EXHIBIT 4.2
EXECUTION VERSION
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CREDIT AGREEMENT
Dated as of December 19, 2002
among
CAREER EDUCATION CORPORATION
a Delaware corporation,
as the Borrower,
BANK OF AMERICA, N.A.,
as
Administrative Agent, Swing Line Lender
and
an L/C Issuer,
LASALLE BANK NATIONAL ASSOCIATION
as a Co-Syndication Agent,
JPMORGAN CHASE BANK
as a Co-Syndication Agent,
SUNTRUST BANK
as Documentation Agent,
and
The Other Lenders Party Hereto
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BANC OF AMERICA SECURITIES LLC,
as
Sole Lead Arranger and Sole Book Manager
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[BANK OF AMERICA LOGO]
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TABLE OF CONTENTS
Section Page
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ARTICLE I DEFINITIONS AND ACCOUNTING TERMS................................................................1
1.01 Defined Terms...................................................................................1
1.02 Other Interpretive Provisions..................................................................22
1.03 Accounting Terms...............................................................................23
1.04 Rounding.......................................................................................23
1.05 References to Agreements and Laws..............................................................24
1.06 Times of Day...................................................................................24
1.07 Letter of Credit Amounts.......................................................................24
1.08 Exchange Rates; Currency Equivalents...........................................................24
1.09 Additional Alternative Currencies..............................................................24
1.10 Redenomination of Certain Alternative Currencies...............................................25
ARTICLE II THE COMMITMENTS AND CREDIT EXTENSIONS.........................................................25
2.01 Committed Loans................................................................................25
2.02 Borrowings, Conversions and Continuations of Committed Loans...................................25
2.03 Letters of Credit..............................................................................28
2.04 Swing Line Loans...............................................................................35
2.05 Prepayments....................................................................................38
2.06 Termination or Reduction of Commitments........................................................39
2.07 Repayment of Loans.............................................................................40
2.08 Interest.......................................................................................40
2.09 Fees...........................................................................................41
2.10 Computation of Interest and Fees...............................................................41
2.11 Evidence of Debt...............................................................................41
2.12 Payments Generally.............................................................................42
2.13 Sharing of Payments............................................................................44
2.14 Increase in Commitments........................................................................45
ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY.......................................................46
3.01 Taxes..........................................................................................46
3.02 Illegality.....................................................................................47
3.03 Inability to Determine Rates...................................................................47
3.04 Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurocurrency Rate Loans.......47
3.05 Funding Losses.................................................................................48
3.06 Matters Applicable to all Requests for Compensation............................................49
3.07 Survival.......................................................................................49
ARTICLE IV CONDITIONS PRECEDENT TO CREDIT EXTENSIONS.....................................................49
4.01 Conditions of Initial Credit Extension.........................................................49
4.02 Conditions to all Credit Extensions............................................................51
ARTICLE V REPRESENTATIONS AND WARRANTIES.................................................................52
5.01 Existence, Qualification and Power; Compliance with Laws.......................................52
5.02 Authorization; No Contravention................................................................52
5.03 Governmental Authorization; Other Consents.....................................................52
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5.04 Binding Effect.................................................................................52
5.05 Financial Statements; No Material Adverse Effect...............................................52
5.06 Litigation.....................................................................................53
5.07 No Default.....................................................................................53
5.08 Ownership of Property; Liens...................................................................53
5.09 Environmental Compliance.......................................................................54
5.10 Insurance......................................................................................54
5.11 Taxes..........................................................................................54
5.12 ERISA Compliance...............................................................................54
5.13 Subsidiaries...................................................................................55
5.14 Margin Regulations; Investment Company Act; Public Utility Holding Company Act.................55
5.15 Disclosure.....................................................................................55
5.16 Compliance with Laws...........................................................................56
5.17 Intellectual Property; Licenses, Etc...........................................................56
5.18 Title IV Compliance............................................................................56
ARTICLE VI AFFIRMATIVE COVENANTS.........................................................................57
6.01 Financial Statements...........................................................................58
6.02 Certificates; Other Information................................................................58
6.03 Notices. Promptly notify the Administrative Agent and each Lender:.............................59
6.04 Payment of Obligations.........................................................................60
6.05 Preservation of Existence, Etc.................................................................60
6.06 Maintenance of Properties......................................................................61
6.07 Maintenance of Insurance.......................................................................61
6.08 Compliance with Laws...........................................................................61
6.09 Books and Records..............................................................................61
6.10 Inspection Rights..............................................................................61
6.11 Use of Proceeds................................................................................61
6.12 Additional Guarantors..........................................................................61
6.13 Acquisitions...................................................................................62
6.14 Title IV Compliance............................................................................62
6.15 Post-Closing Deliveries........................................................................63
ARTICLE VII NEGATIVE COVENANTS...........................................................................64
7.01 Liens..........................................................................................64
7.02 Investments....................................................................................65
7.03 Indebtedness...................................................................................65
7.04 Fundamental Changes............................................................................66
7.05 Dispositions...................................................................................67
7.06 Restricted Payments............................................................................67
7.07 Change in Nature of Business...................................................................67
7.08 Transactions with Affiliates...................................................................68
7.09 Burdensome Agreements..........................................................................68
7.10 Use of Proceeds................................................................................68
7.11 Financial Covenants............................................................................68
ARTICLE VIII EVENTS OF DEFAULT AND REMEDIES..............................................................69
8.01 Events of Default..............................................................................69
8.02 Remedies Upon Event of Default.................................................................71
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8.03 Application of Funds...........................................................................72
ARTICLE IX ADMINISTRATIVE AGENT..........................................................................72
9.01 Appointment and Authorization of Administrative Agent..........................................72
9.02 Delegation of Duties...........................................................................73
9.03 Liability of Administrative Agent..............................................................73
9.04 Reliance by Administrative Agent...............................................................73
9.05 Notice of Default..............................................................................74
9.06 Credit Decision; Disclosure of Information by Administrative Agent.............................74
9.07 Indemnification of Administrative Agent........................................................75
9.08 Administrative Agent in its Individual Capacity................................................75
9.09 Successor Administrative Agent.................................................................76
9.10 Administrative Agent May File Proofs of Claim..................................................76
9.11 Guaranty Matters...............................................................................77
9.12 Other Agents; Arrangers and Managers...........................................................77
ARTICLE X MISCELLANEOUS..................................................................................78
10.01 Amendments, Etc.............................................................................78
10.02 Notices and Other Communications; Facsimile Copies..........................................79
10.03 No Waiver; Cumulative Remedies..............................................................80
10.04 Attorney Costs, Expenses and Taxes..........................................................80
10.05 Indemnification by the Borrower.............................................................81
10.06 Payments Set Aside..........................................................................81
10.07 Successors and Assigns......................................................................82
10.08 Confidentiality.............................................................................85
10.09 Set-off.....................................................................................85
10.10 Interest Rate Limitation....................................................................86
10.11 Counterparts................................................................................86
10.12 Integration.................................................................................86
10.13 Survival of Representations and Warranties..................................................86
10.14 Severability................................................................................87
10.15 Tax Forms...................................................................................87
10.16 Replacement of Lenders......................................................................89
10.17 Governing Law...............................................................................89
10.18 Waiver of Right to Trial by Jury............................................................90
10.19 Time of the Essence.........................................................................90
10.20 Judgment Currency...........................................................................90
10.21 Canadian Commitments........................................................................90
SIGNATURES..............................................................................................S-1
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SCHEDULES
1.01 Existing Letters of Credit
2.01 Commitments and Pro Rata Shares
5.05 Supplement to Interim Financial Statements
5.06 Litigation
5.09 Environmental Matters
5.12 ERISA Compliance
5.13 Subsidiaries and Other Equity Investments
5.17 Intellectual Property Matters
5.18(e) Title IV Compliance Disclosure
5.18(f) Cohort Default Rates
7.01 Existing Liens
7.03 Existing Indebtedness
10.02 Administrative Agent's Office, Certain Addresses for Notices
EXHIBITS
FORM OF
A Committed Loan Notice
B Swing Line Loan Notice
C Note
D Compliance Certificate
E Assignment and Assumption
F Guaranty
G Opinion Matters
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CREDIT AGREEMENT
This
CREDIT AGREEMENT ("Agreement") is entered into as of December 19,
2002, among
Career Education Corporation, a Delaware corporation (the
"BORROWER"), each lender from time to time party hereto (collectively, the
"LENDERS" and individually, a "LENDER"), LaSalle Bank National Association, as
an L/C Issuer and a Co-Syndication Agent, JPMorgan Chase Bank, as a
Co-Syndication Agent, SunTrust Bank, as Documentation Agent and Bank of America,
N.A., as Administrative Agent, Swing Line Lender and an L/C Issuer.
WITNESSETH:
WHEREAS, the Borrower has requested that the Lenders provide a revolving
credit facility, and the Lenders are willing to do so on the terms and
conditions set forth herein;
NOW THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto covenant and agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01 DEFINED TERMS. As used in this Agreement, the following terms shall
have the meanings set forth below:
"ACCREDITING BODY" means, with respect to any Educational Institution, any
entity or organization, whether governmental, government-chartered,
inter-governmental, private or quasi-private, which engages in granting or
withholding licensing, accreditation or similar approval for such Educational
Institution, in accordance with standards relating to the performance,
operation, financial condition and/or academic standing of private
post-secondary schools, including, as applicable, the those entities and
organizations approved pursuant to Part 602 of 34 C.F.R.
"ACQUISITION" means any transaction or series of related transactions for
the purpose of or resulting, directly or indirectly, in (a) the acquisition of
all or substantially all of the assets of a Person, or of any line or segment of
business or division of a Person, (b) the acquisition of in excess of 50% of the
capital stock, partnership interests, membership interests or equity of any
Person, or otherwise causing any Person to become a Subsidiary, or (c) a merger
or consolidation or any other combination with another Person (other than a
Person that is a Subsidiary) PROVIDED that (i) the Borrower or the Subsidiary is
the surviving entity or (ii) after giving effect to such merger or
consolidation, such other Person has become a Subsidiary of the Borrower;
PROVIDED, FURTHER that no acquisition described in clauses (a) or (b) above
shall constitute an Acquisition unless the total consideration (including cash,
assumed Indebtedness and equity) paid in respect thereof exceeds $1,000,000; and
PROVIDED FURTHER that in no event shall the formation or establishment of a
Subsidiary or the capitalization of or transfer to such Subsidiary of any
existing assets or business of the Borrower or any Subsidiary constitute an
Acquisition.
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"ADMINISTRATIVE AGENT" means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.
"ADMINISTRATIVE AGENT'S OFFICE" means, with respect to any currency, the
Administrative Agent's address and, as appropriate, account as set forth on
SCHEDULE 10.02 with respect to such currency, or such other address or account
with respect to such currency as the Administrative Agent may from time to time
notify the Borrower and the Lenders.
"ADMINISTRATIVE QUESTIONNAIRE" means an Administrative Questionnaire in a
form supplied by the Administrative Agent.
"AFFILIATE" means, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified. "CONTROL"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. "CONTROLLING" and
"CONTROLLED" have meanings correlative thereto. Without limiting the generality
of the foregoing, a Person shall be deemed to be Controlled by another Person if
such other Person possesses, directly or indirectly, power to vote 10% or more
of the securities having ordinary voting power for the election of directors,
managing general partners or the equivalent.
"AGENT-RELATED PERSONS" means the Administrative Agent, together with its
Affiliates (including, in the case of Bank of America in its capacity as the
Administrative Agent and the Arranger), and the officers, directors, employees,
agents and attorneys-in-fact of such Persons and Affiliates.
"AGGREGATE COMMITMENTS" means the Commitments of all the Lenders, which
shall not exceed $200,000,000 in the aggregate, subject to increases as provided
in SECTION 2.14 hereof.
"AGREEMENT" means this
Credit Agreement, as may be amended, amended and
restated, supplemented or otherwise modified from time to time.
"ALTERNATIVE CURRENCY" means each of Canadian Dollars, Euro, Sterling and
each other lawful currency (other than Dollars) that is freely available and
freely transferable and convertible into Dollars and which is approved by all
the Lenders in accordance with SECTION 1.09.
"ALTERNATIVE CURRENCY EQUIVALENT" means, at any time, with respect to any
amount denominated in Dollars, the equivalent amount thereof in the applicable
Alternative Currency as determined by the Administrative Agent at such time on
the basis of the Spot Rate (determined in respect of the most recent Revaluation
Date) for the purchases of such Alternative Currency with Dollars.
"ALTERNATIVE CURRENCY SUBLIMIT" means an amount equal to $50,000,000. The
Alternative Currency Sublimit is part of, and not in addition to, the Aggregate
Commitments.
"APPLICABLE CURRENCY" has the meaning specified in SECTION 3.02.
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"APPLICABLE RATE" means the following percentages per annum, based upon the
Consolidated Leverage Ratio as set forth in the most recent Compliance
Certificate received by the Administrative Agent pursuant to SECTION 6.02(b):
APPLICABLE RATE
Applicable Rate
for
Eurocurrency Applicable
Loans and Rate for
Pricing Consolidated Letters of Base Rate Commitment
Level Leverage Ratio Credit Loans Fee
------- ---------------------------- --------------- ---------- ----------
1 LESS THAN 0.5:1 0.750% 0.000% 0.200%
2 GREATER THAN OR EQUAL
TO 0.5:1 but LESS THAN 1.0:1 0.875% 0.000% 0.200%
3 GREATER THAN OR EQUAL
TO 1.0:1 but LESS THAN 1.5:1 1.000% 0.000% 0.250%
4 GREATER THAN OR EQUAL
TO 1.5:1 but LESS THAN 2.0 1.250% 0.250% 0.300%
5 GREATER THAN OR EQUAL
TO 2.0:1 1.500% 0.500% 0.350%
Any increase or decrease in the Applicable Rate resulting from a change in
the Consolidated Leverage Ratio shall become effective as of the first Business
Day following the date a Compliance Certificate is delivered pursuant to
SECTION 6.02(b); PROVIDED, HOWEVER, that if a Compliance Certificate is not
delivered when due in accordance with such Section, then Pricing Level 5 shall
apply as of the first Business Day after the date on which such Compliance
Certificate was required to have been delivered until the first Business Day
after the delivery of a Compliance Certificate demonstrating that a different
Pricing Level is required. The Applicable Rate in effect from the Closing Date
through a redetermination of the Applicable Rate in accordance with the
foregoing shall be determined based upon Pricing Level 2.
"APPLICABLE TIME" means with respect to any borrowings and payments in
Alternative Currencies, the local times in the place of settlement for such
Alternative Currencies as may be determined by the Administrative Agent to be
necessary for timely settlement on the relevant date in accordance with normal
banking procedures in the place of payment.
"ARRANGER" means Banc of America Securities LLC, in its capacity as sole
lead arranger and sole book manager.
"ASSIGNMENT AND ASSUMPTION" means an Assignment and Assumption
substantially in the form of EXHIBIT E.
"ATTORNEY COSTS" means and includes all reasonable fees, expenses and
disbursements of any law firm or other external counsel and, without
duplication, the reasonable allocated cost of internal legal services and all
reasonable expenses and disbursements of internal counsel.
"ATTRIBUTABLE INDEBTEDNESS" means, on any date, (a) in respect of any
capital lease of any Person, the capitalized amount thereof that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP,
and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of
the remaining lease payments under the relevant lease that
3
would appear on a balance sheet of such Person prepared as of such date in
accordance with GAAP if such lease were accounted for as a capital lease.
"AUDITED FINANCIAL STATEMENTS" means the audited consolidated balance sheet
of the Borrower and its Subsidiaries for the fiscal year ended December 31,
2001, and the related consolidated statements of income, shareholders' equity
and cash flows for such fiscal year of the Borrower and its Subsidiaries,
including the notes thereto.
"AVAILABILITY PERIOD" means the period from and including the Closing Date
to the earliest of (a) the Maturity Date, (b) the date of termination of the
Aggregate Commitments pursuant to SECTION 2.06, and (c) the date of termination
of the commitment of each Lender to make Loans and of the obligation of the of
the L/C Issuer to make L/C Credit Extensions pursuant to SECTION 8.02.
"BANC OF AMERICA SECURITIES" means Banc of America Securities LLC and its
successors.
"BANK OF AMERICA" means Bank of America, N.A. and its successors.
"BASE RATE" means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest
in effect for such day as publicly announced from time to time by Bank of
America as its "prime rate." The "prime rate" is a rate set by Bank of America
based upon various factors including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced
rate. Any change in such rate announced by Bank of America shall take effect at
the opening of business on the day specified in the public announcement of such
change.
"BASE RATE COMMITTED LOAN" means a Committed Loan that is a Base Rate Loan.
"BASE RATE LOAN" means a Loan that bears interest based on the Base Rate.
"BORROWER" has the meaning specified in the introductory paragraph hereto.
"BORROWING" means a Committed Borrowing or a Swing Line Borrowing, as the
context may require.
"BUSINESS DAY" means any day other than a Saturday, Sunday or other day on
which commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where the Administrative Agent's Office with respect to
Obligations denominated in Dollars is located and (a) if such day relates to any
Eurocurrency Rate Loan denominated in a currency other than Euro, means any such
day on which dealings in deposits in the relevant currency are conducted by and
between banks in the London or other applicable offshore interbank market for
such currency or (b) if such day relates to any Eurocurrency Rate Loan
denominated in Euro, means a TARGET Day.
"CANADIAN COMMITMENT" means, as to a Lender, its obligation to make loans
and purchase participations with respect to letters of credit under the Canadian
Facility Agreement.
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"CANADIAN DOLLAR" means the lawful currency of Canada.
"CANADIAN FACILITY AGREEMENT" means the
credit agreement among the
Borrower's Canadian Subsidiaries and certain lenders party thereto providing for
a revolving credit facility in the initial amount of the Dollar Equivalent of
$10,000,000.
"CASH COLLATERALIZE" has the meaning specified in SECTION 2.03(g).
"CHANGE OF CONTROL" means, with respect to any Person, an event or series
of events by which:
(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); or
during any period of 12 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 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 directors).
"CLOSING DATE" means the first date all the conditions precedent in
SECTION 4.01 are satisfied or waived in accordance with SECTION 4.01 (or, in the
case of SECTION 4.01(b), waived by the Person entitled to receive the applicable
payment).
"CODE" means the Internal Revenue Code of 1986.
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"COMMITMENT" means, as to each Lender, its obligation to (a) make Committed
Loans to the Borrower pursuant to SECTION 2.01, (b) purchase participations in
L/C Obligations, and (c) purchase participations in Swing Line Loans, in an
aggregate principal amount at any one time outstanding not to exceed the amount
set forth opposite such Lender's name on SCHEDULE 2.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable,
as such amount may be adjusted from time to time in accordance with this
Agreement.
"COMMITTED BORROWING" means a borrowing consisting of simultaneous
Committed Loans of the same Type, in the same currency and having the same
Interest Period made by each of the Lenders pursuant to SECTION 2.01.
"COMMITTED LOAN" has the meaning specified in SECTION 2.01.
"COMMITTED LOAN NOTICE" means a notice of (a) a Committed Borrowing, (b) a
conversion of Committed Loans from one Type to the other, or (c) a continuation
of Eurocurrency Rate Loans, pursuant to SECTION 2.02(a), which, if in writing,
shall be substantially in the form of Exhibit A.
"COMPLIANCE CERTIFICATE" means a certificate substantially in the form of
EXHIBIT D.
"CONSOLIDATED EBITDA" means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, an amount equal to Consolidated Net Income
for such period PLUS (a) the following to the extent deducted in calculating
such Consolidated Net Income: (i) Consolidated Interest Charges for such period,
(ii) the provision for federal, state, local and foreign income taxes payable by
the Borrower and its Subsidiaries for such period, (iii) the amount of
depreciation and amortization expense deducted in determining such Consolidated
Net Income (iv) all non-cash and nonrecurring charges and (v) extraordinary
charges, MINUS to the extent included in such Consolidated Net Income, all
nonrecurring and extraordinary gains for such period.
"CONSOLIDATED EBITDAR" means, for any period, an amount equal to
Consolidated EBITDA of the Borrower and its Subsidiaries plus, without
duplication, the consolidated rental expense of the Borrower and its
Subsidiaries (determined in accordance with GAAP and net of related sublease
income) for such period.
"CONSOLIDATED FIXED CHARGE COVERAGE RATIO" means, as of any date of
determination, the ratio of (a) the Consolidated EBITDAR for the period of the
four fiscal quarters most recently ended for which the Borrower has delivered
financial statements pursuant to SECTION 6.01(a), MINUS (i) Maintenance Capital
Expenditures, and (ii) all income tax expenses during such period to (b)
Consolidated Fixed Charges for such period.
"CONSOLIDATED FIXED CHARGES" means, for any period, for the Borrower and
its Subsidiaries on a consolidated basis, the sum of, without duplication, (a)
all Consolidated Interest Charges (excluding fees and expenses payable in
connection with the closing of the Loan Documents), (b) all principal repayments
of Indebtedness made that were scheduled or required
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to be made (other than payments made pursuant to SECTIONS 2.07 or 2.08 hereof)
and (c) all rental expense (determined in accordance with GAAP and net of all
related sublease rental income).
"CONSOLIDATED FUNDED INDEBTEDNESS" means, as of any date of determination,
for the Borrower and its Subsidiaries on a consolidated basis, the sum of (a)
the outstanding principal amount of all obligations, whether current or
long-term, for borrowed money (including Obligations hereunder) and all
obligations evidenced by bonds, debentures, notes, loan agreements or other
similar instruments, (b) all purchase money Indebtedness, (c) all direct
obligations arising under letters of credit (including standby and commercial),
bankers' acceptances, bank guaranties, surety bonds and similar instruments, (d)
all obligations in respect of the deferred purchase price of property or
services (other than trade accounts payable in the ordinary course of business),
(e) Attributable Indebtedness in respect of capital leases and Synthetic Lease
Obligations, (f) without duplication, all Guarantees with respect to outstanding
Indebtedness of the types specified in clauses (a) through (e) above of Persons
other than the Borrower or any Subsidiary, and (g) all Indebtedness of the types
referred to in clauses (a) through (f) above of any partnership or joint venture
(other than a joint venture that is itself a corporation or limited liability
company) in which the Borrower or a Subsidiary is a general partner or joint
venturer, unless such Indebtedness is expressly made non-recourse to the
Borrower or such Subsidiary.
"CONSOLIDATED INTEREST CHARGES" means, for any period, for the Borrower and
its Subsidiaries on a consolidated basis, the sum of (a) all interest, premium
payments, debt discount, fees, charges and related expenses of the Borrower and
its Subsidiaries in connection with borrowed money (including capitalized
interest) or in connection with the deferred purchase price of assets, in each
case to the extent treated as interest in accordance with GAAP, and (b) the
portion of rent expense of the Borrower and its Subsidiaries with respect to
such period under capital leases that is treated as interest in accordance with
GAAP.
"CONSOLIDATED LEVERAGE RATIO" means, as of any date of determination, the
ratio of (a) Consolidated Funded Indebtedness as of such date to (b) the
Consolidated EBITDA for the period of the four fiscal quarters most recently
ended for which the Borrower has delivered financial statements pursuant to
SECTION 6.01(a) or (b).
"CONSOLIDATED NET INCOME" means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, the net income of the Borrower and its
Subsidiaries, calculated in accordance with GAAP, for that period.
"CONSOLIDATED NET REVENUE" means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, the total net revenue of the Borrower and
its Subsidiaries, calculated in accordance with GAAP, for that period.
"CONSOLIDATED NET WORTH" means, as of any date of determination, for the
Borrower and its Subsidiaries on a consolidated basis, Shareholders' Equity of
the Borrower and its Subsidiaries on that date.
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"CONTRACTUAL OBLIGATION" means, as to any Person, any provision of any
security issued by such Person or of any material agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"CONTROL" has the meaning specified in the definition of "Affiliate."
"CREDIT EXTENSION" means each of the following: (a) a Borrowing and (b) an
L/C Credit Extension.
"DEBTOR RELIEF LAWS" means the Bankruptcy Code of the United States, and
all other liquidation, conservatorship, bankruptcy, assignment for the benefit
of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.
"DEFAULT" means any event or condition that constitutes an Event of Default
or that, with the giving of any notice, the passage of time, or both, would be
an Event of Default.
"DEFAULT RATE" means an interest rate equal to (a) in the case of
Eurocurrency Rate Loans, the sum of (i) the Eurocurrency Rate for such Loans,
PLUS (ii) the Applicable Rate applicable to such Loans, plus (iii) 2% per annum,
and (b) in the case of Base Rate Loans and for all other purposes, the sum of
(i) the Base Rate then in effect PLUS (ii) the Applicable Rate, if any,
applicable to Base Rate Loans PLUS (iii) 2% per annum.
"DEFAULTING LENDER" means any Lender that (a) has failed to fund any
portion of the Committed Loans, participations in L/C Obligations or
participations in Swing Line Loans required to be funded by it hereunder within
one Business Day of the date required to be funded by it hereunder, (b) has
otherwise failed to pay over to the Administrative Agent or any other Lender any
other amount required to be paid by it hereunder within one Business Day of the
date when due, unless the subject of a good faith dispute, or (c) has been
deemed insolvent or become the subject of a bankruptcy or insolvency proceeding.
"DISPOSITION" or "DISPOSE" means the sale, transfer, license, lease or
other disposition (including any sale and leaseback transaction) of any property
by any Person, including any sale, assignment, transfer or other disposal, with
or without recourse, of any notes or accounts receivable or any rights and
claims associated therewith.
"DOE" means the United States Department of Education and any successor
agency administering federal student financial assistance under Title IV.
"DOE RATIO" means the Borrower's composite score as of any fiscal year end,
as determined by the Secretary of the DOE pursuant to Section 668.172 of 34
C.F.R.
"DOLLAR" and "$" mean lawful money of the United States.
"DOLLAR EQUIVALENT" means, at any time, (a) with respect to any amount
denominated in Dollars, such amount, and (b) with respect to any amount
denominated in any Alternative
8
Currency, the equivalent amount thereof in Dollars as determined by the
Administrative Agent at such time on the basis of the Spot Rate (determined in
respect of the most recent Revaluation Date) for the purchase of Dollars with
such Alternative Currency.
"DOMESTIC SUBSIDIARY" means any Subsidiary that is organized under the laws
of any political subdivision of the United States.
"EDUCATIONAL INSTITUTION" shall mean each of the Subsidiaries of the
Borrower and any other Acquisition pursuant to a Permitted Acquisition, in each
case, which constitutes an Eligible Facility and satisfies clause (ii) of the
definition of Permitted Acquisitions.
"ELIGIBLE ASSIGNEE" has the meaning specified in SECTION 10.07(g).
"ELIGIBLE FACILITY" means a vocational or similar educational institution
or any institution involved in the offering of short-term or long-term
educational corporate seminar training.
"EMU" means the economic and monetary union in accordance with the Treaty
of Rome 1957, as amended by the Single ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, the Maastricht Treaty
of 1992 and the Amsterdam Treaty of 1998, as amended from time to time.
"EMU LEGISLATION" means the legislative measures of the European Council
for the introduction of, changeover to or operation of a single or unified
European currency (whether known, as the "euro" or otherwise).
"ENVIRONMENTAL LAWS" means any and all Federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including those related to
hazardous substances or wastes, air emissions and discharges to waste or public
systems.
ENVIRONMENTAL LIABILITY" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower, any other Loan Party or any of their
respective Subsidiaries directly or indirectly resulting from or based upon (a)
violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the release or threatened release of
any Hazardous Materials into the environment or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or imposed
with respect to any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA AFFILIATE" means any trade or business (whether or not incorporated)
under common control with the Borrower within the meaning of Section 414(b) or
(c) of the Code (and Sections 414(m) and (o) of the Code for purposes of
provisions relating to Section 412 of the Code).
9
"ERISA EVENT" means (a) an unwaived Reportable Event with respect to a
Pension Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which it was
a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a
cessation of operations that is treated as such a withdrawal under
Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the Borrower
or any ERISA Affiliate from a Multiemployer Plan or notification that a
Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to
terminate, the treatment of a Plan amendment as a termination under Sections
4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to
terminate a Pension Plan or Multiemployer Plan; (e) an event or condition which
constitutes grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Pension Plan or Multiemployer Plan;
or (f) the imposition of any liability under Title IV of ERISA, other than for
PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the
Borrower or any ERISA Affiliate.
