security agreements, deeds of trust, mortgages, and other agreements, documents,
instruments, and certificates as Administrative Agent may reasonably deem
necessary or appropriate in order to create, perfect, preserve, and protect
those guaranties, assurances, and Liens, (f) represents and warrants to
Administrative Agent and the Lenders that (i) the value of the consideration
received and to be received by the undersigned in respect of those guaranties,
assurances, and Liens are reasonably worth at least as much as the liability and
obligation of the undersigned thereunder, (ii) the liability and obligation may
reasonably be expected to directly or indirectly benefit the undersigned, and
(iii) the undersigned is and after giving effect to those guaranties,
assurances, Liens, and the Credit Documents, in light of all existing facts and
circumstances (including, without limitation, collateral for and other obligors
in respect of the Obligations and various components of it and various rights of
subrogation and contribution), will be solvent, and (g) waives notice of
acceptance of this consent and agreement, which consent and agreement binds the
undersigned and its successors and permitted assigns and inures to Lenders and
their successors and permitted assigns.
Executed effective as of June 30, 2005.
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC.,
a California corporation, as Guarantor
By:
-----------------------------------------
Name:
Title:
SIGNATURE PAGE TO
THIRD AMENDMENT TO CREDIT AND GUARANTY AGREEMENT