AMENDED AND RESTATED SENIOR SECURED CREDIT AGREEMENT - EXHIBIT 10.12
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AMENDED AND RESTATED SENIOR SECURED CREDIT AGREEMENT
among
COTELLIGENT, INC.,
THE CO-BORROWERS LISTED HEREIN,
THE BANKS LISTED HEREIN
BANKBOSTON, N.A.
as Administrative Agent
and arranged by
BANCBOSTON ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, INC.
with
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
as Documentation Agent
FLEET NATIONAL BANK
as Syndication Agent
U.S. BANK
as Co-Agent
March 12, 1999
$100,000,000 Revolving/Term Facility
TABLE OF CONTENTS
Page
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ARTICLE 1. DEFINITIONS AND RELATED MATTERS 1
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Section 1.1. Definitions............................................................................................... 1
Section 1.2. Related Matters........................................................................................... 16
1.2.1. Construction..................................................................................... 16
1.2.2. Determinations................................................................................... 17
1.2.3. Accounting Terms and Determinations.............................................................. 17
1.2.4. Independence of Covenants........................................................................ 17
ARTICLE 2. AMOUNTS AND TERMS OF THE CREDIT FACILITY 18
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Section 2.1. Revolving Loans........................................................................................... 18
2.1.1. Working Capital Revolving Commitment............................................................. 18
2.1.2. Revolving Acquisition Commitment................................................................. 18
2.1.3. Type of Loans and Minimum Amounts................................................................ 19
2.1.4. Notice of Borrowing.............................................................................. 19
2.1.5. Funding.......................................................................................... 20
Section 2.2. Swingline Loans........................................................................................... 21
2.2.1. Swingline Commitment............................................................................. 21
2.2.2. Interest on Swingline Loans...................................................................... 21
2.2.3. Notice of Borrowing of Swingline Loans........................................................... 21
2.2.4. Limitations on Swingline Lender's Obligation to Make Swingline Loans............................. 22
2.2.5. Mandatory Borrowings............................................................................. 22
Section 2.3. Letters of Credit......................................................................................... 23
2.3.1. In General....................................................................................... 23
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2.3.2. Notices of Issuance, Etc......................................................................... 23
2.3.3. Participations in Letters of Credit.............................................................. 24
2.3.4. Reimbursement for Drawings, Etc.................................................................. 24
2.3.5. Cash Collateral Cover............................................................................ 26
Section 2.4. Use of Proceeds........................................................................................... 26
Section 2.5. Interest; Interest Periods; Conversion/Continuation....................................................... 27
2.5.1. Interest Rate and Payment........................................................................ 27
2.5.2. Interest Periods and Minimum Amounts............................................................. 27
2.5.3. Conversion or Continuation....................................................................... 27
2.5.4. Computations..................................................................................... 28
2.5.5. Maximum Lawful Rate of Interest.................................................................. 29
Section 2.6. Notes, Etc................................................................................................ 29
2.6.1. Loans Evidenced by Notes......................................................................... 29
2.6.2. Notation of Amounts and Maturities, Etc.......................................................... 30
2.6.3. Loan Account..................................................................................... 30
Section 2.7. Fees...................................................................................................... 30
2.7.1. Commitment Fee................................................................................... 30
2.7.2. Letter of Credit Fees............................................................................ 29
2.7.3. Other Fees....................................................................................... 31
2.7.4. Fees Non-Refundable.............................................................................. 31
Section 2.8. Termination, Reduction and Modification of Commitments.................................................... 31
Section 2.9. Repayments and Prepayments................................................................................ 33
2.9.1. Repayment of Revolving Loans..................................................................... 33
2.9.2. Repayment of Term Acquisition Loans.............................................................. 33
2.9.3. Mandatory Prepayment............................................................................. 33
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2.9.3.1. Excess Working Capital Revolving Loans.................................................... 33
2.9.3.2. Excess Revolving Acquisition Loans........................................................ 33
2.9.3.3. Proceeds of Collateral.................................................................... 33
2.9.3.4. Proceeds of Securities Offerings.......................................................... 34
2.9.3.5. Proceeds of Asset Dispositions............................................................ 34
2.9.3.6. Notice and Application of Mandatory Prepayments; Interest................................. 34
2.9.4. Optional Prepayments............................................................................. 35
2.9.5. Payments Set Aside............................................................................... 35
Section 2.10. Manner of Payment........................................................................................ 35
Section 2.11. Pro Rata Treatment....................................................................................... 36
Section 2.12. Mandatory Suspension and Conversion of LIBOR Rate Loans.................................................. 37
Section 2.13. Regulatory Changes....................................................................................... 37
2.13.1. Increased Costs................................................................................. 37
2.13.2. Capital Costs................................................................................... 38
Section 2.14. Taxes.................................................................................................... 38
Section 2.15. Compensation for Funding Losses.......................................................................... 40
Section 2.16. Certificates Regarding Yield Protection, Etc............................................................. 40
Section 2.17. Applicable Lending Office; Discretion of Lenders as to Manner of Funding................................. 41
Section 2.18. Waivers of Co-Borrowers.................................................................................. 41
ARTICLE 3. CONDITIONS TO LOANS 41
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Section 3.1. Closing Conditions........................................................................................ 41
3.1.1. Closing Date..................................................................................... 41
3.1.2. Certain Documents................................................................................ 41
3.1.3. Fees and Expenses Paid........................................................................... 41
3.1.4. Satisfaction of Certain Conditions............................................................... 42
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3.1.5. Absence of Litigation Events............................................. 42
3.1.6. General.................................................................. 42
3.1.7. No Material Adverse Change............................................... 42
3.1.8. Absence of Market Disruption or Changes in Governmental Regulations...... 42
3.1.9. No Misstatements......................................................... 42
Section 3.2. Conditions Precedent to Working Capital Revolving Loans, Revolving Acquisition
Loans, Swingline Loans and Letters of Credit...................................... 43
3.2.1. Occurrence of Closing Date............................................... 43
3.2.2. Notice of Borrowing or Issuance.......................................... 43
3.2.3. Representations and Warranties........................................... 43
3.2.4. No Default............................................................... 43
3.2.5. No Material Adverse Change............................................... 43
3.2.6. Satisfaction of Conditions............................................... 43
3.2.7. No Violation of Applicable Law........................................... 43
Section 3.3. Additional Conditions Precedent to Revolving Acquisition Loans..................... 44
ARTICLE 4. REPRESENTATIONS AND WARRANTIES 44
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Section 4.1. Organization, Powers and Good Standing............................................. 44
Section 4.2. Authorization, Binding Effect, No Conflict, Etc.................................... 44
4.2.1. Authorization, Binding Effect, Etc....................................... 44
4.2.2. No Conflict.............................................................. 44
4.2.3. Governmental Approvals................................................... 45
Section 4.3. Subsidiaries; Investments.......................................................... 45
4.3.1. Subsidiaries............................................................. 45
4.3.2. Borrower Capital Stock................................................... 45
Section 4.4. Financial Information.............................................................. 46
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Section 4.5. No Material Adverse Changes: Solvency.............................................. 47
Section 4.6. Litigation......................................................................... 47
Section 4.7. Agreements: Applicable Law......................................................... 47
Section 4.8. Governmental Regulation............................................................ 47
Section 4.9. Margin Regulations................................................................. 47
Section 4.10. Employee Benefit Plans............................................................. 47
Section 4.11. Title to Property.................................................................. 48
Section 4.12. Intellectual Property, Etc......................................................... 48
Section 4.13. Environmental Condition............................................................ 49
Section 4.14. Absence of Certain Restrictions.................................................... 49
Section 4.15. Labor Matters...................................................................... 49
Section 4.16. Tax Returns........................................................................ 49
Section 4.17. Year 2000 Matters.................................................................. 50
Section 4.18. Disclosure......................................................................... 50
ARTICLE 5. AFFIRMATIVE COVENANTS OF THE BORROWERS 50
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Section 5.1. Financial Statements and Other Reports............................................. 50
Section 5.2. Records and Inspection............................................................. 53
Section 5.3. Audits of the Collateral........................................................... 53
Section 5.4. Corporate Existence, Etc........................................................... 53
Section 5.5. Payment of Taxes................................................................... 53
Section 5.6. Maintenance of Properties.......................................................... 54
Section 5.7. Maintenance of Insurance........................................................... 54
Section 5.8. Conduct of Business and Compliance with Laws....................................... 55
Section 5.9. Future Information................................................................. 55
Section 5.10. New Borrowers and Additional Collateral............................................ 55
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Section 5.11. Subordination of Intercompany Debt................................................. 56
Section 5.12. Environmental Compliance........................................................... 56
Section 5.13. Year 2000.......................................................................... 56
Section 5.14. New Consolidated Subsidiaries To Become Borrowers.................................. 57
ARTICLE 6. NEGATIVE COVENANTS OF THE BORROWERS 57
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Section 6.1. Liens.............................................................................. 57
Section 6.2. Debt............................................................................... 58
Section 6.3. Restricted Payments................................................................ 59
Section 6.4. Investments........................................................................ 60
Section 6.5. Financial Covenants................................................................ 61
6.5.1. Leverage Ratio........................................................... 61
6.5.2. Minimum Net Worth........................................................ 61
6.5.3. Debt Service Coverage Ratio.............................................. 61
Section 6.6. Restriction on Fundamental Changes................................................. 61
Section 6.7. Asset Dispositions: Sales of Receivables........................................... 61
Section 6.8. Transactions with Affiliates....................................................... 62
Section 6.9. Prepayment of Debt................................................................. 63
Section 6.10. Employee Benefit Plans............................................................. 63
Section 6.11. Amendments of Charter Documents.................................................... 63
Section 6.12. Restrictive Agreements............................................................. 64
Section 6.13. Negative Pledges, Etc.............................................................. 64
ARTICLE 7. EVENTS OF DEFAULT 64
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Section 7.1. Events of Default.................................................................. 64
7.1.1. Failure to Make Payments................................................. 64
7.1.2. Default in Other Debt.................................................... 65
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7.1.3. Breach of Certain Covenants..................................................................... 65
7.1.4. Certain Defaults Under Article 6................................................................ 65
7.1.5. Other Defaults Under Loan Documents............................................................. 65
7.1.6. Breach of Warranty.............................................................................. 65
7.1.7. Involuntary Bankruptcy; Appointment of Receiver, Etc............................................ 66
7.1.8. Voluntary Bankruptcy; Appointment of Receiver, Etc.............................................. 66
7.1.9. Change of Control............................................................................... 66
7.1.10. Termination of Loan Documents, Etc.............................................................. 66
7.1.11. Material Adverse Change......................................................................... 67
7.1.12. Judgments and Attachments....................................................................... 67
Section 7.2. Remedies.................................................................................................. 67
ARTICLE 8. THE AGENT AND THE BANKS 68
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Section 8.1. Authorization and Action................................................................................. 68
Section 8.2. Exculpation; Agent's Reliance; Etc....................................................................... 69
Section 8.3. Agent and Affiliates..................................................................................... 70
Section 8.4. Lender Credit Decision................................................................................... 70
Section 8.5. Indemnification.......................................................................................... 70
Section 8.6. Successor Agent.......................................................................................... 71
Section 8.7. Excess Payments.......................................................................................... 71
Section 8.8. Lender Parties........................................................................................... 72
Section 8.9. Collateral Matters....................................................................................... 72
Section 8.10. Payments; Availability of Funds; Certain Notices......................................................... 73
Section 8.11. Obligations of Lenders Several; Enforcement by the Agent................................................. 74
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ARTICLE 9. MISCELLANEOUS 75
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Section 9.1. Expenses................................................................................................. 75
Section 9.2. Indemnity................................................................................................ 75
Section 9.3. Waivers; Amendments in Writing........................................................................... 76
Section 9.4. Cumulative Remedies; Failure or Delay.................................................................... 78
Section 9.5. Notices, Etc............................................................................................. 78
Section 9.6. Successors and Assigns................................................................................... 78
Section 9.7. Confidentiality.......................................................................................... 80
Section 9.8. Governing Law............................................................................................ 80
Section 9.9. Choice of Forum.......................................................................................... 81
Section 9.10. Set Off.................................................................................................. 81
Section 9.11. Changes in Accounting Principles......................................................................... 82
Section 9.12. Headings................................................................................................. 82
Section 9.13. Severability............................................................................................. 82
Section 9.14. Survival of Agreements, Representations and Warranties................................................... 82
Section 9.15. Execution in Counterparts................................................................................ 83
Section 9.16. Complete Agreement....................................................................................... 83
Section 9.17. Limitation of Liability.................................................................................. 83
Section 9.18. WAIVER OF TRIAL BY JURY.................................................................................. 83
Section 9.19 Supersession of Original Credit Agreement................................................................. 83
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EXHIBITS TO AMENDED AND RESTATED CREDIT AGREEMENT
Exhibit A-1 Form of Working Capital Revolving Loan Note
Exhibit A-2 Form of Acquisition Loan Notes
Exhibit A-3 Form of Swingline Note
Exhibit C-1 Form of Amended and Restated Security Agreement
Exhibit C-2 Form of Amended and Restated Pledge Agreement
Exhibit E-1 Form of Notice of Borrowing
Exhibit E-2 Form of Notice of Swingline Borrowing
Exhibit E-3 Form of Notice of Conversion/Continuation
Exhibit E-4 Form of Notice of Issuance
Exhibit E-5 Form of Notice of Reallocation
Exhibit E-7 Form of Notice of Responsible Officers
Exhibit F-1 Form of Secretary's Certificate
Exhibit F-3 Form of Officers' Closing Certificate
Exhibit F-6 Form of Compliance Certificate
Exhibit G-1 Form of Borrower's Counsel Opinion
Exhibit G-2 Form of Borrower's In-house Counsel Opinion
Exhibit H Form of Assignment and Acceptance
SCHEDULES
Schedule R-1 Consolidated Subsidiaries of Borrower
Schedule 1.1.A Revolving Commitments
Schedule 1.1.B Lender Information
Schedule 1.1.C Existing Debt
Schedule 1.1.D Existing Liens
Schedule 1.1.E Applicable Margin
Schedule 2.18. Certain Waivers
Schedule 3.1.2. Closing Documents
Schedule 4.1. Organization of Borrower and Subsidiaries
Schedule 4.3. Subsidiaries and Other Investments
Schedule 4.6. Material Litigation
Schedule 4.13. Environmental Condition
Schedule 4.14. Certain Restrictions
Schedule 4.15. Labor Matters
Schedule 4.17. Year 2000 Exceptions
Schedule 5.14. Additional Loan Documents Needed from New Consolidated
Subsidiary
Schedule 6.8. Existing Contractual Obligations
Schedule 6.10. Employee Benefit Plans
Schedule 9.5. Borrower Information
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AMENDED AND RESTATED SENIOR SECURED CREDIT AGREEMENT
AMENDED AND RESTATED SENIOR SECURED CREDIT AGREEMENT, dated as of March 12,
1999 (as amended from time to time, this "Agreement"), by and among Cotelligent,
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Inc., a Delaware corporation formerly known as Cotelligent Group, Inc. ("CI"),
and each of the Consolidated Subsidiaries of CI, the present list of which is
set forth on Schedule R-1 hereto (each a "Co-Borrower"; sometimes herein CI and
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the Co-Borrowers are collectively referred to as the "Borrowers"), and the banks
and other financial institutions that either now or in the future are parties
hereto, including without limitation the Swingline Lender, as defined herein
(collectively the "Lenders" and each individually a "Lender"), BankBoston, N.A.
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in its capacity as L/C Issuer (in such capacity, together with any successors
thereto in such capacity, the "L/C Issuer"), and BankBoston N.A., as
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administrative agent for and representative of the Lenders (in such capacity,
BankBoston N.A. or any successor in such capacity is referred to herein as the
"Agent"). The Lenders, the L/C Issuer and the Agent are collectively referred
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to herein as the "Lender Parties" and each individually as a "Lender Party."
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R E C I T A L S
A. The Borrowers, certain of the Lenders, and the Agent are parties to
that certain Senior Secured Credit Agreement, dated as of September 12, 1997
(the "Original Credit Agreement"), pursuant to which such Lenders agreed to make
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a credit facility in the aggregate amount of $40,000,000 available to the
Borrowers, subject to the terms and conditions set forth therein.
B. The Borrowers and the Lender Parties have agreed to amend and restate
the Original Credit Agreement as provided herein to, among other things,
increase the aggregate amount of the credit facilities to $100,000,000 and to
continue the security interests granted under the Security Agreement and the
Pledge Agreements in favor of the Agent.
ARTICLE 1.