"EURO" and "EUR" mean the lawful currency of the Participating Member
States introduced in accordance with the EMU Legislation.
"EUROCURRENCY RATE" means for any Interest Period with respect to any
Eurocurrency Rate Loan:
(a) the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate that appears on the page of the
Telerate screen (or any successor thereto) that displays an average British
Bankers Association Interest Settlement Rate for deposits in the relevant
currency (for delivery on the first day of such Interest Period) with a
term equivalent to such Interest Period, determined as of approximately
11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period, or
(b) if the rate referenced in the preceding clause (a) does not appear
on such page or service or such page or service shall not be available, the
rate per annum equal to the rate determined by the Administrative Agent to
be the offered rate on such other page or other service that displays an
average British Bankers Association Interest Settlement Rate for deposits
in the relevant currency (for delivery on the first day of such Interest
Period) with a term equivalent to such Interest Period, determined as of
approximately 11:00 a.m. (London time) two Business Days prior to the first
day of such Interest Period, or
(c) if the rates referenced in the preceding clauses (a) and (b) are
not available, the rate per annum determined by the Administrative Agent as
the rate of interest at which deposits in the relevant currency for
delivery on the first day of such Interest Period in same day funds in the
approximate amount of the Eurocurrency Rate Loan being made, continued or
converted by Bank of America and with a term equivalent to such Interest
Period would be offered by Bank of America's London Branch to major banks
in the offshore interbank market for such currency at their request at
approximately 11:00 a.m. (London time) two Business Days prior to the first
day of such Interest Period.
"EUROCURRENCY RATE LOAN" means a Committed Loan that bears interest at a
rate based on the Eurocurrency Rate. Eurocurrency Rate Loans may be denominated
in Dollars or in an
10
Alternative Currency. All Loans denominated in an Alternative Currency must be
Eurocurrency Rate Loans.
"EVENT OF DEFAULT" has the meaning specified in SECTION 8.01.
"EXISTING
CREDIT AGREEMENT" means that certain Amended and Restated
Credit
Agreement, dated as of October 26, 1998 among the Borrower, the Co-Borrowers
named therein, LaSalle Bank National Association, as administrative agent, The
Bank of Nova Scotia, as foreign currency agent, and a syndicate of lenders, as
amended by that certain Amendment No. 1 and Consent to Amended and Restated
Credit Agreement, dated as of February 24, 1999 and that certain Amendment No. 2
to Amended and Restated
Credit Agreement, dated as of March 31, 1999.
"EXISTING LETTERS OF CREDIT" means those letters of credit specified on
SCHEDULE 1.01.
"FEDERAL FUNDS RATE" means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank on the Business Day next
succeeding such day; PROVIDED that (a) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day,
and (b) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate (rounded upward,
if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on
such day on such transactions as determined by the Administrative Agent.
"FEE LETTER" means the letter agreement, dated October 29, 2002, among the
Borrower, the Administrative Agent and the Arranger.
"FISCAL YEAR" means any period of twelve consecutive calendar months ending
on December 31; references to a Fiscal Year with a number corresponding to any
calendar year (e.g., the "2001 Fiscal Year") refer to the Fiscal Year ending on
the December 31 occurring during such calendar year.
"FOREIGN LENDER" has the meaning specified in SECTION 10.15(a)(i).
"FRB" means the Board of Governors of the Federal Reserve System of the
United States.
"GAAP" means generally accepted accounting principles in the United States
set forth in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.
11
"GOVERNMENTAL AUTHORITY" means any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
"GUARANTORS" means, collectively, each Domestic Subsidiary of the Borrower,
whether now existing or hereafter arising.
"GUARANTY" means the Guaranty and Subordination Agreement made by the
Guarantors in favor of the Administrative Agent on behalf of the Lenders,
substantially in the form of EXHIBIT F.
"GUARANTEE" means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect, (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person. The amount of any Guarantee shall be
deemed to be an amount equal to the stated or determinable amount of the related
primary obligation, or portion thereof, in respect of which such Guarantee is
made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof as determined by the guaranteeing Person in good
faith. The term "Guarantee" as a verb has a corresponding meaning.
"HAZARDOUS MATERIALS" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos-containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"HONOR DATE" has the meaning specified in SECTION 2.03(c)(i).
"INCREASE EFFECTIVE DATE" has the meaning specified in SECTION 2.14(b).
"INDEBTEDNESS" means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:
12
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments;
(b) all direct or contingent obligations of such Person arising under
letters of credit (including standby and commercial), bankers' acceptances,
bank guaranties, surety bonds and similar instruments;
(c) net obligations of such Person under any Swap Contract;
(d) all obligations of such Person to pay the deferred purchase price
of property or services (other than trade accounts payable in the ordinary
course of business and, except for those being contested in good faith, not
past due for more than 90 days after the due date on which each such trade
payable or account payable was created);
(e) indebtedness (excluding prepaid interest thereon) secured by a Lien
on property owned or being purchased by such Person (including indebtedness
arising under conditional sales or other title retention agreements),
whether or not such indebtedness shall have been assumed by such Person or
is limited in recourse;
(f) capital leases and Synthetic Lease Obligations;
(g) all obligations of such Person to purchase, redeem, retire, defease
or otherwise make any payment in respect of any equity interests in such
Person or any other Person or any warrants, rights or options to acquire
such equity interests, valued in the case of redeemable preferred
interests, at the greater of its voluntary or involuntary liquidation
preference plus accrued and unpaid dividends; and
(h) all Guarantees of such Person in respect of any of the foregoing.
For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer, unless such Indebtedness is expressly
made non-recourse to such Person. The amount of any net obligation under any
Swap Contract on any date shall be deemed to be the Swap Termination Value
thereof as of such date. The amount of any capital lease or Synthetic Lease
Obligation as of any date shall be deemed to be the amount of Attributable
Indebtedness in respect thereof as of such date.
"INDEMNIFIED LIABILITIES" has the meaning specified in Section 10.05.
"INDEMNITEES" has the meaning specified in Section 10.05.
"INFORMATION" has the meaning specified in Section 10.08.
"INTEREST PAYMENT DATE" means, (a) as to any Loan other than a Base Rate
Loan, the last day of each Interest Period applicable to such Loan and the
Maturity Date; PROVIDED, HOWEVER, that if any Interest Period for a Eurocurrency
Rate Loan exceeds three months, the respective
13
dates that fall every three months after the beginning of such Interest Period
shall also be Interest Payment Dates; and (b) as to any Base Rate Loan
(including a Swing Line Loan), the last Business Day of each March, June,
September and December and the Maturity Date.
"INTEREST PERIOD" means, as to each Eurocurrency Rate Loan, the period
commencing on the date such Eurocurrency Rate Loan is disbursed or converted to
or continued as a Eurocurrency Rate Loan and ending on the date one, two, three
or six months thereafter, as selected by the Borrower in its Committed Loan
Notice; PROVIDED that:
(i) any Interest Period that would otherwise end on a day that is not a
Business Day shall be extended to the next succeeding Business Day unless,
in the case of a Eurocurrency Rate Loan, such Business Day falls in another
calendar month, in which case such Interest Period shall end on the next
preceding Business Day;
(ii) any Interest Period pertaining to a Eurocurrency Rate Loan that
begins on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end
of such Interest Period) shall end on the last Business Day of the calendar
month at the end of such Interest Period; and
(iii) no Interest Period shall extend beyond the Maturity Date.
"INVESTMENT" means, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other
acquisition of capital stock or other securities of another Person, (b) a loan,
advance or capital contribution to, Guarantee or assumption of debt of, or
purchase or other acquisition of any other debt or equity participation or
interest in, another Person, including any partnership or joint venture interest
in such other Person or (c) the purchase or other acquisition (in one
transaction or a series of transactions) of assets of another Person that
constitute a business unit. For purposes of covenant compliance, the amount of
any Investment shall be the amount actually invested, without adjustment for
subsequent increases or decreases in the value of such Investment.
"IP RIGHTS" has the meaning set forth in SECTION 5.17.
"IRS" means the United States Internal Revenue Service.
"LAWS" means, collectively, all international, foreign, Federal, state and
local statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
"L/C ADVANCE" means, with respect to each Lender, such Lender's funding of
its participation in any L/C Borrowing in accordance with its Pro Rata Share.
14
"L/C BORROWING" means an extension of credit resulting from a drawing under
any Letter of Credit which has not been reimbursed by the Borrower on the Honor
Date or refinanced as a Committed Borrowing.
"L/C CREDIT EXTENSION" means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the renewal or
increase of the amount thereof.
"L/C ISSUER" means Bank of America in its capacity as issuer of Letters of
Credit hereunder, or any successor issuer of Letters of Credit hereunder and
LaSalle Bank National Association in its capacity as issuer of the Existing
Letters of Credit.
"L/C OBLIGATIONS" means, as at any date of determination, the aggregate
undrawn amount of all outstanding Letters of Credit PLUS the aggregate of all
Unreimbursed Amounts, including all L/C Borrowings.
"LENDER" has the meaning specified in the introductory paragraph hereto
and, as the context requires, includes each Lender with a commitment to make
Committed Loans as designated in Section 2.01 or in an Assignment and Assumption
Agreement or a joinder pursuant to which such Lender becomes a party hereto, the
L/C Issuer and the Swing Line Lender.
"LENDING OFFICE" means, as to any Lender, the office or offices of such
Lender described as such in such Lender's Administrative Questionnaire, or such
other office or offices as a Lender may from time to time notify the Borrower
and the Administrative Agent.
"LETTER OF CREDIT" means any standby letter of credit issued hereunder and
Existing Letters of Credit.
"LETTER OF CREDIT APPLICATION" means an application and agreement for the
issuance or amendment of a Letter of Credit in the form from time to time in use
by the L/C Issuer.
"LETTER OF CREDIT EXPIRATION DATE" means the day that is seven days prior
to the Maturity Date (or, if such day is not a Business Day, the next preceding
Business Day).
"LETTER OF CREDIT SUBLIMIT" means an amount equal to the lesser of (a)
$100,000,000 and (b) the unused amount of the Aggregate Commitments at such
time. The Letter of Credit Sublimit is part of, and not in addition to, the
Aggregate Commitments.
"LIEN" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement of any kind or
nature whatsoever (including any conditional sale or other title retention
agreement, and any financing lease having substantially the same economic effect
as any of the foregoing).
"LOAN" means an extension of credit by a Lender to the Borrower under
ARTICLE II in the form of a Committed Loan or a Swing Line Loan.
"LOAN DOCUMENTS" means this Agreement, each Note, the Fee Letter and the
Guaranty.
15
"LOAN PARTIES" means, collectively, the Borrower and each Guarantor.
"MAINTENANCE CAPITAL EXPENDITURES" means an amount equal to 5% of
Borrower's Consolidated Net Revenue for the applicable trailing four quarter
period.
"MATERIAL ADVERSE EFFECT" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, liabilities
(actual or contingent), condition (financial or otherwise) or prospects of the
Borrower or the Borrower and its Subsidiaries taken as a whole; (b) a material
impairment of the ability of the Loan Parties, taken as a whole, to perform
their obligations under the Loan Documents; or (c) a material adverse effect
upon the legality, validity, binding effect or enforceability against any Loan
Party of any Loan Document to which it is a party.
"MATURITY DATE" means December 19, 2007.
"MULTIEMPLOYER PLAN" means any employee benefit plan of the type described
in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate
makes or is obligated to make contributions, or during the preceding five plan
years, has made or been obligated to make contributions.
"NONRENEWAL NOTICE DATE" has the meaning specified in SECTION 2.03(b).
"NOTE" means a promissory note made by the Borrower in favor of a Lender
evidencing Loans made by such Lender, substantially in the form of EXHIBIT C.
"OBLIGATIONS" means all advances to, and debts, liabilities, obligations,
covenants and duties of, any Loan Party arising under any Loan Document
(including any Swap Contract entered into after the date of this Agreement to
which a Lender or an Affiliate of a Lender is a party) or otherwise with respect
to any Loan or Letter of Credit, whether direct or indirect (including those
acquired by assumption), absolute or contingent, due or to become due, now
existing or hereafter arising and including interest and fees that accrue after
the commencement by or against any Loan Party or any Affiliate thereof of any
proceeding under any Debtor Relief Laws naming such Person as the debtor in such
proceeding, regardless of whether such interest and fees are allowed claims in
such proceeding. Without limiting the generality of the foregoing, the
Obligations of any Loan Party under the Loan Documents include (a) the
obligation to pay principal, interest, Letter of Credit commissions, charges,
expenses, fees, Attorney Costs and disbursements, indemnities and other amounts
payable by any Loan Party under any Loan Document and (b) the obligations of the
Borrower to reimburse any amount in respect of any of the foregoing that any
Lender, in its sole discretion, may elect to pay or advance on behalf of the
Borrower.
"ORGANIZATION DOCUMENTS" means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement,
16
instrument, filing or notice with respect thereto filed in connection with its
formation or organization with the applicable Governmental Authority in the
jurisdiction of its formation or organization and, if applicable, any
certificate or articles of formation or organization of such entity.
"OTHER TAXES" has the meaning specified in Section 3.01(b).
"OUTSTANDING AMOUNT" means (i) with respect to Committed Loans and Swing
Line Loans on any date, the aggregate outstanding principal Dollar Equivalent
amount thereof after giving effect to any borrowings and prepayments or
repayments of Committed Loans and Swing Line Loans, as the case may be,
occurring on such date; and (ii) with respect to any L/C Obligations on any
date, the Dollar Equivalent amount of such L/C Obligations on such date after
giving effect to any L/C Credit Extension occurring on such date and any other
changes in the aggregate amount of the L/C Obligations as of such date,
including as a result of any reimbursements of outstanding unpaid drawings under
any Letters of Credit or any reductions in the maximum amount available for
drawing under Letters of Credit taking effect on such date.
"OVERNIGHT RATE" means, for any day, (a) with respect to any amount
denominated in Dollars, the Federal Funds Rate and (b) with respect to any
amount denominated in an Alternative Currency, the rate of interest per annum at
which overnight deposits in the applicable Alternative Currency, in an amount
approximately equal to the amount with respect to which such rate is being
determined, would be offered for such day by a branch or Affiliate of Bank of
America located in the applicable interbank market for such currency to major
banks in such interbank market.
"PARTICIPANT" has the meaning specified in SECTION 10.07(d).
"PARTICIPATING MEMBER STATE" means each state so described in any EMU
Legislation.
"PBGC" means the Pension Benefit Guaranty Corporation.
"PENSION PLAN" means any "employee pension benefit plan" (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer or
other plan described in Section 4064(a) of ERISA, has made contributions at any
time during the immediately preceding five plan years.
"PERMITTED ACQUISITIONS" means Acquisitions by the Borrower or any of its
Subsidiaries of Persons and/ or assets where no Default or Event of Default
exists either before or after the proposed Permitted Acquisition and that meet
each of the following criteria:
(i) the Persons or assets to be acquired are in (or used in) a
business substantially related or incidental to those lines of business
conducted by the Borrower and its Subsidiaries and the prior, effective written
consent or approval of such Acquisition of the board of directors or equivalent
governing body, or the stockholders, as appropriate, of the other party
17
or parties has been obtained, would not be perceived by the Person or assets to
be acquired as hostile in nature;
(ii) any Acquisitions where, if the total consideration exceeds
$25,000,000, the target is an accredited, Title IV eligible institution, if
applicable, and is in good standing with all applicable accrediting agencies, it
being understood that, for purposes hereof, the failure to be in good standing
means the target shall have received an order, notice or other decision from a
state that has given such college authority to provide postsecondary education
in that state that such college's authority to provide postsecondary education
is or will be withdrawn, revoked or terminated;
(iii) any individual Acquisition where the total cash
consideration (including assumed Indebtedness, if any) does not exceed
$50,000,000;
(iv) all Acquisitions during the preceding four consecutive
fiscal quarters where the total cash consideration (including assumed
Indebtedness) paid is less than the Borrower's Consolidated EBITDA for the
preceding four consecutive fiscal quarters; and
(v) all Acquisitions during the preceding four consecutive
fiscal quarters where the total consideration (including equity) paid is less
than 1.5 times the Borrower's Consolidated EBITDA for the preceding four
consecutive fiscal quarters.
"PERMITTED TREASURY STOCK REPURCHASE" means, for each fiscal year, the
amount of Restricted Payments made by the Borrower during such period in respect
of purchases, redemptions or other acquisitions of shares of its common stock,
other common equity interests or warrants or options to acquire any such shares
(other than any such purchase, redemption or acquisition made with the proceeds
received from the substantially concurrent issue of new shares of its common
stock or other common equity interests); PROVIDED, that the amount expended for
such purchases (i) shall not exceed $50,000,000 in any fiscal year; PROVIDED,
that if the amount expended for such purchases does not equal $50,000,000 in any
fiscal year, the unused amount in each fiscal year shall be available for use in
the next fiscal year only, and (ii) would not otherwise cause a Default.
"PERSON" means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.
"PLAN" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or, with respect to any such
plan that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA
Affiliate.
"PRO RATA SHARE" means, with respect to each Lender at any time, a fraction
(expressed as a percentage, carried out to the ninth decimal place), the
numerator of which is the amount of the Commitment of such Lender at such time
and the denominator of which is the amount of the Aggregate Commitments at such
time; PROVIDED that if the commitment of each Lender to make Loans and the
obligation of the L/C Issuer to make L/C Credit Extensions have been terminated
pursuant to SECTION 8.02, then the Pro Rata Share of each Lender shall be
determined based on the Pro Rata Share of such Lender immediately prior to such
termination and after giving effect
18
to any subsequent assignments made pursuant to the terms hereof. The initial Pro
Rata Share of each Lender is set forth opposite the name of such Lender on
SCHEDULE 2.01 or in the Assignment and Assumption pursuant to which such Lender
becomes a party hereto, as applicable.
"REGISTER" has the meaning specified in SECTION 10.07(c).
"REPORTABLE EVENT" means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the 30 day notice period has been waived.
"REQUEST FOR CREDIT EXTENSION" means (a) with respect to a Borrowing,
conversion or continuation of Committed Loans, a Committed Loan Notice, (b) with
respect to an L/C Credit Extension, a Letter of Credit Application, and (c) with
respect to a Swing Line Loan, a Swing Line Loan Notice.
"REQUIRED LENDERS" means, as of any date of determination, Lenders having
more than 50% of the sum of (a) the Aggregate Commitments plus (b) the Dollar
Equivalent of Canadian Commitments of the Lenders or, if the commitment of each
Lender to make Loans and the obligation of the L/C Issuer to make L/C Credit
Extensions have been terminated pursuant to SECTION 8.02 or otherwise, Lenders
holding in the aggregate more than 50% of the sum of (a) the Total Outstandings
(with the aggregate amount of each Lender's risk participation and funded
participation in L/C Obligations and Swing Line Loans being deemed "held" by
such Lender for purposes of this definition) and (b) the aggregate outstanding
Dollar Equivalent amount of loans and letters of credit of the Lenders under the
Canadian Facility Agreement; PROVIDED that the Commitment of, and the portion of
the Total Outstandings held or deemed held by, any Defaulting Lender shall be
excluded for purposes of making a determination of Required Lenders.
"RESPONSIBLE OFFICER" means the chief executive officer, president, chief
financial officer, treasurer, secretary, assistant treasurer or assistant
secretary of a Loan Party. Any document delivered hereunder that is signed by a
Responsible Officer of a Loan Party shall be conclusively presumed to have been
authorized by all necessary corporate, partnership and/or other action on the
part of such Loan Party and such Responsible Officer shall be conclusively
presumed to have acted on behalf of such Loan Party.
"RESTRICTED PAYMENT" means any dividend or other distribution (whether in
cash, securities or other property) with respect to any capital stock or other
equity interest of the Borrower or any Subsidiary, or any payment (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such capital stock or other equity interest
or of any option, warrant or other right to acquire any such capital stock or
other equity interest or on account of any warrant or other right to acquire any
such capital stock or other equity interest, or on account of any return of
capital to the Borrower's stockholders, partners or members (or the equivalent
Persons thereof) or the issuance of any equity interest or acceptance of any
capital contributions.
"REVALUATION DATE" means each of the following: (a) each date of a
Borrowing of a Eurocurrency Rate Loan denominated in an Alternative Currency,
(b) each date of a continuation
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of a Eurocurrency Rate Loan denominated in an Alternative Currency pursuant to
SECTION 2.02; (c) each date of issuance of a Letter of Credit denominated in an
Alternative Currency, (d) each date of an amendment of any such Letter of Credit
having the effect of increasing the amount thereof, and (e) such additional
dates as the Administrative Agent or the Required Lenders shall specify.
"▇▇▇▇▇▇▇▇-▇▇▇▇▇" means the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002.
"SAME DAY FUNDS" means (a) with respect to disbursements and payments in
Dollars, immediately available funds, and (b) with respect to disbursements and
payments in an Alternative Currency, same day or other funds as may be
determined by the Administrative Agent to be customary in the place of
disbursement or payment for the settlement of international banking transactions
in the relevant Alternative Currency.
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"SECRETARY" means the Secretary of the DOE or an official or employee of
the DOE acting for the Secretary under a delegation of authority.
"SHAREHOLDERS' EQUITY" means, as of any date of determination, consolidated
shareholders' equity of the Borrower and its Subsidiaries as of that date
determined in accordance with GAAP.
"SPECIAL NOTICE CURRENCY" means at any time an Alternative Currency, other
than the currency of Japan or of a country that is a member of the Organization
for Economic Cooperation and Development at such time located in North America
or Europe.
"SPOT RATE" for a currency means the rate quoted by Bank of America as the
spot rate for the purchase by Bank of America of such currency with another
currency through its principal foreign exchange trading office at approximately
11:00 a.m., New York time, on the date two Business Days prior to the date as of
which the foreign exchange computation is made.
"STERLING" means the lawful currency of the United Kingdom.
"SUBSIDIARY" of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares or securities or other interests having ordinary voting power for the
election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a
"Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of
the Borrower.
"SWAP BANK" means any Lender or an Affiliate of a Lender in its capacity as
a party to a Swap Contract entered into after the date of this Agreement.
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"SWAP CONTRACT" means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a "MASTER AGREEMENT"), including
any such obligations or liabilities under any Master Agreement.
"SWAP TERMINATION VALUE" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the
▇▇▇▇-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).
"SWING LINE" means the revolving credit facility made available by the
Swing Line Lender pursuant to SECTION 2.04.
"SWING LINE BORROWING" means a borrowing of a Swing Line Loan pursuant to
SECTION 2.04.
"SWING LINE LENDER" means Bank of America in its capacity as provider of
Swing Line Loans, or any successor swing line lender hereunder.
"SWING LINE LOAN" has the meaning specified in SECTION 2.04(a).
"SWING LINE LOAN NOTICE" means a notice of a Swing Line Borrowing pursuant
to SECTION 2.04(b), which, if in writing, shall be substantially in the form of
EXHIBIT B.
"SWING LINE SUBLIMIT" means an amount equal to the lesser of (a)
$10,000,000 and (b) the Aggregate Commitments. The Swing Line Sublimit is part
of, and not in addition to, the Aggregate Commitments.
"SYNTHETIC LEASE OBLIGATION" means the monetary obligation of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) an agreement for the use or possession of property creating obligations that
do not appear on the balance sheet of such
21
Person but which, upon the insolvency or bankruptcy of such Person, would be
characterized as the indebtedness of such Person (without regard to accounting
treatment).
"TARGET DAY" means any day on which the Trans-European Automated Real-time
Gross Settlement Express Transfer (TARGET) System (or, if such clearing system
ceases to be operative, such other clearing system (if any) determined by the
Administrative Agent to be a suitable replacement) is operating.
"TAXES" has the meaning specified in Section 3.01(a)
"TITLE IV" means Title IV of the Higher Education Act of 1965, as amended,
20 U.S.C.A. (S)1070, and any amendments or successor statutes thereto.
"TITLE IV PROGRAMS" means the Title IV Programs as defined in
Section 668.1(c) of 34 C.F.R.
"TOTAL OUTSTANDINGS" means the aggregate Outstanding Amount of all Loans
and all L/C Obligations.
"TYPE" means, with respect to a Committed Loan, its character as a Base
Rate Loan or a Eurocurrency Rate Loan.
"UNFUNDED PENSION LIABILITY" means the excess of a Pension Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.
"UNITED STATES" and "U.S." mean the United States of America.
"UNREIMBURSED AMOUNT" has the meaning specified in SECTION 2.03(c)(i).
1.02 OTHER INTERPRETIVE PROVISIONS. With reference to this Agreement and
each other Loan Document, unless otherwise specified herein or in such other
Loan Document:
(a) The meanings of defined terms are equally applicable to the singular
and plural forms of the defined terms.
(b) (i) The words "HEREIN," "HERETO," "HEREOF" and "HEREUNDER" and words of
similar import when used in any Loan Document shall refer to such Loan Document
as a whole and not to any particular provision thereof.
(ii) Article, Section, Exhibit and Schedule references are to
the Loan Document in which such reference appears.
(iii) The term "INCLUDING" is by way of example and not
limitation.
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(iv) The term "DOCUMENTS" includes any and all instruments,
documents, agreements, certificates, notices, reports, financial statements
and other writings, however evidenced, whether in physical or electronic
form.
(c) In the computation of periods of time from a specified date to a later
specified date, the word "FROM" means "FROM AND INCLUDING;" the words "TO" and
"UNTIL" each mean "TO BUT EXCLUDING;" and the word "THROUGH" means "TO AND
INCLUDING."
(d) Each reference to "basis points" or "bps" shall be interpreted in
accordance with the convention that 100 bps = 1.0%.
(e) Section headings herein and in the other Loan Documents are included
for convenience of reference only and shall not affect the interpretation of
this Agreement or any other Loan Document.
1.03 ACCOUNTING TERMS. (a) All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall be prepared in
conformity with, GAAP applied on a consistent basis, as in effect from time to
time, applied in a manner consistent with that used in preparing the Audited
Financial Statements, except as otherwise specifically prescribed herein.
(b) If at any time any change in GAAP would affect the computation of any
financial ratio or requirement set forth in any Loan Document, and either the
Borrower or the Required Lenders shall so request, the Administrative Agent, the
Lenders and the Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in
GAAP (subject to the approval of the Required Lenders); PROVIDED THAT, until so
amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) the Borrower shall
provide to the Administrative Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP.
(c) If at any time any regulatory change in the DOE Ratio would affect the
computation of the DOE Ratio or SECTION 7.11(d), and either the Borrower or the
Required Lenders shall so request, the Administrative Agent, the Lenders and the
Borrower shall negotiate in good faith to amend such ratio or requirement to
preserve the original intent thereof in light of such change in the DOE Ratio;
provided that, until so amended, such ratio or requirement shall continue to be
computed in accordance with regulations referred to in the definition of the DOE
Ratio prior to such change therein.
1.04 ROUNDING. Any financial ratios required to be maintained by the
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).
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1.05 REFERENCES TO AGREEMENTS AND LAWS. Unless otherwise expressly
provided herein, (a) references to Organization Documents, agreements (including
the Loan Documents) and other contractual instruments shall be deemed to include
all subsequent amendments, restatements, extensions, supplements and other
modifications thereto, but only to the extent that such amendments,
restatements, extensions, supplements and other modifications are not prohibited
by any Loan Document; and (b) references to any Law shall include all statutory
and regulatory provisions consolidating, amending, replacing, supplementing or
interpreting such Law.
1.06 TIMES OF DAY. Unless otherwise specified, all references herein to
times of day shall be references to Central time (daylight or standard, as
applicable).
1.07 LETTER OF CREDIT AMOUNTS. Unless otherwise specified, all
references herein to the amount of a Letter of Credit at any time shall be
deemed to mean the maximum face amount of such Letter of Credit after giving
effect to all increases thereof contemplated by such Letter of Credit or the
Letter of Credit Application therefor, whether or not such maximum face amount
is in effect at such time.
1.08 EXCHANGE RATES; CURRENCY EQUIVALENTS.
(a) The Administrative Agent shall determine the Spot Rates as of each
Revaluation Date to be used for calculating Dollar Equivalent amounts of Credit
Extensions and Outstanding Amounts denominated in Alternative Currencies. Such
Spot Rates shall become effective as of such Revaluation Date and shall be the
Spot Rates employed in converting any amounts between the applicable currencies
until the next Revaluation Date to occur. Except for purposes of financial
statements delivered by Loan Parties hereunder or calculating financial
covenants hereunder or except as otherwise provided herein, the applicable
amount of any currency for purposes of the Loan Documents shall be such Dollar
Equivalent amount as so determined by the Administrative Agent.