DEFINITIONS AND RELATED MATTERS
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Section 1.1. Definitions. The following terms with initial capital letters
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have the following meanings:
"Accounts Receivable" means, as of any measurement date, all "accounts," as
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such term is defined in Section 9106 of the California UCC, then owned by any
Borrower, including, without limitation, all accounts receivable, book debts and
other forms of obligations (other than forms of obligations evidenced by chattel
paper, documents or instruments) now owned by or belonging or owing to any
Borrower (including, without limitation, under any trade name, style or division
thereof) arising out of goods sold or services rendered by any Borrower, whether
billed or unbilled, and all monies due or to become due to any Borrower under
all purchase orders and contracts for the sale of goods or the performance of
services or both by such Borrower.
"Adjusted LIBOR Rate" means, with respect to any day during any Interest
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Period, a rate per annum (rounded upwards, if necessary, to the next higher
1/100 of 1%) equal to (i) the applicable London Interbank Offered Rate for such
Interest Period, divided by (ii) 1.00 minus the LIBOR Reserve Requirement for
such day (expressed as a decimal).
"Affiliate" means, with respect to any Person, any other Person that,
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directly or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such first Person. The term
"control" means the possession, directly or indirectly, of the power, whether or
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not exercised, (i) to vote ten percent (10%) or more of the securities having
voting power for the election of directors (or Persons performing similar
functions) of such Person or (ii) to direct or cause the direction of the
management or policies of a Person, whether through the ownership of voting
securities, by contract or otherwise, and the terms "controlled" and "common
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control" have correlative meanings. Unless otherwise indicated, "Affiliate"
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refers to an Affiliate of any of the Borrowers. Notwithstanding the foregoing,
in no event shall any Lender Party or any Affiliate of any Lender Party be
deemed to be an Affiliate of any Borrower.
"Agent" is defined in the Preamble and, where the context so requires,
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includes BankBoston, N.A. in its individual capacity.
"Agent's Account" means the account of the Agent identified as such on
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Schedule 1.1.B, or such other account as the Agent may hereafter designate by
notice to CI and each Lender Party.
"Agent's Office" means the office of the Agent identified as such on
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Schedule 1.1.B, or such other office as the Agent may hereafter designate by
notice to CI and each Lender Party.
"Agreement" is defined in the Preamble and includes all Schedules and
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Exhibits hereto.
"Applicable Law" means all applicable provisions of all (i) constitutions,
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treaties, statutes, laws, rules, regulations and ordinances of any Governmental
Authority, (ii) Governmental Approvals, and (iii) orders, decisions, judgments,
awards and decrees of any Governmental Authority.
"Applicable Lending Office" means, with respect to any Lender, (i) in the
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case of any payment with respect to LIBOR Rate Loans, the Lender's LIBOR Lending
Office, and (ii) in the case of any payment with respect to Base Rate Loans or
any other payment under the Loan Documents, the Lender's Domestic Lending
Office.
"Applicable Margin" is defined on Schedule 1.1.E.
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"Arranger" means BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Inc.
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"Asset Disposition" means any sale or other disposition of any assets by
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any Borrower (including sales of any receivables but excluding sales of
inventory and dispositions of obsolete or worn-out equipment in the ordinary
course of business).
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"Assignment" and "Assignment and Acceptance" are defined in Section 9.6.2.
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"Bankruptcy Code" means Title 11 of the United States Code (11 U.S.C.
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Section 101 et seq.), as amended from time to time.
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"Base Rate" means the greater of (i) the rate of interest announced from
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time to time by BankBoston, N.A. at its head office as its "Base Rate," or (ii)
the Federal Funds Effective Rate plus 1/2 of 1% per annum (rounded upwards, if
necessary, to the next 1/8 of 1%).
"Base Rate Loan" means a Loan, or portion thereof, that bears interest by
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reference to the Base Rate.
"Borrowers" is defined in the preamble.
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"Borrower Account" means the account of CI identified as such on Schedule
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9.5, or such other account as CI may hereafter designate by notice to the Agent.
"Borrowing" means a contemporaneous borrowing of Loans of the same Type.
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"Business Day" means any day that is not a Saturday, Sunday or other day on
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which banks in Boston, Massachusetts or San Francisco, California are authorized
or obligated to close.
"Capital Expenditures" means, for any period, the expenditures (whether
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paid in cash or accrued and including payments made with respect to Capitalized
Leases during such period) of any Borrower during such period with respect to
property, plant and equipment (other than repairs) that are required to be
capitalized on the consolidated balance sheet of CI and its Consolidated
Subsidiaries.
"Capital Stock" means, with respect to any Person, all (i) shares,
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interests, participations or other equivalents (howsoever designated) of capital
stock and other equity interests of such Person and (ii) rights (other than debt
securities convertible into capital stock or other equity interests), warrants
or options to acquire any such capital stock or other equity interests.
"Capitalized Leases" means all leases of any Borrower of real, personal or
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mixed property that are required by GAAP to be capitalized on the consolidated
balance sheet of CI and its Subsidiaries. The amount of any Capitalized Lease
shall be the capitalized amount thereof.
"Cash" means cash and cash equivalents.
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"Cash Collateral Cover" is defined in Section 2.3.5.
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"Change of Control" means the acquisition, directly or indirectly, by any
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person (as defined in Section 13(d)(3) of the Exchange Act), of 50% or more of
the total voting power in the aggregate of all classes of common stock or other
equity securities of CI, then outstanding or of the ability, whether or not
exercised, to appoint 50% or more of the Board of Directors of CI, whether
through the ownership of voting securities, by contract, or otherwise.
3
"Closing Date" means the date of this Agreement or such later date on which
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all conditions set forth in Section 3.1 have been satisfied or waived.
"Code" means the Internal Revenue Code of 1986, as amended from time to
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time.
"Collateral" means the collateral under the Collateral Documents, however
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defined.
"Collateral Documents" means the Security Agreement, the Pledge Agreement,
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financing statements and all other documents executed or delivered from time to
time in connection therewith or otherwise to secure the Borrowers' obligations
under the Loan Documents, in each case as amended or restated from time to time.
"Compliance Certificate" is defined in Section 5.1.3.
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"Consolidated Subsidiary" means, at any time, any Subsidiary whose accounts
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would be consolidated with those of CI in the consolidated financial statements
of CI at such time in accordance with GAAP.
"Contingent Obligation" means, as to any Person, any obligation, direct or
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indirect, contingent or otherwise, of such Person (i) with respect to any Debt
or other obligation of another Person, including any direct or indirect
guarantee of such Debt (other than any endorsement for collection in the
ordinary course of business) or any other direct or indirect obligation, by
agreement or otherwise, to purchase or repurchase any such Debt or obligation or
any security therefor, or to provide funds for the payment or discharge of any
such Debt or obligation (whether in the form of loans, advances, stock
purchases, capital contributions or otherwise), (ii) to provide funds to
maintain the financial condition of any other Person, (iii) otherwise to assure
or hold harmless the holders of Debt or other obligations of another Person
against loss in respect thereof, or (iv) with respect to "off balance sheet" or
"synthetic" leases (i.e., leases where for tax purposes the lessee is treated as
the owner of the leased property but for GAAP purposes the lease is treated as
an operating lease and the lessor is treated as the owner of the leased
property). The amount of any Contingent Obligation under clause (i) or (ii) of
the preceding sentence shall be the lesser of (a) the amount of the Debt or
obligation guarantied or otherwise supported thereby, and (b) the maximum amount
guarantied or supported by the Contingent Obligation.
"Contractual Obligation" means, as applied to any Person, any provision of
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any security issued by that Person or of any agreement or other instrument to
which that Person is a party or by which it or any of the properties owned or
leased by it is bound or otherwise subject.
"Debt" means, with respect to any Person, without duplication: (i) all
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obligations for borrowed money; (ii) all obligations evidenced by bonds,
debentures, notes or other similar instruments; (iii) all obligations to pay the
deferred purchase price of property or services or other criteria in connection
with acquisitions), except trade accounts payable arising in the ordinary
course of business that are not overdue by more than 60 days; (iv) all
Capitalized Leases; (v) all obligations of others secured by a Lien on any asset
owned by such Person or Persons whether or not such obligation or liability is
assumed; (vi) all obligations of such Person
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or Persons, contingent or otherwise, in respect of any letters of credit or
bankers' acceptances; (vii) all Contingent Obligations; and (viii) all
obligations under facilities for the discount or sale of receivables.
"Debt Service Coverage Ratio" means at the end of any Fiscal Quarter, the
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ratio of (x) (a) EBITDA for the four consecutive Fiscal Quarters then ended
minus (b) Capital Expenditures for such four-quarter period, to (y) (a) Interest
Expense for such four-quarter period, plus (b) the sum of the aggregate
scheduled payments of principal in respect of the Debt of any Borrower plus the
amount of any payments based on the future performance of any acquired business
(i.e. "earnouts") for such four-quarter period.
"Default" means any condition or event that, with the giving of notice or
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lapse of time or both, would, unless cured or waived, become an Event of
Default.
"Defined Benefit Plan" means any plan subject to Title IV of ERISA that is
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not a Multiemployer Plan.
"Dollars" and "$" means lawful money of the United States of America.
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"Domestic Lending Office" means the office, branch or Affiliate of any
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Lender identified on Schedule 1.1.B as its Domestic Lending Office or such other
office, branch or Affiliate as the Lender may hereafter designate as its
Domestic Lending Office for one or more Types of Loans by notice to CI and the
Agent.
"EBIT" means, for the Borrowers for any period, (i) Net Income, plus (ii)
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Interest Expense deducted in the determination of Net Income, plus (iii) the
amount of taxes based on or measured by income and deducted in the determination
of Net Income, plus (iv) the amount of any extraordinary non-cash losses
included in the determination of Net Income, minus (v) the amount of any
extraordinary gains included in the determination of Net Income, in each case
for such period.
"EBITDA" means, for the Borrowers for any period, an amount equal to EBIT,
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plus the amount of depreciation and amortization expense deducted in determining
Net Income, in each case for such period.
"Environmental Damages" means all claims, judgments, damages, losses,
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penalties, liabilities (including strict liability), costs and expenses,
including costs of investigation, remediation, defense, settlement and
reasonable attorneys' fees and consultants' fees, that are incurred at any time
as a result of the existence of Hazardous Material upon, about or beneath any
Real Property or migrating or threatening to migrate to or from any Real
Property, or arising in any manner whatsoever out of any violation of
Environmental Requirements.
"Environmental Lien" means a Lien in favor of any Governmental Authority
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for Environmental Damages.
5
"Environmental Requirements" means all Applicable Laws relating to
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Hazardous Materials or the protection of human health or the environment,
including all requirements pertaining to reporting, permitting, investigation
and remediation of releases or threatened releases of Hazardous Materials into
the environment, or relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Hazardous Materials.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended from time to time.
"ERISA Affiliate" means any Person (including for this purpose any trade or
---------------
business) that is or was a member of the controlled group of corporations or
trades or businesses (as defined in Subsection (b), (c), (m) or (o) of Section
414 of the Code) of which any Borrower is or was a member at any time within the
last six years.
"Event of Default" is defined in Section 7.1.
----------------
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
------------
time to time.
"Excluded Taxes" is defined in Section 2.14.1.
--------------
"Existing Debt" means the Debt described on Schedule 1.1.C.
-------------
"Existing Liens" means the Liens described on Schedule 1.1.D.
--------------
"Federal Funds Effective Rate" means, for any day, a fluctuating interest
----------------------------
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, as published for such day (or, if such day is not a
Business Day, for the next preceding Business Day), by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day that is a Business
Day, the average of the quotations for such day on such transactions received by
Agent from three federal funds brokers of recognized standing selected by the
Agent.
"Federal Reserve Board" means the Board of Governors of the Federal Reserve
---------------------
System, or any successor thereto.
"Fee Letter" means that certain letter dated January 7, 1999 between CI and
----------
the Agent.
"Fees" means, collectively, the fees described or referenced in Section
----
2.7.
"Fiscal Year" means the fiscal year of CI, which shall be the 12 month-
----------
period ending on March 31 in each year or such other period as CI may designate
and the Agent may approve in writing. "Fiscal Quarter" or "fiscal quarter"
-------------- --------------
means any quarter of a Fiscal Year.
"Funded Debt" means, with respect to any Borrower, without duplication, the
-----------
sum of such Borrower's Debt, determined on a consolidated basis for such
Borrower in accordance with GAAP, relating to the borrowing of money or the
obtaining of credit including, without
6
limitation, all Borrowings under this Agreement, plus any and all subordinated
debt, purchase money debt and Capitalized Leases.
"Funding Date" means any date on which a Loan is (or is requested to be)
------------
made or a Letter of Credit is (or is requested to be) issued.
"GAAP" means generally accepted accounting principles as in effect in the
----
United States of America from time to time.
"Governmental Approval" means an authorization, consent, approval, permit
---------------------
or license issued by, or a registration or filing with, any Governmental
Authority.
"Governmental Authority" means any nation and any state or political
----------------------
subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government and any
tribunal or arbitrator of competent jurisdiction.
"Hazardous Materials" means any substance (i) the presence of which
-------------------
requires investigation or remediation under any Applicable Law; (ii) that is or
becomes defined as a "hazardous waste" or "hazardous substance" under any
Applicable Law, including the Comprehensive Environmental Response, Compensation
and Liability Act (42 U.S.C. Section 9601 et seq.) or the Resource Conservation
and Recovery Act (42 U.S.C. Section 6901 et seq.); (iii) that is toxic,
explosive, corrosive, inflammable, infectious, radioactive, carcinogenic,
mutagenic, or otherwise hazardous and is or becomes regulated by any
Governmental Authority; (iv) the presence of which on any Real Property causes
or threatens to cause a nuisance upon the Real Property or to adjacent
properties or poses or threatens to pose a hazard to any Real Property or to the
health or safety of Persons on or about any Real Property; or (v) without
limitation, that contains gasoline or other petroleum hydrocarbons,
polychlorinated biphenyls or asbestos.
"Honor Date" is defined in Section 2.3.4.1.
----------
"Indemnified Liabilities" is defined in Section 9.2.1.
-----------------------
"Indemnitee" is defined in Section 9.2.1.
----------
"Intellectual Property Right" means (i) any patent, copyright, trademark,
---------------------------
service ▇▇▇▇, trade name, trade secret or other intellectual property right,
(ii) all registrations and applications to register any such patent, copyright,
trademark, service ▇▇▇▇, trade name or other intellectual property right with
any Governmental Authority and all renewals and extensions thereof, and (iii)
the goodwill of the business associated with or relating to any such trademark,
service ▇▇▇▇, trade name or other intellectual property right.
"Intercompany Debt" means any Debt of any Borrower that is owed to any
-----------------
other Borrower or any Affiliate.
7
"Interest Expense" means, for any period, total consolidated interest
----------------
expense of the Borrowers, including Fees, charges in respect of Letters of
Credit and the portion of any Capitalized Lease obligations allocable to
interest expense, but excluding amortization or write-off of debt discount and
expense, provided Interest Expense shall be adjusted on a pro forma basis to
include the amount of interest expense which would have accrued during such
period with respect to Debt incurred in connection with any acquisition of a
Consolidated Subsidiary by CI or any other Borrower.
"Interest Payment Date" means the last day of March, June, September and
---------------------
December in each year (or, if such day is not a Business Day, the next
succeeding Business Day).
"Interest Period" means, subject to the next sentence, with respect to each
---------------
LIBOR Rate Loan, the period commencing on the date specified in the related
Notice of Borrowing or Notice of Conversion/Continuation (or telephonic notice
in lieu thereof) and ending one, two, three or six months thereafter, as CI may
elect pursuant to Section 2.1. Notwithstanding the foregoing: (a) if a LIBOR
Rate Loan is continued, the Interest Period applicable to the continued or
converted Loan shall commence on the day on which the Interest Period applicable
to such LIBOR Rate Loan ends; (b) any Interest Period applicable to a LIBOR Rate
Loan (x) that would otherwise end on a day that is not a LIBOR Business Day
shall be extended to the next succeeding LIBOR Business Day, unless such
succeeding LIBOR Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding LIBOR Business Day, or (y)
that begins on the last LIBOR 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 LIBOR Business Day of the
calendar month; and (c) no Interest Period shall end after the Stated
Termination Date.
"Investment" means, with respect to any Person, (i) any direct or indirect
----------
purchase or other acquisition by that Person of stock or securities, or any
beneficial interest in stock or other securities, of any other Person, any
partnership (whether general or limited) or limited liability company interest
in any other Person, or all or any substantial part of the business or assets of
any other Person, or (ii) any direct or indirect loan, advance or capital
contribution by that Person to any other Person, including all indebtedness and
accounts receivable from that other Person that are not current assets or did
not arise from sales to that other Person in the ordinary course of business.
The amount of any Investment shall be the original cost of such Investment plus
the cost of all additions thereto, without any adjustments for increases or
decreases in value, or write-ups, write-downs or write-offs with respect to such
Investment, but shall not include the principal amount of any loan or other
indebtedness to the extent such principal amount of such loan or indebtedness
has been repaid.
"Knowledge" means actual knowledge or knowledge imputed to a Senior Officer
---------
in the ordinary course of such Senior Officer's duties.