(b) Wherever in this Agreement in connection with a Borrowing, conversion,
continuation or prepayment of a Loan or the issuance of a Letter of Credit, an
amount, such as a required minimum or multiple amount, is expressed in Dollars,
but such Borrowing, Loan or Letter of Credit is denominated in an Alternative
Currency, such amount shall be the relevant Alternative Currency Equivalent of
such Dollar amount (rounded to the nearest 1,000 units of such Alternative
Currency), as determined by the Administrative Agent.
1.09 ADDITIONAL ALTERNATIVE CURRENCIES. The Borrower may from time to
time request that Committed Loans be made in a currency other than those
specifically listed in the definition of "Alternative Currency;" provided that
such requested currency otherwise meets the requirements set forth in such
definition. Any such request shall be made to the Administrative Agent (which
shall promptly notify each Lender thereof) not later than 11:00 a.m., Chicago
time, 15 Business Days prior to the date of the desired loans. Each Lender shall
notify the Administrative Agent, not later than 11:00 a.m., Chicago time, 10
Business Days after receipt of such request whether it consents, in its sole
discretion, to making Committed Loans in such requested currency. Any failure by
a Lender to respond to such request within the time period specified in the
preceding sentence shall be deemed to be a refusal by such Lender to make
24
Committed Loans in such requested currency. If all the Lenders consent to making
Committed Loans in such requested currency, the Administrative Agent shall so
notify the Borrower and such currency shall thereupon be deemed for all purposes
to be an Alternative Currency hereunder.
1.10 REDENOMINATION OF CERTAIN ALTERNATIVE CURRENCIES.
(a) Each obligation of the Borrower to make a payment denominated in the
national currency unit of any member state of the European Union that adopts the
Euro as its lawful currency after the date hereof shall be redenominated into
Euro at the time of such adoption (in accordance with the EMU Legislation). If,
in relation to the currency of any such member state, the basis of accrual of
interest expressed in this Agreement in respect of that currency shall be
inconsistent with any convention or practice in the London interbank market for
the basis of accrual of interest in respect of the Euro, such expressed basis
shall be replaced by such convention or practice with effect from the date on
which such member state adopts the Euro as its lawful currency; provided that if
any Borrowing in the currency of such member state is outstanding immediately
prior to such date, such replacement shall take effect, with respect to such
Borrowing, at the end of the then current Interest Period.
(b) Each provision of this Agreement shall be subject to such reasonable
changes of construction as the Administrative Agent may from time to time
specify to be appropriate to reflect the adoption of the Euro by any member
state of the European Union and any relevant market conventions or practices
relating to the Euro.
ARTICLE II
THE COMMITMENTS AND CREDIT EXTENSIONS
2.01 COMMITTED LOANS. Subject to the terms and conditions set forth
herein, each Lender severally agrees to make loans (each such loan, a "COMMITTED
LOAN") to the Borrower in Dollars or in one or more Alternative Currencies from
time to time, on any Business Day during the Availability Period, in an
aggregate amount not to exceed at any time outstanding the amount of such
Lender's Commitment; PROVIDED, HOWEVER, that after giving effect to any
Committed Borrowing, the Dollar Equivalent of, (i) the Total Outstandings shall
not exceed the Aggregate Commitments, (ii) the aggregate Outstanding Amount of
the Committed Loans of any Lender, PLUS such Lender's Pro Rata Share of the
Outstanding Amount of all L/C Obligations, PLUS such Lender's Pro Rata Share of
the Outstanding Amount of all Swing Line Loans shall not exceed such Lender's
Commitment and (iii) the aggregate Outstanding Amount of all Loans and L/C
Obligations denominated in Alternative Currencies shall not exceed the
Alternative Currency Sublimit. Within the limits of each Lender's Commitment,
and subject to the other terms and conditions hereof, the Borrower may borrow
under this SECTION 2.01, prepay under SECTION 2.05, and reborrow under this
SECTION 2.01. Committed Loans may be Base Rate Loans or Eurocurrency Rate Loans,
as further provided herein.
2.02 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF COMMITTED LOANS.
25
(a) Each Committed Borrowing, each conversion of Committed Loans from one
Type to the other, and each continuation of Eurocurrency Rate Loans shall be
made upon the Borrower's irrevocable notice to the Administrative Agent, which
may be given by telephone. Each such notice must be received by the
Administrative Agent not later than 11:00 a.m. (i) three Business Days prior to
the requested date of any Borrowing of, conversion to or continuation of
Eurocurrency Rate Loans denominated in Dollars or of any conversion of
Eurocurrency Rate Loans denominated in Dollars to Base Rate Committed Loans,
(ii) four Business Days (or five Business Days in the case of a Special Notice
Currency) prior to the requested date of any Borrowing of, conversion to or
continuation of Eurocurrency Rate Loans denominated in Alternative Currencies,
and (iii) on the requested date of any Borrowing of Base Rate Committed Loans.
Each telephonic notice by the Borrower pursuant to this SECTION 2.02 (a) must be
confirmed promptly by delivery to the Administrative Agent of a written
Committed Loan Notice, appropriately completed and signed by a Responsible
Officer of the Borrower. Each Borrowing of, conversion to or continuation of
Eurocurrency Rate Loans in Dollars shall be in a principal amount of $5,000,000
or a whole multiple of $1,000,000 in excess thereof. Each Borrowing of,
conversion to or continuation of Eurocurrency Rate Loans in Alternative
Currencies shall be in a principal Dollar Equivalent amount of or approximating
$5,000,000. Except as provided in SECTIONS 2.03(c) and 2.04(c), each Borrowing
of or conversion to Base Rate Committed Loans shall be in a principal amount of
$500,000 or a whole multiple of $100,000 in excess thereof. Each Committed Loan
Notice (whether telephonic or written) shall specify (i) whether the Borrower is
requesting a Committed Borrowing, a conversion of Committed Loans from one Type
to the other, or a continuation of Eurocurrency Rate Loans, (ii) the requested
date of the Borrowing, conversion or continuation, as the case may be (which
shall be a Business Day), (iii) the principal amount of Committed Loans to be
borrowed, converted or continued, (iv) the Type of Committed Loans to be
borrowed or to which existing Committed Loans are to be converted, (v) if
applicable, the duration of the Interest Period with respect thereto and (vi)
the currency of the Committed Loans to be borrowed; provided, however, that if
as of the date of any Committed Loan Notice requesting a Committed Borrowing,
there are Swing Line Loans and/or L/C Borrowings outstanding, the Borrower shall
be deemed to have requested that a portion of the requested Committed Loans in a
principal amount equal to the outstanding principal amount of such Swing Line
Loans and L/C Borrowings be denominated in Dollars. If the Borrower fails to
specify a currency in a Committed Loan Notice requesting a Borrowing, then the
Committed Loans so requested shall be made in Dollars. If the Borrower fails to
specify a Type of Committed Loan in a Committed Loan Notice or if the Borrower
fails to give a timely notice requesting a conversion or continuation, then the
applicable Committed Loans shall be made as, or converted to, Base Rate Loans;
provided, however, that in the case of a failure to timely request a
continuation of Committed Loans denominated in Alternative Currencies, such
Loans shall be continued as Eurocurrency Rate Loans in their original currency
with an Interest Period of one month. Any automatic conversion to Base Rate
Loans shall be effective as of the last day of the Interest Period then in
effect with respect to the applicable Eurocurrency Rate Loans. If the Borrower
requests a Borrowing of, conversion to, or continuation of Eurocurrency Rate
Loans in any such Committed Loan Notice, but fails to specify an Interest
Period, it will be deemed to have specified an Interest Period of one month. No
Committed Loan may be converted into or continued as a Committed Loan
denominated in a different currency, but instead must be prepaid in the original
currency of such Loan and reborrowed in the other currency.
26
(b) Following receipt of a Committed Loan Notice, the Administrative Agent
shall promptly notify each Lender of the amount of its Pro Rata Share of the
applicable Committed Loans, and if no timely notice of a conversion or
continuation is provided by the Borrower, the Administrative Agent shall notify
each Lender of the details of any automatic conversion to Base Rate Loans or
continuation of Committed Loans denominated in a currency other than Dollars, in
each case as described in the preceding subsection (a). In the case of a
Committed Borrowing, each Lender shall make the amount of its Committed Loan
available to the Administrative Agent in Same Day Funds at the Administrative
Agent's Office not later than 1:00 p.m., in the case of any Committed Loan
denominated in Dollars, and not later than the Applicable Time specified by the
Administrative Agent in the case of any Committed Loan in an Alternative
Currency, in each case on the Business Day specified in the applicable Committed
Loan Notice. Upon satisfaction of the applicable conditions set forth in
SECTION 4.02 (and, if such Borrowing is the initial Credit Extension,
SECTION 4.01), the Administrative Agent shall make all funds so received
available to the Borrower in like funds as received by the Administrative Agent
either by (i) crediting the account of the Borrower on the books of Bank of
America with the amount of such funds or (ii) wire transfer of such funds, in
each case in accordance with instructions provided to (and reasonably acceptable
to) the Administrative Agent by the Borrower; PROVIDED, HOWEVER, that if, on the
date the Committed Loan Notice, with respect to such Committed Borrowing, is
given by the Borrower, there are Swing Line Loans or L/C Borrowings outstanding,
then the proceeds of such Committed Borrowing shall be applied, FIRST, to the
payment in full of any such L/C Borrowings, SECOND, to the payment in full of
any such Swing Line Loans, and THIRD, to the Borrower as provided above.
(c) Except as otherwise provided herein, a Eurocurrency Rate Loan may be
continued or converted only on the last day of an Interest Period for such
Eurocurrency Rate Loan. During the existence of a Default, no Loans may be
requested as, converted to or continued as Eurocurrency Rate Loans without the
consent of the Required Lenders, and the Required Lenders may demand that (i)
any or all of the then outstanding Eurocurrency Rate Loans denominated in
Dollars be converted immediately to Base Rate Loans and (ii) any or all of the
then outstanding Eurocurrency Rate Loans denominated in an Alternative Currency
be prepaid on the last day of the then current Interest Period with respect
thereto.
(d) The Administrative Agent shall promptly notify the Borrower and the
Lenders of the interest rate applicable to any Interest Period for Eurocurrency
Rate Loans upon determination of such interest rate. The determination of the
Eurocurrency Rate by the Administrative Agent shall be conclusive in the absence
of manifest error. At any time that Base Rate Loans are outstanding, the
Administrative Agent shall notify the Borrower and the Lenders of any change in
Bank of America's prime rate used in determining the Base Rate promptly
following the public announcement of such change.
(e) After giving effect to all Committed Borrowings, all conversions of
Committed Loans from one Type to the other, and all continuations of Committed
Loans as the same Type, there shall not be more than eight (8) Interest Periods
in effect with respect to Committed Loans.
(f) The failure of any Lender to make any Loan to be made by it as part of
any Committed Borrowing shall not relieve any other Lender of its obligation, if
any, hereunder to
27
make its Loan on the date of such Committed Borrowing, but no Lender shall be
responsible for the failure of any other Lender to make any Loan to be made by
such other Lender on the date of any Committed Borrowing.
2.03 LETTERS OF CREDIT.
(a) THE LETTER OF CREDIT COMMITMENT.
(i) Subject to the terms and conditions set forth herein, (A)
the L/C Issuer agrees, in reliance upon the agreements of the other Lenders
set forth in this SECTION 2.03, (1) from time to time on any Business Day
during the period from the Closing Date until the Letter of Credit
Expiration Date, to issue Standby Letters of Credit denominated in Dollars
or in one or more Alternative Currencies for the account of the Borrower,
and to amend or renew Letters of Credit previously issued by it, in
accordance with subsection (b) below, and (2) to honor drafts under the
Letters of Credit; and (B) the Lenders severally agree to participate in
Letters of Credit issued for the account of the Borrower; PROVIDED that the
L/C Issuer shall not be obligated to make any L/C Credit Extension with
respect to any Letter of Credit, and no Lender shall be obligated to
participate in any Letter of Credit if as of the date of such L/C Credit
Extension, the Dollar Equivalent of (w) the Total Outstandings would exceed
the Aggregate Commitments, (x) the aggregate Outstanding Amount of the
Committed Loans of any Lender, PLUS such Lender's Pro Rata Share of the
Outstanding Amount of all L/C Obligations, PLUS such Lender's Pro Rata
Share of the Outstanding Amount of all Swing Line Loans would exceed such
Lender's Commitment, (y) the Outstanding Amount of the L/C Obligations
would exceed the Letter of Credit Sublimit or (z) the aggregate Outstanding
Amount of all L/C Obligations and all Loans denominated in Alternative
Currencies would exceed the Alternative Currency Sublimit. Within the
foregoing limits, and subject to the terms and conditions hereof, the
Borrower's ability to obtain Letters of Credit shall be fully revolving,
and accordingly the Borrower may, during the foregoing period, obtain
Letters of Credit to replace Letters of Credit that have expired or that
have been drawn upon and reimbursed. All Existing Letters of Credit shall
be deemed to have been issued pursuant hereto, and from and after the
Closing Date shall be subject to and governed by the terms and conditions
hereof.
(ii) The L/C Issuer shall be under no obligation to issue any
Letter of Credit if:
(A) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or
restrain the L/C Issuer from issuing such Letter of Credit, or any
Law applicable to the L/C Issuer or any request or directive
(whether or not having the force of law) from any Governmental
Authority with jurisdiction over the L/C Issuer shall prohibit, or
request that the L/C Issuer refrain from, the issuance of letters
of credit generally or such Letter of Credit in particular or shall
impose upon the L/C Issuer with respect to such Letter of Credit
any restriction, reserve or capital requirement (for which the L/C
Issuer is not otherwise compensated hereunder) not in effect on the
Closing Date, or shall impose upon the L/C Issuer any unreimbursed
loss, cost or
28
expense which was not applicable on the Closing Date and which the
L/C Issuer in good ▇▇▇▇▇ ▇▇▇▇▇ material to it;
(B) the expiry date of such requested Letter of Credit
would occur more than twelve months after the date of issuance or
last renewal, unless the Required Lenders have approved such expiry
date;
(C) the expiry date of such requested Letter of Credit
would occur after the Letter of Credit Expiration Date, unless all
the Lenders have approved such expiry date;
(D) the issuance of such Letter of Credit would violate one
or more policies of the L/C Issuer;
(E) such Letter of Credit is to be denominated in a
currency other than Dollars or an Alternative Currency or is a
commercial letter of credit; or
(F) such Letter of Credit has automatic renewal provisions.
(iii) The L/C Issuer shall be under no obligation to amend any
Letter of Credit if (A) the L/C Issuer would have no obligation at such
time to issue such Letter of Credit in its amended form under the terms
hereof, or (B) the beneficiary of such Letter of Credit does not accept the
proposed amendment to such Letter of Credit.
(b) PROCEDURES FOR ISSUANCE AND AMENDMENT OF LETTERS OF CREDIT.
(i) Each Letter of Credit shall be issued or amended, as the
case may be, upon the request of the Borrower delivered to the L/C Issuer
(with a copy to the Administrative Agent) in the form of a Letter of Credit
Application, appropriately completed and signed by a Responsible Officer of
the Borrower. Such Letter of Credit Application must be received by the L/C
Issuer and the Administrative Agent not later than 11:00 a.m. at least two
Business Days (or such later date and time as the L/C Issuer may agree in a
particular instance in its sole discretion) prior to the proposed issuance
date or date of amendment, as the case may be. In the case of a request for
an initial issuance of a Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the L/C
Issuer: (A) the proposed issuance date of the requested Letter of Credit
(which shall be a Business Day); (B) the amount thereof; (C) the expiry
date thereof; (D) the name and address of the beneficiary thereof; (E) the
documents to be presented by such beneficiary in case of any drawing
thereunder; (F) the full text of any certificate to be presented by such
beneficiary in case of any drawing thereunder; and (G) such other matters
as the L/C Issuer may require. In the case of a request for an amendment of
any outstanding Letter of Credit, such Letter of Credit Application shall
specify in form and detail satisfactory to the L/C Issuer (A) the Letter of
Credit to be amended; (B) the proposed date of amendment thereof (which
shall be a Business Day); (C) the nature of the proposed amendment; and (D)
such other matters as the L/C Issuer may require.
29
(ii) Promptly after receipt of any Letter of Credit Application,
the L/C Issuer will confirm with the Administrative Agent (by telephone or
in writing) that the Administrative Agent has received a copy of such
Letter of Credit Application from the Borrower and, if not, the L/C Issuer
will provide the Administrative Agent with a copy thereof. Upon receipt by
the L/C Issuer of confirmation from the Administrative Agent that the
requested issuance or amendment is permitted in accordance with the terms
hereof, then, subject to the terms and conditions hereof, the L/C Issuer
shall, on the requested date, issue a Letter of Credit for the account of
the Borrower or enter into the applicable amendment, as the case may be, in
each case in accordance with the L/C Issuer's usual and customary business
practices. Immediately upon the issuance of each Letter of Credit, each
Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the L/C Issuer a risk participation in such Letter
of Credit in an amount equal to the product of such Lender's Pro Rata Share
TIMES the amount of such Letter of Credit.
(iii) Promptly after its delivery of any Letter of Credit or any
amendment to a Letter of Credit to an advising bank with respect thereto or
to the beneficiary thereof, the L/C Issuer will also deliver to the
Borrower and the Administrative Agent a true and complete copy of such
Letter of Credit or amendment.
(c) DRAWINGS AND REIMBURSEMENTS; FUNDING OF PARTICIPATIONS.
(i) Upon receipt from the beneficiary of any Letter of Credit
of any notice of a drawing under such Letter of Credit, the L/C Issuer
shall notify the Borrower and the Administrative Agent thereof and shall
state the date payment shall be made by the L/C Issuer under a Letter of
Credit (each such date, an "HONOR DATE"). Not later than 11:00 a.m. on the
Honor Date, the Borrower shall reimburse the L/C Issuer through the
Administrative Agent in an amount equal to the amount of such drawing and
in the applicable currency. If the Borrower fails to so reimburse the L/C
Issuer by such time, the Administrative Agent shall promptly notify each
Lender of the Honor Date, the amount of the unreimbursed drawing (the
"UNREIMBURSED AMOUNT"), and the amount of such Lender's Pro Rata Share
thereof. In the case of any Letter of Credit denominated in an Alternative
Currency, the Unreimbursed Amount shall be redenominated into Dollars and
equal the Dollar Equivalent Amount thereof, and the Administrative Agent
shall so notify the Lenders in the notice described in the preceding
sentence. In such event, the Borrower shall be deemed to have requested a
Committed Borrowing of Base Rate Loans to be disbursed on the Honor Date in
an amount equal to the Unreimbursed Amount, without regard to the minimum
and multiples specified in SECTION 2.02 for the principal amount of Base
Rate Loans, but subject to the amount of the unutilized portion of the
Aggregate Commitments and the conditions set forth in SECTION 4.02 (other
than the delivery of a Committed Loan Notice). Any notice given by the L/C
Issuer or the Administrative Agent pursuant to this SECTION 2.03(c)(i) may
be given by telephone if immediately confirmed in writing; PROVIDED that
the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.
30
(ii) Each Lender (including the Lender acting as L/C Issuer)
shall upon any notice pursuant to SECTION 2.03(c)(i) make funds available
to the Administrative Agent for the account of the L/C Issuer at the
Administrative Agent's Office for Dollar denominated payments in an amount
equal to its Pro Rata Share of the Unreimbursed Amount not later than 1:00
p.m. on the Business Day specified in such notice by the Administrative
Agent, whereupon, subject to the provisions of SECTION 2.03(c)(iii), each
Lender that so makes funds available shall be deemed to have made a Base
Rate Committed Loan to the Borrower in such amount. The Administrative
Agent shall remit the funds so received to the L/C Issuer.
(iii) With respect to any Unreimbursed Amount that is not fully
refinanced by a Committed Borrowing of Base Rate Loans because the
conditions set forth in SECTION 4.02 cannot be satisfied or for any other
reason, the Borrower shall be deemed to have incurred from the L/C Issuer
an L/C Borrowing in the amount of the Unreimbursed Amount that is not so
refinanced, which L/C Borrowing shall be due and payable on demand
(together with interest) and shall bear interest at the Default Rate. In
such event, each Lender's payment to the Administrative Agent for the
account of the L/C Issuer pursuant to SECTION 2.03(c)(ii) shall be deemed
payment in respect of its participation in such L/C Borrowing and shall
constitute an L/C Advance from such Lender in satisfaction of its
participation obligation under this SECTION 2.03.
(iv) Until each Lender funds its Committed Loan or L/C Advance
pursuant to this SECTION 2.03(c) to reimburse the L/C Issuer for any amount
drawn under any Letter of Credit, interest in respect of such Lender's Pro
Rata Share of such amount shall be solely for the account of the L/C
Issuer.
(v) Each Lender's obligation to make Committed Loans or L/C
Advances to reimburse the L/C Issuer for amounts drawn under Letters of
Credit, as contemplated by this SECTION 2.03(c), shall be absolute and
unconditional and shall not be affected by any circumstance, including (A)
any set-off, counterclaim, recoupment, defense or other right which such
Lender may have against the L/C Issuer, the Administrative Agent, the
Borrower or any other Person for any reason whatsoever; (B) the occurrence
or continuance of a Default, or (C) any other occurrence, event or
condition, whether or not similar to any of the foregoing; PROVIDED,
HOWEVER, that each Lender's obligation to make Committed Loans pursuant to
this SECTION 2.03(c) is subject to the conditions set forth in SECTION 4.02
(other than delivery by the Borrower of a Committed Loan Notice). No such
making of an L/C Advance shall relieve or otherwise impair the obligation
of the Borrower to reimburse the L/C Issuer for the amount of any payment
made by the L/C Issuer under any Letter of Credit, together with interest
as provided herein.
(vi) If any Lender fails to make available to the Administrative
Agent for the account of the L/C Issuer any amount required to be paid by
such Lender pursuant to the foregoing provisions of this SECTION 2.03(c) by
the time specified in SECTION 2.03(c)(ii), the L/C Issuer shall be entitled
to recover from such Lender (acting through the Administrative Agent), on
demand, such amount with interest thereon for the period from the date such
payment is required to the date on which such payment is immediately
31
available to the L/C Issuer at a rate per annum equal to the Federal Funds
Rate from time to time in effect. A certificate of the L/C Issuer submitted
to any Lender (through the Administrative Agent) with respect to any
amounts owing under this clause (vi) shall be conclusive absent manifest
error.
(d) REPAYMENT OF PARTICIPATIONS.
(i) At any time after the L/C Issuer has made a payment under
any Letter of Credit and has received from any Lender such Lender's L/C
Advance in respect of such payment in accordance with SECTION 2.03(c), if
the Administrative Agent receives for the account of the L/C Issuer any
payment in respect of the related Unreimbursed Amount or interest thereon
(whether directly from the Borrower or otherwise, including proceeds of
Cash Collateral applied thereto by the Administrative Agent), the
Administrative Agent will distribute to such Lender its Pro Rata Share
thereof (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Lender's L/C Advance was
outstanding) in the same funds as those received by the Administrative
Agent.
(ii) If any payment received by the Administrative Agent for the
account of the L/C Issuer pursuant to SECTION 2.03(c)(i) is required to be
returned under any of the circumstances described in SECTION 10.06
(including pursuant to any settlement entered into by the L/C Issuer in its
discretion), each Lender shall pay to the Administrative Agent for the
account of the L/C Issuer its Pro Rata Share thereof on demand of the
Administrative Agent, plus interest thereon from the date of such demand to
the date such amount is returned by such Lender, at a rate per annum equal
to the Federal Funds Rate from time to time in effect.
(e) OBLIGATIONS ABSOLUTE. The obligation of the Borrower to reimburse the
L/C Issuer for each drawing under each Letter of Credit and to repay each L/C
Borrowing shall be absolute, unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including the following:
(i) any lack of validity or enforceability of such Letter of
Credit, this Agreement, or any other agreement or instrument relating
thereto;
(ii) the existence of any claim, counterclaim, set-off, defense
or other right that the Borrower may have at any time against any
beneficiary or any transferee of such Letter of Credit (or any Person for
whom any such beneficiary or any such transferee may be acting), the L/C
Issuer or any other Person, whether in connection with this Agreement, the
transactions contemplated hereby or by such Letter of Credit or any
agreement or instrument relating thereto, or any unrelated transaction;
(iii) any draft, demand, certificate or other document presented
under such Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect; or any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under such
Letter of Credit;
32
(iv) any payment by the L/C Issuer under such Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of such Letter of Credit; or any payment made by the
L/C Issuer under such Letter of Credit to any Person purporting to be a
trustee in bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of or successor to
any beneficiary or any transferee of such Letter of Credit, including any
arising in connection with any proceeding under any Debtor Relief Law; or
(v) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing, including any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the
Borrower.
The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower's instructions or other irregularity, the
Borrower will immediately notify the L/C Issuer. The Borrower shall be
conclusively deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid.
(f) ROLE OF L/C ISSUER. Each Lender and the Borrower agree that, in paying
any drawing under a Letter of Credit, the L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. None of the L/C Issuer,
any Agent-Related Person nor any of the respective correspondents, participants
or assignees of the L/C Issuer shall be liable to any Lender for (i) any action
taken or omitted in connection herewith at the request or with the approval of
the Lenders or the Required Lenders, as applicable; (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii) the
due execution, effectiveness, validity or enforceability of any document or
instrument related to any Letter of Credit or Letter of Credit Application. The
Borrower hereby assumes all risks of the acts or omissions of any beneficiary or
transferee with respect to its use of any Letter of Credit; PROVIDED, HOWEVER,
that this assumption is not intended to, and shall not, preclude the Borrower's
pursuing such rights and remedies as it may have against the beneficiary or
transferee at law or under any other agreement. None of the L/C Issuer, any
Agent-Related Person, nor any of the respective correspondents, participants or
assignees of the L/C Issuer, shall be liable or responsible for any of the
matters described in clauses (i) through (v) of SECTION 2.03(e); PROVIDED,
HOWEVER, that anything in such clauses to the contrary notwithstanding, the
Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be
liable to the Borrower, to the extent, but only to the extent, of any direct, as
opposed to consequential or exemplary, damages suffered by the Borrower which
the Borrower proves were caused by the L/C Issuer's willful misconduct or gross
negligence or the L/C Issuer's willful failure to pay under any Letter of Credit
after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing, the L/C Issuer
may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and the L/C Issuer shall not be responsible for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the
33
rights or benefits thereunder or proceeds thereof, in whole or in part, which
may prove to be invalid or ineffective for any reason.
(g) CASH COLLATERAL. Upon the request of the Administrative Agent, (i) if
the L/C Issuer has honored any full or partial drawing request under any Letter
of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if, as of
the Letter of Credit Expiration Date, any Letter of Credit may for any reason
remain outstanding and partially or wholly undrawn, the Borrower shall
immediately Cash Collateralize the then Outstanding Amount of all L/C
Obligations (in an amount equal to the Dollar Equivalent of such Outstanding
Amount determined as of the date of such L/C Borrowing or the Letter of Credit
Expiration Date, as the case may be). For purposes hereof, "CASH COLLATERALIZE"
means to pledge and deposit with or deliver to the Administrative Agent, for the
benefit of the L/C Issuer and the Lenders, as collateral for the L/C
Obligations, cash or deposit account balances pursuant to documentation in form
and substance satisfactory to the Administrative Agent and the L/C Issuer (which
documents are hereby consented to by the Lenders). Derivatives of such term have
corresponding meanings. The Borrower hereby grants to the Administrative Agent,
for the benefit of the L/C Issuer and the Lenders, a security interest in all
such cash, deposit accounts and all balances therein and all proceeds of the
foregoing. Cash collateral shall be maintained in blocked, non-interest bearing
deposit accounts at Bank of America. If at any time the Administrative Agent
determines that any funds held as Cash Collateral are subject to any right or
claim of any Person other than the Administrative Agent or that the total amount
of such funds is less than the aggregate Outstanding Amount of L/C Obligations,
the Borrower will forthwith, upon demand by the Administrative Agent, pay to the
Administrative Agent, as additional funds to be deposited and held in deposit
accounts at Bank of America as aforesaid, an amount equal to the excess of (i)
such aggregate Outstanding Amount over (ii) the total amount of funds, if any,
then held as Cash Collateral that the Administrative Agent determines to be free
and clear of any such right and claim. Upon the drawing of any Letter of Credit
for which funds are on deposit as Cash Collateral, such funds shall be applied,
to the extent permitted under applicable law, to reimburse the L/C Issuer. The
Administrative Agent may, at any time and from time to time after the initial
deposit of Cash Collateral, request that additional Cash Collateral be provided
in order to protect against the results of exchange rate fluctuations.