"Lender" is defined in the Preamble. For purposes of the Sections referred
------
to in (and subject to) the last sentence of Section 9.6.4, "Lender" includes a
------
holder of a Participation.
"L/C Issuer" is defined in the Preamble.
----------
8
"Lender Party" is defined in the Preamble. For purposes of the Sections
------------
referred to in (and subject to) the last sentence of Section 9.6.4, "Lender
------
Party" includes a holder of a Participation.
-----
"Letter of Credit" is defined in Section 2.3.1.
----------------
"Letter of Credit Application" is defined in Section 2.3.2.
----------------------------
"Letter of Credit Fee" is defined in Section 2.7.2.
--------------------
"Letter of Credit Liability" means, at any time, all liabilities of CI to
--------------------------
the Lenders and the L/C Issuer in respect of Letters of Credit at such time,
whether or not such liability is contingent, and shall consist of the sum of (i)
the aggregate Stated Amount of all Letters of Credit then outstanding, and (ii)
all amounts that then have been paid by the L/C Issuer if and to the extent
reimbursement has not been received therefor.
"Leverage Ratio" means at the end of any Fiscal Quarter, the ratio of (x)
--------------
the aggregate Funded Debt of the Borrowers on a consolidated basis to (y) the
EBITDA of the Borrowers for the four consecutive Fiscal Quarters then ended, as
adjusted by Pro Forma Adjustments reflecting each Permitted Acquisition
occurring during such preceding four consecutive Fiscal Quarters.
"LIBOR Business Day" means any Business Day on which commercial banks are
------------------
open for international business (including dealings in interbank Dollar
deposits) in London, England.
"LIBOR Lending Office" means the office, branch or Affiliate of any Lender
--------------------
identified on Schedule 1.1.B as its LIBOR Lending Office or such other office,
branch or Affiliate as the Lender may hereafter designate as its LIBOR Lending
Office by notice to CI and the Agent.
"LIBOR Rate Loan" means a Loan, or portion thereof, that bears interest at
---------------
a rate determined by reference to an Adjusted LIBOR Rate (and as to which a
single Interest Period is applicable).
"LIBOR Reserve Requirement" means, with respect to any LIBOR Rate Loan and
-------------------------
for any day, the maximum rate at which reserves (including any marginal,
supplemental, special or emergency reserve) are required to be maintained on
such day under Regulation D by member banks of the Federal Reserve System in New
York City with deposits exceeding $5 billion against "Euro-Currency
Liabilities," as that term is used in Regulation D (or in respect of any other
category of liabilities that includes deposits by reference to which the
interest rate on LIBOR Rate Loans is determined or any category of extensions of
credit or other assets that includes loans by a non-United States office of any
bank to United States residents).
"Lien" means any lien, mortgage, pledge, security interest, charge, or
----
encumbrance of any kind (including any conditional sale or other title retention
agreement or any lease in the nature thereof) and any agreement to give or
refrain from giving any lien, mortgage, pledge, security interest, charge, or
other encumbrance of any kind.
9
"Liquidity" means on any date of determination, the sum of Borrowers' Cash
---------
plus the aggregate amount of all Lenders' Working Capital Revolving Commitments
minus the Working Capital Revolving Commitment Usage of all Lenders at such
date.
"Loan" means a Working Capital Revolving Loan, a Revolving Acquisition
----
Loan, a Term Acquisition Loan or a Swingline Loan made or to be made pursuant to
Article 2.
"Loan Account" is defined in Section 2.6.3.
------------
"Loan Documents" means, collectively, this Agreement, the Notes, the
--------------
Collateral Documents, the Letters of Credit, the Fee Letter and any other
agreement, instrument or other writing executed or delivered by any Borrower in
connection herewith, and all amendments, exhibits and schedules to any of the
foregoing.
"London Interbank Offered Rate" means, with respect to any Interest Period,
-----------------------------
a rate of interest per annum, selected by the Agent acting in good faith, at
which deposits in dollars are offered to the Agent in the London interbank
market at approximately 11:00 A.M. (London time) two LIBOR Business Days before
the first day of such Interest Period in an amount approximately equal to the
principal amount of the LIBOR Rate Loan to which such Interest Period is to
apply and for a period of time comparable to such Interest Period.
"Mandatory Borrowing" is defined in Section 2.2.5.
-------------------
"Margin Regulations" means Regulations G, T, U and X of the Federal Reserve
------------------
Board, as amended from time to time.
"Margin Stock" means "margin stock" as defined in the Margin Regulations.
------------
"Material," "Material Adverse Effect" or "Material Adverse Change" means a
-------- ----------------------- -----------------------
condition or event material to, a material adverse effect on or a material
adverse change in, as the case may be, any one or more of the following: (i) the
operations, business, properties, or condition (financial or otherwise) of the
Borrowers taken as a whole; (ii) the Borrowers' ability, taken as a whole, to
perform their obligations under any Loan Document and avoid any Event of
Default; or (iii) the legality, validity, binding effect or enforceability of
any Loan Document. "Materially" has a correlative meaning.
----------
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
------------------
3(37) and Section 4001(a)(3)(A) of ERISA to which CI or any of the ERISA
Affiliates is making or accruing an obligation to make contributions or to which
any such Person has within any of the preceding five plan years made or accrued
an obligation to make contributions.
"Multiple Employer Plan" means a "single employer plan," as defined in
----------------------
Section 4001(a)(15) of ERISA, that (i) is maintained for employees of any
Borrower or any ERISA Affiliate and at least one person other than such Borrower
and the ERISA Affiliates or (ii) was so maintained and in respect of which such
Borrower or any ERISA Affiliate could have liability under Section 4064 or 4069
of ERISA if such plan has been or were to be terminated.
10
"Net Income" means, for any period, consolidated net income (or loss) after
----------
taxes, determined in accordance with GAAP, of the Borrowers for such period
taken as a single accounting period, provided that there shall be excluded
therefrom (i) the income (or loss) of any Person (other than a Borrower) in
which any Borrower has an equity interest, except to the extent of dividends or
other distributions actually paid to such Borrower by such Person during such
period, (ii) the undistributed income of any Consolidated Subsidiary to the
extent that the declaration or payment of dividends or other distributions by
such Consolidated Subsidiary is not at the time permitted by the terms of its
charter or Contractual Obligations or Applicable Law binding on such
Consolidated Subsidiary, and (iii) the income (or loss) of any Consolidated
Subsidiary that is included in the calculation of Net Income but is attributable
to an owner of Capital Stock of such Consolidated Subsidiary other than CI, and
provided further, Net Income shall be adjusted by the Pro Forma Adjustments for
any new Consolidated Subsidiary acquired by Borrower.
"Net Worth" means, at any date, the consolidated stockholders' equity of
---------
CI, excluding any amounts attributable to mandatorily redeemable preferred
stock.
"Note" means each of the Working Capital Revolving Loan Notes, which notes
----
are in substantially the form of Exhibit A-1, as amended from time to time, the
Swingline Note, and the Acquisition Loan Notes, which notes are in substantially
the form of Exhibit A-2, as amended from time to time.
"Notice of Borrowing" is defined in Section 2.1.4.
-------------------
"Notice of Issuance" is defined in Section 2.3.2.
------------------
"Notice of Continuation/Conversion" is defined in Section 2.5.3.2.
---------------------------------
"Notice of Responsible Officer" is defined in Section 2.1.4.3.
-----------------------------
"Obligations" means all present and future obligations and liabilities of
-----------
each Borrower of every type and description arising under or in connection with
the Loan Documents due or to become due to the Lender Parties or any Person
entitled to indemnification, or any of their respective successors, transferees
or assigns, whether for principal, interest, letter of credit or other
reimbursement obligations, cash collateral cover, Fees, expenses, indemnities or
other amounts (including attorneys' fees and expenses) and whether due or not
due, direct or indirect, joint and/or several, absolute or contingent, voluntary
or involuntary, liquidated or unliquidated, determined or undetermined, and
whether now or hereafter existing, renewed or restructured.
"Operating Lease" means, as applied to any Person, any lease of any
---------------
property (whether real, personal, or mixed) under which such Person is the
lessee and that is not capitalized on the balance sheet of such Person.
"Participation" is defined in Section 9.6.4.
-------------
11
"PBGC" means the Pension Benefit Guaranty Corporation, as defined in Title
----
IV of ERISA, or any successor.
"Permitted Acquisition" means the acquisition by CI or a Wholly-Owned
---------------------
Subsidiary of all, but not less than all, ownership interests in another Person,
in connection with which all of the following conditions are met: (i) the
acquired Person has generated positive earnings before interest, taxes,
depreciation and amortization expense, as adjusted by the Pro Forma Adjustments,
for the twelve-month period immediately preceding the date of such acquisition;
(ii) the acquired Person is in a line of business substantially similar in type
to the businesses in which the Borrowers are already engaged; (iii) if on a pro
forma basis, the Leverage Ratio on the closing date of the acquisition (a) does
not exceed 2.00:1.00, the cash portion of the purchase price for such
acquisition, regardless of when paid, will not exceed $25,000,000, or (b) is
equal to or exceeds 2.00:1.00, the cash portion of the purchase price for such
acquisition, regardless of when paid, will not exceed $7,500,000; (iv) if, on a
pro forma basis, the Leverage Ratio on the closing date of the acquisition (a)
does not exceed 2.00:1.00, the total purchase price for such acquisition,
regardless of when paid, including in such total CI's reasonable estimate, based
on the historical performance of the acquired company, of the total amount of
payments based on future performance of such acquired business or Person (i.e.
"earnouts") or other criteria in connection with acquisitions to be paid, Debt
to be assumed and securities to be issued in connection with such acquisition,
will not exceed $50,000,000, or (b) is equal to or exceeds 2.00:1.00, the total
purchase price for such acquisition, regardless of when paid, including in such
total CI's reasonable estimate, based on the historical performance of the
acquired Person, of the total amount of payments based on future performance of
such acquired business or Person (i.e. "earnouts") or other criteria in
connection with acquisitions to be paid, Debt to be assumed and securities to be
issued in connection with such acquisition, will not exceed $15,000,000; (v) to
the extent any such acquisition involves a merger, CI is the surviving Person;
(vi) after giving effect to Pro Forma Adjustments with respect to such
acquisition, the Borrowers are in compliance with the covenants set forth in
Section 6.5.1 through Section 6.5.3; (vii) at the time of such acquisition, no
Default or Event of Default has occurred and is continuing; (viii) CI's
acquisition of such Person is being accomplished with the cooperation and
consent of the management of, the board of directors (if any) of, the managing
member (if any) of, and the holders of ownership interests in, the acquired
Person; and (ix) any Debt incurred or assumed by any Borrower in connection with
such acquisition (other than the Obligations hereunder) shall be subordinated in
right of payment to the Obligations, and the contractual terms of such Debt
shall provide that the holders of such Debt shall have no payment blockage
rights of any kind. Notwithstanding the foregoing, any acquisition approved by
the Required Lenders shall be a "Permitted Acquisition."
"Permitted Liens" means, with respect to any asset, the Liens (if any)
---------------
permitted to exist on such asset under Section 6.1.
"Person" means an individual, a corporation, a partnership, a limited
------
liability company, a trust, an unincorporated organization or any other entity
or organization, including a government or any agency or political subdivision
thereof.
12
"Plan" means any pension, retirement, disability, defined benefit, defined
----
contribution, profit sharing, deferred compensation, employee stock ownership,
employee stock purchase, health, life insurance, or other employee benefit plan
or arrangement, other than a Multiemployer Plan, irrespective of whether any of
the foregoing is funded, in which any personnel of CI or ERISA Affiliate
participates or from which any such personnel may derive a benefit.
"Pledge Agreement" means the Amended and Restated Pledge Agreement, of even
----------------
date herewith, between the Borrowers and the Agent in substantially the form of
Exhibit C-2, as amended or restated from time to time.
"Post-Default Rate" means, at any time, a rate per annum equal to the rate
-----------------
of interest otherwise in effect at such time pursuant to the terms hereof plus
2%; provided that with respect to any amount not paid when due (whether
principal, interest, or otherwise), the Post-Default Rate means the Base Rate in
effect at such time plus the Applicable Margin plus 2%.
"Pro Forma Adjustments" means, in the context of an acquisition by CI of a
---------------------
new Consolidated Subsidiary, adjustments to the actual historical financial data
of the acquired Person, without duplication, to reflect (i) compensation
differentials to former owners and employees of such acquired Person, (ii) the
termination of contributions by the acquired Person to retirement plans, (iii)
removal of non-recurring transaction costs incurred by CI in connection with the
acquisition of such acquired Person, and (iv) income taxes as if CI and such
acquired Person were combined and subject to the effective federal and state
statutory rates throughout the fiscal period during which the acquired Person
was acquired by CI, all as if the acquired Person had been a Consolidated
Subsidiary for the entire fiscal period during which it was acquired.
"Prohibited Transaction" means a transaction that is prohibited under
----------------------
Section 4975 of the Code or Section 406 or 407 of ERISA and not exempt under
Section 4975 of the Code or Section 408 of ERISA.
"Real Property" means each of those parcels (or portions thereof) of real
-------------
property, improvements and fixtures thereon and appurtenances thereto now or
hereafter owned or leased by any Borrower.
"Regulation D" means Regulation D of the Federal Reserve Board, as amended
------------
from time to time.
"Regulatory Change" means (i) the adoption or becoming effective after the
-----------------
date hereof of any treaty, law, rule or regulation, (ii) any change in any such
treaty, law, rule or regulation (including Regulation D), or any change in the
administration or enforcement thereof, by any Governmental Authority, central
bank or other monetary authority charged with the interpretation or
administration thereof, in each case after the date hereof, or (iii) compliance
after the date hereof by any Lender Party (or its Applicable Lending Office or,
in the case of capital adequacy requirements, any holding company of any Lender
Party) with, any interpretation, directive, request, order or decree (whether or
not having the force of law) of any such Governmental Authority, central bank or
other monetary authority.
13
"Reportable Event" means any of the events set forth in Section 4043(b) of
----------------
ERISA or the regulations thereunder, except any such event (other than the
failure to meet minimum funding standards of Section 412 of the Code or Section
302 of ERISA) as to which the provision for 30 days' notice to the PBGC is
waived under applicable regulations.
"Required Lenders" means Lenders having at least 51% of the aggregate
----------------
amount of the Commitments or, if the Commitments have terminated, Lenders
holding at least 51% of the sum of (a) the aggregate unpaid principal amount of
the Loans plus (b) the aggregate amount of all Letter of Credit Liability.
"Responsible Officer" is defined in Section 2.1.4.3.
-------------------
"Restricted Payment" means (i) any dividend or other distribution, direct
------------------
or indirect, on account of any Capital Stock of any Borrower now or hereafter
outstanding, except (a) a dividend or other distribution payable solely in
shares or equivalents of the same class of Capital Stock and (b) the issuance of
equity interests upon the exercise of outstanding warrants, options or other
rights, or (ii) any redemption, retirement, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any Capital
Stock of any Borrower now or hereafter outstanding.
"Revolving Acquisition Commitment" means, with respect to each Lender, the
--------------------------------
amount set forth for such Lender as its "Revolving Acquisition Commitment" on
Schedule 1.1.A as the amount of such Lender's commitment to make Revolving
Acquisition Loans to the Borrowers, as reallocated, reduced or terminated from
time to time pursuant to the terms hereof.
"Revolving Acquisition Commitment Usage" means, at any time, (i) with
--------------------------------------
respect to any Lender, the aggregate unpaid principal amount of all Revolving
Acquisition Loans made by such Lender, and (ii) with respect to all Lenders, the
aggregate unpaid principal amount of all Revolving Acquisition Loans, in each
case giving effect to Borrowings then requested.
"Revolving Acquisition Loans" is defined in Section 2.1.2.
---------------------------
"Revolving Acquisition Stated Termination Date" is defined in Section
---------------------------------------------
2.8.1.
"SEC" means the United States Securities and Exchange Commission, and any
---
successor.
"Securities Act" means the Securities Act of 1933, as amended from time to
--------------
time.
"Security Agreement" means the Amended and Restated Security Agreement, of
------------------
even date herewith, between the Borrowers and the Agent in substantially the
form of Exhibit C-1, as amended or restated from time to time.
"Senior Officer" means the President, the Chief Executive Officer, the
--------------
Chief Accounting Officer, or the Chief Financial Officer of CI.
"Single Employer Plan" means a Plan other than a Multiemployer Plan.
--------------------
14
"Solvent" means, with respect to any Person, that: (i) the total present
-------
fair salable value of such Person's business on a going concern basis is in
excess of the total amount of such Person's liabilities, including contingent
liabilities; (ii) such Person is able to pay its liabilities and contingent
liabilities as they become due; and (iii) such Person does not have unreasonably
small capital to carry on such Person's business as theretofore operated and as
proposed to be operated.
"Stated Amount" means, with respect to a Letter of Credit, the maximum
-------------
amount available to be drawn thereunder, without regard to whether any
conditions to drawing could be met.
"Stated Termination Date" is defined in Section 2.8.
-----------------------
"Subsidiary" means, with respect to any Person, any other Person of which
----------
more than 50% of the total voting power of the Capital Stock entitled to vote in
the election of the board of directors (or other Persons performing similar
functions) is at the time directly or indirectly owned by such first Person.
Unless otherwise indicated, "Subsidiary" refers to a Subsidiary of CI.
----------
"Swingline Commitment" means Ten Million Dollars ($10,000,000).
--------------------
"Swingline Lender" means BankBoston, N.A. in its individual capacity and
----------------
not as Agent.
"Swingline Loan" has the meaning assigned to such term in Section 2.2.1.
--------------
"Swingline Maturity Date" means the date which is five Business Days prior
-----------------------
to the Stated Termination Date.
"Swingline Note" means the Swingline Note made by the Borrowers payable to
--------------
the order of the Swingline Lender, in the original principal amount of Ten
Million Dollars ($10,000,000), which note is in substantially the form of
Exhibit A-3, as amended or restated from time to time.
"Taxes" means any present or future income, stamp and other taxes, charges,
-----
fees, levies, duties, imposts, withholdings or other assessments, together with
any interest and penalties, additions to tax and additional amounts imposed by
any federal, state, local or foreign taxing authority upon any Person.
"Termination Date" is defined in Section 2.8.1.
----------------
"Term Acquisition Loan" is defined in Section 2.8.1.
---------------------
"Termination Event" means: (i) a Reportable Event or an event described in
-----------------
Section 4068(f) of ERISA; (ii) the withdrawal of CI or any of its ERISA
Affiliates from a Multiple Employer Plan during a plan year in which it was a
"substantial employer" as defined in Section 4001(a)(2) of ERISA or the
cessation of operations at a facility in the circumstances described in
15
Section 4068(f) of ERISA; (iii) the filing of a notice of intent to terminate a
Defined Benefit Plan (including any such notice with respect to a Defined
Benefit Plan amendment referred to in Section 4041(e) of ERISA) or the
termination of a Defined Benefit Plan excluding, for purposes of this clause
(iii), any standard termination under Section 4041(b) of ERISA; (iv) the
institution of proceedings to terminate a Defined Benefit Plan by the PBGC; (v)
the appointment of a trustee to administer any Defined Benefit Plan under
Section 4042 of ERISA; or (vi) any other event or condition that might
reasonably constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Defined Benefit Plan.
"Total Commitment" means, with respect to each Lender, the aggregate of
----------------
such Lender's Working Capital Revolving Commitment plus such Lender's Revolving
Acquisition Commitment.
"Wholly-Owned" means, with respect to any Subsidiary, that all the Capital
------------
Stock (except for directors' qualifying shares) of such Subsidiary is directly
or indirectly owned by CI.
"Working Capital Revolving Commitment" means, with respect to each Lender,
------------------------------------
the amount set forth for such Lender as its "Working Capital Revolving
Commitment" on Schedule 1.1.A as the amount of such Lender's commitment to make
Working Capital Revolving Loans and purchase participations in, and assignments
of, Swingline Loans to the Borrowers, as reallocated, reduced or terminated from
time to time pursuant to the terms hereof.
"Working Capital Revolving Commitment Usage" means, at any time, (i) with
------------------------------------------
respect to any Lender, the sum of (A) the aggregate unpaid principal amount of
all Working Capital Revolving Loans made by such Lender (including, with respect
to the Swingline Lender, the aggregate unpaid principal amount of all Swingline
Loans made by the Swingline Lender), plus (B) the Lender's pro rata share of all
Letter of Credit Liability and (ii) with respect to all Lenders, the sum of (A)
the aggregate unpaid principal amount of all Working Capital Revolving Loans
made by all Lenders (including all Swingline Loans referred to in clause (i))
plus (B) all Letter of Credit Liability, in each case giving effect to
Borrowings then requested.
"Working Capital Revolving Loans" is defined in Section 2.1.1.1.
-------------------------------
Section 1.2. Related Matters.
---------------
1.2.1. Construction. Unless the context of this Agreement clearly
------------
requires otherwise, references to the plural include the singular, the singular
includes the plural, the part includes the whole, "including" is not limiting,
and "or" has the inclusive meaning represented by the phrase "and/or." The words
"hereof," "herein," "hereby," "hereunder" and similar terms in this Agreement
refer to this Agreement as a whole (including the Preamble, the Recitals, the
Schedules and the Exhibits) and not to any particular provision of this
Agreement. Article, section, subsection, exhibit, schedule, recital and preamble
references in this Agreement are to this Agreement unless otherwise specified.
References in this Agreement to any agreement, other document or law "as
amended" or "as amended from time to time," or to amendments of any document or
law, shall include any amendments, supplements, replacements, renewals, waivers
or other modifications not prohibited by the Loan Documents. References in this
16
Agreement to any law (or any part thereof) include any rules and regulations
promulgated thereunder (or with respect to such part) by the relevant
Governmental Authority, as amended from time to time.
1.2.2. Determinations. Any determination or calculation contemplated by
--------------
this Agreement that is made by any Lender Party shall be final and conclusive
and binding upon the Borrowers, and, in the case of determinations by the Agent,
also the other Lender Parties, in the absence of manifest error. References in
this Agreement to any "determination" by any Lender Party include good faith
estimates by such Lender Party (in the case of quantitative determinations), and
good faith beliefs by such Lender Party (in the case of qualitative
determinations). All references herein to "discretion" of any Lender Party (or
terms of similar import) shall mean "absolute and sole discretion." All consents
and other actions of any Lender Party contemplated by this Agreement may be
given, taken, withheld or not taken in such Lender Party's discretion (whether
or not so expressed), except as otherwise expressly provided herein.
1.2.3. Accounting Terms and Determinations. Unless otherwise specified
-----------------------------------
herein, all accounting terms used herein shall be interpreted, all accounting
determinations hereunder shall be made, and all financial statements required to
be delivered hereunder shall be prepared in accordance with GAAP, applied on a
basis consistent with the audited financial statements referred to in Section
4.4.
1.2.4. Independence of Covenants. All covenants under this Agreement
-------------------------
shall each be given independent effect so that if a particular action or
condition is not permitted by any such covenant, the fact that it would be
permitted by another covenant, by an exception thereto, or be otherwise within
the limitations thereof, shall not avoid the occurrence of a Default or an Event
of Default if such action is taken or condition exists.
ARTICLE 2.
AMOUNTS AND TERMS OF THE CREDIT FACILITY
----------------------------------------
Section 2.1. Revolving Loans.
---------------
2.1.1. Working Capital Revolving Commitment.
------------------------------------
2.1.1.1. Each Lender severally agrees, upon the terms and subject
to the conditions set forth in this Agreement, at any time from and after
the Closing Date until the Business Day next preceding the Termination
Date, to make revolving loans for working capital purposes other than in
connection with the consummation of any acquisition in whole or in part of
another Person or business (each such revolving loan, including those made
in connection with Mandatory Borrowings, a "Working Capital Revolving
-------------------------
Loan")to CI, provided that (a) the Working Capital Revolving Commitment
----
Usage of any Lender shall not exceed, at any time, the Working Capital
Revolving Commitment of such Lender, and (b) the Working Capital Revolving
Commitment Usage
17
of all Lenders at any time, in the aggregate, shall not exceed the
aggregate Working Capital Revolving Commitments of all Lenders.
2.1.1.2. Working Capital Revolving Loans may be voluntarily prepaid
pursuant to Section 2.9.4 and, subject to the provisions of this Agreement,
any amounts so prepaid may be re-borrowed, up to the amount available under
this Section 2.1.1 at the time of such re-borrowing.
2.1.2. Revolving Acquisition Commitment.
--------------------------------
2.1.2.1. Each Lender severally agrees, upon the terms and subject to
the conditions set forth in this Agreement, at any time from and after the
Closing Date until the Business Day next preceding the Revolving
Acquisition Stated Termination Date, to make revolving loans in connection
with the consummation of any Permitted Acquisition (each such revolving
loan, a "Revolving Acquisition Loan") to CI, provided that (a) the
--------------------------
Revolving Acquisition Commitment Usage of any Lender shall not exceed, at
any time, the Revolving Acquisition Commitment of such Lender, and (b) the
Revolving Acquisition Commitment Usage of all Lenders at any time, in the
aggregate, shall not exceed the aggregate Revolving Acquisition Commitments
of all Lenders.
2.1.1.2. Revolving Acquisition Loans may be voluntarily prepaid
pursuant to Section 2.9.4 and, subject to the provisions of this Agreement,
any amounts so prepaid may be re-borrowed prior to the Revolving
Acquisition Stated Termination Date, up to the amount available under this
Section 2.1.2 at the time of such re-borrowing.
2.1.3. Type of Loans and Minimum Amounts.
---------------------------------
2.1.3.1. Working Capital Revolving Loans and Revolving Acquisition
Loans made under this Section 2.1 and Term Acquisition Loans converted
under Section 2.8.1 may be Base Rate Loans or LIBOR Rate Loans (each a
"Type" of Loan),subject, however, to Sections 2.5.2 and 2.12.
----
2.1.3.2. Each Borrowing of Working Capital Revolving Loans (other than
Mandatory Borrowings) or Revolving Acquisition Loans shall be in a minimum
aggregate amount of $500,000 and integral multiples of $100,000, in the
case of a Borrowing of Base Rate Loans, or a minimum aggregate amount of
$1,000,000, and integral multiples of $1,000,000, in the case of a
Borrowing of LIBOR Rate Loans, provided that in no event shall the amount
of any Revolving Acquisition Loan Borrowing exceed the consideration
directly or indirectly paid by CI in connection with the Permitted
Acquisition giving rise to such Borrowing, including related costs and
expenses.
18
2.1.4. Notice of Borrowing.
-------------------
2.1.4.1. When CI desires to borrow Working Capital Revolving Loans
or Revolving Acquisition Loans pursuant to Section 2.1, it shall deliver to
the Agent a Notice of Borrowing substantially in the form of Exhibit E-1,
duly completed and executed by a Responsible Officer (a "Notice of
---------
Borrowing"),no later than 12:00 noon (California time) (a) at least one
---------
Business Day before the proposed Funding Date, in the case of a Borrowing
of Base Rate Loans, or (b) at least three LIBOR Business Days before the
proposed Funding Date, in the case of a Borrowing of LIBOR Rate Loans. In
addition, as promptly as practicable after reaching an agreement in
principle with respect to a Permitted Acquisition to be financed with a
Revolving Acquisition Loan Borrowing (but in any event not later than five
(5) Business Days prior to such Borrowing), Borrower shall furnish or cause
to be furnished to Agent such information as it may reasonably require to
enable it to review the material terms of such Permitted Acquisition,
including without limitation, a copy of the definitive acquisition
agreement, if available, and information as to the target of the
Acquisition, including market conditions, general resources and profits,
any debt assumption and the total purchase price.
2.1.4.2. In lieu of delivering a Notice of Borrowing, CI, through a
Responsible Officer, may give the Agent telephonic notice of any proposed
Borrowing by the time a Notice of Borrowing would be required to be
delivered and containing all information required for a Notice of
Borrowing; provided, however, that such notice shall be confirmed in
writing by delivery of a Notice of Borrowing to the Agent on or before the
proposed Funding Date (or, in case of a Base Rate Borrowing, one Business
Day after the Funding Date). The Lender Parties shall incur no liability to
the Borrowers or the other Lender Parties in acting upon any telephonic
notice that the Agent believes to have been given by a Responsible Officer
or for otherwise acting in good faith under this Section 2.1 and in making
any Loan in accordance with this Agreement pursuant to any telephonic
notice.
2.1.4.3. CI shall notify the Agent of the names of its officers and
employees authorized to request and take other actions with respect to
Loans on behalf of CI (each a "Responsible Officer") by providing the Agent
-------------------
with a Notice of Responsible Officers substantially in the form of Exhibit
E-7, duly completed and executed by a Senior Officer (a "Notice of
---------
Responsible Officer"). The Agent shall be entitled to rely conclusively
-------------------
on a Responsible Officer's authority to request and take other actions with
respect to Loans on behalf of CI until the Agent receives a new Notice of
Responsible Officer that no longer designates such Person as a Responsible
Officer. The Agent shall have no duty to verify the authenticity of the
signature appearing on any Notice of Borrowing, Notice of Responsible
Officer or any other notice given under the Loan Documents.
2.1.4.4. Any Notice of Borrowing (or telephone notice in lieu thereof)
delivered pursuant to this Section 2.1.4.4 shall be irrevocable and CI
shall be bound to make a Borrowing in accordance therewith.
19
2.1.4.5. The Agent shall promptly notify each Lender of the contents
of any Notice of Borrowing (or telephonic notice in lieu thereof) received
by it and such Lender's pro rata portion of the Borrowing requested. Not
later than 11:30 a.m. (California time) on the date specified in such
notice as the Funding Date (or, in the case of Base Rate Loans, 10:30 a.m.
(California time) on such date), each Lender, subject to the terms and
conditions hereof, shall make its pro rata portion of the Borrowing
available, in immediately available funds, to the Agent at the Agent's
Account.
2.1.5. Funding. Not later than 11:00 a.m. (California time) or such later
-------
time as may be agreed to by CI and the Agent, and subject to and upon
satisfaction of the applicable conditions set forth in Article 3 as determined
by the Agent, the Agent shall arrange for a wire transfer of immediately
available funds in the amount of the requested Working Capital Revolving Loans
and Revolving Acquisition Loans to the account designated by CI pursuant to wire
instructions set forth in the Notice of Borrowing.
Section 2.2. Swingline Loans.
---------------
2.2.1. Swingline Commitment. Subject to the terms and conditions set
--------------------
forth herein, the Swingline Lender agrees to lend to CI, and CI may borrow,
repay, and reborrow from time to time between the Closing Date and the Swingline
Maturity Date upon notice by CI to the Swingline Lender given in accordance with
Section 2.2.3, such sums as are r equested by CI (each a "Swingline Loan") up
--------------
to a maximum aggregate principal amount outstanding (after giving effect to all
amounts requested) at any one time equal to the Swingline Commitment, provided
--------
that the sum of the outstanding principal amount of the Swingline Loans (after
giving effect to all amounts requested), plus the then outstanding aggregate
principal amount of all of the Working Capital Revolving Loans shall not at any
time exceed the aggregate of all Lenders' Working Capital Revolving Commitments.
Each request for a Swingline Loan hereunder shall constitute a representation
and warranty by CI that the conditions set forth in Article 3 have been
satisfied on the date of such request. For all purposes of this Agreement,
except as otherwise expressly stated to the contrary, Swingline Loans shall be
treated as Working Capital Revolving Loans.
2.2.2. Interest on Swingline Loans. Except as otherwise provided in
---------------------------
2.5.1.2, each Swingline Loan shall bear interest for the period commencing with
the Funding Date thereof and ending on the date of repayment thereof at a rate
per annum equal to the Base Rate. Each Borrower promises to pay interest on each
Swingline Loan in arrears on the earlier to occur of (a) the day on which such
Swingline Loan is repaid and (b) the next occurring Interest Payment Date for
Base Rate Loans. Prior to the date of any Mandatory Borrowing in respect of a
Swingline Loan, interest on such Swingline Loan shall be for the Swingline
Lender's account, and following any Mandatory Borrowing in respect of any
Swingline Loan, interest on such Swingline Loan shall be for the account of all
Lenders, pro rata in accordance with the amounts of such Lenders' Working
Capital Revolving Loan Commitments.
2.2.3. Notice of Borrowing of Swingline Loans. CI shall give to the Agent
--------------------------------------
written notice in the form of Exhibit E-2 hereto (or telephonic notice
confirmed in a writing in
20
the form of Exhibit E-2 hereto) of each Swingline Loan requested hereunder (a
"Swingline Loan Request") no later than 12:00 noon, California time, on the
----------------------
proposed Funding Date of any Swingline Loan. Each such notice shall specify (a)
the principal amount of the Swingline Loan requested, (b) the proposed Funding
Date of such Swingline Loan, and (c) wire transfer instructions for the account
into which such Loan shall be disbursed if it is such account is not the
Borrower Account. Each Swingline Loan Request shall be irrevocable and binding
on the Borrowers and shall obligate the Borrowers to accept the Swingline Loan
requested from the Swingline Lender on the proposed Funding Date. Each Swingline
Loan Request shall be in a minimum amount of $10,000 or an integral multiple
thereof. The Swingline Lender agrees and acknowledges that the parties intend
that the Swingline Loans be funded on the same day as they are requested and
agrees to use all commercially reasonable efforts to honor each Swingline Loan
Request that is timely made pursuant to the terms hereof. Notwithstanding the
foregoing, the Borrowers agree and acknowledge that the Swingline Lender shall
incur no liability as a result of its inability to fund the amount requested in
any Swingline Loan Request until the Business Day following the day on which
such Swingline Loan Request is made.