(h) APPLICABILITY OF ISP98 AND UCP. Unless otherwise expressly agreed by
the L/C Issuer and the Borrower when a Letter of Credit is issued (including any
such agreement applicable to an Existing Letter of Credit), (i) the rules of the
"International Standby Practices 1998" published by the Institute of
International Banking Law & Practice (or such later version thereof as may be in
effect at the time of issuance) shall apply to each standby Letter of Credit,
and (ii) the rules of the Uniform Customs and Practice for Documentary Credits,
as most recently published by the International Chamber of Commerce (the "ICC")
at the time of issuance (including the ICC decision published by the Commission
on Banking Technique and Practice on April 6, 1998 regarding the European single
currency (euro)) shall apply to each commercial Letter of Credit.
(i) LETTER OF CREDIT FEES. The Borrower shall pay to the Administrative
Agent for the account of each Lender in accordance with its Pro Rata Share a
Letter of Credit fee for each Letter of Credit equal to the Applicable Rate
TIMES the daily maximum amount available to be
34
drawn under such Letter of Credit (whether or not such maximum amount is then in
effect under such Letter of Credit). Such letter of credit fees shall be
computed on a quarterly basis in arrears. Such letter of credit fees shall be
due and payable on the last Business Day of each March, June, September and
December, commencing with the first such date to occur after the issuance of
such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on
demand. If there is any change in the Applicable Rate during any quarter, the
daily maximum amount of each Letter of Credit shall be computed and multiplied
by the Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect.
(j) FRONTING FEE AND DOCUMENTARY AND PROCESSING CHARGES PAYABLE TO L/C
ISSUER. The Borrower shall pay directly to the L/C Issuer for its own account a
fronting fee with respect to each Letter of Credit in an amount equal to 12.5
basis points of the maximum amount available to be drawn under such Letter of
Credit on the date of (i) issuance, (ii) extension/renewal, or (iii) increase in
the amount of the Letter of Credit payable on such date. In addition, the
Borrower shall pay directly to the L/C Issuer for its own account the customary
issuance, presentation, amendment and other processing fees, and other standard
costs and charges, of the L/C Issuer relating to letters of credit as from time
to time in effect. Such customary fees and standard costs and charges are due
and payable on demand and are nonrefundable.
(k) CONFLICT WITH LETTER OF CREDIT APPLICATION. In the event of any
conflict between the terms hereof and the terms of any Letter of Credit
Application, the terms hereof shall control.
(l) EXISTING LETTERS OF CREDIT. Notwithstanding anything to the contrary
contained herein, LaSalle Bank National Association shall have no duties or
obligations as an L/C Issuer except in respect of Existing Letters of Credit.
2.04 SWING LINE LOANS.
(a) THE SWING LINE. Subject to the terms and conditions set forth herein,
the Swing Line Lender agrees to make loans in Dollars (each such loan, a "SWING
LINE LOAN") to the Borrower from time to time on any Business Day during the
Availability Period in an aggregate amount not to exceed at any time outstanding
the amount of the Swing Line Sublimit, notwithstanding the fact that such Swing
Line Loans, when aggregated with the Dollar Equivalent, Pro Rata Share of the
Outstanding Amount of Committed Loans and L/C Obligations of the Lender acting
as Swing Line Lender, may exceed the amount of such Lender's Commitment;
PROVIDED, HOWEVER, that after giving effect to any Swing Line Loan, the Dollar
Equivalent of (i) the Total Outstandings shall not exceed the Aggregate
Commitments, and (ii) the aggregate Outstanding Amount of the Committed Loans of
any Lender, plus such Lender's Pro Rata Share of the Outstanding Amount of all
L/C Obligations, plus such Lender's Pro Rata Share of the Outstanding Amount of
all Swing Line Loans shall not exceed such Lender's Commitment, and PROVIDED,
FURTHER, that the Borrower shall not use the proceeds of any Swing Line Loan to
refinance any outstanding Swing Line Loan. Within the foregoing limits, and
subject to the other terms and conditions hereof, the Borrower may borrow under
this SECTION 2.04, prepay under SECTION 2.05, and reborrow under this
SECTION 2.04. Each Swing Line Loan shall be a Base Rate Loan. Immediately upon
the making of a Swing Line Loan, each Lender shall be deemed to, and hereby
irrevocably and unconditionally agrees to, purchase from the Swing Line
35
Lender a risk participation in such Swing Line Loan in an amount equal to the
product of such Lender's Pro Rata Share TIMES the amount of such Swing Line
Loan.
(b) BORROWING PROCEDURES. Each Swing Line Borrowing shall be made upon the
Borrower's irrevocable notice to the Swing Line Lender and the Administrative
Agent, which may be given by telephone. Each such notice must be received by the
Swing Line Lender and the Administrative Agent not later than 1:00 p.m. on the
requested borrowing date, and shall specify (i) the amount to be borrowed, which
shall be a minimum of $100,000, and (ii) the requested borrowing date, which
shall be a Business Day. Each such telephonic notice must be confirmed promptly
by delivery to the Swing Line Lender and the Administrative Agent of a written
Swing Line Loan Notice, appropriately completed and signed by a Responsible
Officer of the Borrower. Promptly after receipt by the Swing Line Lender of any
telephonic Swing Line Loan Notice, the Swing Line Lender will confirm with the
Administrative Agent (by telephone or in writing) that the Administrative Agent
has also received such Swing Line Loan Notice and, if not, the Swing Line Lender
will notify the Administrative Agent (by telephone or in writing) of the
contents thereof. Unless the Swing Line Lender has received notice (by telephone
or in writing) from the Administrative Agent (including at the request of any
Lender) prior to 2:00 p.m. on the date of the proposed Swing Line Borrowing (A)
directing the Swing Line Lender not to make such Swing Line Loan as a result of
the limitations set forth in the proviso to the first sentence of
SECTION 2.04(a), or (B) that one or more of the applicable conditions specified
in ARTICLE IV is not then satisfied, then, subject to the terms and conditions
hereof, the Swing Line Lender will, not later than 3:00 p.m. on the borrowing
date specified in such Swing Line Loan Notice, make the amount of its Swing Line
Loan available to the Borrower at its office by crediting the account of the
Borrower on the books of the Swing Line Lender in immediately available funds.
(c) REFINANCING OF SWING LINE LOANS.
(i) The Swing Line Lender at any time in its sole and absolute
discretion may request, on behalf of the Borrower (which hereby irrevocably
authorizes the Swing Line Lender to so request on its behalf), that each
Lender make a Base Rate Committed Loan in an amount equal to such Lender's
Pro Rata Share of the amount of Swing Line Loans then outstanding. Such
request shall be made in writing (which written request shall be deemed to
be a Committed Loan Notice for purposes hereof) and in accordance with the
requirements of SECTION 2.02, without regard to the minimum and multiples
specified therein for the principal amount of Base Rate Loans, but subject
to the unutilized portion of the Aggregate Commitments and the conditions
set forth in SECTION 4.02. The Swing Line Lender shall furnish the Borrower
with a copy of the applicable Committed Loan Notice promptly after
delivering such notice to the Administrative Agent. Each Lender shall make
an amount equal to its Pro Rata Share of the amount specified in such
Committed Loan Notice available to the Administrative Agent in immediately
available funds for the account of the Swing Line Lender at the
Administrative Agent's Office not later than 1:00 p.m. on the day specified
in such Committed Loan Notice, whereupon, subject to SECTION 2.04(c)(ii),
each Lender that so makes funds available shall be deemed to have made a
Base Rate Committed Loan to the Borrower in such amount. The Administrative
Agent shall remit the funds so received to the Swing Line Lender.
36
(ii) If for any reason any Swing Line Loan cannot be refinanced
by such a Committed Borrowing in accordance with SECTION 2.04(c)(i), the
request for Base Rate Committed Loans submitted by the Swing Line Lender as
set forth herein shall be deemed to be a request by the Swing Line Lender
that each of the Lenders fund its risk participation in the relevant Swing
Line Loan and each Lender's payment to the Administrative Agent for the
account of the Swing Line Lender pursuant to SECTION 2.04(c)(i) shall be
deemed payment in respect of such participation.
(iii) If any Lender fails to make available to the Administrative
Agent for the account of the Swing Line Lender any amount required to be
paid by such Lender pursuant to the foregoing provisions of this
SECTION 2.04(c) by the time specified in SECTION 2.04(c)(i), the Swing Line
Lender shall be entitled to recover from such Lender (acting through the
Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such
payment is immediately available to the Swing Line Lender at a rate per
annum equal to the Federal Funds Rate from time to time in effect. A
certificate of the Swing Line Lender submitted to any Lender (through the
Administrative Agent) with respect to any amounts owing under this clause
(iii) shall be conclusive absent manifest error.
(iv) Each Lender's obligation to make Committed Loans or to
purchase and fund risk participations in Swing Line Loans pursuant to this
SECTION 2.04(c) shall be absolute and unconditional and shall not be
affected by any circumstance, including (A) any set-off, counterclaim,
recoupment, defense or other right which such Lender may have against the
Swing Line Lender, the Borrower or any other Person for any reason
whatsoever, (B) the occurrence or continuance of a Default, or (C) any
other occurrence, event or condition, whether or not similar to any of the
foregoing; PROVIDED, HOWEVER, that each Lender's obligation to make
Committed Loans pursuant to this SECTION 2.04(c) is subject to the
conditions set forth in SECTION 4.02. No such funding of risk
participations shall relieve or otherwise impair the obligation of the
Borrower to repay Swing Line Loans, together with interest as provided
herein.
(d) REPAYMENT OF PARTICIPATIONS.
(i) At any time after any Lender has purchased and funded a
risk participation in a Swing Line Loan, if the Swing Line Lender receives
any payment on account of such Swing Line Loan, the Swing Line Lender will
distribute to such Lender its Pro Rata Share of such payment (appropriately
adjusted, in the case of interest payments, to reflect the period of time
during which such Lender's risk participation was funded) in the same funds
as those received by the Swing Line Lender.
(ii) If any payment received by the Swing Line Lender in respect
of principal or interest on any Swing Line Loan is required to be returned
by the Swing Line Lender under any of the circumstances described in
SECTION 10.06 (including pursuant to any settlement entered into by the
Swing Line Lender in its discretion), each Lender shall pay to the Swing
Line Lender its Pro Rata Share thereof on demand of the Administrative
Agent, plus interest thereon from the date of such demand to the date such
amount is
37
returned, at a rate per annum equal to the Federal Funds Rate. The
Administrative Agent will make such demand upon the request of the Swing
Line Lender.
(e) INTEREST FOR ACCOUNT OF SWING LINE LENDER. The Swing Line Lender shall
be responsible for invoicing the Borrower for interest on the Swing Line Loans.
Until each Lender funds its Base Rate Committed Loan or risk participation
pursuant to this SECTION 2.04 to refinance such Lender's Pro Rata Share of any
Swing Line Loan, interest in respect of such Pro Rata Share shall be solely for
the account of the Swing Line Lender.
(f) PAYMENTS DIRECTLY TO SWING LINE LENDER. The Borrower shall make all
payments of principal and interest in respect of the Swing Line Loans directly
to the Swing Line Lender.
2.05 PREPAYMENTS.
(a) The Borrower may, upon notice to the Administrative Agent, at any time
or from time to time voluntarily prepay Committed Loans in whole or in part
without premium or penalty; PROVIDED that (i) such notice must be received by
the Administrative Agent not later than 11:00 a.m. (A) three Business Days prior
to any date of prepayment of Eurocurrency Rate Loans denominated in Dollars and
four Business Days (or five in the case of prepayment of Loans denominated in
Special Notice Currencies) prior to any date of prepayment of Eurocurrency Rate
Loans denominated in Alternative Currencies, and (B) on the date of prepayment
of Base Rate Committed Loans; (ii) any prepayment of Eurocurrency Rate Loans
denominated in Dollars shall be in a principal amount of $5,000,000 or a whole
multiple of $1,000,000 in excess thereof, (iii) any prepayment of Eurocurrency
Rate Loans in Alternative Currencies shall be in a minimum Dollar equivalent
principal amount of or approximating $5,000,000; and (iv) any prepayment of Base
Rate Committed Loans shall be in a principal amount of $500,000 or a whole
multiple of $100,000 in excess thereof or, in each case, if less, the entire
principal amount thereof then outstanding. Each such notice shall specify the
date and amount of such prepayment and the Type(s) of Committed Loans to be
prepaid. The Administrative Agent will promptly notify each Lender of its
receipt of each such notice, and of the amount of such Lender's Pro Rata Share
of such prepayment. If such notice is given by the Borrower, the Borrower shall
make such prepayment and the payment amount specified in such notice shall be
due and payable on the date specified therein. Any prepayment of a Eurocurrency
Rate Loan shall be accompanied by all accrued interest thereon, together with
any additional amounts required pursuant to SECTION 3.05. Each such prepayment
shall be applied to the Committed Loans of the Lenders in accordance with their
respective Pro Rata Shares.
(b) The Borrower may, upon notice to the Swing Line Lender (with a copy to
the Administrative Agent), at any time or from time to time, voluntarily prepay
Swing Line Loans in whole or in part without premium or penalty; PROVIDED that
(i) such notice must be received by the Swing Line Lender and the Administrative
Agent not later than 1:00 p.m. on the date of the prepayment, and (ii) any such
prepayment shall be in a minimum principal amount of $100,000. Each such notice
shall specify the date and amount of such prepayment. If such notice is given by
the Borrower, the Borrower shall make such prepayment and the payment amount
specified in such notice shall be due and payable on the date specified therein.
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(c) (i) If the Administrative Agent notifies the Borrower at any time that
the Dollar Equivalent of the Outstanding Amount of all Loans and L/C Obligations
at such time exceeds the Aggregate Commitments then in effect, the Borrower
shall, within two Business Days after receipt of such notice, prepay Loans
and/or Cash Collateralize the L/C Obligations in an aggregate amount sufficient
to reduce the Dollar Equivalent of such Outstanding Amount as of such date of
payment to an amount not to exceed 100% of the Aggregate Commitments then in
effect. The Administrative Agent may, at any time and from time to time after
the initial deposit of such Cash Collateral, request that additional Cash
Collateral be provided in order to protect against the results of further
exchange rate fluctuations.
(ii) If the Administrative Agent notifies the Borrower at any time that
the Dollar Equivalent of the Outstanding Amount of all Loans and L/C Obligations
denominated in Alternative Currencies at such time exceeds the Alternative
Currency Sublimit then in effect, the Borrower shall, within two Business Days
after receipt of such notice, prepay Loans and/or Cash Collateralize the L/C
Obligations in an aggregate amount sufficient to reduce the Dollar Equivalent of
such Outstanding Amount as of such date of payment to an amount not to exceed
100% of the Alternative Currency Sublimit then in effect. The Administrative
Agent may, at any time and from time to time after the initial deposit of such
Cash Collateral, request that additional Cash Collateral be provided in order to
protect against the results of further exchange rate fluctuations.
(iii) If the Administrative Agent notifies the Borrower at any time that
the Dollar Equivalent of the Outstanding Amount of all L/C Obligations at such
time exceeds the Letter of Credit Sublimit then in effect, the Borrower shall,
within two Business Days after receipt of such notice, Cash Collateralize the
L/C Obligations in an aggregate amount sufficient to reduce the Dollar
Equivalent of such Outstanding Amount as of such date of payment to an amount
not to exceed 100% of the Letter of Credit Sublimit then in effect. The
Administrative Agent may, at any time and from time to time after the initial
deposit of such Cash Collateral, request that additional Cash Collateral be
provided in order to protect against the results of further exchange rate
fluctuations.
2.06 TERMINATION OR REDUCTION OF COMMITMENTS. The Borrower may, upon
notice to the Administrative Agent, terminate the Aggregate Commitments, or from
time to time permanently reduce the Aggregate Commitments; provided that (i) any
such notice shall be received by the Administrative Agent not later than 11:00
a.m. five Business Days prior to the date of termination or reduction, (ii) any
such partial reduction shall be in an aggregate amount of $10,000,000 or any
whole multiple of $1,000,000 in excess thereof, (iii) the Borrower shall not
terminate or reduce the Aggregate Commitments if, after giving effect thereto
and to any concurrent prepayments hereunder, the Total Outstandings would exceed
the Aggregate Commitments, and (iv) if, after giving effect to any reduction of
the Aggregate Commitments, the Letter of Credit Sublimit or the Swing Line
Sublimit exceeds the amount of the Aggregate Commitments, such Sublimit shall be
automatically reduced by the amount of such excess. The Administrative Agent
will promptly notify the Lenders of any such notice of termination or reduction
of the Aggregate Commitments. Any reduction of the Aggregate Commitments shall
be applied to the Commitment of each Lender according to its Pro Rata Share. All
fees accrued
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until the effective date of any termination of the Aggregate Commitments shall
be paid on the effective date of such termination.
2.07 REPAYMENT OF LOANS.
(a) The Borrower shall repay to the Lenders on the Maturity Date the
aggregate principal amount of Committed Loans outstanding on such date.
(b) The Borrower shall repay each Swing Line Loan on the earlier of (i) the
demand of the Swing Line Lender and (ii) the Maturity Date.
2.08 INTEREST.
(a) Subject to the provisions of subsection (b) below, (i) each
Eurocurrency Rate Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Eurocurrency
Rate for such Interest Period PLUS the Applicable Rate; (ii) each Base Rate
Committed Loan shall bear interest on the outstanding principal amount thereof
from the applicable borrowing date at a rate per annum equal to the Base Rate
PLUS the Applicable Rate; and (iii) each Swing Line Loan shall bear interest on
the outstanding principal amount thereof from the applicable borrowing date at a
rate per annum equal to the Base Rate PLUS the Applicable Rate.
(b) If any amount payable by the Borrower under any Loan Document is not
paid when due (without regard to any applicable grace periods), whether at
stated maturity, by acceleration or otherwise, such amount shall thereafter bear
interest at a fluctuating interest rate per annum at all times equal to the
Default Rate to the fullest extent permitted by applicable Laws. Furthermore,
while any Event of Default exists, the Borrower shall pay interest on the
principal amount of all outstanding Obligations hereunder at a fluctuating
interest rate per annum at all times equal to the Default Rate to the fullest
extent permitted by applicable Laws. Accrued and unpaid interest on past due
amounts (including interest on past due interest) shall be due and payable upon
demand.
(c) Interest on each Loan shall be due and payable in arrears on each
Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
(d) For the purposes of the Interest Act (Canada), (i) whenever a rate of
interest or fee rate hereunder is calculated on the basis of a year (the "deemed
year") that contains fewer days than the actual number of days in the calendar
year of calculation, such rate of interest or fee rate shall be expressed as a
yearly rate by multiplying such rate of interest or fee rate by the actual
number of days in the calendar year of calculation and dividing it by the number
of days in the deemed year, (ii) the principle of deemed reinvestment of
interest shall not apply to any interest calculation hereunder and (iii) the
rates of interest stipulated herein are intended to be nominal rates and not
effective rates or yields.
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2.09 FEES. In addition to certain fees described in subsections (i) and
(j) of SECTION 2.03:
(a) COMMITMENT FEE. The Borrower shall pay to the Administrative Agent for
the account of each Lender in accordance with its Pro Rata Share, a commitment
fee equal to the Applicable Rate TIMES the actual daily amount by which the
Aggregate Commitments exceed the sum of (i) the Outstanding Amount of Committed
Loans and (ii) the Outstanding Amount of L/C Obligations. The commitment fee
shall accrue at all times during the Availability Period, including at any time
during which one or more of the conditions in ARTICLE IV is not met, and shall
be due and payable quarterly in arrears on the last Business Day of each March,
June, September and December, commencing with the first such date to occur after
the Closing Date, and on the Maturity Date. The commitment fee shall be
calculated quarterly in arrears, and if there is any change in the Applicable
Rate during any quarter, the actual daily amount shall be computed and
multiplied by the Applicable Rate separately for each period during such quarter
that such Applicable Rate was in effect.
(b) OTHER FEES. (i) The Borrower shall pay to the Arranger and the
Administrative Agent for their own respective accounts fees in the amounts and
at the times specified in the Fee Letter. Such fees shall be fully earned when
paid and shall not be refundable for any reason whatsoever.
(ii) The Borrower shall pay to the Lenders such fees as shall
have been separately agreed upon in writing in the amounts and at the times
so specified. Such fees shall be fully earned when paid and shall not be
refundable for any reason whatsoever.
2.10 COMPUTATION OF INTEREST AND FEES. All computations of interest for
Base Rate Loans when the Base Rate is determined by Bank of America's "prime
rate" shall be made on the basis of a year of 365 or 366 days, as the case may
be, and actual days elapsed. All other computations of fees and interest shall
be made on the basis of a 360-day year and actual days elapsed (which results in
more fees or interest, as applicable, being paid than if computed on the basis
of a 365-day year) or, in the case of interest in respect of Loans denominated
in Alternative Currencies as to which market practice differs from the
foregoing, in accordance with such market practice. Interest shall accrue on
each Loan for the day on which the Loan is made, and shall not accrue on a Loan,
or any portion thereof, for the day on which the Loan or such portion is paid,
PROVIDED that any Loan that is repaid on the same day on which it is made shall,
subject to SECTION 2.12(a), bear interest for one day. Each determination by the
Administrative Agent of an interest rate or fee hereunder shall be conclusive
and binding for all purposes, absent manifest error.
2.11 EVIDENCE OF DEBT.
(a) The Credit Extensions made by each Lender shall be evidenced by one or
more accounts or records maintained by such Lender and by the Administrative
Agent in the ordinary course of business. The accounts or records maintained by
the Administrative Agent and each Lender shall be conclusive absent manifest
error of the amount of the Credit Extensions made by the Lenders to the Borrower
and the interest and payments thereon. Any failure to so record or any error in
doing so shall not, however, limit or otherwise affect the obligation of the
Borrower hereunder to pay any amount owing with respect to the Obligations. In
the event of any conflict
41
between the accounts and records maintained by any Lender and the accounts and
records of the Administrative Agent in respect of such matters, the accounts and
records of the Administrative Agent shall control in the absence of manifest
error. Upon the request of any Lender made through the Administrative Agent, the
Borrower shall execute and deliver to such Lender (through the Administrative
Agent) a Note, which shall evidence such Lender's Loans in addition to such
accounts or records. Each Lender may attach schedules to its Note and endorse
thereon the date, Type (if applicable), amount and maturity of its Loans and
payments with respect thereto.
(b) In addition to the accounts and records referred to in subsection (a),
each Lender and the Administrative Agent shall maintain in accordance with its
usual practice accounts or records evidencing the purchases and sales by such
Lender of participations in Letters of Credit and Swing Line Loans. In the event
of any conflict between the accounts and records maintained by the
Administrative Agent and the accounts and records of any Lender in respect of
such matters, the accounts and records of the Administrative Agent shall control
in the absence of manifest error.
(c) Entries made in good faith by the Administrative Agent in the Register
pursuant to subsection (b) above, and by each Lender in its accounts pursuant to
subsections (a) and (b) above, shall be prima facie evidence of the amount of
principal and interest due and payable or to become due and payable from the
Borrower to, in the case of the Register each Lender and, in the case of such
account or accounts, such Lender, under this Agreement and the other Loan
Documents, absent manifest error; provided that the failure of the
Administrative Agent or such Lender to make any entry, or any finding that an
entry is incorrect, in the Register or such account or accounts shall not limit
or otherwise affect the obligations of the Borrower under this Agreement and the
other Loan Documents.
2.12 PAYMENTS GENERALLY.
(a) All payments to be made by the Borrower shall be made without condition
or deduction for any counterclaim, defense, recoupment or setoff. Except as
otherwise expressly provided herein and except with respect to principal of and
interest on Loans denominated in an Alternative Currency, all payments by the
Borrower hereunder shall be made to the Administrative Agent, for the account of
the respective Lenders to which such payment is owed, at the Administrative
Agent's Office in Dollars and in Same Day Funds not later than 2:00 p.m. on the
date specified herein. Except as otherwise expressly provided herein, all
payments by the Borrower hereunder with respect to principal and interest on
Loans denominated in an Alternative Currency shall be made to the Administrative
Agent, for the account of the respective Lenders to which such payment is owed,
at the applicable Administrative Agent's Office in such Alternative Currency and
in Same Day Funds not later than the Applicable Time specified by the
Administrative Agent on the dates specified herein. The Administrative Agent
will promptly distribute to each Lender its Pro Rata Share (or other applicable
share as provided herein) of such payment in like funds as received by wire
transfer to such Lender's Lending Office. All payments received by the
Administrative Agent (i) after 2:00 p.m., in the case of Dollars, or (ii) later
than the Applicable Time specified by the Administrative Agent in the case
42
of payments in an Alternative Currency, shall in each case be deemed received on
the next succeeding Business Day and any applicable interest or fee shall
continue to accrue.
(b) If any payment to be made by the Borrower shall come due on a day other
than a Business Day, payment shall be made on the next following Business Day,
and such extension of time shall be reflected in computing interest or fees, as
the case may be; provided, however, that, if such extension would cause payment
of interest on or principal of Eurocurrency Rate Loans to be made in the next
succeeding calendar month, such payment shall be made on the immediately
preceding Business Day.
(c) Unless the Borrower or any Lender has notified the Administrative
Agent, prior to the date any payment is required to be made by it to the
Administrative Agent hereunder, that the Borrower or such Lender, as the case
may be, will not make such payment, the Administrative Agent may assume that the
Borrower or such Lender, as the case may be, has timely made such payment and
may (but shall not be so required to), in reliance thereon, make available a
corresponding amount to the Person entitled thereto. If and to the extent that
such payment was not in fact made to the Administrative Agent in Same Day Funds,
then:
(i) if the Borrower failed to make such payment, each Lender
shall forthwith on demand repay to the Administrative Agent the portion of
such assumed payment that was made available to such Lender in Same Day
Funds, together with interest thereon in respect of each day from and
including the date such amount was made available by the Administrative
Agent to such Lender to the date such amount is repaid to the
Administrative Agent in Same Day Funds at the Overnight Rate from time to
time in effect; and
(ii) if any Lender failed to make such payment, such Lender
shall forthwith on demand pay to the Administrative Agent the amount
thereof in Same Day Funds, together with interest thereon for the period
from the date such amount was made available by the Administrative Agent to
the Borrower to the date such amount is recovered by the Administrative
Agent (the "COMPENSATION PERIOD") at a rate per annum equal to the
Overnight Rate from time to time in effect. If such Lender pays such amount
to the Administrative Agent, then such amount shall constitute such
Lender's Committed Loan included in the applicable Borrowing. If such
Lender does not pay such amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent may make a demand therefor upon
the Borrower, and the Borrower shall pay such amount to the Administrative
Agent, together with interest thereon for the Compensation Period at a rate
per annum equal to the rate of interest applicable to the applicable
Borrowing. Nothing herein shall be deemed to relieve any Lender from its
obligation to fulfill its Commitment or to prejudice any rights which the
Administrative Agent or the Borrower may have against any Lender as a
result of any default by such Lender hereunder.
A notice of the Administrative Agent to any Lender or the Borrower with
respect to any amount owing under this subsection (c) shall be conclusive,
absent manifest error.
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(d) If any Lender makes available to the Administrative Agent funds for any
Loan to be made by such Lender as provided in the foregoing provisions of this
ARTICLE II, and such funds are not made available to the Borrower by the
Administrative Agent because the conditions to the applicable Credit Extension
set forth in ARTICLE IV are not satisfied or waived in accordance with the terms
hereof, the Administrative Agent shall return such funds (in like funds as
received from such Lender) to such Lender, without interest.
(e) The obligations of the Lenders hereunder to make Committed Loans and to
fund participations in Letters of Credit and Swing Line Loans are several and
not joint. The failure of any Lender to make any Committed Loan or to fund any
such participation on any date required hereunder shall not relieve any other
Lender of its corresponding obligation to do so on such date, and no Lender
shall be responsible for the failure of any other Lender to so make its
Committed Loan or purchase its participation.