2.2.4. Limitations on Swingline Lender's Obligation to Make Swingline
--------------------------------------------------------------
Loans. The Swingline Lender will not make any Swingline Loan after it has
-----
received written notice from the Required Lenders (other than the Swingline
Lender) that one or more of the applicable conditions precedent set forth in
Section 3.1 has not then been satisfied (provided that the delivery and receipt
of such written notice shall not limit, affect or modify the Lenders'
obligations in respect of a Mandatory Borrowing in respect of any Swingline Loan
made prior to the receipt of such notice, as specified in Section 2.2.4).
2.2.5. Mandatory Borrowings. On any Business Day, either CI or the
--------------------
Swingline Lender may, in its sole discretion, give notice to the Agent pursuant
to Section 2.1.4 that all then outstanding Swingline Loans shall be funded with
a Borrowing of Working Capital Revolving Loans (provided that such notice shall
be deemed to have been automatically given by the Swingline Lender upon the
occurrence of a Default, and further provided that such notice shall be deemed
to have been automatically given on the fourth Business Day after any day on
which the aggregate principal amount of Swingline Loans outstanding equals or
exceeds Five Hundred Thousand Dollars ($500,000)), in which case a Borrowing of
Working Capital Revolving Loans constituting Base Rate Loans (each such
Borrowing , a "Mandatory Borrowing") shall be made on the Funding Date set forth
-------------------
in the notice of such Mandatory Borrowing (which shall be a Business Day and
shall not be later than the first Business Day after the date of such notice,
and in the case of a notice deemed to be given automatically hereunder, shall be
the same day on which such notice is deemed given), by all Lenders pro rata in
accordance with each Lender's Working Capital Revolving Commitment, and the
proceeds thereof shall be applied directly to repay the Swingline Lender for all
outstanding Swingline Loans. Each Lender hereby irrevocably agrees to make
Working Capital Revolving Loans pursuant to each Mandatory Borrowing in the
amount and in the manner specified in the preceding sentence, and on the date
specified in writing by the Swingline Lender, notwithstanding (i) whether any
conditions specified in Article 3 are then satisfied; (ii) whether a Default or
Event of Default has occurred and is continuing; (iii) the date of such
Mandatory Borrowing; and (iv) any reduction in the Commitments after any such
Swingline Loans were
21
made. In the event that any Mandatory Borrowing cannot for any reason be made on
the date otherwise required above (including, without limitation, as a result of
the commencement of a case under the Bankruptcy Code in respect of CI), each
Lender (other than the Swingline Lenders) hereby agrees that it will forthwith
purchase from the Swingline Lenders (without recourse or warranty) such
assignment of their outstanding Swingline Loans as shall be necessary to cause
the Lenders to share in such Swingline Loans ratably based upon their respective
Working Capital Revolving Commitments, provided that all interest payable on
such Swingline Loans shall be for the account of the Swingline Lenders until the
date the respective assignment is purchased and, to the extent attributable to
the purchased assignment, shall be payable to the Lender purchasing such
assignment from and after the date of purchase. Each Lender's obligations under
this Section 2.2.5 shall be absolute and unconditional.
Section 2.3. Letters of Credit.
-----------------
2.3.1. In General. The L/C Issuer hereby agrees, upon the terms and
----------
subject to the conditions set forth in this Agreement, at any time from and
after the Closing Date until the Business Day preceding the Termination Date, to
issue for the account of the Borrower one or more letters of credit (each a
"Letter of Credit"), provided that (a) the aggregate Stated Amount of all
-----------------
outstanding Letters of Credit shall not exceed $5,000,000, (b) the Working
Capital Revolving Commitment Usage of all Lenders, in the aggregate, shall not
exceed at any time the aggregate Working Capital Revolving Commitments of all
Lenders, and (c) no order, judgment or decree of, or any request or directive
(whether or not having the force of law) from, any Governmental Authority, or
any other Applicable Law, shall purport by its terms to enjoin, restrain,
prohibit or otherwise prevent the L/C Issuer from issuing letters of credit
generally or the Letter of Credit or shall impose upon the L/C Issuer with
respect to that Letter of Credit any restriction, unreimbursed reserve
requirement or unreimbursed cost or expense that was not applicable, in effect
or known to the L/C Issuer on the Closing Date and that the L/C Issuer in good
▇▇▇▇▇ ▇▇▇▇▇ materially adverse to it. Letters of Credit shall (i) have expiry
dates not later than twelve (12) months from the date of issuance and in any
event not later than 10 Business Days prior to the Stated Termination Date and
(ii) support performance, payment, deposit or surety obligations of CI or any
Subsidiary, in each case under circumstances where provision of a letter of
credit is required by Applicable Law, in accordance with the custom or practice
in the industry of CI and its Subsidiaries or requested by a customer or client
of or vendor to CI or any Subsidiary in the ordinary course of business;
provided, however, that if the L/C Issuer shall consent (in its sole
-------- -------
discretion), a Letter of Credit may have an expiry date later than 10 Business
Days prior to the Stated Termination Date if the Borrowers have agreed to
deposit Cash Collateral Cover as provided in Section 2.3.5. The provisions of
this Section 2.3 and Section 3.2 shall apply to any extension, renewal or
increase of a Letter of Credit as if it were a new Letter of Credit.
2.3.2. Notices of Issuance, Etc. When CI desires the issuance of a
-------------------------
Letter of Credit, CI shall deliver to the L/C Issuer and the Agent at least
three Business Days before the Funding Date, (a) a Notice of Issuance
substantially in the form of Exhibit E-4, duly completed and executed by a
Responsible Officer (the "Notice of Issuance"), and (b) a letter of credit
------------------
application, a letter of credit reimbursement agreement and such other documents
and materials
22
as may be required by the L/C Issuer, each in form and substance satisfactory to
the L/C Issuer (collectively, a "Letter of Credit Application"). In the event
----------------------------
of a conflict between the terms of any Letter of Credit Application and this
Agreement, the terms of this Agreement shall govern. Upon receipt by the Agent
of a Notice of Issuance, the Agent shall promptly notify each Lender of the
contents thereof and such Lender's pro rata share of such Letter of Credit.
2.3.3. Participations in Letters of Credit. Immediately upon the
-----------------------------------
issuance of a Letter of Credit, each Lender shall be deemed to have irrevocably
purchased from the L/C Issuer a participation in such Letter of Credit and any
drawing thereunder in an amount equal to such Lender's pro rata share of the
Stated Amount of such Letter of Credit. An amount equal to the Letter of Credit
Liability for each Letter of Credit shall be reserved under the Working Capital
Revolving Commitment and shall not be available for borrowing for any purpose
other than reimbursement of amounts drawn under the Letters of Credit pursuant
to the terms of this Section 2.3.
2.3.4. Reimbursement for Drawings, Etc. Notwithstanding any
--------------------------------
provisions to the contrary in any Letter of Credit Application:
2.3.4.1. In case of a drawing under any Letter of Credit, the L/C
Issuer will notify CI and the Agent (which notification may be verbal).
The Borrowers shall reimburse the L/C Issuer for any and all amounts that
the L/C Issuer pays under any Letter of Credit no later than the date of
payment by the L/C Issuer (the "Honor Date"), whether or not the notice
----------
referred to in the preceding sentence is given.
2.3.4.2. If the L/C Issuer shall not be reimbursed for any drawing
under any Letter of Credit issued by it as provided in Section 2.3.4.1, the
L/C Issuer shall promptly notify the Agent, CI shall be automatically
deemed to have requested a Base Rate Borrowing in an amount equal to such
unreimbursed drawing, and the Agent shall promptly notify each Lender of
the unreimbursed amount of such drawing and of such Lender's respective
participation therein. Each Lender shall make available to the L/C Issuer
an amount equal to its respective participation in immediately available
funds, at the office of the L/C Issuer specified in such notice, not later
than the Business Day after the date on which the Agent gives such notice.
Each Lender's obligations under this Section 2.3.4.2 (a) shall not be
subject to any set-off, counterclaim or defense to payment that the Lender
may have against the Borrowers or against the L/C Issuer and (b) shall be
absolute, unconditional and irrevocable, and as a primary obligor, not as a
surety, notwithstanding any circumstance or event whatsoever, including (i)
the occurrence of an Event of Default or Default, (ii) the failure of any
other Lender to fund its participation as required hereby, (iii) the
financial condition of the Borrowers or any Lender Party or any set-off,
counterclaim or defense to payment that the Borrowers may have, or (iv) the
termination or cancellation of the Commitments. If any Lender fails to
make available to the L/C Issuer the amount of such Lender's participation
in the Letter of Credit as provided in this Section 2.3.4.2, such amount
shall bear interest at the Federal Funds Effective Rate (or, commencing
with the third day, the Base Rate) from the day on which the Agent's notice
to such Lender referred to above is given until paid. The L/C Issuer
23
shall pay to the Agent, and the Agent shall distribute to each Lender that
has paid all amounts payable by it under this Section 2.3.4.2, such
Lender's pro rata share of all payments received by the L/C Issuer from the
Borrowers in reimbursement of drawings honored by the L/C Issuer under a
Letter of Credit, as and when such payments are received.
2.3.4.3. The obligation of the Borrowers to reimburse the L/C Issuer
for drawings honored under a Letter of Credit in accordance with the terms
of this Agreement shall be absolute, unconditional and irrevocable,
notwithstanding any circumstance or event whatsoever, including the
following:
(a) any lack of validity or enforceability of such Letter of
Credit, any instrument transferring or assigning such Letter of Credit
or of any other Loan Document or the rights or benefits thereunder;
(b) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations or any other
amendments of or relating to such Letter of Credit or any other Loan
Document;
(c) the existence of any claim, setoff, defense or other right
that the Borrowers or any of their Affiliates may have at any time
against any Lender Party or any transferee of such Letter of Credit
(or any persons or entities for whom such Lender Party or transferee
may be acting), the L/C Issuer or any other Person, whether in
connection with this Agreement, the transactions contemplated herein
or any unrelated transaction (including any underlying transaction
between the Borrowers or one of its Subsidiaries and the L/C Issuer);
(d) any draft, demand, certificate or any other document
presented under any 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;
(e) honoring any Letter of Credit upon presentation of a demand,
draft or certificate or other document that does not comply on its
face with the terms of such Letter of Credit;
(f) any exchange, release or non-perfection of any Collateral
for the Letter of Credit Liability;
(g) any loss or delay in the transmission or otherwise of any
documents required in order to make a drawing under such Letter of
Credit or of the proceeds thereof;
(h) any misapplication of the proceeds of such Letter of Credit;
(i) the fact that a Default or and Event of Default shall have
occurred
24
and be continuing; or
(j) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing.
As between the Borrowers and the Lender Parties, the Borrowers assume all
risks of the acts and omissions of, or misuse of Letters of Credit by, the
respective beneficiaries in respect of the Letters of Credit and all risks of
any loss, errors, omissions or delays in the transmission of any document
required in order to make a drawing under any Letter of Credit. Nothing in this
Section 2.3.4.3 shall impair any claim the Borrowers or any Lender may otherwise
have against the L/C Issuer for any direct, but not consequential, damages
suffered by the Borrowers or such Lender that the Borrower or such Lender proves
were caused by (i) such L/C Issuer's willful misconduct or negligence in
determining whether documents presented under any Letter of Credit comply on
their face with the term of the Letter of Credit, or (ii) such L/C Issuer's
willful failure to make lawful payment under a Letter of Credit after the
presentation of documents strictly complying with the terms and conditions of
the Letter of Credit.
2.3.5. Cash Collateral Cover. If any Letter of Credit has an expiry date
---------------------
later than 10 Business Days prior to the Stated Termination Date, the Borrowers
shall be obligated on such tenth Business Day prior to the Stated Termination
Date, without presentment, demand, protest, notice or other requirements of any
kind, all of which are hereby expressly waived by the Borrowers, to deliver to
the Agent as Collateral therefor (the "Cash Collateral Cover"), an amount of
---------------------
Cash equal to 101% of the Letter of Credit Liability. Any amounts so received
shall be deposited in an interest bearing account maintained by the Agent. At
any time after any Obligations shall become due and payable by a drawing on a
Letter of Credit the Cash Collateral Cover may be applied in whole or in part by
the Agent against or on account of all or any part of such Obligations that have
become so due and payable. Interest earned on this account, to the extent such
interest is not required for, or applied to, the payment or repayment of such
Obligations, shall be paid to CI. Upon the expiry of all Letters of Credit,
Cash Collateral Cover may be applied in whole or in part by the Agent against or
on account of all or any part of any remaining Obligations that are due and
payable.
Section 2.4. Use of Proceeds. The proceeds of Working Capital Revolving Loans
---------------
shall be used by the Borrowers only for working capital and other general
corporate purposes and may not be used for any other purpose, including without
limitation, the direct or indirect, redemption, purchase or acquisition of
outstanding shares of Capital Stock of CI or for the consummation of any
Permitted Acquisition. The proceeds of the Revolving Acquisition Loans shall be
used by the Borrowers only for consummating Permitted Acquisitions, and subject
to Section 6.3, the direct or indirect, redemption, purchase or acquisition of
outstanding shares of Capital Stock of CI, provided that in no event shall the
amount of any Revolving Acquisition Loan Borrowing exceed the consideration
directly or indirectly paid by the Borrowers in connection with the Permitted
Acquisition giving rise to such Borrowing, including related costs and expenses.
No part of the proceeds of any Loans or Letters of Credit shall be used directly
or indirectly for the purpose, whether immediate, incidental or ultimate, of
purchasing or carrying
25
any Margin Stock or maintaining or extending credit to others for such purpose
or for any other purpose that otherwise violates the Margin Regulations.
Section 2.5. Interest; Interest Periods; Conversion/Continuation.
---------------------------------------------------
2.5.1. Interest Rate and Payment.
-------------------------
2.5.1.1. Each Loan shall bear interest on the unpaid principal
amount thereof, from and including the date of the making of such Loan to
and excluding the due date or the date of any repayment thereof, at the
following rates per annum: (a) for so long as and to the extent that such
Loan is a Base Rate Loan, at the Base Rate (as in effect from time to
time); and (b) for so long as and to the extent that such Loan is a LIBOR
Rate Loan, at the Adjusted LIBOR Rate for each day during each Interest
Period applicable thereto plus the Applicable Margin;
2.5.1.2. Notwithstanding the foregoing provisions of this Section
any principal, interest or other amount payable under this Agreement and
the other Loan Documents that is not paid when due shall bear interest at a
rate per annum equal to the Post-Default Rate, without notice or demand of
any kind.
2.5.1.3. Accrued interest shall be payable in arrears (a) in the
case of any Loan, on each Interest Payment Date; (b) in the case of a LIBOR
Rate Loan, on each Interest Payment Date that occurs during such Interest
Period applicable thereto and on the last day of the Interest Period
applicable thereto; (c) in the case of any interest accrued at the Post-
Default Rate, on demand; and (d) in the case of any Loan, when the Loan
shall become due (whether at maturity, by reason of prepayment,
acceleration or otherwise).
2.5.2. Interest Periods and Minimum Amounts. Notwithstanding anything
------------------------------------
herein to the contrary, (a) all Interest Periods applicable to LIBOR Rate Loans
shall comply with the definition of "Interest Period," (b) there may be no more
than ten different Interest Periods for all LIBOR Rate Loans outstanding at the
same time, and (c) LIBOR Rate Loans with the same Interest Period outstanding at
any time shall be in an aggregate amount at least equal to $1,000,000 and in an
integral multiple of $1,000,000. For purposes of the foregoing clause (b),
Interest Periods applicable to Working Capital Revolving Loans and Revolving
Acquisition Loans or Term Acquisition Loans, as applicable, shall constitute
different Interest Periods even if they are coterminous.
2.5.3. Conversion or Continuation.
--------------------------
2.5.3.1. Subject to this Section 2.5.3 and Sections 2.5.2 and 2.12,
CI shall have the option (a) at any time, to convert all or any part of the
outstanding Base Rate Loans to LIBOR Rate Loans; or (b) on the last day of
the Interest Period applicable thereto, to (i) convert all or any part of
the outstanding LIBOR Rate Loans to Base Rate Loans, (ii) to continue all
or any part of its LIBOR Rate Loans as Loans of the same Type, or (iii) to
convert all or any part of the outstanding LIBOR Rate Loans to LIBOR Rate
Loans of another Interest Period; provided that, in the case of clause (a),
(b) (ii) or
26
(b)(iii), there does not exist a Default or an Event of Default
at such time. If a Default or an Event of Default shall exist upon the
expiration of the Interest Period applicable to any LIBOR Rate Loan, such
Loan automatically shall be converted into a Base Rate Loan.
2.5.3.2. If CI elects to convert or continue a Loan under this
Section 2.5.3, it shall deliver to the Agent a Notice of
Continuation/Conversion substantially in the form of Exhibit E-3, duly
completed and executed by a Responsible Officer (a "Notice of
---------
Continuation/Conversion"), (a) not later than 11:00 a.m. (California time)
-----------------------
at least three LIBOR Business Days before the proposed conversion or
continuation date, if CI proposes to convert into, or to continue, a LIBOR
Rate Loan, and (b) otherwise not later than 11:00 a.m. (California time) on
the Business Day next preceding the proposed conversion or continuation
date.
2.5.3.3. In lieu of delivering a Notice of Continuation/Conversion,
CI, through a Responsible Officer, may give the Agent telephonic notice of
any proposed continuation or conversion by the time a Notice of
Continuation/Conversion would be required to be delivered and containing
all information required therefor; provided, however, that such notice
shall be confirmed in writing by delivery of a Notice of
Continuation/Conversion to the Agent on or before the proposed continuation
or conversion date. The Lender Parties shall incur no liability to the
Borrowers or the other Lender Parties in acting upon any telephonic notice
that the Agent believes to have been given by a Responsible Officer or for
otherwise acting in good faith under this Section 2.5.3 and in converting
or continuing any Loan (or a part thereof) pursuant to any telephonic
notice.
2.5.3.4. Any Notice of Conversion/Continuation (or telephonic
notice in lieu thereof) shall be irrevocable and CI shall be bound to
convert or continue in accordance therewith. If any request for the
conversion or continuation of a Loan is not made in accordance with this
Section 2.5.3, or if no notice is so given with respect to a LIBOR Rate
Loan as to which the Interest Period expires, then such Loan automatically
shall be converted into a Base Rate Loan.
2.5.4. Computations. Interest on each LIBOR Rate Loan and all Fees and
------------
other amounts payable hereunder or the other Loan Documents shall be computed on
the basis of a 360-day year, and interest on Base Rate Loans shall be computed
on the basis of a 365 or 366-day year, and the actual number of days elapsed
(including the first and excluding the last day of the period). Any change in
the interest rate on any Loan or other amount resulting from a change in the
rate applicable thereto (or any component thereof) pursuant to the terms hereof
shall become effective as of the opening of business on the day on which such
change in the applicable rate (or component) shall become effective.
2.5.5. Maximum Lawful Rate of Interest. The rate of interest payable on
-------------------------------
any Loan or other amount shall in no event exceed the maximum rate permissible
under Applicable Law. If the rate of interest payable on any Loan or other
amount is ever reduced as a result of this Section and at any time thereafter
the maximum rate permitted by Applicable Law shall
27
exceed the rate of interest provided for in this Agreement, then the rate
provided for in this Agreement shall be increased to the maximum rate provided
by Applicable Law for such period as is required so that the total amount of
interest received by the Lenders is that which would have been received by the
Lenders but for the operation of the first sentence of this Section.
Section 2.6. Notes, Etc.
-----------
2.6.1. Loans Evidenced by Notes.
------------------------
2.6.1.1. The Working Capital Revolving Loans made by each Lender to
any Borrower shall be evidenced by one or more Working Capital Revolving Loan
Notes executed by each of the Borrowers, provided that all of such Working
Capital Revolving Loan Notes shall comprise a joint and several obligation in an
amount not exceeding the aggregate amount of the Lenders' Working Capital
Revolving Commitments.
2.6.1.2. The Revolving Acquisition Loans made by each Lender to any
Borrower shall be evidenced by one or more Revolving Acquisition Loan Notes
executed by each of the Borrowers, provided that all of such Revolving
Acquisition Loan Notes shall comprise a joint and several obligation in an
amount not exceeding the aggregate amount of the Lenders' Revolving Acquisition
Commitments.
2.6.1.3. Upon termination of each Lender's Revolving Acquisition
Commitment and the conversion of each Revolving Acquisition Loan into a Term
Acquisition Loan, the Term Acquisition Loans made by each Lender to any Borrower
shall be evidenced by the Acquisition Loan Notes executed by each of the
Borrowers, provided that all of such Acquisition Loan Notes shall comprise a
joint and several obligation in an amount not exceeding the aggregate amount of
the Term Acquisition Loans.
2.6.1.4. The Swingline Loan shall be evidenced by the Swingline
Note, dated the Closing Date and completed with appropriate insertions. The
Swingline Note shall be payable to the order of the Swingline Lender in a
principal amount equal to the Swingline Commitment.
2.6.2. Notation of Amounts and Maturities, Etc. Each Lender is hereby
---------------------------------------
irrevocably authorized to record on the schedules attached to its Working
Capital Revolving Loan Note and its Acquisition Loan Note (or continuations
thereof) the information contemplated by such schedules. The Swingline Lender
shall make or cause to be made, at or about the time of the Funding Date of any
Swingline Loan or at the time of receipt of any payment of principal on the
Swingline Note, an appropriate notation on the Swingline Note reflecting the
making of such Swingline Loan or (as the case may be) the receipt of such
payment. The failure to record, or any error in recording, any such information
shall not, however, affect the obligations of the Borrowers hereunder or under
any Working Capital Revolving Loan Note, the Swingline Note or any Acquisition
Loan Note to repay the principal amount of the Loans evidenced thereby, together
with all interest accrued thereon. All such notations shall constitute
conclusive evidence of the accuracy of the information so recorded, in the
absence of manifest error.
28
2.6.3. Loan Account. The Agent shall maintain a loan account (the "Loan
------------ ----
Account") on its books in which shall be recorded (a) all Loans made by the
--------
Lenders to the Borrowers pursuant to this Agreement, (b) all other appropriate
debits and credits as and when due in accordance with this Agreement, including
all Fees, charges, expenses and interest, and (c) all payments made by any
Borrower on the Obligations. All entries in the Loan Account shall be made in
accordance with the customary accounting practices of the Agent as in effect
from time to time. The balance shown in the Loan Account shall be rebuttable
presumptive evidence of the amounts due and owing the Lender Parties by the
Borrowers.
Section 2.7. Fees.
----
2.7.1. Commitment Fee. CI shall pay to the Agent, for the pro rata
--------------
benefit of the Lenders, a commitment fee for each day from and after the Closing
Date until the Stated Termination Date, upon the sum of (x) the excess, if any,
of (a) the aggregate Working Capital Revolving Commitments of the Lenders minus
(b) the Working Capital Revolving Commitment Usage, plus (y) the excess, if any,
of (a) the aggregate Revolving Acquisition Commitments of the Lenders minus (b)
the Revolving Acquisition Commitment Usage, in each case for such day. Such Fee
shall be payable in arrears on each Interest Payment Date and the Termination
Date. The commitment fee shall accrue at the following rate: (i) at any time
when the Applicable Margin is 1.875, 0.50% per annum; (ii) at any time when the
Applicable Margin is 1.50, 0.40% per annum; (iii) at any time when the
Applicable Margin is 1.25, 0.35% per annum; (iv) at any time when the Applicable
Margin is 1.00, 0.30% per annum; and (v) at any time when the Applicable Margin
is 0.875, 0.25%, per annum.
2.7.2. Letter of Credit Fees. The Borrowers shall pay to the Agent,
---------------------
for the pro rata benefit of the Lenders, a letter of credit fee for each Letter
of Credit issued in an amount equal to (i) the Applicable LIBOR Margin
multiplied by (ii) the average Stated Amount of the Letter of Credit for the
period from the date of issuance of such Letter of Credit until its expiry. Such
Fee shall be payable in arrears on each Interest Payment Date, the Termination
Date and if any Letter of Credit has an expiry date later than the Stated
Termination Date, the expiry date for such Letter of Credit. In addition, the
Borrowers shall pay to the L/C Issuer (a) on the date of issuance of such letter
of credit, a letter of credit fronting fee equal to 1/8% per annum of the Stated
Amount of such Letter of Credit, and (b) the L/C Issuer's standard
administration (including drawing, cancellation, and transfer), amendment and
handling charges, which charges shall be payable at such times and in such
amounts as may be set forth in the standard schedule of the L/C Issuer for such
charges.
2.7.3. Other Fees. On the Closing Date and from time to time thereafter
----------
as specified in the Fee Letter, the Borrowers shall pay to the Agent the fees
specified in the Fee Letter. CI shall not be required to pay a fee in connection
with the conversion of the Revolving Acquisition Loans into the Term Acquisition
Loans.
2.7.4. Fees Non-Refundable. All Fees shall be fully earned when payable
-------------------
hereunder or under the Fee Letter and shall be non-refundable.
29
Section 2.8. Termination, Reduction and Modification of Commitments.
------------------------------------------------------
2.8.1. Each Lender's Working Capital Revolving Commitment shall
terminate without further action on the part of such Lender on the earlier to
occur of (a) March 12, 2004 (or if that date is not a Business Day, the next
preceding LIBOR Business Day) (the "Stated Termination Date"), and (b) the date
-----------------------
of termination of the Working Capital Revolving Commitment and the Revolving
Acquisition Commitment pursuant to Section 2.8.2 or 7.2 (such earlier date being
referred to herein as the "Termination Date"). The Swingline Commitment shall
----------------
expire without further action on the part of the Swingline Lender on the
Termination Date. Each Lender's Revolving Acquisition Commitment shall terminate
without further action on the part of such Lender on the earlier to occur of (a)
March 12, 2001 (or if that date is not a Business Day, the next preceding LIBOR
Business Day) (the "Revolving Acquisition Stated Termination Date"), and (b) the
---------------------------------------------
date of termination of the Working Capital Revolving Commitment and the
Revolving Acquisition Commitment pursuant to Section 2.8.2 or 7.2. Upon the
termination of each Lender's Revolving Acquisition Commitment, all outstanding
Revolving Acquisition Loans shall be automatically converted into a term loan
(each, a "Term Acquisition Loan") in an amount equal to the outstanding
---------------------
principal balance of each such Revolving Acquisition Loan without any further
action on the party of Agent, the Borrowers, or any Lender Party and such Term
Acquisition Loans shall be repaid in accordance with Section 2.8.3.
2.8.2. CI shall have the right, at any time or from time to time after
the Closing Date, to terminate in whole or permanently reduce in part, without
premium or penalty, either or both of the Working Capital Revolving Commitments
and the Revolving Acquisition Commitments (the amount of which termination or
reduction shall be allocated among the Lenders on a pro rata basis) to an amount
not less than the Working Capital Revolving Commitment Usage of all Lenders, all
Letter of Credit Liability and the Revolving Acquisition Commitment Usage of all
Lenders, respectively, by giving the Agent not less than seven days prior
written notice of such termination or reduction and the amount of any partial
reduction. Any such termination or partial reduction shall be effective on the
date specified in CI's notice and shall be in a minimum amount of $10,000,000
and integral multiples of $5,000,000. In addition, each termination of the
Working Capital Revolving Commitments of the Lenders, or reduction of such
Working Capital Revolving Commitments to an aggregate amount less than the
amount of the Swing Line Commitment then in effect, shall automatically
terminate or reduce the Swing Line Commitment to the amount of the Working
Capital Revolving Commitments then in effect.
2.8.3. The Borrower shall have the right, at any time after the Closing
Date and prior to the earlier of (a) the Termination Date and (b) the Revolving
Acquisition Stated Termination Date, but no more frequently than once per Fiscal
Quarter, to reallocate amounts between the Working Capital Revolving Commitments
and the Revolving Acquisition Commitments of all of the Lenders, on a pro rata
basis, without premium or penalty, by giving the Agent not less than three
Business Days' prior written notice of such reallocation in the form of Exhibit
E-5 (a "Notice of Reallocation"), provided that in no event shall either the
----------------------
Working Capital Revolving Commitments or the Revolving Acquisition Commitments
of all Lenders be in an amount less than the Working Capital Revolving
Commitment Usage of all Lenders and the
30
Revolving Acquisition Commitment Usage of all Lenders, respectively. Any such
reallocation shall be effective on the date specified in CI's notice and shall
be in a minimum amount of $500,000 and a maximum amount of $15,000,000, provided
that, subject to Section 2.8.2, after giving effect to any reallocations
pursuant to this Section 2.8.3, in no event shall (i) the aggregate amount of
the Working Capital Revolving Commitments of all Lenders exceed Twenty-Five
Million Dollars ($25,000,000), (ii) the aggregate amount of the Revolving
Acquisition Commitments of all Lenders exceed Ninety Million Dollars
($90,000,000), and (iii) the aggregate amount of the Working Capital Revolving
Commitments of all Lenders plus the aggregate amount of the Revolving
Acquisition Commitments of all Lenders exceed One Hundred Million Dollars
($100,000,000).
Section 2.9. Repayments and Prepayments.
--------------------------
2.9.1. Repayment of Revolving Loans. The unpaid principal amount of
----------------------------
all Working Capital Revolving Loans shall be paid in full on the Termination
Date. If the Termination Date occurs prior to the Revolving Acquisition Stated
Termination Date, the unpaid principal amount of all Revolving Acquisition Loans
shall be paid in full on the Termination Date.
2.9.2. Repayment of Term Acquisition Loans. Subject to Sections 2.9.4
-----------------------------------
and 7.2, the outstanding principal amount of the Term Acquisition Loans as of
the Revolving Acquisition Stated Termination Date shall be repaid in twelve (12)
equal and consecutive quarterly installments, payable on each Interest Payment
Date, commencing on June 30, 2001.
2.9.3. Mandatory Prepayment.
--------------------
2.9.3.1. Excess Working Capital Revolving Loans. If at any time
--------------------------------------
the aggregate Working Capital Revolving Commitment Usage of all Lenders
exceeds the aggregate amount of the Working Capital Revolving Commitments
then in effect, CI shall, on the Business Day on which CI learns or is
notified of the excess, notify the Agent that on the next Business Day the
Borrowers will make mandatory prepayments of the Working Capital Revolving
Loans (and thereafter in respect of any Letters of Credit as provided in
Section 2.9.3.6.) as may be necessary so that, after such prepayment and
provision, such excess is eliminated.
2.9.3.2. Excess Revolving Acquisition Loans. If at any time the
----------------------------------
aggregate Revolving Acquisition Commitment Usage of all Lenders exceeds
the aggregate amount of the Revolving Acquisition Commitments then in
effect the Borrowers shall, on the Business Day on which any Borrower
learns or is notified of the excess, notify the Agent that on the next
Business Day the Borrowers will make mandatory prepayments of the
Revolving Acquisition Loans as may be necessary so that, after such
prepayment and provision, such excess is eliminated.
2.9.3.3. Proceeds of Collateral. All proceeds of Collateral and
----------------------
pursuant to the provisions of the Security Agreement shall be credited to
Borrower's Loan Account and applied to the repayment of the Obligations
31
one Business Day after the Agent's receipt thereof (conditional upon the
Agent's receipt of immediately available funds at the end of such one-
Business Day period).
2.9.3.4. Proceeds of Securities Offerings. Upon the issuance of
--------------------------------
any Capital Stock (other than in connection with a merger or upon the
exercise of employee or director stock options) or debt securities by CI or
any Consolidated Subsidiary on or after January 1, 1999, the Borrowers
shall notify the Agent that on the next Business Day the Borrowers will
make mandatory prepayments of the Revolving Acquisition Loans or Term
Acquisition Loans, as applicable, in an amount equal to either (i) 75% of
the net cash proceeds of all such issuances of Capital Stock or debt
securities if the Borrowers' Leverage Ratio is greater than 2.00 to 1.00,
or (ii) 50% of the net cash proceeds of all such issuances of capital stock
or debt securities if the Borrowers' Leverage Ratio is equal to or less
than 2.00 to 1.00.
2.9.3.5. Proceeds of Asset Dispositions. Upon the consummation of
------------------------------
one or more Asset Dispositions which results in net proceeds to one more of
the Borrowers in an amount equal to or greater than $3,000,000 during any
twelve month period, the Borrowers shall notify the Agent that on the next
Business Day the Borrowers will make mandatory prepayments of the Revolving
Acquisition Loans or Term Acquisition Loans, as applicable, in an amount
equal to 100% of the net cash proceeds of such Asset Disposition or related
Asset Dispositions.
2.9.3.6. Notice and Application of Mandatory Prepayments;
-----------------------------------------------
Interest. The Borrower shall give the Agent not less than one Business
--------
Day's prior written notice of the date on which a Mandatory Prepayment will
be made. Each Mandatory Prepayment shall be applied to the unpaid principal
amount of the Loans; provided that each Mandatory Prepayment shall be
applied first to reduce the Base Rate Loan constituting a portion of the
respective Loan and then to the LIBOR Rate Loans constituting a portion
thereof, in the inverse order of termination of Interest Periods applicable
thereto. Each Mandatory Prepayment shall be made together with accrued
interest on the amount prepaid to the date of prepayment. Each Mandatory
Prepayment made with respect to Term Acquisition Loans shall be applied to
payments in reverse order of maturity. If no Loans are outstanding when all
or any portion of a Mandatory Prepayment is required to be made, the
balance of the Mandatory Prepayment shall be applied to reduce any
outstanding Letter of Credit Liability, first to pay any Obligations in
respect thereof then due and payable and then to provide Cash Collateral
Cover for any outstanding Letters of Credit.