(f) Nothing herein shall be deemed to obligate any Lender to obtain the
funds for any Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.
(g) The Borrower hereby authorizes each Lender, if and to the extent
payment owed to such Lender is not made when due hereunder (after any cure
periods therefor) to charge from time to time against any and all of the
Borrower's accounts with such Lender any amount so due.
2.13 SHARING OF PAYMENTS. If, other than as expressly provided elsewhere
herein, any Lender shall obtain on account of the Committed Loans made by it, or
the participations in L/C Obligations or in Swing Line Loans held by it, any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) in excess of its ratable share (or other share
contemplated hereunder) thereof, such Lender shall immediately (a) notify the
Administrative Agent of such fact, and (b) purchase from the other Lenders such
participations in the Committed Loans made by them and/or such subparticipations
in the participations in L/C Obligations or Swing Line Loans held by them, as
the case may be, as shall be necessary to cause such purchasing Lender to share
the excess payment in respect of such Committed Loans or such participations, as
the case may be, pro rata with each of them; PROVIDED, HOWEVER, that if all or
any portion of such excess payment is thereafter recovered from the purchasing
Lender under any of the circumstances described in SECTION 10.06 (including
pursuant to any settlement entered into by the purchasing Lender in its
discretion), such purchase shall to that extent be rescinded and each other
Lender shall repay to the purchasing Lender the purchase price paid therefor,
together with an amount equal to such paying Lender's ratable share (according
to the proportion of (i) the amount of such paying Lender's required repayment
to (ii) the total amount so recovered from the purchasing Lender) of any
interest or other amount paid or payable by the purchasing Lender in respect of
the total amount so recovered, without further interest thereon. The Borrower
agrees that any Lender so purchasing a participation from another Lender may, to
the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off, but subject to SECTION 10.09) with respect to
such participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation. The Administrative Agent will keep
records (which shall be conclusive and binding in the absence of manifest error)
of participations purchased under this Section and will in each case notify the
Lenders following
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any such purchases or repayments. Each Lender that purchases a participation
pursuant to this Section shall from and after such purchase have the right to
give all notices, requests, demands, directions and other communications under
this Agreement with respect to the portion of the Obligations purchased to the
same extent as though the purchasing Lender were the original owner of the
Obligations purchased.
2.14 INCREASE IN COMMITMENTS.
(a) During the period beginning on the Closing Date and ending December 19,
2005 and provided there exists no Default, upon notice to the Administrative
Agent (which shall promptly notify the Lenders), the Borrower may request,
without the consent of the Administrative Agent and the Lenders, an increase in
the Aggregate Commitments to an amount not exceeding $275,000,000. At the time
of sending such notice, the Borrower (in consultation with the Administrative
Agent) shall specify the time period within which each Lender is requested to
respond (which shall in no event be less than ten Business Days from the date of
delivery of such notice to the Lenders). Each Lender shall notify the
Administrative Agent within such time period whether or not it agrees to
increase its Commitment and, if so, whether by an amount equal to, greater than,
or less than its Pro Rata Share of such requested increase. Any Lender not
responding within such time period shall be deemed to have declined to increase
its Commitment. The Administrative Agent shall notify the Borrower and each
Lender of the Lenders' responses to the request made hereunder. To achieve the
full amount of a requested increase, the Borrower in consultation with the
Administrative Agent may also invite additional Eligible Assignees to become
Lenders pursuant to a joinder agreement in form and substance satisfactory to
the Administrative Agent and its counsel.
(b) If the Aggregate Commitments are increased in accordance with this
Section, the Administrative Agent and the Borrower shall determine the effective
date (the "INCREASE EFFECTIVE DATE") and the final allocation of such increase.
The Administrative Agent shall promptly notify the Borrower and the Lenders of
the final allocation of such increase and the Increase Effective Date. As a
condition precedent to such increase, the Borrower shall deliver to the
Administrative Agent a certificate of each Loan Party dated as of the Increase
Effective Date (in sufficient copies for each Lender) signed by a Responsible
Officer of such Loan Party (i) certifying and attaching the resolutions adopted
by such Loan Party approving or consenting to such increase, and (ii) in the
case of the Borrower, certifying that, before and after giving effect to such
increase, (A) the representations and warranties contained in ARTICLE V and the
other Loan Documents are true and correct in all material respects on and as of
the Increase Effective Date, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they are true
and correct in all material respects as of such earlier date, and except that
for purposes of this SECTION 2.14, the representations and warranties contained
in subsections (a) and (b) of SECTION 5.05 shall be deemed to refer to the most
recent statements furnished pursuant to subsections (a) and (b), respectively,
of SECTION 6.01, and (B) no Default exists. The Borrower shall prepay any
Committed Loans outstanding on the Increase Effective Date (and pay any
additional amounts required pursuant to SECTION 3.05) to the extent necessary to
keep the outstanding Committed Loans ratable with any revised Pro Rata Shares
arising from any nonratable increase in the Aggregate Commitments under this
Section.
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(c) This Section shall supersede any provisions in SECTIONS 2.13 or 10.01
to the contrary.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 TAXES.
(a) Subject to SECTION 10.15, any and all payments by the Borrower to or
for the account of the Administrative Agent or any Lender under any Loan
Document shall be made free and clear of and without deduction for any and all
present or future taxes, duties, levies, imposts, deductions, assessments, fees,
withholdings or similar charges, and all liabilities with respect thereto,
EXCLUDING, in the case of the Administrative Agent and each Lender, income,
franchise or similar taxes imposed on (or measured by) its overall net income,
by the jurisdiction (or any political subdivision thereof) under the Laws of
which the Administrative Agent or such Lender, as the case may be, is organized
or maintains a lending office (all such non-excluded taxes, duties, levies,
imposts, deductions, assessments, fees, withholdings or similar charges, and
liabilities being hereinafter referred to as "TAXES"). Subject to SECTION 10.15,
if the Borrower shall be required by any Laws to deduct any Taxes from or in
respect of any sum payable under any Loan Document to the Administrative Agent
or any Lender, (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section), each of the Administrative Agent and such
Lender receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions, (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable Laws, and (iv) within 30 days
after the date of such payment, the Borrower shall furnish to the Administrative
Agent (which shall forward the same to such Lender) the original or a certified
copy of a receipt evidencing payment thereof.
(b) In addition, the Borrower agrees to pay any and all present or future
stamp, court or documentary taxes and any other excise or property taxes or
charges or similar levies which arise from any payment made under any Loan
Document or from the execution, delivery, performance, enforcement or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "OTHER TAXES").
(c) If the Borrower shall be required to deduct or pay any Taxes or Other
Taxes from or in respect of any sum payable under any Loan Document to the
Administrative Agent or any Lender, the Borrower shall also pay to the
Administrative Agent or to such Lender, as the case may be, at the time interest
is paid, such additional amount that the Administrative Agent or such Lender
specifies is necessary to preserve the after-tax yield (after factoring in all
taxes, including taxes imposed on or measured by net income) that the
Administrative Agent or such Lender would have received if such Taxes or Other
Taxes had not been imposed.
(d) The Borrower agrees to indemnify the Administrative Agent and each
Lender for (i) the full amount of Taxes and Other Taxes (including any Taxes or
Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this Section) paid by the Administrative Agent and such Lender, (ii) amounts
payable under SECTION 3.01, and (iii) any liability (including
46
additions to tax, penalties, interest and expenses) arising therefrom or with
respect thereto, in each case whether or not such Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
Payment under this subsection (d) shall be made within 30 days after the date
the Lender or the Administrative Agent makes a demand therefor.
3.02 ILLEGALITY. If any Lender determines that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund
Eurocurrency Rate Loans (whether denominated in Dollars or an Alternative
Currency (the "APPLICABLE CURRENCY")), or to determine or charge interest rates
based upon the Eurocurrency Rate, or any Governmental Authority has imposed
material restrictions on the authority of such Lender to purchase or sell, or to
take deposits of, any Applicable Currency in the applicable interbank market,
then, on notice thereof by such Lender to the Borrower through the
Administrative Agent, any obligation of such Lender to make or continue
Eurocurrency Rate Loans or to convert Base Rate Committed Loans to Eurocurrency
Rate Loans shall be suspended until such Lender notifies the Administrative
Agent and the Borrower that the circumstances giving rise to such determination
no longer exist. Upon receipt of such notice, the Borrower shall, upon demand
from such Lender (with a copy to the Administrative Agent), prepay or, if
applicable and such Loans are denominated in Dollars, convert all Eurocurrency
Rate Loans of such Lender to Base Rate Loans, either on the last day of the
Interest Period therefor, if such Lender may lawfully continue to maintain such
Eurocurrency Rate Loans to such day, or immediately, if such Lender may not
lawfully continue to maintain such Eurocurrency Rate Loans. Upon any such
prepayment or conversion, the Borrower shall also pay accrued interest on the
amount so prepaid or converted. Each Lender agrees to designate a different
Lending Office if such designation will avoid the need for such notice and will
not, in the good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender.
3.03 INABILITY TO DETERMINE RATES. If the Required Lenders determine
that for any reason (i) deposits in the relevant currency are not being offered
to banks in the applicable offshore interbank market for such currency for the
applicable amount and Interest Period of such Eurocurrency Rate Loan, (ii)
adequate and reasonable means do not exist for determining the Eurocurrency Rate
for any requested Interest Period with respect to a proposed Eurocurrency Rate
Loan, or (iii) that the Eurocurrency Rate for any requested Interest Period with
respect to a proposed Eurocurrency Rate Loan does not adequately and fairly
reflect the cost to such Lenders of funding such Loan, the Administrative Agent
will promptly so notify the Borrower and each Lender. Thereafter, the obligation
of the Lenders to make or maintain Eurocurrency Rate Loans shall be suspended
until the Administrative Agent (upon the instruction of the Required Lenders)
revokes such notice. Upon receipt of such notice, the Borrower may revoke any
pending request for a Borrowing of, conversion to or continuation of
Eurocurrency Rate Loans or, failing that, will be deemed to have converted such
request into a request for a Committed Borrowing of Base Rate Loans in the
amount specified therein.
3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY; RESERVES ON
EUROCURRENCY RATE LOANS.
47
(a) If any Lender determines that as a result of the introduction of or any
change in or in the interpretation of any Law, or such Lender's compliance
therewith, there shall be any increase in the cost to such Lender of agreeing to
make or making, funding or maintaining Eurocurrency Rate Loans or (as the case
may be) issuing or participating in Letters of Credit, or a reduction in the
amount received or receivable by such Lender in connection with any of the
foregoing (excluding for purposes of this subsection (a) any such increased
costs or reduction in amount resulting from (i) Taxes or Other Taxes (as to
which SECTION 3.01 shall govern), (ii) changes in the basis of taxation of
overall net income or overall gross income by the United States or any foreign
jurisdiction or any political subdivision of either thereof under the Laws of
which such Lender is organized or has its Lending Office, and (iii) reserve
requirements [contemplated by SECTION 3.04(c)]), then from time to time upon
demand of such Lender (with a copy of such demand to the Administrative Agent),
the Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such increased cost or reduction.
(b) If any Lender determines that the introduction of any Law regarding
capital adequacy or any change therein or in the interpretation thereof, or
compliance by such Lender (or its Lending Office) therewith, has the effect of
reducing the rate of return on the capital of such Lender or any corporation
controlling such Lender as a consequence of such Lender's obligations hereunder
(taking into consideration its policies with respect to capital adequacy and
such Lender's desired return on capital), then from time to time upon demand of
such Lender (with a copy of such demand to the Administrative Agent), the
Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such reduction.
(c) The Borrower shall pay to each Lender, as long as such Lender shall be
required to maintain reserves with respect to liabilities or assets consisting
of or including Eurocurrency funds or deposits (currently known as "EUROCURRENCY
LIABILITIES"), additional interest on the unpaid principal amount of each
Eurocurrency Rate Loan equal to the actual costs of such reserves allocated to
such Loan by such Lender (as determined by such Lender in good faith, which
determination shall be conclusive), which shall be due and payable on each date
on which interest is payable on such Loan, PROVIDED the Borrower shall have
received at least 15 days' prior notice (with a copy to the Administrative
Agent) of such additional interest from such Lender. If a Lender fails to give
notice 15 days prior to the relevant Interest Payment Date, such additional
interest shall be due and payable 15 days from receipt of such notice.
3.05 FUNDING LOSSES. Upon demand of any Lender (with a copy to the
Administrative Agent) from time to time, the Borrower shall promptly compensate
such Lender for and hold such Lender harmless from any loss, cost or expense
incurred by it as a result of:
(a) any continuation, conversion, payment or prepayment of any Loan other
than a Base Rate Loan on a day other than the last day of the Interest Period
for such Loan (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise);
(b) any failure by the Borrower (for a reason other than the failure of
such Lender to make a Loan) to prepay, borrow, continue or convert any Loan
other than a Base Rate Loan on the date or in the amount notified by the
Borrower;
48
(c) any failure by the Borrower to make payment of any Loan or drawing
under any Letter of Credit (or interest due thereon) denominated in an
Alternative Currency on its scheduled due date or any payment thereon in a
different currency; or
(d) any assignment of a Eurocurrency Rate Loan on a day other than the last
day of the Interest Period therefor as a result of a request by the Borrower
pursuant to SECTION 10.16;
including any loss of anticipated profits, any foreign exchange losses and any
loss or expense arising from the liquidation or reemployment of funds obtained
by it to maintain such Loan or from fees payable to terminate the deposits from
which such funds were obtained. The Borrower shall also pay any customary
administrative fees charged by such Lender in connection with the foregoing.
For purposes of calculating amounts payable by the Borrower to the Lenders under
this SECTION 3.05, each Lender shall be deemed to have funded each Eurocurrency
Rate Loan made by it at the Eurocurrency Rate for such Loan by a matching
deposit or other borrowing in the applicable offshore interbank market for such
currency for a comparable amount and for a comparable period, whether or not
such Eurocurrency Rate Loan was in fact so funded.
3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.
(a) A certificate of the Administrative Agent or any Lender claiming
compensation under this ARTICLE III and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, the Administrative Agent or such
Lender may use any reasonable averaging and attribution methods.
(b) Upon any Lender's making a claim for compensation under
SECTION 3.01 or 3.04, the Borrower may replace such Lender in accordance with
SECTION 10.16.
3.07 SURVIVAL. All of the Borrower's obligations under this ARTICLE III
shall survive termination of the Aggregate Commitments and repayment of all
other Obligations hereunder.
ARTICLE IV
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
4.01 CONDITIONS OF INITIAL CREDIT EXTENSION. The obligation of each
Lender to make its initial Credit Extension hereunder is subject to satisfaction
or waiver of the following conditions precedent:
(a) The Administrative Agent's receipt of the following, each of which
shall be originals or facsimiles (followed promptly by originals) unless
otherwise specified, each properly executed by a Responsible Officer of the
signing Loan Party, each dated the Closing Date (or, in the case of certificates
of governmental officials, a recent date before the Closing Date) and each in
form and substance satisfactory to the Administrative Agent and its legal
counsel:
49
(i) executed counterparts of this Agreement and the Guaranty,
sufficient in number for distribution to the Administrative Agent, each
Lender and the Borrower;
(ii) a Note executed by the Borrower in favor of each Lender
requesting a Note;
(iii) such certificates of resolutions or other action,
incumbency certificates and/or other certificates of Responsible Officers
of each Loan Party as the Administrative Agent may require evidencing the
identity, authority and capacity of each Responsible Officer thereof
authorized to act as a Responsible Officer in connection with this
Agreement and the other Loan Documents to which such Loan Party is a party;
(iv) such documents and certifications as the Administrative
Agent may reasonably require to evidence that each Loan Party is duly
organized or formed, and that the Borrower and each Guarantor is validly
existing, in good standing and qualified to engage in business in each
jurisdiction where its ownership, lease or operation of properties or the
conduct of its business requires such qualification, except to the extent
that failure to do so could not reasonably be expected to have a Material
Adverse Effect, including, certified copies of the Borrower's Organization
Documents, certificates of good standing and/or qualification to engage in
business and tax clearance certificates;
(v) a favorable opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
counsel to the Loan Parties, addressed to the Administrative Agent and each
Lender, as to the matters set forth in EXHIBIT G and such other matters
concerning the Loan Parties and the Loan Documents as the Required Lenders
may reasonably request;
(vi) a certificate of a Responsible Officer of each Loan Party
either (A) attaching copies of all consents, licenses and approvals
required in connection with the execution, delivery and performance by such
Loan Party and the validity against such Loan Party of the Loan Documents
to which it is a party, and such consents, licenses and approvals shall be
in full force and effect, or (B) stating that no such consents, licenses or
approvals are so required;
(vii) a certificate signed by a Responsible Officer of the
Borrower certifying (A) that the conditions specified in SECTIONS 4.02(a)
and (b) have been satisfied, (B) that, except as disclosed in any filings
made with the SEC, there has been no event or circumstance since the date
of the Audited Financial Statements that has had or could be reasonably
expected to have, either individually or in the aggregate, a Material
Adverse Effect; and (C) a calculation of the Consolidated Leverage Ratio as
of the last day of the fiscal quarter of the Borrower most recently ended
prior to the Closing Date;
(viii) evidence that all insurance required to be maintained
pursuant to the Loan Documents has been obtained and is in effect;
(ix) evidence that the Existing
Credit Agreement has been or
concurrently with the Closing Date is being terminated and all Liens, if
any, securing obligations under the
50
Existing Credit Agreement have been or concurrently with the Closing Date
are being released; and
(x) such other assurances, certificates, documents, consents or
opinions as the Administrative Agent, the L/C Issuer, the Swing Line Lender
or the Required Lenders reasonably may require.
(b) Any fees and expenses required to be paid on or before the Closing Date
shall have been paid.
(c) The Borrower shall have paid all Attorney Costs of the Administrative
Agent to the extent invoiced prior to or on the Closing Date, plus such
additional amounts of Attorney Costs as shall constitute its reasonable estimate
of Attorney Costs incurred or to be incurred by it through the closing
proceedings (provided that such estimate shall not thereafter preclude a final
settling of accounts between the Borrower and the Administrative Agent).
(d) The Closing Date shall have occurred on or before December 31, 2002.
4.02 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of each Lender
to honor any Request for Credit Extension (other than a Committed Loan Notice
requesting only a conversion of Committed Loans to the other Type, or a
continuation of Eurocurrency Rate Loans) and an increase in Commitments in
accordance with SECTION 2.14 is subject to the following conditions precedent:
(a) The representations and warranties of the Borrower and each other Loan
Party contained in ARTICLE V or any other Loan Document, or which are contained
in any document furnished by the Borrower or any other Loan Party at any time
under or in connection herewith or therewith, shall be true and correct in all
material respects on and as of the date of such Credit Extension and any
Increase Effective Date, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they shall be
true and correct in all material respects as of such earlier date, and except
that for purposes of this SECTION 4.02, the representations and warranties
contained in subsections (a) and (b) of SECTION 5.05 shall be deemed to refer to
the most recent statements furnished pursuant to clauses (a) and (b),
respectively, of SECTION 6.01.
(b) No Default shall exist, or would result from such proposed Credit
Extension or increase in Aggregate Commitments in accordance with SECTION 2.14.
(c) The Administrative Agent and, if applicable, the L/C Issuer or the
Swing Line Lender shall have received a Request for Credit Extension or the
certificate referred to in Section 2.14(b) with respect to any increase in
Aggregate Commitments, as applicable, in accordance with the requirements
hereof.
Each Request for Credit Extension (other than a Committed Loan Notice
requesting only a conversion of Committed Loans to the other Type or a
continuation of Eurocurrency Rate Loans) and certificate referred to in Section
2.14(b) with respect to any increase in the Aggregate Commitments, as
applicable, submitted by the Borrower shall be deemed to be a representation
51
and warranty that the conditions specified in SECTIONS 4.02(a) and (b) have been
satisfied on and as of the date of the applicable Credit Extension or the
Increase Effective Date, as applicable.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Administrative Agent and the
Lenders that:
5.01 EXISTENCE, QUALIFICATION AND POWER; COMPLIANCE WITH LAWS. Each Loan
Party (a) is a corporation, partnership or limited liability company duly
organized or formed, validly existing and in good standing under the Laws of the
jurisdiction of its incorporation or organization, (b) has all requisite power
and authority and all requisite governmental licenses, authorizations, consents
and approvals to (i) own its assets and carry on its business and (ii) execute,
deliver and perform its obligations under the Loan Documents to which it is a
party, (c) is duly qualified and is licensed and in good standing under the Laws
of each jurisdiction where its ownership, lease or operation of properties or
the conduct of its business requires such qualification or license, and (d) is
in compliance with all Laws; except in each case referred to in clause (b)(i),
(c) or (d), to the extent that failure to do so could not reasonably be expected
to have a Material Adverse Effect.
5.02 AUTHORIZATION; NO CONTRAVENTION. The execution, delivery and
performance by each Loan Party of each Loan Document to which such Person is
party, have been duly authorized by all necessary corporate or other
organizational action, and do not and will not (a) contravene the terms of any
of such Person's Organization Documents; (b) conflict with or result in any
breach or contravention of, or the creation of any Lien under, (i) any
Contractual Obligation to which such Person is a party or (ii) any order,
injunction, writ or decree of any Governmental Authority or any arbitral award
to which such Person or its property is subject; or (c) violate any Law. No
Subsidiary of the Borrower is in breach of any Contractual Obligation, the
breach of which could be reasonably likely to have a Material Adverse Effect.
5.03 GOVERNMENTAL AUTHORIZATION; OTHER CONSENTS. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person is necessary or required in
connection with the execution, delivery or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document.
5.04 BINDING EFFECT. This Agreement has been, and each other Loan
Document, when delivered hereunder, will have been, duly executed and delivered
by each Loan Party that is party thereto. This Agreement constitutes, and each
other Loan Document when so delivered will constitute, a legal, valid and
binding obligation of such Loan Party, enforceable against each Loan Party that
is party thereto in accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditor's rights generally or by equitable principles relating to
enforceability.
5.05 FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT.
52
(a) The Audited Financial Statements (i) were prepared in accordance with
GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein; (ii) fairly present in all material respects
the financial condition of the Borrower and its Subsidiaries as of the date
thereof and their results of operations for the period covered thereby in
accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein; and (iii) show all material
indebtedness and other liabilities, direct or contingent, of the Borrower and
its Subsidiaries as of the date thereof, including liabilities for taxes,
material commitments and Indebtedness.
(b) The unaudited consolidated financial statements of the Borrower and its
Subsidiaries dated September 30, 2002, and the related consolidated statements
of income, shareholders' equity and cash flows for the fiscal quarter ended on
that date (i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein, and (ii) fairly present in all material respects the financial
condition of the Borrower and its Subsidiaries as of the date thereof and their
results of operations for the period covered thereby, subject, in the case of
clauses (i) and (ii), to the absence of footnotes and to normal year-end audit
adjustments. SCHEDULE 5.05 sets forth all material indebtedness and other
liabilities, direct or contingent, of the Borrower and its consolidated
Subsidiaries as of the date of such financial statements, including liabilities
for taxes, material commitments and Indebtedness.
(c) Except as disclosed in any filings made with the SEC, since the date of
the Audited Financial Statements, there has been no event or circumstance,
either individually or in the aggregate, that has had or could reasonably be
expected to have a Material Adverse Effect.
5.06 LITIGATION. There are no actions, suits, proceedings, claims or
disputes pending or, to the knowledge of the Borrower after due and diligent
investigation, threatened or contemplated, at law, in equity, in arbitration or
before any Governmental Authority, by or against the Borrower or any of its
Subsidiaries or against any of their properties or revenues (collectively
"PENDING LITIGATION") that (a) purport to affect or pertain to this Agreement or
any other Loan Document, or any of the transactions contemplated hereby, or (b)
either individually or in the aggregate, if determined adversely, could
reasonably be expected to have a Material Adverse Effect. All Pending
Litigation, where the amount claimed is more than $1,000,000, is disclosed on
SCHEDULE 5.06 hereto.
5.07 NO DEFAULT. Neither the Borrower nor any Subsidiary is in default
under or with respect to any Contractual Obligation that could, either
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. No Default has occurred and is continuing or would result from
the consummation of the transactions contemplated by this Agreement or any other
Loan Document.
5.08 OWNERSHIP OF PROPERTY; LIENS. Each of the Borrower and each
Subsidiary has good record and marketable title in fee simple to, or valid
leasehold interests in, all real property necessary or used in the ordinary
conduct of its business, except for such defects in title as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. The property of the Borrower and its Subsidiaries is subject to
no Liens, other than Liens permitted by SECTION 7.01.
53
5.09 ENVIRONMENTAL COMPLIANCE. The Borrower and its Subsidiaries conduct
in the ordinary course of business a review of the effect of existing
Environmental Laws and claims alleging potential liability or responsibility for
violation of any Environmental Law on their respective businesses, operations
and properties, and as a result thereof the Borrower has reasonably concluded
that, except as specifically disclosed in SCHEDULE 5.09, such Environmental Laws
and claims could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.
5.10 INSURANCE. The properties of the Borrower and its Subsidiaries are
insured with financially sound and reputable insurance companies not Affiliates
of the Borrower, in such amounts, with such deductibles and covering such risks
as are customarily carried by companies engaged in similar businesses and owning
similar properties in localities where the Borrower or the applicable Subsidiary
operates.
5.11 TAXES. The Borrower and its Subsidiaries have filed all Federal,
state and other material tax returns and reports required to be filed, except to
the extent that failure to have done so would not result in a Material Adverse
Effect, and have paid all Federal, state and other material taxes, assessments,
fees and other governmental charges levied or imposed upon them or their
properties, income or assets otherwise due and payable, except those which are
being contested in good faith by appropriate proceedings diligently conducted
and for which adequate reserves have been provided in accordance with GAAP. To
the best knowledge of the Borrower and its Subsidiaries, there is no proposed
tax assessment against the Borrower or any Subsidiary that would, if made, have
a Material Adverse Effect.
5.12 ERISA COMPLIANCE.
(a) Except as disclosed on SCHEDULE 5.12, each Plan is in compliance in all
material respects with the applicable provisions of ERISA, the Code and other
Federal or state Laws. Each Plan that is intended to qualify under Section
401(a) of the Code has received a favorable determination letter from the IRS or
an application for such a letter is currently being processed by the IRS with
respect thereto and, to the best knowledge of the Borrower, nothing has occurred
which would prevent, or cause the loss of, such qualification. Except as
disclosed on SCHEDULE 5.12, the Borrower and each ERISA Affiliate have made all
required contributions to each Plan subject to Section 412 of the Code, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of the Borrower,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan that could be reasonably be expected to have a Material
Adverse Effect. There has been no prohibited transaction or violation of the
fiduciary responsibility rules with respect to any Plan that has resulted or
could reasonably be expected to result in a Material Adverse Effect.
(c) Except as disclosed on SCHEDULE 5.12, (i) No ERISA Event has occurred
or is reasonably expected to occur; (ii) no Pension Plan has any Unfunded
Pension Liability; (iii) neither the Borrower nor any ERISA Affiliate has
incurred, or reasonably expects to incur, any liability under Title IV of ERISA
with respect to any Pension Plan (other than premiums due and
54
not delinquent under Section 4007 of ERISA); (iv) neither the Borrower nor any
ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and
no event has occurred which, with the giving of notice under Section 4219 of
ERISA, would result in such liability) under Sections 4201 or 4243 of ERISA with
respect to a Multiemployer Plan; and (v) neither the Borrower nor any ERISA
Affiliate has engaged in a transaction that could be subject to Sections 4069 or
4212(c) of ERISA.
5.13 SUBSIDIARIES. As of the Closing Date, the Borrower has no
Subsidiaries other than those specifically disclosed in Part (a) of SCHEDULE
5.13 and has no equity investments in any other corporation or entity other than
those specifically disclosed in Part(b) of SCHEDULE 5.13.
5.14 MARGIN REGULATIONS; INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING
COMPANY ACT.
(a) The Borrower is not engaged and will not engage, principally or as one
of its important activities, in the business of purchasing or carrying margin
stock (within the meaning of Regulation U issued by the FRB), or extending
credit for the purpose of purchasing or carrying margin stock and no proceeds of
any Loans or drawings under any Letter of Credit will be used to purchase or
carry any margin stock or to extend credit to others for the purpose of
purchasing or carrying margin stock.