2.9.4. Optional Prepayments
--------------------
2.9.4.1. Subject to this Section 2.9.4 and Section 2.16, the
Borrowers may, at their option, at any time or from time to time, prepay
the Loans in whole or in part, without premium or penalty.
2.9.4.2. If the Borrowers elect to prepay a Loan under this
Section 2.9.4, they shall deliver to the Agent a notice of optional
prepayment that specifies whether the
32
Loan to be prepaid is a Working Capital Revolving Loan, a Revolving
Acquisition Loan or a Term Acquisition Loan (i) not later than 12:00 noon
(California time) at least three LIBOR Business Days before the proposed
prepayment, if the Borrowers propose to prepay a LIBOR Rate Loan, and (ii)
otherwise not later than 12:00 noon (California time) on the proposed
prepayment date (which shall be a Business Day). Any notice of optional
prepayment shall be irrevocable, and the payment amount specified in such
notice shall be due and payable on the date specified in such notice,
together with interest accrued thereon to such date.
2.9.5. Payments Set Aside. To the extent the Agent or any Lender receives
------------------
payment of any amount under the Loan Documents, whether by way of payment by the
Borrowers, set-off, as proceeds of Collateral or otherwise, which payment is
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, other law or equitable cause, in whole or in part, then, to the
extent of such payment received, the Obligations or part thereof intended to be
satisfied thereby shall be revived and continue in full force and effect,
together with all Collateral security therefor, as if such payment had not been
received by the Agent or Lender. If prior to any such invalidation, declaration,
setting aside or requirement, this Agreement shall have been canceled or
surrendered, this Agreement shall be reinstated in full force and effect, and
such prior cancellation or surrender shall not diminish, discharge or otherwise
affect the obligations of the Borrowers in respect of the amount of the affected
payment.
Section 2.10. Manner of Payment.
----------------
2.10.1. Except as otherwise expressly provided, the Borrowers shall make
each payment under the Loan Documents to the Agent in Dollars and in immediately
available funds, without any deduction whatsoever, including any deduction for
any set-off, recoupment, counterclaim or Taxes (other than Excluded Taxes), at
the Agent's Office, for the account of the Applicable Lending Offices of the
Lender Party entitled to such payment, by depositing such payment in the Agent's
Account not later than 12:00 noon (California time) on the due date thereof. Any
payments received after 12:00 noon (California time) on any Business Day shall
be deemed received on the next succeeding Business Day. Not later than 1:00 p.m.
(California time) on the day such payment is made, the Agent shall deliver to
each Lender, for the account of the Lender's Applicable Lending Office, in
Dollars and in immediately available funds, such Lender's share of the payment
so made, determined pursuant to Section 2.16. Delivery shall be made in
accordance with the written instructions satisfactory to the Agent from time to
time given to the Agent by each Lender. Without limiting the rights of the
Lender Parties under Section 9.10, each Lender Party shall have the right, at
any time, to charge any account of any Borrower maintained with the Lender Party
for the amount of any payment due by such or any other Borrower under the Loan
Documents or to deduct the amount of any such payment from any remittance due to
such or any other Borrower hereunder.
2.10.2. Whenever any payment to be made hereunder shall be due on a day
that is not a Business Day (or, in the case of any payment with respect to any
LIBOR Rate Loan, not a
33
LIBOR Business Day), such payment shall instead be made on the
next succeeding Business Day (or, in the case of any such payment with respect
to any LIBOR Rate Loan, the next succeeding LIBOR Business Day, subject to
clause (b) of the definition of "Interest Period"), together with interest
accrued during the period of such extension.
Section 2.11. Pro Rata Treatment. Except to the extent otherwise expressly
------------------
provided herein:
2.11.1. Working Capital Revolving Loans shall be requested from the
Lenders pro rata according to their respective Working Capital Revolving
Commitments and Revolving Acquisition Loans shall be requested from the Lenders
pro rata according to their respective Revolving Acquisition Commitments.
2.11.2. Mandatory Borrowings in respect of Swingline Loans shall be funded
by the Lenders pro rata according to their respective Working Capital Revolving
Commitments.
2.11.3. Each reduction of the Working Capital Revolving Commitments of the
Lenders shall be applied to the respective Working Capital Revolving Commitments
of the Lenders pro rata according to their respective Working Capital Revolving
Commitments before such reduction and each reduction of the Revolving
Acquisition Commitments of the Lenders shall be applied to the respective
Revolving Acquisition Commitments of the Lenders pro rata according to their
respective Revolving Acquisition Commitments before such reduction.
2.11.4. Each payment or prepayment by the Borrowers of principal of the
Working Capital Revolving Loans, Revolving Acquisition Loans or Term Acquisition
Loans shall be made for the account of the Lenders pro rata according to the
respective unpaid principal amounts of their Working Capital Revolving Loans,
Revolving Acquisition Loans or Term Acquisition Loans, and each payment by the
Borrowers of interest on the Working Capital Revolving Loans, Revolving
Acquisition Loans or Term Acquisition Loans shall be made for the account of the
Lenders pro rata according to the respective accrued but unpaid interest on
their Working Capital Revolving Loans, Revolving Acquisition Loans or Term
Acquisition Loans. Each payment by the Borrowers of Fees payable to the Lenders
pursuant to Section 2.7.1 shall be made for the account of the Lenders pro rata
according to the respective amounts of their Total Commitments.
Section 2.12. Mandatory Suspension and Conversion of LIBOR Rate Loans. Each
-------------------------------------------------------
Lender's obligation to make, continue or convert Loans into LIBOR Rate
Loans shall be suspended, all outstanding LIBOR Rate Loans shall be
automatically converted into Base Rate Loans on the last day of the respective
Interest Periods applicable thereto (or, if earlier, in the case of clause
2.12.2, on the last day that such Lender can lawfully continue to maintain LIBOR
Rate Loans) and all pending requests for the making or continuation of, or
conversion into, LIBOR Rate Loans shall be of no force of effect, if:
2.12.1. on or prior to the determination of the interest rate for a LIBOR
Rate Loan for any Interest Period, the Agent determines that for any reason
appropriate quotations are not available to the Agent in the relevant interbank
market for purposes of determining the
34
Adjusted LIBOR Rate or that such rate would not accurately reflect the cost to
the Lenders of making, continuing, or converting a Loan into, a LIBOR Rate Loan
for such Interest Period; or
2.12.2. after the date hereof a Lender notifies the Agent (which shall
thereupon notify CI and the other Lenders) of its determination that any
Regulatory Change makes it unlawful or impossible for such Lender or its LIBOR
Lending Office to make or maintain any LIBOR Rate Loan, to obtain in the
interbank eurodollar market through its LIBOR Lending Office the funds with
which to make any LIBOR Rate Loan or to comply with its obligations hereunder in
respect thereof.
Section 2.13. Regulatory Changes.
------------------
2.13.1.Increased Costs. If, on or after the date hereof, any Regulatory
---------------
Change shall impose, modify or deem applicable any reserve, special deposit,
compulsory loan, insurance or similar requirement (other than any such
requirement with respect to any LIBOR Rate Loan to the extent included in the
LIBOR Reserve Requirement), against, or any fees or charges in respect of,
assets held by, deposits with or other liabilities for the account of,
commitments of, advances or Loans by, Letters of Credit (or participations
therein) or other credit extended by, any Lender Party (or its Applicable
Lending Office) or shall impose on any Lender Party (or its Applicable Lending
Office) or on the relevant interbank market any other condition affecting any
LIBOR Rate Loan, or any Letter of Credit (or participations therein) or any
obligation to make LIBOR Rate Loans, or in respect of Letter of Credit
participations and the effect of the foregoing is (i) to increase the cost to
such Lender Party (or its Applicable Lending Office) of making, issuing,
renewing or maintaining any LIBOR Rate Loan or its Total Commitment or Total
Commitments in respect thereof or any Letter of Credit (or participations
therein) or (ii) to reduce the amount of any sum received or receivable by such
Lender Party (or its Applicable Lending Office) hereunder or under any other
Loan Document with respect thereto, then, subject to Section 2.16.1, the
Borrowers shall from time to time pay to such Lender Party, within 10 days after
request by such Lender Party, such additional amounts as may be specified by
such Lender Party as sufficient to compensate such Lender Party for such
increased cost or reduction.
2.13.2. Capital Costs. If a Regulatory Change regarding capital adequacy
-------------
(including the adoption or becoming effective of any treaty, law, rule,
regulation or guideline adopted pursuant to or arising out of the July 1988
report of the Basle Committee on Banking Regulations and Supervisory Practices
entitled "International Convergence of Capital Measurement and Capital
Standards") has or would have the effect of reducing the rate of return on the
capital of or maintained by any Lender Party or any Person controlling such
Lender Party as a consequence of such Lender Party's Loans, Letters of Credit,
Total Commitment or obligations hereunder and other commitments of this type to
a level below that which such Lender Party or Person could have achieved but for
such Regulatory Change (taking into account such Lender Party's or Person's
policies with respect to capital adequacy), then, subject to Section 2.16.1, the
Borrowers shall from time to time pay to such Lender Party, within 10 days after
request by such Lender Party, such additional amounts as may be specified by
such Lender Party as sufficient to compensate such Lender Party or Person for
such reduction in return, to the extent such Lender Party or such Person
determines such reduction to be attributable to the
35
existence, issuance or maintenance of such Loans, Letters of Credit or
obligations for the account of the Borrowers.
Section 2.14. Taxes.
-----
2.14.1. If any Borrower is required by Applicable Law to make any
deduction or withholding in respect of any Taxes (other than Excluded Taxes)
from any amount payable under any Loan Document to or for the account of any
Lender Party, the Borrowers shall pay to or for the account of such Lender
Party, on the date such amount is payable, such additional amounts as such
Lender Party reasonably determines may be necessary so that the net amounts
received by it or for its account, in the aggregate, after all applicable
deductions or withholdings, shall equal the amount that such Lender Party would
have been entitled to receive if no deductions or withholdings were made.
"Excluded Taxes" means with respect to any payment to any Lender Party, (a) any
--------------
taxes imposed on or measured by the overall net income (including a franchise
tax based on net income) of such Lender Party or its Agent's Office or
Applicable Lending Office by the jurisdiction in which it is incorporated,
maintains its principal executive office or in which such Agent's Office or
Applicable Lending Office is located, and (b) "Excluded Taxes" arising under
Section 2.14.3. If any Borrower shall deduct or withhold any Taxes from any
payments under the Loan Documents, it shall provide to the relevant Lender Party
(i) a statement setting forth the amount and type of Taxes so deducted or
withheld, the applicable rate and any other information or documentation that
such Lender Party may reasonably request and (ii) as promptly as possible after
payment is made to the relevant Governmental Authority, a certified copy of any
original official receipt received by such Borrower showing payment.
2.14.2. If any Lender Party is required by law to make any payment on
account of Taxes (other than Excluded Taxes) on or in relation to any sum
received or receivable by it under any Loan Document, or any liability for Taxes
(other than Excluded Taxes) in respect of any such payment is imposed, levied or
assessed against such Lender Party, then the Borrowers shall pay when due such
additional amounts as such Lender Party reasonably determines to be necessary so
that the amount received by it, less any such Taxes paid, imposed, levied or
assessed, including any Taxes (other than Excluded Taxes) imposed on such
additional amounts, shall equal the amount that such Lender Party would have
been entitled to retain in the absence of the payment, imposition, levy or
assessment of such Taxes.
2.14.3. If any Lender Party is not organized and existing under the laws
of the United States of America or any political subdivision thereof or therein
(a "Foreign Lender Party"), to the extent entitled to do so under Applicable
--------------------
Law,such Lender Party shall furnish to CI, on the Closing Date (or on the date
on which such Foreign Lender Party first becomes a Lender Party pursuant to
Section 9.3) a duly executed certificate to the effect that such Foreign Lender
Party is entitled to receive all amounts payable under the Loan Documents
without deduction or withholding (or at a reduced rate of deduction or
withholding) on account of Taxes imposed by the United States (A) pursuant to
the terms of an applicable tax treaty in effect with the United States of
America (in which case such certificate shall be accompanied by two executed
copies of IRS Form 1001), or (B) under Code Section 1441(c) (in which case such
certificate shall be accompanied by two executed copies of IRS Form 4224) (such
forms being
36
the Prescribed Forms"). If requested by CI from time to time afterthe Closing
Date (upon the obsolescence of any previously delivered form or otherwise), a
Foreign Lender Party shall, to the extent entitled thereto under Applicable Law,
provide to CI new Prescribed Forms, in each case duly executed and completed by
such Foreign Lender Party. If a Foreign Lender Party does not furnish Prescribed
Forms establishing a complete exemption from deduction and withholding on
account of Taxes imposed by the United States of America, any deductions or
withholdings required to be made by CI under Applicable Law on account of Taxes
imposed by the United States of America (including deductions or withholdings on
account of such Taxes at the rate shown in such Prescribed Forms), and any
payments required to be made by, and any liability imposed, levied or assessed
against, such Lender Party on account of such Taxes, shall
constitute "Excluded Taxes," provided that any such deductions, withholdings,
--------------
payments or liabilities shall not constitute "Excluded Taxes" to the extent they
are attributable to a Regulatory Change occurring after the date hereof (or, in
the case of any Person who becomes a Lender Party after the date hereof pursuant
to Section 9.3, the date on which such Person becomes a Lender Party) if such
Lender Party has furnished to CI all Prescribed Forms required to be furnished
by this Section 2.14.3.
Section 2.15. Compensation for Funding Losses. The Borrower shall pay to any
-------------------------------
Lender, upon demand by such Lender, such amount or amounts as such Lender
reasonably determines is or are necessary to compensate it for any loss, cost,
expense or liabilities incurred (including any loss, cost, expense or liability
incurred by reason of the liquidation or redeployment of deposits but excluding
loss of future margin) by it as a result of (a) any payment, prepayment or
conversion of any LIBOR Rate Loan for any reason (including by reason of a
Mandatory Prepayment, an acceleration pursuant to Section 7.2 or by operation of
Section 2.12) on a date other than the last day of an Interest Period applicable
to such LIBOR Rate Loan, or (b) any LIBOR Rate Loan for any reason not being
made (other than a wrongful failure to fund by such Lender), converted or
continued, or any payment of principal of or interest thereon not being made, on
the date therefor determined in accordance with the applicable provisions of
this Agreement.
Section 2.16. Certificates Regarding Yield Protection, Etc.
--------------------------------------------
2.16.1. Any request by any Lender for payment of additional amounts
pursuant to Sections 2.13, 2.14 and 2.15 shall be submitted through the Agent
and shall be accompanied by a certificate of such Lender Party setting forth the
basis and amount of such request, including a description or explanation in
reasonable detail of how such amount was determined and a statement that such
Lender Party has assessed, or is in the process of assessing, such Lender
Party's other similarly situated borrowers for similar amounts. In determining
the amount of such payment, such Lender Party may use such reasonable
attribution or averaging methods as it deems appropriate and practical.
2.16.2. Before any Lender Party requests compensation under Section 2.13 or
2.14, such Lender Party shall designate a different Applicable Lending Office if
such designation (a) will avoid the need for such request or reduce the amount
payable under such Section and (b) will not cause the imposition on such Lender
Party of any additional costs or legal, regulatory or
37
administrative burdens deemed by such Lender Party to be material or otherwise
be deemed by such Lender Party in its discretion to be materially
disadvantageous to it.
Section 2.17. Applicable Lending Office; Discretion of Lenders as to Manner of
----------------------------------------------------------------
Funding. Each Lender may make, carry or transfer LIBOR Rate Loans at, to, or for
the account of an Affiliate of the Lender, provided that such Lender shall not
be entitled to receive any greater amount under Section 2.13 or 2.14 as a result
of the transfer of any such Loan than such Lender would be entitled to
immediately prior thereto unless (a) such transfer occurred at a time when
circumstances giving rise to the claim for such greater amount did not exist or
(b) such claim would have arisen even if such transfer had not occurred.
Notwithstanding any other provision of this Agreement, each Lender Party shall
be entitled to fund and maintain its funding of all or any part of its LIBOR
Rate Loans in any manner it sees fit, it being understood, however, that for
purposes of this Agreement all determinations hereunder shall be made as if each
Lender Party had actually funded and maintained each LIBOR Rate Loan through the
purchase of deposits in the relevant interbank market having a maturity
corresponding to such Loan's Interest Period and bearing interest at the
applicable rate.