(b) None of the Borrower, any Person Controlling the Borrower, or any
Subsidiary (i) is a "holding company," or a "subsidiary company" of a "holding
company," or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company," within the meaning of the Public Utility Holding Company
Act of 1935, or (ii) is or is required to be registered as an "investment
company" under the Investment Company Act of 1940. Neither the making of the
Loans, nor the issuance of the Letters of Credit or the application of the
proceeds or repayment thereof by the Borrower, nor the consummation of other
transactions contemplated hereunder, will violate any provision of any such Act
or any rule, regulation or order of the SEC.
5.15 DISCLOSURE. The Borrower has disclosed to the Administrative Agent
and the Lenders all agreements, instruments and corporate or other restrictions
to which it or any of its Subsidiaries is subject, and all other matters known
to it, that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect. No report, financial statement, certificate
or other information furnished (whether in writing or orally) by or on behalf of
any Loan Party to the Administrative Agent or any Lender in connection with the
transactions contemplated hereby and the negotiation of this Agreement or
delivered hereunder (as modified or supplemented by other information so
furnished) contains any material misstatement of fact (known to the Borrower in
the case of any document not furnished by the Borrower) or omits to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that, with
respect to projected financial information, the Borrower represents only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time, it being recognized by the Lenders that such
projections as to future events are not viewed as facts and that actual results
during the period or periods covered by any such projections may differ
significantly from the projected results.
55
5.16 COMPLIANCE WITH LAWS. Each of the Borrower and each Subsidiary is
in compliance in all material respects with the requirements of all Laws and all
orders, writs, injunctions and decrees applicable to it or to its properties,
except in such instances in which (a) such requirement of Law or order, writ,
injunction or decree is being contested in good faith by appropriate proceedings
diligently conducted or (b) the failure to comply therewith, either individually
or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect.
5.17 INTELLECTUAL PROPERTY; LICENSES, ETC. The Borrower and its
Subsidiaries own, or possess the right to use, all of the material trademarks,
service marks, trade names, copyrights, patents, patent rights, franchises,
licenses and other intellectual property rights (collectively, "IP RIGHTS") that
are reasonably necessary for the operation of their respective businesses and,
except as disclosed in SCHEDULE 5.17, are not aware of any conflicts between
such rights and the rights of any other Person which could reasonably be
expected to have a Material Adverse Effect. Except as specifically disclosed in
SCHEDULE 5.17, no claim or litigation regarding any IP Rights is pending or, to
the knowledge of the Borrower, threatened, which, either individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
5.18 TITLE IV COMPLIANCE. With respect to each Educational Institution
which participates in Title IV:
(a) Each Educational Institutional is (or, in the case of any Educational
Institution acquired on or after the Closing Date, immediately prior to the
acquisition such Educational Institution was, and in the ordinary course of
review by the DOE, will be) an "eligible proprietary institution of higher
education," as defined in 34 C.F.R. Section 600.5.
(b) Each Educational Institution has (or, in the case of any Educational
Institution acquired on or after the Closing Date, immediately prior to the
acquisition such Educational Institution was, and in the ordinary course of
review by the DOE, will have) received an eligibility notification, as that term
is defined in 34 C.F.R. Section 600.21.
(c) Each Educational Institution has (or, in the case of any Educational
Institution acquired on or after the Closing Date, immediately prior to the
acquisition such Educational Institution was, and in the ordinary course of
review by the DOE, will have) met the standards for participation in Title IV
Programs as set forth in 34 C.F.R. Section 668.16, and has a current program
participation agreement with the Secretary.
(d) Each Educational Institution has at all times during which it has been
owned by the Borrower or a Subsidiary of the Borrower acted with the competency
and integrity necessary to qualify as a fiduciary in the administration of Title
IV Programs, as provided by 34 C.F.R. Section 668.82.
(e) To the best of the Borrower's and each of its Subsidiary's knowledge,
and except as disclosed on SCHEDULE 5.18(e), the Borrower and each such
Subsidiary's operations with respect to each Educational Institution at all
times during which it has been owned by the Borrower or a Subsidiary of the
Borrower, have, in all material respects, been conducted in all material
respects in accordance with all relevant standards imposed by Accrediting
Bodies, agencies administering
56
state or federal government student aid programs in which any such Subsidiary
participates, and all other applicable laws and regulations. The Borrower and
each of its Subsidiaries, at all times during which it has been owned by the
Borrower or a Subsidiary of the Borrower, have submitted all reports, audits and
other information, whether periodic in nature or pursuant to specific requests,
for each Educational Institution ("Compliance Reports") to all agencies or other
entities with which such filings are required relating to its compliance with
(i) applicable accreditation standards governing its activities or (ii) laws or
regulations governing programs pursuant to which any Subsidiary or its students
receive funding, and (iii) all articulation agreements, if any, with
degree-granting colleges and universities in effect as of the date of this
Agreement, except to the extent that failure to submit any such Compliance
Report would not result in a Material Adverse Effect. To the best of the
Borrower's and each such Subsidiary's knowledge, all such forms and records with
respect to each Educational Institution have, at all times during which it has
been owned by the Borrower or a Subsidiary of the Borrower, been prepared,
completed, maintained and filed in all material respects in accordance with all
applicable federal and state laws and regulation, and are true and correct in
all material respects. To the best knowledge of the Borrower and each Subsidiary
of the Borrower, all financial aid grants and loans, disbursements and record
keeping relating thereto with respect to each Educational Institution, at all
times during which it has been owned by the Borrower or a Subsidiary of the
Borrower, have been completed in substantial compliance with all federal and
state requirements, and there are no material deficiencies in respect thereto.
To the best of the Borrower's and each of its Subsidiaries' knowledge and except
as previously disclosed in prior audits by DOE, no student at any Educational
Institution has been funded prior to the date for which such student was
eligible for funding, except to the extent that such prior funding would not
have a Material Adverse Effect, and such student's records conform in all
material respects in form and substance to all relevant regulatory requirements.
(f) SCHEDULE 5.18(f) sets forth the cohort default rate for each
Educational Institution, as calculated and published by the DOE, for each
Educational Institution for the federal cohort year 2000. Except as set forth in
the appeals described on SCHEDULE 5.18(f), to the best of the Borrower's and
each of its Subsidiaries knowledge, such schedule is materially accurate in all
respects. To the best of the Borrower's and each of its Subsidiaries knowledge,
they have received no notice as to the calculation or publication of the cohort
default rates for any Educational Institution for the federal cohort year 2001.
As used in this section, all terms, unless otherwise defined herein, shall
have the meanings as set forth in the citations referred to above or as
otherwise defined in 34 C.F.R., Part 600 or Part 668, as the context requires.
ARTICLE VI
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, the Borrower shall, and shall (except in the
case of the covenants set forth in SECTIONS 6.01, 6.02, 6.03 and 6.11) cause
each Subsidiary to:
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6.01 FINANCIAL STATEMENTS. Deliver to the Administrative Agent and each
Lender, in form and detail satisfactory to the Administrative Agent and the
Required Lenders:
(a) as soon as available, but in any event within 95 days after the end of
each fiscal year of the Borrower, a consolidated balance sheet of the Borrower
and its Subsidiaries as at the end of such fiscal year, and the related
consolidated statements of income, shareholders' equity and cash flows for such
fiscal year, setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail and prepared in accordance with
GAAP, audited and accompanied by a report and opinion of an independent
certified public accountant of nationally recognized standing reasonably
acceptable to the Administrative Agent, which report and opinion shall be
prepared in accordance with generally accepted auditing standards and shall not
be subject to any "going concern" or like qualification or exception or any
qualification or exception as to the scope of such audit; and
(b) as soon as available, but in any event within 50 days after the end of
each of the first three fiscal quarters of each fiscal year of the Borrower, a
consolidated balance sheet of the Borrower and its Subsidiaries as at the end of
such fiscal quarter, and the related consolidated statements of income,
shareholders' equity and cash flows for such fiscal quarter and for the portion
of the Borrower's fiscal year then ended, setting forth in each case in
comparative form the figures for the corresponding fiscal quarter of the
previous fiscal year and the corresponding portion of the previous fiscal year,
all in reasonable detail and certified by a Responsible Officer of the Borrower
as fairly presenting in all material respects the financial condition, results
of operations, shareholders' equity and cash flows of the Borrower and its
Subsidiaries in accordance with GAAP, subject only to normal year-end audit
adjustments and the absence of footnotes.
As to any information contained in materials furnished pursuant to SECTION
6.02(e), the Borrower shall not be separately required to furnish such
information under clause (a) or (b) above, but the foregoing shall not be in
derogation of the obligation of the Borrower to furnish the information and
materials described in subsections (a) and (b) above at the times specified
therein.
6.02 CERTIFICATES; OTHER INFORMATION. Deliver to the Administrative
Agent and each Lender, in form and detail satisfactory to the Administrative
Agent and the Required Lenders:
(a) concurrently with the delivery of the financial statements referred to
in SECTION 6.01(a), a certificate of its independent certified public
accountants certifying such financial statements and stating that in making the
examination necessary therefor no knowledge was obtained of any Default under
the financial covenants set forth herein or, if any such Default shall exist,
stating the nature and status of such event setting forth the details of such
Default and the action that the Borrower has taken or proposes to take with
respect thereto;
(b) concurrently with the delivery of the financial statements referred to
in SECTIONS 6.01(a) and (b), a duly completed Compliance Certificate signed by a
Responsible Officer of the Borrower;
(c) promptly after any request by the Administrative Agent or any Lender,
copies of any detailed audit reports, management letters or recommendations
submitted to the board of
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directors (or the audit committee of the board of directors) of the Borrower by
independent accountants in connection with the accounts or books of the Borrower
or any Subsidiary, or any audit of any of them;
(d) As soon as available, but in any event: (a) within 30 days after the
beginning of each fiscal year of the Borrower, a copy of the plan and forecast
(including a projected closing consolidated and consolidating balance sheet,
income statement and funds flow statements) of the Borrower and its Subsidiaries
for such fiscal year; and (b) within 30 days after the end of the second fiscal
quarter of the Borrower in each fiscal year, an update of each plan and forecast
delivered with respect to the fiscal year in which such fiscal quarter occurs,
reflecting changes in such plan resulting from actual and then anticipated
results and forecasts;
(e) promptly after the same are available, copies of each annual report,
proxy or financial statement or other report or communication sent to the
stockholders of the Borrower, and copies of all annual, regular, periodic and
special reports and registration statements which the Borrower may file or be
required to file with the SEC under Section 13 or 15(d) of the Securities
Exchange Act of 1934, and not otherwise required to be delivered to the
Administrative Agent pursuant hereto; and
(f) promptly, such additional information regarding the business, financial
or corporate affairs of the Borrower or any Subsidiary, or compliance with the
terms of the Loan Documents, as the Administrative Agent or any Lender may from
time to time reasonably request.
Documents required to be delivered pursuant to SECTIONS 6.01(a) or (b) or
SECTION 6.02(e) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Borrower posts such documents, or provides a link thereto on the Borrower's
website on the Internet at the website address listed on SCHEDULE 10.02; or (ii)
on which such documents are posted on the Borrower's behalf on
IntraLinks/IntraAgency or another relevant website, if any, to which each Lender
and the Administrative Agent have access (whether a commercial, third-party
website or whether sponsored by the Administrative Agent); PROVIDED that: (i)
the Borrower shall deliver paper copies of such documents to the Administrative
Agent or any Lender that requests the Borrower to deliver such paper copies
until a written request to cease delivering paper copies is given by the
Administrative Agent or such Lender and (ii) the Borrower shall notify (which
may be by facsimile or electronic mail) the Administrative Agent and each Lender
of the posting of any such documents and provide to the Administrative Agent by
electronic mail electronic versions (i.e., soft copies) of such documents.
Notwithstanding anything contained herein, in every instance the Borrower shall
be required to provide paper copies of the Compliance Certificates required by
SECTION 6.02(c) to the Administrative Agent and each of the Lenders. Except for
such Compliance Certificates, the Administrative Agent shall have no obligation
to request the delivery or to maintain copies of the documents referred to
above, and in any event shall have no responsibility to monitor compliance by
the Borrower with any such request for delivery, and each Lender shall be solely
responsible for requesting delivery to it or maintaining its copies of such
documents.
6.03 NOTICES. PROMPTLY NOTIFY THE ADMINISTRATIVE AGENT AND EACH LENDER:
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(a) of the occurrence of any Default;
(b) of any matter that has resulted or could reasonably be expected to
result in a Material Adverse Effect, including (i) any material breach or
material non-performance of, or any material default under, a Contractual
Obligation of the Borrower or any Subsidiary; (ii) any dispute, litigation,
investigation, proceeding or suspension between the Borrower or any Subsidiary
and any Governmental Authority; or (iii) the commencement of, or any material
development in, any litigation or proceeding affecting the Borrower or any
Subsidiary, including pursuant to any applicable Environmental Laws;
(c) of the occurrence of any ERISA Event;
(d) of any material change in accounting policies or financial reporting
practices by the Borrower or any Subsidiary; and
Each notice pursuant to this Section shall be accompanied by a statement of
a Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower has taken and proposes
to take with respect thereto. Each notice pursuant to SECTION 6.03(a) shall
describe with particularity any and all provisions of this Agreement and any
other Loan Document that have been breached.
6.04 PAYMENT OF OBLIGATIONS. Pay and discharge as the same shall become
due and payable, all its obligations and liabilities, including (a) all tax
liabilities, assessments and governmental charges or levies upon it or its
properties or assets, unless the same are being contested in good faith by
appropriate proceedings diligently conducted and adequate reserves in accordance
with GAAP are being maintained by the Borrower or such Subsidiary; (b) all
lawful claims which, if unpaid, would by law become a Lien upon its property;
and (c) all Indebtedness, as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness unless the same are being contested in good faith by
appropriate proceedings diligently conducted and adequate reserves in accordance
with GAAP are being maintained by the Borrower or such Subsidiary.
6.05 PRESERVATION OF EXISTENCE, ETC. (a) Preserve, renew and maintain in
full force and effect its legal existence and good standing under the Laws of
the jurisdiction of its organization except in a transaction permitted by
SECTIONS 7.04 or 7.05, and except that the Borrower shall not be required to
maintain the existence or good standing of any Subsidiary which (i) when taken
together with all other Subsidiaries which have been dissolved pursuant hereto
in the aggregate during any consecutive twelve (12) month period, accounts for
less than ten percent (10%) of Consolidated EBITDA for such twelve (12) month
period and (ii) preservation thereof is no longer desirable in the conduct of
business of the Borrower or its Subsidiaries; (b) take all reasonable action to
maintain all rights, privileges, permits, licenses and franchises necessary or
desirable in the normal conduct of its business, except to the extent that
failure to do so could not reasonably be expected to have a Material Adverse
Effect; and (c) preserve or renew all of its registered patents, trademarks,
trade names and service marks, the non-preservation of which could reasonably be
expected to have a Material Adverse Effect.
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6.06 MAINTENANCE OF PROPERTIES. (a) Maintain, preserve and protect all
of its material properties and equipment necessary in the operation of its
business in good working order and condition, ordinary wear and tear excepted;
(b) make all necessary repairs thereto and renewals and replacements thereof
except where the failure to do so could not reasonably be expected to have a
Material Adverse Effect; and (c) use the standard of care typical in the
industry in the operation and maintenance of its facilities.
6.07 MAINTENANCE OF INSURANCE. Maintain with financially sound and
reputable insurance companies not Affiliates of the Borrower, insurance with
respect to its properties and business against loss or damage of the kinds
customarily insured against by Persons engaged in the same or similar business,
of such types and in such amounts as are customarily carried under similar
circumstances by such other Persons.
6.08 COMPLIANCE WITH LAWS. Comply in all material respects with the
requirements of all Laws and all orders, writs, injunctions and decrees
applicable to it or to its business or property, except in such instances in
which (a) such requirement of Law or order, write, injunction or decree is being
contested in good faith by appropriate proceedings diligently conducted or a
bona fide dispute exists with respect thereto; or (b) the failure to comply
therewith could not reasonably be expected to have a Material Adverse Effect.
6.09 BOOKS AND RECORDS. (a) Maintain proper books of record and account,
in which full, true and correct entries in conformity with GAAP consistently
applied shall be made of all financial transactions and matters involving the
assets and business of the Borrower or such Subsidiary, as the case may be; and
(b) maintain such books of record and account in material conformity with all
applicable requirements of any Governmental Authority having regulatory
jurisdiction over the Borrower or such Subsidiary, as the case may be.
6.10 INSPECTION RIGHTS. Permit not more than two times per year
representatives and independent contractors of the Administrative Agent and each
Lender to visit and inspect any of its properties, to examine its corporate,
financial and operating records, and make copies thereof or abstracts therefrom,
and to discuss its affairs, finances and accounts with its directors, officers,
and independent public accountants, all at the expense of the Administrative
Agent or such Lender, as applicable, and at such reasonable times during normal
business hours, upon reasonable advance notice to the Borrower; PROVIDED,
HOWEVER, that when an Event of Default exists the Administrative Agent or any
Lender (or any of their respective representatives or independent contractors)
may do any of the foregoing at the expense of the Borrower as often as may be
desired during normal business hours and without advance notice.
6.11 USE OF PROCEEDS. Use the proceeds of the Credit Extensions for
Permitted Acquisitions, to refinance certain existing indebtedness outstanding,
to support the issuance of standby letters of credit and for general corporate
purposes not in contravention of any Law or of any Loan Document.
6.12 ADDITIONAL GUARANTORS. Notify the Administrative Agent at the time
that any Person becomes a Domestic Subsidiary, and promptly thereafter (and in
any event within 30 days), cause such Person to (a) become a Guarantor by
executing and delivering to the Administrative Agent a counterpart of the
Guaranty or such other document as the
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Administrative Agent shall deem appropriate for such purpose, and (b) deliver to
the Administrative Agent documents of the types referred to in clauses (iii) and
(iv) of Section 4.01(a) and favorable opinion(s) of counsel to such Person
(which shall cover, among other things, the legality, validity, binding effect
and enforceability of the documentation referred to in clause (a)), all in form,
content and scope reasonably satisfactory to the Administrative Agent.
6.13 ACQUISITIONS. Prior to consummating any Acquisition with a value in
excess of $10,000,000, the Borrower shall have delivered to the Administrative
Agent (in form and detail reasonably satisfactory to each Lender and in
sufficient copies for each Lender) the following:
(i) Simultaneously with, or as soon as practicable after, the
first public announcement of the Borrower's intention to consummate an
Acquisition, a brief summary of the substantive terms thereof, or if
available, a copy of the executed purchase or merger agreement, together
with a copy of such announcement;
(ii) At least 10 days prior to the consummation of such
Acquisition (unless the first public announcement thereof or the execution
of the relevant purchase or merger agreement occurs later, in which case
upon such later date), a copy, certified by a Responsible Officer of the
Borrower, of the executed purchase contract or merger agreement relating to
such Acquisition; and
(iii) An Officer's certificate, executed by a Responsible Officer
of the Borrower, dated the date of consummation of such Acquisition,
certifying that immediately before and after giving effect to such
Acquisition (A) no Default has occurred and is continuing or will exist,
(B) that the Borrower will be in compliance on a pro forma basis with each
of the financial ratios specified in SECTION 7.11 as of the end of the
fiscal quarter immediately preceding such Acquisition for which financial
statements have been delivered pursuant to SECTION 6.01 for the
twelve-month period preceding such fiscal quarter end, together with a
reasonably detailed worksheet setting forth the calculation of such ratios
and (C) that the Acquisition is a Permitted Acquisition.
6.14 TITLE IV COMPLIANCE. The Borrower and each of its Subsidiaries
shall:
(a) Other than actions in connection with an Acquisition for which the
Borrower shall use its best efforts to obtain favorable DOE review of a
pre-acquisition review application in connection with the Acquisition, take no
action which would cause any Educational Institution to fail to qualify as an
"eligible institution," as defined in 34 C.F.R. Section 600.2, including without
limitation, under 34 C.F.R. Section 600.40;
(b) Other than actions in connection with an Acquisition for which the
Borrower shall use its best efforts to obtain favorable DOE review of a
pre-acquisition review application in connection with the Acquisition, take no
action which would cause any Educational Institution to fail to qualify as a
Proprietary Institution of Higher Education in accordance with 34 C.F.R. Section
600.5;
(c) Not permit more than ninety percent (90%) of each Educational
Institution's revenues during the most recent fiscal year to be derived from
Title IV Program Funds based on the
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formula set forth in 34 C.F.R. Section 600.5(d) and with respect to any
Educational Institution acquired after the Closing Date, the Borrower shall have
until the end of the next subsequent fiscal year of the Borrower to bring such
Educational Institution in compliance with the first clause of this SECTION
6.14(c);
(d) Other than actions in connection with an Acquisition, maintain each
Educational Institution as an institution that is accredited, as defined in 34
C.F.R. Section 600.2;
(e) Submit a materially complete application for a renewal of certification
to the Secretary at least ninety (90) days prior to the expiration of such
Educational Institution's current period of participation or, in the event of
the Secretary's selection of an Educational Institution for recertification,
submit a materially completed application for renewal to the Secretary on or
before the date specified in the notice of selection for recertification;
(f) Comply with the application procedures set forth in 34 C.F.R. Section
600.20;
(g) Other than actions in connection with an Acquisition for which the
Borrower shall use its best efforts to obtain favorable DOE review of a
pre-acquisition review application in connection with the Acquisition, take no
action that would cause any Educational Institution to undergo a change of
ownership that would result in a change of control, as set forth in 34 C.F.R.
Section 600.31;
(h) Cause each Educational Institution to meet the standards for
participation in Title IV Programs in 34 C.F.R., Part 668, Subpart B, and to
have a current program participation agreement with the Secretary or in the case
of an Acquisition, immediately following approval by the DOE, take such action
as is necessary to comply with the foregoing;
(i) Monitor and use its best efforts to prevent the Federal student aid
published cohort default rate for each Educational Institution from exceeding
twenty-five percent (25%) for any three consecutive 12-month periods or forty
percent (40%) for any twelve month period; and
(j) Cause each Educational Institution to comply with the standard of
conduct required of a fiduciary in the administration of Title IV Programs, as
set forth in 34 C.F.R. Section 668.82.
As used in this section, all terms shall have the meanings as set forth in
the citations referred to above or as otherwise defined in 34 C.F.R., Part 600
or Part 668, as the context requires.
6.15 POST-CLOSING DELIVERIES. As soon as available but in any event by
January 31, 2003, the Borrower shall provide the Administrative Agent with
copies of UCC, tax and judgment Lien searches for the jurisdictions listed on
SCHEDULE 7.01 hereto for which search information is incomplete, such searches
to show no Liens other than Liens permitted under SECTION 7.01 (other than
subsection (b) thereof).
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ARTICLE VII
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, the Borrower shall not, nor shall it permit any
Subsidiary to, directly or indirectly:
7.01 LIENS. Create, incur, assume or suffer to exist any Lien upon any
of its property, assets or revenues, whether now owned or hereafter acquired,
other than the following:
(a) Liens pursuant to any Loan Document;
(b) Liens existing on the date hereof and listed on SCHEDULE 7.01 and any
renewals or extensions thereof, PROVIDED that the property covered thereby is
not increased and any renewal or extension of the obligations secured or
benefited thereby is permitted by SECTION 7.03(b);
(c) Liens for taxes not yet due or which are being contested in good faith
and by appropriate proceedings diligently conducted, if adequate reserves with
respect thereto are maintained on the books of the applicable Person in
accordance with GAAP;
(d) carriers', warehousemen's, mechanics', materialmen's, repairmen's or
other like Liens arising in the ordinary course of business which are not
overdue for a period of more than 30 days or which are being contested in good
faith and by appropriate proceedings diligently conducted, if adequate reserves
with respect thereto are maintained on the books of the applicable Person in
accordance with GAAP;
(e) pledges or deposits in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other social security
legislation, other than any Lien imposed by ERISA;
(f) deposits to secure the performance of bids, trade contracts and leases
(other than Indebtedness), statutory obligations, surety bonds (other than bonds
related to judgments or litigation), performance bonds and other obligations of
a like nature incurred in the ordinary course of business;
(g) easements, rights-of-way, restrictions and other similar encumbrances
affecting real property which, in the aggregate, are not substantial in amount,
and which do not in any case materially detract from the value of the property
subject thereto or materially interfere with the ordinary conduct of the
business of the applicable Person;
(h) Liens securing judgments for the payment of money not constituting an
Event of Default under SECTION 8.01(h) or securing appeal or other surety bonds
related to such judgments;
(i) Liens securing Indebtedness permitted under SECTION 7.03(e); PROVIDED
that (i) such Liens do not at any time encumber any property other than the
property financed by such
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Indebtedness and (ii) the Indebtedness secured thereby does not exceed the cost
or fair market value, whichever is lower, of the property being acquired on the
date of acquisition;
(j) Liens on fixed assets when acquired in connection with Permitted
Acquisitions;
(k) Liens arising from precautionary uniform commercial code financing
statements filed under any lease, consignment arrangement or bailment permitted
by this Agreement;
(l) Liens on the Borrower's assets in favor of Guarantors securing loans
and advances to the Borrower which have been subordinated pursuant to the
Guaranty; and
(m) Liens in an aggregate amount not to exceed $30,000,000 at any time
outstanding securing Indebtedness permitted hereunder.
7.02 INVESTMENTS. Make any Investments, except:
(a) Investments held by the Borrower or such Subsidiary in the form of cash
equivalents or short-term marketable debt securities;
(b) advances to officers, directors and employees of the Borrower and
Subsidiaries in an aggregate amount not to exceed $1,000,000 at any time
outstanding, for travel, entertainment, relocation and analogous ordinary
business purposes to the extent permitted under ▇▇▇▇▇▇▇▇-▇▇▇▇▇;
(c) Investments of the Borrower in any Guarantor and Investments of any
Subsidiary in the Borrower or in any Guarantor;
(d) Existing Investments by the Borrower in any Subsidiary which is not a
Guarantor and additional Investments not exceeding $50,000,000 at any one time
outstanding;
(e) Investments consisting of extensions of credit in the nature of
accounts receivable or notes receivable arising from the grant of trade credit
in the ordinary course of business, and Investments received in satisfaction or
partial satisfaction thereof from financially troubled account debtors to the
extent reasonably necessary in order to prevent or limit loss;
(f) Guarantees permitted by SECTION 7.03;
(g) Permitted Acquisitions; and
(h) other Investments not exceeding $50,000,000 in the aggregate at any one
time outstanding.
7.03 INDEBTEDNESS. Create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness under the Loan Documents and the Canadian Facility
Agreement;
(b) Indebtedness outstanding on the date hereof and listed on SCHEDULE 7.03
and any refinancings, refundings, renewals or extensions thereof; PROVIDED that
the amount of such
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Indebtedness is not increased at the time of such refinancing, refunding,
renewal or extension except by an amount equal to a reasonable premium or other
reasonable amount paid, and fees and expenses reasonably incurred, in connection
with such refinancing and by an amount equal to any existing commitments
unutilized thereunder;
(c) Guarantees of any Loan Party in respect of Indebtedness otherwise
permitted hereunder of any other Loan Party;
(d) obligations (contingent or otherwise) of the Borrower or any Subsidiary
existing or arising under any Swap Contract, PROVIDED that (i) such obligations
are (or were) entered into by such Person in the ordinary course of business for
the purpose of directly mitigating risks associated with liabilities,
commitments, investments, assets, or property held or reasonably anticipated by
such Person, or changes in the value of securities issued by such Person, and
not for purposes of speculation or taking a "market view;" and (ii) such Swap
Contract does not contain any provision exonerating the non-defaulting party
from its obligation to make payments on outstanding transactions to the
defaulting party;
(e) Indebtedness in respect of capital leases, Synthetic Lease Obligations
and purchase money obligations for fixed or capital assets within the
limitations set forth in SECTION 7.01(i); PROVIDED, HOWEVER, that the aggregate
amount of all such Indebtedness at any one time outstanding shall not exceed
$50,000,000;
(f) so long as no Default has occurred and is continuing or would result
therefrom, unsecured Indebtedness in an aggregate principal amount not to exceed
$100,000,000 at any time outstanding; PROVIDED that such Indebtedness is not
senior in right of payment to the payment of the Indebtedness arising under this
Agreement and the Loan Documents; and
(g) Indebtedness in an aggregate principal amount not to exceed $30,000,000
at any time outstanding in respect of surety bonds and similar instruments
issued in the ordinary course of business.
7.04 FUNDAMENTAL CHANGES. Merge, dissolve, liquidate, consolidate with
or into another Person, or Dispose of (whether in one transaction or in a series
of transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to or in favor of any Person, except that, so long as no
Default exists or would result therefrom:
(a) any Subsidiary may merge with (i) the Borrower, PROVIDED that the
Borrower shall be the continuing or surviving Person, or (ii) any one or more
other Subsidiaries, PROVIDED that when any Guarantor is merging with another
Subsidiary, the Guarantor shall be the continuing or surviving Person; and
(b) any Subsidiary may Dispose of all or substantially all of its assets
(upon voluntary liquidation or otherwise) to the Borrower or to another
Subsidiary; PROVIDED that if the transferor in such a transaction is a
wholly-owned Subsidiary, then the transferee must either be the Borrower or a
wholly-owned Subsidiary.
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7.05 DISPOSITIONS. Make any Disposition or enter into any agreement to
make any Disposition, except:
(a) Dispositions of obsolete or worn out property, whether now owned or
hereafter acquired, in the ordinary course of business;
(b) Dispositions of inventory in the ordinary course of business;
(c) Dispositions of equipment or real property to the extent that (i) such
property is exchanged for credit against the purchase price of similar
replacement property or (ii) the proceeds of such Disposition are reasonably
promptly applied to the purchase price of such replacement property within 180
days of such Disposition;
(d) Dispositions of property by any Subsidiary to the Borrower or to a
wholly-owned Subsidiary; PROVIDED that if the transferor of such property is a
Guarantor, the transferee thereof must either be the Borrower or a Guarantor;
and
(e) Dispositions permitted by SECTION 7.04.
PROVIDED, HOWEVER, that any Disposition pursuant to clauses (a) through (e)
shall be for fair market value.
7.06 RESTRICTED PAYMENTS. Declare or make, directly or indirectly, any
Restricted Payment, or incur any obligation (contingent or otherwise) to do so,
except that:
(a) each Subsidiary may make Restricted Payments to the Borrower and to
wholly-owned Subsidiaries (and, in the case of a Restricted Payment by a
non-wholly-owned Subsidiary, to the Borrower and any Subsidiary and to each
other owner of capital stock or other equity interests of such Subsidiary on a
pro rata basis based on their relative ownership interests);
(b) the Borrower and each Subsidiary may declare and make dividend payments
or other distributions payable solely in the common stock or other common equity
interests of such Person;
(c) the Borrower and each Subsidiary may purchase, redeem or otherwise
acquire shares of its common stock or other common equity interests or warrants
or options to acquire any such shares with the proceeds received from the
substantially concurrent issue of new shares of its common stock or other common
equity interests;
(d) the Borrower and each Subsidiary may make Permitted Treasury Stock
Repurchases; and
(e) the Borrower may make payment in its common stock in connection with a
Permitted Acquisition.
7.07 CHANGE IN NATURE OF BUSINESS. Engage in any material line of
business substantially different from those lines of business conducted by the
Borrower and its Subsidiaries on the date hereof or any business substantially
related or incidental thereto.
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7.08 TRANSACTIONS WITH AFFILIATES. Enter into any transaction of any
kind with any Affiliate of the Borrower, whether or not in the ordinary course
of business, other than on fair and reasonable terms substantially as favorable
to the Borrower or such Subsidiary as would be obtainable by the Borrower or
such Subsidiary at the time in a comparable arm's length transaction with a
Person other than an Affiliate.
7.09 BURDENSOME AGREEMENTS. Enter into any Contractual Obligation (other
than this Agreement or any other Loan Document) that (a) limits the ability (i)
of any Subsidiary to make Restricted Payments to the Borrower or any Guarantor
or to otherwise transfer property to the Borrower or any Guarantor, (ii) of any
Subsidiary to Guarantee the Indebtedness of the Borrower or (iii) of the
Borrower or any Subsidiary to create, incur, assume or suffer to exist Liens on
property of such Person; PROVIDED, HOWEVER, that this clause (iii) shall not
prohibit any negative pledge incurred or provided in favor of any holder of
Indebtedness permitted under SECTION 7.03(e) solely to the extent any such
negative pledge relates to the property financed by or the subject of such
Indebtedness; or (b) requires the grant of a Lien to secure an obligation of
such Person if a Lien is granted to secure another obligation of such Person.
7.10 USE OF PROCEEDS. Use the proceeds of any Credit Extension, whether
directly or indirectly, and whether immediately, incidentally or ultimately, to
purchase or carry margin stock (within the meaning of Regulation U of the FRB)
or to extend credit to others for the purpose of purchasing or carrying margin
stock or to refund indebtedness originally incurred for such purpose.
7.11 FINANCIAL COVENANTS.
(a) CONSOLIDATED NET WORTH. Permit Consolidated Net Worth at any time to be
less than the sum of (a) $335,000,000, (b) an amount equal to 75% of the
Consolidated Net Income earned in each full fiscal quarter ending after
September 30, 2002 (with no deduction for a net loss in any such fiscal quarter)
and (c) an amount equal to 100% of the aggregate increases in Shareholders'
Equity of the Borrower and its Subsidiaries after the date hereof by reason of
the issuance and sale of capital stock or other equity interests of the Borrower
or any Subsidiary (other than issuances to the Borrower or a wholly-owned
Subsidiary), including upon any conversion of debt securities of the Borrower
into such capital stock or other equity interests.
(b) CONSOLIDATED FIXED CHARGE COVERAGE RATIO. Permit the Consolidated Fixed
Charge Coverage Ratio as of the end of any fiscal quarter of the Borrower from
and after September 30, 2002 to be less than 1.50:1.00.
(c) CONSOLIDATED LEVERAGE RATIO. Permit the Consolidated Leverage Ratio at
any time during any period of four fiscal quarters of the Borrower ending during
any period set forth below to be greater than the ratio set forth below opposite
such period:
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Minimum
Consolidated
Four Fiscal Quarters Ending Leverage Ratio
-----------------------------------------------------------------------
Closing Date through December 31, 2003 2.50:1.00
January 1, 2004 through December 31, 2004 2.25:1.00
January 1, 2005 through December 31, 2006 2.00:1.00
January 1, 2007 and each fiscal quarter thereafter 1.75:1.00
(d) DOE FINANCIAL RESPONSIBILITY COMPOSITE RATIO. Permit the DOE Ratio, for
the Borrower and its Subsidiaries on a consolidated basis, as of the last day of
any fiscal year of the Borrower to be less than 1.50.
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES
8.01 EVENTS OF DEFAULT. Any of the following shall constitute an Event
of Default:
(a) NON-PAYMENT. The Borrower or any other Loan Party fails to pay (i) when
and as required to be paid herein, any amount of principal of any Loan or any
L/C Obligation, or (ii) within three days after the same becomes due, any
interest on any Loan or on any L/C Obligation, or any commitment or other fee
due hereunder, or (iii) within five days after the same becomes due, any other
amount payable hereunder or under any other Loan Document; or
(b) SPECIFIC COVENANTS. (i) the Borrower fails to perform or observe any
term, covenant or agreement contained in any of SECTION 6.01, 6.02, 6.03, 6.05,
6.10, 6.11 or 6.12 or ARTICLE VII, or (ii) any Guarantor fails to perform or
observe any term, covenant or agreement contained in the Guaranty; or
(c) OTHER DEFAULTS. Any Loan Party fails to perform or observe any other
covenant or agreement (not specified in subsection (a) or (b) above) contained
in any Loan Document on its part to be performed or observed and such failure
continues for 30 days after the earlier of (i) knowledge by an executive officer
of such Loan Party or (ii) notice thereof has been received by the Borrower from
the Administrative Agent or any Lender; or
(d) REPRESENTATIONS AND WARRANTIES. Any representation, warranty,
certification or statement of fact made or deemed made by or on behalf of the
Borrower or any other Loan Party herein, in any other Loan Document, or in any
document delivered in connection herewith or therewith shall be materially
incorrect or misleading when made or deemed made; or
(e) CROSS-DEFAULT. (i) The Borrower or any Subsidiary (A) fails to make any
payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of any Indebtedness or Guarantee
(other than Indebtedness hereunder and Indebtedness under Swap Contracts) having
an aggregate principal amount (including undrawn committed or available amounts
and including amounts owing to all creditors under any combined or syndicated
credit arrangement) of more than $10,000,000, or (B) fails to observe or
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perform any other agreement or condition relating to any such Indebtedness or
Guarantee or contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event occurs, the effect of which default or
other event is to cause, or to permit the holder or holders of such Indebtedness
or the beneficiary or beneficiaries of such Guarantee (or a trustee or agent on
behalf of such holder or holders or beneficiary or beneficiaries) to cause, with
the giving of notice if required, such Indebtedness to be demanded or to become
due or to be repurchased, prepaid, defeased or redeemed (automatically or
otherwise), or an offer to repurchase, prepay, defease or redeem such
Indebtedness to be made, prior to its stated maturity, or such Guarantee to
become payable or cash collateral in respect thereof to be demanded; or (ii)
there occurs under any Swap Contract an Early Termination Date (as defined in
such Swap Contract) resulting from (A) any event of default under such Swap
Contract as to which the Borrower or any Subsidiary is the Defaulting Party (as
defined in such Swap Contract) or (B) any Termination Event (as so defined)
under such Swap Contract as to which the Borrower or any Subsidiary is an
Affected Party (as so defined) and, in either event, the Swap Termination Value
owed by the Borrower or such Subsidiary as a result thereof is greater than
$10,000,000; or (iii) there occurs any event of default under the Canadian
Facility Agreement; or
(f) INSOLVENCY PROCEEDINGS, ETC. Any Loan Party or any of its Subsidiaries
institutes or consents to the institution of any proceeding under any Debtor
Relief Law, or makes an assignment for the benefit of creditors; or applies for
or consents to the appointment of any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer for it or for all or any material
part of its property; or any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the
application or consent of such Person and the appointment continues undischarged
or unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law
relating to any such Person or to all or any material part of its property is
instituted without the consent of such Person and continues undismissed or
unstayed for 60 calendar days, or an order for relief is entered in any such
proceeding; or
(g) INABILITY TO PAY DEBTS; ATTACHMENT. (i) The Borrower or any Subsidiary
becomes unable or admits in writing its inability or fails generally to pay its
debts as they become due, or (ii) any writ or warrant of attachment or execution
or similar process is issued or levied against all or any material part of the
property of any such Person and is not released, vacated or fully bonded within
30 days after its issue or levy; or
(h) JUDGMENTS. There is entered against the Borrower or any Subsidiary (i)
a final judgment or order for the payment of money in an aggregate amount
exceeding $10,000,000 (to the extent not covered by independent third-party
insurance as to which the insurer does not dispute coverage), or (ii) any one or
more non-monetary final judgments that have, or could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect and, in either
case, (A) enforcement proceedings are commenced by any creditor upon such
judgment or order, or (B) there is a period of 30 consecutive days during which
a stay of enforcement of such judgment, by reason of a pending appeal or
otherwise, is not in effect; or
(i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in liability of the Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate
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amount in excess of $10,000,000, or (ii) the Borrower or any ERISA Affiliate
fails to pay when due, after the expiration of any applicable grace period, any
installment payment with respect to its withdrawal liability under Section 4201
of ERISA under a Multiemployer Plan in an aggregate amount in excess of the
$10,000,000; or
(j) INVALIDITY OF LOAN DOCUMENTS. Any Loan Document, at any time after its
execution and delivery and for any reason other than as expressly permitted
hereunder or satisfaction in full of all the Obligations, ceases to be in full
force and effect; or any Loan Party or any other Person contests in any manner
the validity or enforceability of any Loan Document; or any Loan Party denies
that it has any or further liability or obligation under any Loan Document, or
purports to revoke, terminate or rescind any Loan Document;
(k) REGULATORY NONCOMPLIANCE. The Borrower or any Subsidiary fails to
comply in any material respect with any of the terms and provisions of any
material license, permit or regulation issued by the DOE or of any Governmental
Authority; or
(l) CHANGE OF CONTROL. There occurs any Change of Control with respect to
the Borrower.
8.02 REMEDIES UPON EVENT OF DEFAULT. If any Event of Default occurs and
is continuing, the Administrative Agent shall, at the request of, or may, with
the consent of, the Required Lenders, take any or all of the following actions:
(a) declare the commitment of each Lender to make Loans and any obligation
of the L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such
commitments and obligation shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower;
(c) require that the Borrower Cash Collateralize the L/C Obligations (in an
amount equal to the Dollar Equivalent Outstanding Amount thereof); and
(d) exercise on behalf of itself and the Lenders all rights and remedies
available to it and the Lenders under the Loan Documents or applicable law;
PROVIDED, HOWEVER, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the
United States, the obligation of each Lender to make Loans and any obligation of
the L/C Issuer to make L/C Credit Extensions shall automatically terminate, the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, and the
obligation of the Borrower to Cash Collateralize the L/C Obligations as
aforesaid shall automatically become effective, in each case without further act
of the Administrative Agent or any Lender.
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8.03 APPLICATION OF FUNDS. After the exercise of remedies provided for
in SECTION 8.02 (or after the Loans have automatically become immediately due
and payable and the L/C Obligations have automatically been required to be Cash
Collateralized as set forth in the proviso to SECTION 8.02), any amounts
received on account of the Obligations shall be applied by the Administrative
Agent in the following order:
FIRST, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including Attorney Costs and amounts
payable under ARTICLE III) payable to the Administrative Agent in its capacity
as such;
SECOND, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal and interest) payable to the
Lenders (including Attorney Costs and amounts payable under ARTICLE III),
ratably among them in proportion to the amounts described in this clause SECOND
payable to them;
THIRD, to payment of that portion of the Obligations constituting accrued
and unpaid interest on the Loans and L/C Borrowings, ratably among the Lenders
in proportion to the respective amounts described in this clause THIRD payable
to them;
FOURTH, to payment of that portion of the Obligations constituting unpaid
principal of the Loans and L/C Borrowings, ratably among the Lenders in
proportion to the respective amounts described in this clause FOURTH held by
them;
FIFTH, to the Administrative Agent for the account of the L/C Issuer, to
Cash Collateralize that portion of L/C Obligations comprised of the aggregate
undrawn amount of Letters of Credit; and
LAST, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to the Borrower or as otherwise required by Law.
Subject to SECTION 2.03(c), amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause FIFTH above shall be
applied to satisfy drawings under such Letters of Credit as they occur. If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.
ARTICLE IX
ADMINISTRATIVE AGENT
9.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT.
(a) Each Lender hereby irrevocably appoints, designates and authorizes the
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the
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contrary contained elsewhere herein or in any other Loan Document, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, nor shall the Administrative Agent and Agent-Related
Persons have or be deemed to have any fiduciary relationship with any Lender or
participant, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against the Administrative Agent and Agent-Related
Persons. Without limiting the generality of the foregoing sentence, the use of
the term "agent" herein and in the other Loan Documents with reference to the
Administrative Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable Law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties.
(b) The L/C Issuer shall act on behalf of the Lenders with respect to any
Letters of Credit issued by it and the documents associated therewith, and the
L/C Issuer shall have all of the benefits and immunities (i) provided to the
Administrative Agent in this ARTICLE IX with respect to any acts taken or
omissions suffered by the L/C Issuer in connection with Letters of Credit issued
by it or proposed to be issued by it and the applications and agreements for
letters of credit pertaining to such Letters of Credit as fully as if the term
"Administrative Agent" as used in this ARTICLE IX and in the definition of
"Agent-Related Person" included the L/C Issuer with respect to such acts or
omissions, and (ii) as additionally provided herein with respect to the L/C
Issuer.
9.02 DELEGATION OF DUTIES. The Administrative Agent may execute any of
its duties under this Agreement or any other Loan Document by or through agents,
employees or attorneys-in-fact and shall be entitled to advice of counsel and
other consultants or experts concerning all matters pertaining to such duties.
The Administrative Agent shall not be responsible for the negligence or
misconduct of any agent or attorney-in-fact that it selects in the absence of
gross negligence or willful misconduct.
9.03 LIABILITY OF ADMINISTRATIVE AGENT. No Agent-Related Person shall
(a) be liable for any action taken or omitted to be taken by any of them under
or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct in connection with its duties expressly set forth herein), or (b) be
responsible in any manner to any Lender or participant for any recital,
statement, representation or warranty made by any Loan Party or any officer
thereof, contained herein or in any other Loan Document, or in any certificate,
report, statement or other document referred to or provided for in, or received
by the Administrative Agent under or in connection with, this Agreement or any
other Loan Document, or the validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document, or for any failure
of any Loan Party or any other party to any Loan Document to perform its
obligations hereunder or thereunder. No Agent-Related Person shall be under any
obligation to any Lender or participant to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of any Loan Party or any Affiliate thereof.
9.04 RELIANCE BY ADMINISTRATIVE AGENT.
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(a) The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, communication, signature, resolution,
representation, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, electronic mail message, statement or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel to any Loan Party),
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent shall be fully justified in failing or refusing to take
any action under any Loan Document unless it shall first receive such advice or
concurrence of the Required Lenders as it deems appropriate and, if it so
requests, it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement or any other Loan Document in accordance with a request or
consent of the Required Lenders (or such greater number of Lenders as may be
expressly required hereby in any instance) and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders.
(b) For purposes of determining compliance with the conditions specified in
SECTION 4.01, each Lender that has signed this Agreement shall be deemed to have
consented to, approved or accepted or to be satisfied with, each document or
other matter required thereunder to be consented to or approved by or acceptable
or satisfactory to a Lender unless the Administrative Agent shall have received
notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.
9.05 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default, except with respect
to defaults in the payment of principal, interest and fees required to be paid
to the Administrative Agent for the account of the Lenders, unless the
Administrative Agent shall have received written notice from a Lender or the
Borrower referring to this Agreement, describing such Default and stating that
such notice is a "notice of default." The Administrative Agent will notify the
Lenders of its receipt of any such notice. The Administrative Agent shall take
such action with respect to such Default as may be directed by the Required
Lenders in accordance with ARTICLE VIII; PROVIDED, HOWEVER, that unless and
until the Administrative Agent has received any such direction, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default as it shall deem
advisable or in the best interest of the Lenders.
9.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE AGENT.
Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
hereafter taken, including any consent to and acceptance of any assignment or
review of the affairs of any Loan Party or any Affiliate thereof, shall be
deemed to constitute any representation or warranty by any Agent-Related Person
to any Lender as to any matter, including whether Agent-Related Persons have
disclosed material information in their possession. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
any Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and
74
investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of the Loan Parties and their respective
Subsidiaries, and all applicable bank or other regulatory Laws relating to the
transactions contemplated hereby, and made its own decision to enter into this
Agreement and to extend credit to the Borrower and the other Loan Parties
hereunder. Each Lender also represents that it will, independently and without
reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigations as
it deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of the Borrower and
the other Loan Parties. Except for notices, reports and other documents
expressly required to be furnished to the Lenders by the Administrative Agent
herein, the Administrative Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the business,
prospects, operations, property, financial and other condition or
creditworthiness of any of the Loan Parties or any of their respective
Affiliates which may come into the possession of any Agent-Related Person.
9.07 INDEMNIFICATION OF ADMINISTRATIVE AGENT. Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand each Agent-Related Person (to the extent not reimbursed by or on
behalf of any Loan Party and without limiting the obligation of any Loan Party
to do so), pro rata, and hold harmless each Agent-Related Person from and
against any and all Indemnified Liabilities incurred by it; PROVIDED, HOWEVER,
that no Lender shall be liable for the payment to any Agent-Related Person of
any portion of such Indemnified Liabilities to the extent determined in a final,
nonappealable judgment by a court of competent jurisdiction to have resulted
from such Agent-Related Person's own gross negligence or willful misconduct;
PROVIDED, HOWEVER, that no action taken in accordance with the directions of the
Required Lenders shall be deemed to constitute gross negligence or willful
misconduct for purposes of this Section. In the case of any investigation,
litigation or proceeding giving rise to Indemnified Liabilities, this SECTION
9.07 applies whether any such investigation, litigation or proceeding is brought
by any Lender or any other Person. Without limitation of the foregoing, each
Lender shall reimburse the Administrative Agent upon demand for its ratable
share of any costs or out-of-pocket expenses (including Attorney Costs) incurred
by the Administrative Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the extent
that the Administrative Agent is not reimbursed for such expenses by or on
behalf of the Borrower. The undertaking in this Section shall survive
termination of the Aggregate Commitments, the payment of all other Obligations
and the resignation of the Administrative Agent.
9.08 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. Bank of America
and its Affiliates may make loans to, issue letters of credit for the account
of, accept deposits from, acquire equity interests in and generally engage in
any kind of banking, trust, financial advisory, underwriting or other business
with each of the Loan Parties and their respective Affiliates as though Bank of
America were not the Administrative Agent or the L/C Issuer hereunder and
75
without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, Bank of America or its Affiliates may receive
information regarding any Loan Party or its Affiliates (including information
that may be subject to confidentiality obligations in favor of such Loan Party
or such Affiliate) and acknowledge that the Administrative Agent shall be under
no obligation to provide such information to them. With respect to its Loans,
Bank of America shall have the same rights and powers under this Agreement as
any other Lender and may exercise such rights and powers as though it were not
the Administrative Agent or the L/C Issuer, and the terms "Lender" and "Lenders"
include Bank of America in its individual capacity.
9.09 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may resign
as Administrative Agent upon 30 days' notice to the Lenders; provided that any
such resignation by Bank of America shall also constitute its resignation as L/C
Issuer and Swing Line Lender. If the Administrative Agent resigns under this
Agreement, the Required Lenders shall appoint from among the Lenders a successor
administrative agent for the Lenders, which successor administrative agent shall
be consented to by the Borrower at all times other than during the existence of
an Event of Default (which consent of the Borrower shall not be unreasonably
withheld or delayed). If no successor administrative agent is appointed prior to
the effective date of the resignation of the Administrative Agent, the
Administrative Agent may appoint, after consulting with the Lenders and the
Borrower, a successor administrative agent from among the Lenders. Upon the
acceptance of its appointment as successor administrative agent hereunder, the
Person acting as such successor administrative agent shall succeed to all the
rights, powers and duties of the retiring Administrative Agent, L/C Issuer and
Swing Line Lender and the respective terms "Administrative Agent," "L/C Issuer"
and "Swing Line Lender" shall mean such successor administrative agent, Letter
of Credit issuer and swing line lender, and the retiring Administrative Agent's
appointment, powers and duties as Administrative Agent shall be terminated and
the retiring L/C Issuer's and Swing Line Lender's rights, powers and duties as
such shall be terminated, without any other or further act or deed on the part
of such retiring L/C Issuer or Swing Line Lender or any other Lender, other than
the obligation of the successor L/C Issuer to issue letters of credit in
substitution for the Letters of Credit, if any, EXISTING at the time of such
succession or to make other arrangements satisfactory to the retiring L/C Issuer
to effectively assume the obligations of the retiring L/C Issuer with respect to
such Letters of Credit. After any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this ARTICLE IX and
SECTIONS 10.04 and 10.05 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent under this
Agreement. If no successor administrative agent has accepted appointment as
Administrative Agent by the date which is 30 days following a retiring
Administrative Agent's notice of resignation, the retiring Administrative
Agent's resignation shall nevertheless thereupon become effective and the
Lenders shall perform all of the duties of the Administrative Agent hereunder
until such time, if any, as the Required Lenders appoint a successor agent as
provided for above.
9.10 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to any Loan Party, the Administrative Agent (irrespective of
whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether the
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Administrative Agent shall have made any demand on the Borrower) shall be
entitled and empowered, by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Loans, L/C
Obligations and all other Obligations that are owing and unpaid and to file
such other documents as may be necessary or advisable in order to have the
claims of the Lenders and the Administrative Agent (including any claim for
the reasonable compensation, expenses, disbursements and advances of the
Lenders and the Administrative Agent and their respective agents and
counsel and all other amounts due the Lenders and the Administrative Agent
under SECTIONS 2.03(i) and (j), 2.09 and 10.04) allowed in such judicial
proceeding; and
(b) to collect and receive any monies or other property payable
or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under SECTIONS 2.09 and 10.04.
Nothing contained herein shall be deemed to authorize the Administrative
Agent to authorize or consent to or accept or adopt on behalf of any Lender any
plan of reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender or to authorize the Administrative Agent
to vote in respect of the claim of any Lender in any such proceeding.
9.11 GUARANTY MATTERS. The Lenders irrevocably authorize the
Administrative Agent, at its option and in its discretion to release any
Guarantor from its obligations under the Guaranty if such Person ceases to be a
Subsidiary as a result of a transaction permitted hereunder. Upon request by the
Administrative Agent at any time, the Required Lenders will confirm in writing
the Administrative Agent's authority to release any Guarantor from its
obligations under the Guaranty pursuant to this SECTION 9.12.
9.12 OTHER AGENTS; ARRANGERS AND MANAGERS. None of the Lenders or other
Persons identified on the facing page or signature pages of this Agreement as a
"syndication agent," "documentation agent," "co-agent," "book manager,"
"bookrunner," "lead manager," "arranger," "lead arranger" or "co-arranger" shall
have any right, power, obligation, liability, responsibility or duty under this
Agreement other than, in the case of such Lenders, those applicable to all
Lenders as such. Without limiting the foregoing, none of the Lenders or other
Persons so identified shall have or be deemed to have any fiduciary relationship
with any Lender. Each Lender acknowledges that it has not relied, and will not
rely, on any of the Lenders or other Persons so identified in deciding to enter
into this Agreement or in taking or not taking action hereunder.
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ARTICLE X
MISCELLANEOUS
10.01 AMENDMENTS, ETC. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by the
Borrower or any other Loan Party therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Required Lenders and the
Borrower or the applicable Loan Party, as the case may be, and acknowledged by
the Administrative Agent, and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given;
PROVIDED, HOWEVER, that no such amendment, waiver or consent shall:
(a) waive any condition set forth in SECTION 4.01(a) without the written
consent of each Lender;
(b) extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to SECTION 8.02) without the written consent of
such Lender;
(c) postpone any date fixed by this Agreement or any other Loan Document
for any payment of principal, interest, fees or other amounts due to the Lenders
(or any of them) or any scheduled or mandatory reduction of the Aggregate
Commitments hereunder or under any other Loan Document without the written
consent of each Lender directly affected thereby;
(d) reduce the principal of, or the rate of interest specified herein on,
any Loan or L/C Borrowing, or (subject to clause IV of the second proviso to
this SECTION 10.01) any fees or other amounts payable hereunder or under any
other Loan Document , or change the manner of computation of any financial ratio
(including any change in any applicable defined term) used in determining the
Applicable Rate that would result in a reduction of any interest rate on any
Loan or any fee payable hereunder without the written consent of each Lender
directly affected thereby; PROVIDED, HOWEVER, that only the consent of the
Required Lenders shall be necessary to amend the definition of "Default Rate" or
to waive any obligation of the Borrower to pay interest at the Default Rate;
(e) change SECTION 2.13 or SECTION 8.03 in a manner that would alter the
pro rata sharing of payments required thereby without the written consent of
each Lender;
(f) change any provision of this Section or the definition of "Required
Lenders" or any other provision hereof specifying the number or percentage of
Lenders required to amend, waive or otherwise modify any rights hereunder or
make any determination or grant any consent hereunder, without the written
consent of each Lender;
(g) Except as permitted by SECTION 9.11, release all or substantially all
of the Guarantors from the Guaranty without the written consent of each Lender;
and, PROVIDED FURTHER, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer under this Agreement or any Letter
of Credit Application relating to any Letter of Credit issued or to be issued by
it; (ii) no amendment, waiver or consent shall, unless in writing
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and signed by the Swing Line Lender in addition to the Lenders required above,
affect the rights or duties of the Swing Line Lender under this Agreement; (iii)
no amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Lenders required above, affect the
rights or duties of the Administrative Agent under this Agreement or any other
Loan Document; and (iv) the Fee Letter may be amended, or rights or privileges
thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have
any right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Commitment of such Lender may not be increased or extended
without the consent of such Lender.
10.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.
(a) GENERAL. Unless otherwise expressly provided herein, all notices and
other communications provided for hereunder shall be in writing (including by
facsimile transmission). All such written notices shall be mailed, faxed or
delivered to the applicable address, facsimile number or (subject to subsection
(c) below) electronic mail address, and all notices and other communications
expressly permitted hereunder to be given by telephone shall be made to the
applicable telephone number, as follows:
(i) if to the Borrower, the Administrative Agent, the L/C
Issuer or the Swing Line Lender, to the address, facsimile number,
electronic mail address or telephone number specified for such Person on
SCHEDULE 10.02 or to such other address, facsimile number, electronic mail
address or telephone number as shall be designated by such party in a
notice to the other parties; and
(ii) if to any other Lender, to the address, facsimile number,
electronic mail address or telephone number specified in its Administrative
Questionnaire or to such other address, facsimile number, electronic mail
address or telephone number as shall be designated by such party in a
notice to the Borrower, the Administrative Agent, the L/C Issuer and the
Swing Line Lender.
All such notices and other communications shall be deemed to be given or made
upon the earlier to occur of (i) actual receipt by the relevant party hereto and
(ii) (A) if delivered by hand or by courier, when signed for by or on behalf of
the relevant party hereto; (B) if delivered by mail, four Business Days after
deposit in the mails, postage prepaid; (C) if delivered by facsimile, when sent
and receipt has been confirmed by telephone; and (D) if delivered by electronic
mail (which form of delivery is subject to the provisions of subsection (c)
below), when delivered; PROVIDED, HOWEVER, that notices and other communications
to the Administrative Agent, the L/C Issuer and the Swing Line Lender pursuant
to ARTICLE II shall not be effective until actually received by such Person. In
no event shall a voicemail message be effective as a notice, communication or
confirmation hereunder.
(b) EFFECTIVENESS OF FACSIMILE DOCUMENTS AND SIGNATURES. Loan Documents may
be transmitted and/or signed by facsimile. The effectiveness of any such
documents and signatures shall, subject to applicable Law, have the same force
and effect as manually-signed originals and shall be binding on all Loan
Parties, the Administrative Agent and the Lenders. The Administrative Agent may
also require that any such documents and signatures be confirmed by
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a manually-signed original thereof; PROVIDED, HOWEVER, that the failure to
request or deliver the same shall not limit the effectiveness of any facsimile
document or signature.
(c) LIMITED USE OF ELECTRONIC MAIL. Electronic mail and Internet and
intranet websites may be used only to distribute routine communications, such as
financial statements and other information as provided in SECTION 6.02, and to
distribute Loan Documents for execution by the parties thereto, and may not be
used for any other purpose.
(d) RELIANCE BY ADMINISTRATIVE AGENT AND LENDERS. The Administrative Agent
and the Lenders shall be entitled to rely and act upon any notices (including
telephonic Committed Loan Notices and Swing Line Loan Notices) purportedly given
by or on behalf of the Borrower even if (i) such notices were not made in a
manner specified herein, were incomplete or were not preceded or followed by any
other form of notice specified herein, or (ii) the terms thereof, as understood
by the recipient, varied from any confirmation thereof. The Borrower shall
indemnify each Agent-Related Person and each Lender from all losses, costs,
expenses and liabilities resulting from the reliance by such Person on each
notice purportedly given by or on behalf of the Borrower. All telephonic notices
to and other communications with the Administrative Agent may be recorded by the
Administrative Agent, and each of the parties hereto hereby consents to such
recording.
10.03 NO WAIVER; CUMULATIVE REMEDIES. No failure by any Lender or the
Administrative Agent to exercise, and no delay by any such Person in exercising,
any right, remedy, power or privilege hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
10.04 ATTORNEY COSTS, EXPENSES AND TAXES. The Borrower agrees (a) to pay
or reimburse the Administrative Agent for all costs and expenses incurred in
connection with the development, preparation, negotiation and execution of this
Agreement and the other Loan Documents and any amendment, waiver, consent or
other modification of the provisions hereof and thereof (whether or not the
transactions contemplated hereby or thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and
thereby, including all Attorney Costs, and (b) to pay or reimburse the
Administrative Agent and each Lender for all costs and expenses incurred in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement or the other Loan Documents (including
all such costs and expenses incurred during any "workout" or restructuring in
respect of the Obligations and during any legal proceeding, including any
proceeding under any Debtor Relief Law), including all Attorney Costs. The
foregoing costs and expenses shall include all search, filing, recording, title
insurance and appraisal charges and fees and taxes related thereto, and other
out-of-pocket expenses incurred by the Administrative Agent and the cost of
independent public accountants and other outside experts retained by the
Administrative Agent or any Lender. All amounts due under this SECTION 10.04
shall be payable within ten Business Days after demand therefor. The agreements
in this Section shall survive the termination of the Aggregate Commitments and
repayment of all other Obligations.
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10.05 INDEMNIFICATION BY THE BORROWER. Whether or not the transactions
contemplated hereby are consummated, the Borrower shall indemnify and hold
harmless each Agent-Related Person, each Lender and their respective Affiliates,
directors, officers, employees, counsel, agents and attorneys-in-fact
(collectively the "Indemnitees") from and against any and all liabilities,
obligations, losses, damages, penalties, claims, demands, actions, judgments,
suits, costs, expenses and disbursements (including Attorney Costs) of any kind
or nature whatsoever which may at any time be imposed on, incurred by or
asserted against any such Indemnitee in any way relating to or arising out of or
in connection with (a) the execution, delivery, enforcement, performance or
administration of any Loan Document or any other agreement, letter or instrument
delivered in connection with the transactions contemplated thereby or the
consummation of the transactions contemplated thereby, (b) any Commitment, Loan
or Letter of Credit or the use or proposed use of the proceeds therefrom
(including any refusal by the L/C Issuer to honor a demand for payment under a
Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit), (c) any actual or
alleged presence or release of Hazardous Materials on or from any property
currently or formerly owned or operated by the Borrower, any Subsidiary or any
other Loan Party, or any Environmental Liability related in any way to the
Borrower, any Subsidiary or any other Loan Party, or (d)any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory (including
any investigation of, preparation for, or defense of any pending or threatened
claim, investigation, litigation or proceeding) and regardless of whether any
Indemnitee is a party thereto (all the foregoing, collectively, the "INDEMNIFIED
LIABILITIES"); PROVIDED that such indemnity shall not, as to any Indemnitee, be
available to the extent that such liabilities, obligations, losses, damages,
penalties, claims, demands, actions, judgments, suits, costs, expenses or
disbursements are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnitee. No Indemnitee shall be liable for any damages
arising from the use by others of any information or other materials obtained
through IntraLinks or other similar information transmission systems in
connection with this Agreement, nor shall any Indemnitee have any liability for
any indirect or consequential damages relating to this Agreement or any other
Loan Document or arising out of its activities in connection herewith or
therewith (whether before or after the Closing Date). In the case of an
investigation, litigation or proceeding to which the indemnity in this Section
10.05 applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by the Borrower or any of its
Subsidiaries, its directors, stockholders or auditors or an Indemnitee or any
other Person, whether or not any Indemnitee is otherwise a party thereto and
whether or not any of the transactions contemplated hereunder or under any of
the other Loan Documents is consummated. All amounts due under this SECTION
10.05 shall be payable within ten Business Days after demand therefor. The
agreements in this Section shall survive the resignation of the Administrative
Agent, the replacement of any Lender, the termination of the Aggregate
Commitments and the repayment, satisfaction or discharge of all the other
Obligations.
10.06 PAYMENTS SET ASIDE. To the extent that any payment by or on behalf
of the Borrower is made to the Administrative Agent or any Lender, or the
Administrative Agent or any Lender exercises its right of set-off, and such
payment or the proceeds of such set-off or any part thereof (or the Dollar
Equivalent amount thereof) is subsequently invalidated, declared to be
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fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under any Debtor Relief Law or otherwise, then
(a) to the extent of such recovery, the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Lender severally agrees to pay to the Administrative Agent upon demand its
applicable share of any amount so recovered from or repaid by the Administrative
Agent, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the Federal Funds Rate from time to
time in effect in the applicable currency of such recovery or payment.
10.07 SUCCESSORS AND ASSIGNS.
(a) The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
each Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of subsection (b) of this Section, (ii) by way of participation in
accordance with the provisions of subsection (d) of this Section, or (iii) by
way of pledge or assignment of a security interest subject to the restrictions
of subsection (f) of this Section (and any other attempted assignment or
transfer by any party hereto shall be null and void). 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,
Participants to the extent provided in subsection (d) of this Section and, to
the extent expressly contemplated hereby, the Indemnitees) any legal or
equitable right, remedy or claim under or by reason of this Agreement.
(b) Any Lender may at any time assign to one or more Eligible Assignees all
or a portion of its rights and obligations under this Agreement (including all
or a portion of its Commitment and the Loans (including for purposes of this
subsection (b), participations in L/C Obligations and in Swing Line Loans) at
the time owing to it); PROVIDED that (i) except in the case of an assignment of
the entire remaining amount of the assigning Lender's Commitment and the Loans
at the time owing to it or in the case of an assignment to a Lender or an
Affiliate of a Lender or an Approved Fund (as defined in subsection (g) of this
Section) with respect to a Lender, the aggregate amount of the Commitment (which
for this purpose includes Loans outstanding thereunder) subject to each such
assignment, determined as of the date the Assignment and Assumption with respect
to such assignment is delivered to the Administrative Agent or, if "Trade Date"
is specified in the Assignment and Assumption, as of the Trade Date, shall not
be less than $5,000,000 unless each of the Administrative Agent and, so long as
no Event of Default has occurred and is continuing, the Borrower otherwise
consents (each such consent not to be unreasonably withheld or delayed); (ii)
each partial assignment shall be made as an assignment of a proportionate part
of all the assigning Lender's rights and obligations under this Agreement with
respect to the Loans or the Commitment assigned, except that this clause (ii)
shall not apply to rights in respect of Swing Line Loans; (iii) any assignment
of a Commitment must be approved by the Borrower (such consent not to be
unreasonably withheld) prior to an Event of Default, the Administrative Agent,
the L/C Issuer and the Swing Line Lender unless the Person
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that is the proposed assignee is itself a Lender (whether or not the proposed
assignee would otherwise qualify as an Eligible Assignee); and (iv) the parties
to each assignment shall execute and deliver to the Administrative Agent an
Assignment and Assumption, together with a processing and recordation fee of
$3,500. Subject to acceptance and recording thereof by the Administrative Agent
pursuant to subsection (c) of this Section, from and after the effective date
specified in each Assignment and Assumption, the Eligible Assignee thereunder
shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of SECTIONS 3.01, 3.04, 3.05, 10.04 and 10.05
with respect to facts and circumstances occurring prior to the effective date of
such assignment). Upon request, the Borrower (at its expense) shall execute and
deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
subsection shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
subsection (d) of this Section.
(c) The Administrative Agent, acting solely for this purpose as an agent of
the Borrower, shall maintain at the Administrative Agent's Office a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitments of, and principal
amounts of the Loans and L/C Obligations owing to, each Lender pursuant to the
terms hereof from time to time (the "REGISTER"). The entries in the Register
shall be conclusive, and the Borrower, the Administrative Agent and the Lenders
may treat each Person whose name is recorded in the Register pursuant to the
terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by the Borrower and any Lender, at any reasonable time and from time
to time upon reasonable prior notice.
(d) Any Lender may at any time, without the consent of, or notice to, the
Borrower or the Administrative Agent, sell participations to any Person (other
than a natural person or the Borrower or any of the Borrower's Affiliates or
Subsidiaries) (each, a "PARTICIPANT") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and/or the Loans (including such Lender's participations in L/C
Obligations and/or Swing Line Loans) owing to it); PROVIDED that (i) such
Lender's obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrower, the Administrative Agent
and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement. Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; PROVIDED that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, waiver or other modification described in the first proviso to
SECTION 10.01 that directly affects such Participant. Subject to subsection (e)
of this Section, the Borrower agrees
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that each Participant shall be entitled to the benefits of SECTIONS 3.01, 3.04
and 3.05 to the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to subsection (b) of this Section. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
SECTION 10.09 as though it were a Lender, PROVIDED such Participant agrees to be
subject to SECTION 2.13 as though it were a Lender.
(e) A Participant shall not be entitled to receive any greater payment
under SECTION 3.01 or 3.04 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower's
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of SECTION 3.01 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with SECTION 10.15 as though
it were a Lender.
(f) Any Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Agreement (including under its Note, if
any) to secure obligations of such Lender, including any pledge or assignment to
secure obligations to a Federal Reserve Bank; PROVIDED that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.
(g) As used herein, the following terms have the following meanings:
"ELIGIBLE ASSIGNEE" means (a) a Lender; (b) an Affiliate of a Lender; (c)
from and after the occurrence of an Event of Default an Approved Fund; and
(d) any other Person (other than a natural person) approved by (i) the
Administrative Agent, the L/C Issuer and the Swing Line Lender, and (ii)
unless an Event of Default has occurred and is continuing, the Borrower
(each such approval not to be unreasonably withheld or delayed); PROVIDED
that notwithstanding the foregoing, "Eligible Assignee" shall not include
the Borrower or any of the Borrower's Affiliates or Subsidiaries.
"FUND" means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its
business.
"APPROVED FUND" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
(h) Notwithstanding anything to the contrary contained herein, if at any
time Bank of America assigns all of its Commitment and Loans pursuant to
subsection (b) above, Bank of America may, (i) upon 30 days' notice to the
Borrower and the Lenders, resign as L/C Issuer and/or (ii) upon 30 days' notice
to the Borrower, resign as Swing Line Lender. In the event of any such
resignation as L/C Issuer or Swing Line Lender, the Borrower shall be entitled
to appoint from among the Lenders a successor L/C Issuer or Swing Line Lender
hereunder; PROVIDED, HOWEVER, that no failure by the Borrower to appoint any
such successor shall affect the resignation of Bank of America as L/C Issuer or
Swing Line Lender, as the case may be. If Bank of America resigns as L/C Issuer,
it shall retain all the rights and obligations of the L/C Issuer
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hereunder with respect to all Letters of Credit outstanding as of the effective
date of its resignation as L/C Issuer and all L/C Obligations with respect
thereto (including the right to require the Lenders to make Base Rate Committed
Loans or fund risk participations in Unreimbursed Amounts pursuant to SECTION
2.03(c)). If Bank of America resigns as Swing Line Lender, it shall retain all
the rights of the Swing Line Lender provided for hereunder with respect to Swing
Line Loans made by it and outstanding as of the effective date of such
resignation, including the right to require the Lenders to make Base Rate
Committed Loans or fund risk participations in outstanding Swing Line Loans
pursuant to SECTION 2.04(c).
10.08 CONFIDENTIALITY. Each of the Administrative Agent and the Lenders
agrees to maintain the confidentiality of the Information (as defined below),
except that Information may be disclosed (a) to its and its Affiliates'
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential); (b) to the extent requested
by any regulatory authority; (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process; (d) to any other party
to this Agreement; (e) in connection with the exercise of any remedies hereunder
or any suit, action or proceeding relating to this Agreement or the enforcement
of rights hereunder; (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any Eligible Assignee of
or Participant in, or any prospective Eligible Assignee of or Participant in,
any of its rights or obligations under this Agreement or (ii) any direct or
indirect contractual counterparty or prospective counterparty (or such
contractual counterparty's or prospective counterparty's professional advisor)
to any credit derivative transaction relating to obligations of the Loan
Parties; (g) with the consent of the Borrower; (h) to the extent such
Information (i) becomes publicly available other than as a result of a breach of
this Section or (ii) becomes available to the Administrative Agent or any Lender
on a nonconfidential basis from a source other than the Borrower; or (i) to the
National Association of Insurance Commissioners or any other similar
organization. In addition, the Administrative Agent and the Lenders may disclose
the existence of this Agreement and information about this Agreement to market
data collectors, similar service providers to the lending industry, and service
providers to the Administrative Agent and the Lenders in connection with the
administration and management of this Agreement, the other Loan Documents, the
Commitments, and the Credit Extensions. For the purposes of this Section,
"INFORMATION" means all information received from any Loan Party relating to any
Loan Party or its business, other than any such information that is available to
the Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by any Loan Party; PROVIDED that, in the case of information received
from a Loan Party after the date hereof, such information is clearly identified
in writing at the time of delivery as confidential. Any Person required to
maintain the confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.
10.09 SET-OFF. In addition to any rights and remedies of the Lenders
provided by law, upon the occurrence and during the continuance of any Event of
Default, each Lender is authorized at any time and from time to time, without
prior notice to the Borrower or any other
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Loan Party, any such notice being waived by the Borrower (on its own behalf and
on behalf of each Loan Party) to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held by, and other indebtedness at any time owing by, such
Lender to or for the credit or the account of the respective Loan Parties
against any and all Obligations owing to such Lender hereunder or under any
other Loan Document, now or hereafter existing, irrespective of whether or not
the Administrative Agent or such Lender shall have made demand under this
Agreement or any other Loan Document and although such Obligations may be
contingent or unmatured or denominated in a currency different from that of the
applicable deposit or indebtedness. Each Lender agrees promptly to notify the
Borrower and the Administrative Agent after any such set-off and application
made by such Lender; PROVIDED, HOWEVER, that the failure to give such notice
shall not affect the validity of such set-off and application.
10.10 INTEREST RATE LIMITATION. Notwithstanding anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under the
Loan Documents shall not exceed the maximum rate of non-usurious interest
permitted by applicable Law (the "MAXIMUM RATE"). If the Administrative Agent or
any Lender shall receive interest in an amount that exceeds the Maximum Rate,
the excess interest shall be applied to the principal of the Loans or, if it
exceeds such unpaid principal, refunded to the Borrower. In determining whether
the interest contracted for, charged, or received by the Administrative Agent or
a Lender exceeds the Maximum 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.
10.11 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
10.12 INTEGRATION. This Agreement, together with the other Loan
Documents, comprises the complete and integrated agreement of the parties on the
subject matter hereof and thereof and supersedes all prior agreements, written
or oral, on such subject matter. In the event of any conflict between the
provisions of this Agreement and those of any other Loan Document, the
provisions of this Agreement shall control; PROVIDED that the inclusion of
supplemental rights or remedies in favor of the Administrative Agent or the
Lenders in any other Loan Document shall not be deemed a conflict with this
Agreement. Each Loan Document was drafted with the joint participation of the
respective parties thereto and shall be construed neither against nor in favor
of any party, but rather in accordance with the fair meaning thereof.
10.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the
Administrative Agent and each Lender, regardless of any investigation made by
the Administrative Agent or any Lender or on their behalf and notwithstanding
that the
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Administrative Agent or any Lender may have had notice or knowledge of
any Default at the time of any Credit Extension, and shall continue in full
force and effect as long as any Loan or any other Obligation hereunder shall
remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.
10.14 SEVERABILITY. If any provision of this Agreement or the other Loan
Documents is held to be illegal, invalid or unenforceable, (a) the legality,
validity and enforceability of the remaining provisions of this Agreement and
the other Loan Documents shall not be affected or impaired thereby and (b) the
parties shall endeavor in good faith negotiations to replace the illegal,
invalid or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the illegal, invalid or
unenforceable provisions. The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
10.15 TAX FORMS. (a) (i) Each Lender that is not a "United States person"
within the meaning of Section 7701(a)(30) of the Code (a "FOREIGN LENDER")
shall deliver to the Administrative Agent, prior to receipt of any payment
subject to withholding under the Code (or upon accepting an assignment of
an interest herein), two duly signed completed copies of either IRS Form
W-8BEN or any successor thereto (relating to such Foreign Lender and
entitling it to an exemption from, or reduction of, withholding tax on all
payments to be made to such Foreign Lender by the Borrower pursuant to this
Agreement) or IRS Form W-8ECI or any successor thereto (relating to all
payments to be made to such Foreign Lender by the Borrower pursuant to this
Agreement) or such other evidence satisfactory to the Borrower and the
Administrative Agent that such Foreign Lender is entitled to an exemption
from, or reduction of, U.S. withholding tax, including any exemption
pursuant to Section 881(c) of the Code. Thereafter and from time to time,
each such Foreign Lender shall (A) promptly submit to the Administrative
Agent such additional duly completed and signed copies of one of such forms
(or such successor forms as shall be adopted from time to time by the
relevant United States taxing authorities) as may then be available under
then current United States laws and regulations to avoid, or such evidence
as is satisfactory to the Borrower and the Administrative Agent of any
available exemption from or reduction of, United States withholding taxes
in respect of all payments to be made to such Foreign Lender by the
Borrower pursuant to this Agreement, (B) promptly notify the Administrative
Agent of any change in circumstances which would modify or render invalid
any claimed exemption or reduction, and (C) take such steps as shall not be
materially disadvantageous to it, in the reasonable judgment of such
Lender, and as may be reasonably necessary (including the re-designation of
its Lending Office) to avoid any requirement of applicable Laws that the
Borrower make any deduction or withholding for taxes from amounts payable
to such Foreign Lender.
(ii) Each Foreign Lender, to the extent it does not act or
ceases to act for its own account with respect to any portion of any sums
paid or payable to such Lender under any of the Loan Documents (for
example, in the case of a typical participation by such Lender), shall
deliver to the Administrative Agent on the date when such Foreign Lender
ceases to act for its own account with respect to any portion of any such
sums
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paid or payable, and at such other times as may be necessary in the
determination of the Administrative Agent (in the reasonable exercise of
its discretion), (A) two duly signed completed copies of the forms or
statements required to be provided by such Lender as set forth above, to
establish the portion of any such sums paid or payable with respect to
which such Lender acts for its own account that is not subject to U.S.
withholding tax, and (B) two duly signed completed copies of IRS Form
W-8IMY (or any successor thereto), together with any information such
Lender chooses to transmit with such form, and any other certificate or
statement of exemption required under the Code, to establish that such
Lender is not acting for its own account with respect to a portion of any
such sums payable to such Lender.
(iii) The Borrower shall not be required to pay any additional
amount to any Foreign Lender under SECTION 3.01 (A) with respect to any
Taxes required to be deducted or withheld on the basis of the information,
certificates or statements of exemption such Lender transmits with an IRS
Form W-8IMY pursuant to this SECTION 10.15(a) or (B) if such Lender shall
have failed to satisfy the foregoing provisions of this SECTION 10.15(a);
PROVIDED that if such Lender shall have satisfied the requirement of this
SECTION 10.15(a) on the date such Lender became a Lender or ceased to act
for its own account with respect to any payment under any of the Loan
Documents, nothing in this SECTION 10.15(a) shall relieve the Borrower of
its obligation to pay any amounts pursuant to SECTION 3.01 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 or other Person
for the account of which such Lender receives any sums payable under any of
the Loan Documents is not subject to withholding or is subject to
withholding at a reduced rate; PROVIDED, FURTHER, that should such Lender
become subject to Taxes because of its failure to satisfy the foregoing
provisions of this SECTION 10.15(a) the Borrower shall take steps as such
Lender shall reasonably request to assist such Lender in recovering such
Taxes.
(iv) The Administrative Agent may, without reduction, withhold
any Taxes required to be deducted and withheld from any payment under any
of the Loan Documents with respect to which the Borrower is not required to
pay additional amounts under SECTION 3.01 or this SECTION 10.15(a).
(b) Upon the request of the Administrative Agent, each Lender that is a
"United States person" within the meaning of Section 7701(a)(30) of the Code
shall deliver to the Administrative Agent two duly signed completed copies of
IRS Form W-9. If such Lender fails to deliver such forms, then the
Administrative Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable back-up withholding tax imposed by the Code,
without reduction.
(c) If any Governmental Authority asserts that the Administrative Agent did
not properly withhold or backup withhold, as the case may be, any Tax or other
amount from payments made to or for the account of any Lender, such Lender shall
indemnify the Administrative Agent
88
therefor, including all penalties and interest, any Taxes imposed by any
jurisdiction on the amounts payable to the Administrative Agent under this
Section, and costs and expenses (including Attorney Costs) of the Administrative
Agent. The obligation of the Lenders under this Section shall survive the
termination of the Aggregate Commitments, repayment of all other Obligations
hereunder and the resignation of the Administrative Agent.
10.16 REPLACEMENT OF LENDERS. Under any circumstances set forth herein
providing that the Borrower shall have the right to replace a Lender as a party
to this Agreement, the Borrower may, upon notice to such Lender and the
Administrative Agent, replace such Lender by causing such Lender to assign its
Commitment (with the assignment fee to be paid by the Borrower in such instance)
pursuant to SECTION 10.07(b) to one or more other Lenders or Eligible Assignees
procured by the Borrower; PROVIDED, HOWEVER, that if the Borrower elects to
exercise such right with respect to any Lender pursuant to SECTION 3.06(b), it
shall be obligated to replace all Lenders that have made similar requests for
compensation pursuant to SECTION 3.01 or 3.04. The Borrower shall (x) pay in
full all principal, interest, fees and other amounts owing to such Lender
through the date of replacement (including any amounts payable pursuant to
SECTION 3.05), and (y) release such Lender from its obligations under the Loan
Documents. Any Lender being replaced shall execute and deliver an Assignment and
Assumption with respect to such Lender's Commitment and outstanding Loans and
participations in L/C Obligations and Swing Line Loans.
10.17 GOVERNING LAW.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAW OF THE STATE OF
ILLINOIS APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE ADMINISTRATIVE AGENT AND
EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF
ILLINOIS
SITTING IN ▇▇▇▇ COUNTY OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF SUCH
STATE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER, THE
ADMINISTRATIVE AGENT AND EACH LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. THE BORROWER, THE
ADMINISTRATIVE AGENT AND EACH LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING
ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER
DOCUMENT RELATED THERETO. THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER
WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE
MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.
89
10.18 WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH
OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH
CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT
OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
10.19 TIME OF THE ESSENCE. Time is of the essence of the Loan Documents.
10.20 JUDGMENT CURRENCY. If, for the purposes of obtaining judgment in
any court, it is necessary to convert a sum due hereunder or any other Loan
Document in one currency into another currency, the rate of exchange used shall
be that at which in accordance with normal banking procedures the Administrative
Agent could purchase the first currency with such other currency on the Business
Day preceding that on which final judgment is given. The obligation of the
Borrower in respect of any such sum due from them to the Administrative Agent or
the Lenders hereunder or under the other Loan Documents shall, notwithstanding
any judgment in a currency (the "JUDGMENT CURRENCY") other than that in which
such sum is denominated in accordance with the applicable provisions of this
Agreement (the "AGREEMENT CURRENCY"), be discharged only to the extent that on
the Business Day following receipt by the Administrative Agent of any sum
adjudged to be so due in the Judgment Currency, the Administrative Agent may in
accordance with normal banking procedures purchase the Agreement Currency with
the Judgment Currency. If the amount of the Agreement Currency so purchased is
less than the sum originally due to the Administrative Agent from the Borrower
in the Agreement Currency, the Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify the Administrative Agent or the
Person to whom such obligation was owing against such loss. If the amount of the
Agreement Currency so purchased is greater than the sum originally due to the
Administrative Agent in such currency, the Administrative Agent agrees to return
the amount of any excess to the Borrower (or to any other Person who may be
entitled thereto under applicable law).
10.21 CANADIAN COMMITMENTS. Any Lender now or hereafter becoming party to
the Canadian Facility Agreement shall notify the Agent of the Dollar Equivalent
amount of its Canadian Commitment and of any change to such amount.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
CAREER EDUCATION CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------------
Title: Executive Vice President, Chief Financial
Officer, Secretary and Treasurer
-------------------------------------------
BANK OF AMERICA, N.A., as
Administrative Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------------
Title: Vice President
-------------------------------------------
BANK OF AMERICA, N.A., as a Lender, an L/C
Issuer and Swing Line Lender
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------------
Title: Vice President
-------------------------------------------
LASALLE BANK NATIONAL ASSOCIATION,
as a Lender, an L/C Issuer and a Co-Syndication
Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------------
Title: First Vice President
-------------------------------------------
JPMORGAN CHASE BANK,
as a Lender and a Co-Syndication Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------------
Title: Vice President
-------------------------------------------
SUN TRUST BANK,
as a Lender and Documentation Agent
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------------
Title: Director
-------------------------------------------
▇▇▇▇▇▇ TRUST AND SAVINGS BANK,
as a Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------------
Title: Vice President
-------------------------------------------
NATIONAL CITY BANK OF MICHIGAN/
ILLINOIS,
as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------------
Title: Senior Vice President
------------------------------------------
UNION BANK OF CALIFORNIA, N.A.
as a Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------------
Title: Vice President
------------------------------------------
FIFTH THIRD BANK (CHICAGO),
A MICHIGAN BANKING CORPORATION,
as a Lender
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
--------------------------------------------
Title: Corporate Banking Officer
-------------------------------------------