Section 2.18. Waivers of Co-Borrowers. The Lender Parties and CI and the Co-
-----------------------
Borrowers intend that each of the Co-Borrowers be treated for all purposes under
Applicable Law as primarily liable for all Obligations. If, however, for any
reason any Co-Borrower is deemed to be a guarantor or any other kind of surety
with respect to any of the Obligations, such Co-Borrower hereby makes each of
the waivers contained on Schedule 2.18 for the benefit of the Agent and each
Lender.
ARTICLE 3.
CONDITIONS TO LOANS
-------------------
Section 3.1. Closing Conditions. The occurrence of the Closing Date shall be
------------------
subject to satisfaction of the following conditions:
3.1.1. Closing Date. The Closing Date shall occur on or before March
------------
12, 1999.
3.1.2. Certain Documents. The Agent shall have received the documents
-----------------
listed on Schedule 3.1.2, all of which shall be duly executed and in form and
substance satisfactory to the Agent.
3.1.3. Fees and Expenses Paid. The Borrowers shall have paid (a) all
----------------------
Fees due on or before the Closing Date and (b) all expenses for which the
Borrowers shall have been billed on or before the Closing Date.
3.1.4. Satisfaction of Certain Conditions. The conditions set forth in
----------------------------------
Sections 3.2.3, 3.2.4 and 3.2.5 shall be satisfied on and as of the Closing
Date as if such date were a Funding Date.
38
3.1.5. Absence of Litigation Events. There has not been issued any
-----------------------------
injunction, order or decree that prohibits or limits any of the transactions
contemplated by the Loan Documents and there shall not be any action, suit,
proceeding or investigation pending or, to the Knowledge of CI, currently
threatened against any Borrower or any Lender Party that (i) draws into question
the validity, legality or enforceability of any Loan Document or its ability to
consummate the transactions contemplated thereby or (ii) might result, either
individually or in the aggregate, in any Material Adverse Change, except as set
forth in Schedule 4.6.
3.1.6. General. All other documents and legal matters in connection with
-------
the transactions contemplated by this Agreement shall have been delivered or
executed or recorded in form and substance satisfactory to the Agent and the
Agent shall have received all such counterpart originals or certified copies
thereof as Agent may request. Without limiting the generality of the foregoing,
the Agent shall have received evidence that UCC-1 financing statements
reflecting the Agent's security interest in the collateral described in the
Security Agreement have been duly filed in the office of the California
Secretary of State and all other filing offices deemed necessary or appropriate
by the Agent and reflect that the Agent's security interest holds first
priority, subject only to exceptions consented to by all Lenders.
3.1.7. No Material Adverse Change. No Material Adverse Change shall have
--------------------------
occurred since March 31, 1998.
3.1.8. Absence of Market Disruption or Changes in Governmental
-------------------------------------------------------
Regulations. In the reasonable judgment of the Arranger or the Agent, there
shall not have occurred any disruption or material adverse change in the
financial, banking or capital markets in general that would have a material
adverse effect on the market for loan syndications, or in the technology sector
in particular, or in the markets for equity securities in general adversely
affecting such syndications, nor shall any material change have occurred in
regulations or policies of any Governmental Authority affecting the Borrowers,
the Agent, the Arranger or Lenders involved in this transaction prior to the
Closing Date.
3.1.9. No Misstatements. No information or materials furnished to the
----------------
Arranger or any of the Lender Parties by or on behalf of the Borrowers, at the
time of delivery thereof, was untrue or omitted any material fact or information
necessary in order to make any statements made not misleading in light of the
circumstances under which they were made.
Section 3.2. Conditions Precedent to Working Capital Revolving Loans, Revolving
------------------------------------------------------------------
Acquisition Loans, Swingline Loans and Letters of Credit. The obligation of
--------------------------------------------------------
each Lender to make any Loan or the L/C Issuer to issue any Letter of Credit on
any Funding Date shall be subject to the following conditions precedent:
3.2.1. Occurrence of Closing Date. The conditions precedent set forth
--------------------------
in Section 3.1 shall have been satisfied or waived in writing by the Agent.
3.2.2. Notice of Borrowing or Issuance. CI shall have delivered to the
-------------------------------
Agent or the Swingline Lender, as applicable, after the time the conditions set
forth in Section 3.1 shall have been satisfied or waived and otherwise in
accordance with the applicable provisions of this
39
Agreement, a Notice of Borrowing (or telephonic notice in lieu thereof), in the
case of a Loan, or a Notice of Issuance and Letter of Credit Application, in the
case of a Letter of Credit.
3.2.3. Representations and Warranties. All of the representations and
------------------------------
warranties of the Borrowers contained in the Loan Documents shall be true and
correct in all material respects on and as of the Funding Date as though made on
and as of that date (except to the extent that such representations and
warranties expressly were made only as of a specific date).
3.2.4. No Default. No Default or Event of Default shall exist or
----------
result from the making of the Loan or the issuance of the Letter of Credit.
3.2.5. No Material Adverse Change. No Material Adverse Change shall have
--------------------------
occurred since the date of the financial statements referred to in Section
4.4.1.
3.2.6. Satisfaction of Conditions. Each Borrowing of a Loan and Letter
--------------------------
of Credit issuance shall constitute a representation and warranty by CI as of
the Funding Date that the conditions contained in Sections 3.2.3 through 3.2.5
have been satisfied.
3.2.7. No Violation of Applicable Law. No Lender shall be prohibited by
------------------------------
any Applicable Law from extending the credit requested in such Notice of
Borrowing or Notice of Issuance.
Section 3.3. Additional Conditions Precedent to Revolving Acquisition Loans.
--------------------------------------------------------------
In addition to the conditions set forth in Sections 3.1 and 3.2, the obligation
of the Lenders to make Revolving Acquisition Loans shall be subject to the
following additional condition precedent: prior to the Lenders funding any
Borrowing under the Revolving Acquisition Commitments, the Agent shall have
received all information to which it is entitled under (and within the time
period specified in) Section 2.1.4.1.
ARTICLE 4.
REPRESENTATIONS AND WARRANTIES
------------------------------
Each of the Borrowers represents and warrants to the Lender Parties as follows:
Section 4.1. Organization, Powers and Good Standing. Each of the Borrowers is a
--------------------------------------
corporation duly organized, validly existing and in good standing under the laws
of its jurisdiction of organization, as shown as of the date hereof on Schedule
4.1, and has all requisite corporate power and authority and the legal right to
own and operate its properties, to carry on its business as heretofore conducted
and as proposed to be conducted, to enter into the Loan Documents to which it is
a party and to carry out the transactions contemplated thereby. Each of the
Borrowers possesses all Governmental Approvals, in full force and effect, free
from unduly burdensome restrictions, that are necessary for the ownership,
maintenance and operation of its properties and conduct of its business as now
conducted and proposed to be conducted, and is not in Material violation
thereof. Each of the Borrowers is duly qualified to do business and in good
40
standing in each jurisdiction where any failure to be so qualified, individually
or in the aggregate, could reasonably be expected to have a Material Adverse
Effect.
Section 4.2. Authorization, Binding Effect, No Conflict, Etc.
-----------------------------------------------
4.2.1. Authorization, Binding Effect, Etc. The execution, delivery and
----------------------------------
performance by each of the Borrowers of each Loan Document have been duly
authorized by all necessary corporate or other action on the part of each of the
Borrowers. Each such Loan Document has been duly executed and delivered by each
of the Borrowers and is the joint and several legal, valid and binding
obligation of each such Borrower, enforceable against it in accordance with its
terms, except as enforcement may be limited by equitable principles and by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
creditors' rights generally.
4.2.2. No Conflict. The execution, delivery and performance by each of the
-----------
Borrowers of each Loan Document and the consummation of the transactions
contemplated thereby, do not and will not (a) violate any provision of the
charter or other organizational documents of any Borrower, (b) except for
consents that have been obtained and are in full force and effect, conflict
with, result in a breach of, or constitute (or, with the giving of notice or
lapse of time or both, would constitute) a default under, or require the
approval or consent of any Person pursuant to, any Contractual Obligation of any
such Borrower, or violate any Applicable Law binding on any such Borrower,
except where such violation, conflict, breach, or default would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect and would not subject any Lender Party to any liability, or (c)
result in the creation or imposition of any Lien upon any asset of any Borrower,
except for Liens in favor of the Agent under the Collateral Documents.
4.2.3. Governmental Approvals. Except for filings and recordings in
----------------------
connection with the perfection of Liens created by the Collateral Documents
listed on Schedule 3.1.2, no Governmental Approval is or will be required in
connection with the execution, delivery and performance by each of the Borrowers
of any Loan Document to which it is party or the transactions contemplated
thereby or to ensure the legality, validity or enforceability thereof, except
where the failure to obtain such Governmental Approval would not, individually
and in the aggregate, reasonably be expected to have a Material Adverse Effect
and would not subject any Lender Party to any liability.
Section 4.3. Subsidiaries; Investments.
-------------------------
4.3.1. Subsidiaries. Each Consolidated Subsidiary of CI, the authorized
------------
and issued Capital Stock of each such Consolidated Subsidiary and the record and
beneficial owner of such Capital Stock are identified in Schedule 4.3, as
amended from time to time. All of the outstanding shares of Capital Stock of
each of the Subsidiaries of CI have been duly authorized and validly issued and
are fully paid and nonassessable. Except as disclosed on Schedule 4.3, as
amended from time to time, there are not outstanding any securities convertible
into or exchangeable for shares of Capital Stock of any of the Subsidiaries of
CI, or any options, warrants or other rights to purchase any such Capital Stock,
or any commitments of any kind for
41
the issuance of additional shares of such Capital Stock or any such convertible
or exchangeable securities or options, warrants or rights to purchase such
Capital Stock. Except for directors qualifying shares or similar arrangements or
as disclosed on Schedule 4.3, neither CI nor any Consolidated Subsidiary thereof
is a party to any agreement with respect to the issuance, voting or sale of
issued or unissued shares of Capital Stock of any Consolidated Subsidiary of CI.
4.3.2. Borrower Capital Stock. The authorized and outstanding Capital
----------------------
Stock of CI is as set forth on Schedule 4.3. All outstanding shares of such
Capital Stock are duly authorized and validly issued and are fully paid and
nonassessable, and Borrower's ownership interest in its Subsidiaries is free and
clear of all Liens except for Liens in favor of the Agent.
Section 4.4. Financial Information.
---------------------
4.4.1. The consolidated balance sheets of CI and its Consolidated
Subsidiaries as of March 31, 1998 and the consolidated statements of income,
stockholders' equity and cash flow of CI and its Consolidated Subsidiaries for
the Fiscal Years then ended, certified by CI's independent certified public
accountants, copies of which have been delivered to the Lender Parties, were
prepared in accordance with GAAP consistently applied and fairly present the
consolidated financial position of CI and its Consolidated Subsidiaries, as of
the respective dates thereof and the results of operations and cash flow of CI
and its Consolidated Subsidiaries for the periods then ended. Neither CI nor
any Consolidated Subsidiary on such dates had any material Contingent
Obligations, liabilities for Taxes or long-term leases, forward or long-term
commitments or unrealized losses from any unfavorable commitments that are not
reflected in the foregoing statements or in the notes thereto and that,
individually or in the aggregate, are Material.
4.4.2. The unaudited consolidated balance sheet of CI and its Consolidated
Subsidiaries as of December 31, 1998 and the related consolidated statements of
income, stockholders' equity and cash flow for the periods then ended, certified
by the Chief Financial Officer of CI, copies of which have been delivered to the
Lender Parties, were prepared in accordance with GAAP consistently applied
(except to the extent noted therein) and fairly present the consolidated
financial position of CI and its Consolidated Subsidiaries as of such date and
the results of operations and cash flow for the periods covered thereby, subject
to the absence of footnotes and normal year-end audit adjustments. Neither CI
nor any Consolidated Subsidiary on such date had any material Contingent
Obligations, liabilities for Taxes or long-term leases, forward or long-term
commitments or unrealized losses from any unfavorable commitments that are not
reflected in the foregoing statements or in the notes thereto and that,
individually or in the aggregate, are Material.
4.4.3. The projected consolidated statements of income and cash flow of CI
and its Consolidated Subsidiaries for the period from April 1, 1999 to and
including March 31, 2004, and the projected annual consolidated balance sheets
of CI and its Consolidated Subsidiaries as of the end of each Fiscal Year
through March 31, 2004, copies of which have been furnished to the Lender
Parties, were prepared by or under the supervision of the Chief Executive
Officer and the Chief Financial Officer of CI, are complete and have been
prepared on the basis of reasonable
42
assumptions and in good faith utilizing historical financial information that
was prepared in accordance with GAAP.
Section 4.5. No Material Adverse Changes; Solvency. Since the date of the
-------------------------------------
Financial Statements referred to in Section 4.4.1, there has been no Material
Adverse Change. Each of the Borrowers is and will be Solvent after giving effect
to any Loans then being requested.
Section 4.6. Litigation. Except as disclosed in Schedule 4.6, there are no
----------
actions, suits or proceedings pending or, to the Knowledge of any Borrower,
threatened against or affecting the Borrowers, any of its Subsidiaries or any of
its or their properties before any Governmental Authority (a) in which there is
a reasonable possibility of an adverse determination that could result in a
Material liability or could reasonably be expected to have a Material Adverse
Effect or (b) that in any manner draws into question the validity, legality or
enforceability of any Loan Document or any transaction contemplated thereby.
Section 4.7. Agreements; Applicable Law. None of the Borrowers is in violation
--------------------------
of any Applicable Law, or in default under its charter or bylaws or any of its
Contractual Obligations, except where such violation or default could not
individually or in the aggregate be reasonably expected to have a Material
Adverse Effect. None of the Borrowers is a party to or bound by any unduly
burdensome Contractual Obligation that, individually or in the aggregate, can be
reasonably expected to have a Material Adverse Effect.
Section 4.8. Governmental Regulation. None of the Borrowers is (a) an
-----------------------
"investment company" registered or required to be registered under the
Investment Company Act of 1940, as amended, or a company controlled by such a
company, or (b) subject to regulation under any Federal or state, statute or
regulation limiting its ability to incur Debt for money borrowed (other than the
Margin Regulations).
Section 4.9. Margin Regulations. None of the Borrowers is engaged principally,
------------------
or as one of its important activities, in the business of extending credit for
the purposes of purchasing or carrying Margin Stock. The aggregate value of all
Margin Stock held by the Borrowers constitutes less than 25% of the value, as
determined in accordance with the Margin Regulations, of all aggregate assets of
the Borrowers.
Section 4.10. Employee Benefit Plans.
----------------------
4.10.1. None of the Borrowers sponsors, maintains or contributes to, or
has an obligation to contribute to, or, within the five years prior to the
Closing Date, maintained, contributed to or was required to contribute to, any
"employee pension benefit plan" within the meaning of Section 3(2) of ERISA that
is subject to Title IV of ERISA.
4.10.2. There exists no Multiemployer Plan. Each Borrower and each of the
ERISA Affiliates is in compliance in all Material respects with all Applicable
Laws, including any applicable provisions of ERISA and the Code, with respect to
all Plans. There have been no Prohibited Transactions with respect to any Plan
that are reasonably likely to result in any Material liability of any Borrower
or any ERISA Affiliate. Each Borrower and the ERISA
43
Affiliates have not had asserted and do not expect to have asserted against them
any Material penalty, interest or excise tax under Sections 4971, 4972, 4975,
4976, 4977, 4979, 4980 or 4980B of the Code or Sections 502(c)(1) or 502(i) of
ERISA. Each Plan covering employees of any of the Borrowers or any of the ERISA
Affiliates is able to pay benefits thereunder when due. There is no claim
pending or, to the Knowledge of any Borrower, threatened, against or involving
any Plan by any Governmental Authority or other Plan, other than ordinary claims
for benefits pursuant to terms of any Plan and other claims that are not
Material.
Section 4.11. Title to Property. Each of the Borrowers has good title to or
-----------------
valid and subsisting leasehold interests in all of its property reflected in its
books and records as being owned or leased by it. No such property is subject to
any Lien, other than Permitted Liens.
Section 4.12. Intellectual Property, Etc. Each of the Borrowers owns or holds
--------------------------
valid licenses in and to all Intellectual Property Rights that are material to
the conduct of its business as heretofore operated and as proposed to be
conducted. None of the Borrowers has infringed, or been charged or, to the
Knowledge of any Borrower, threatened to be charged with any infringement of,
any unexpired Intellectual Property Right of any Person, except where the effect
thereof would not, individually or in the aggregate, be reasonably expected to
have a Material Adverse Effect. No Borrower is bound by or a party to any
options, licenses or agreements of any kind with respect to the Intellectual
Property Rights of any other Person except for arrangements that, if terminated,
would not be reasonably likely to result in a Material Adverse Effect. None of
the Borrowers is aware that any of its employees is obligated under any
Contractual Obligation (including licenses, covenants or commitments of any
nature), or subject to any judgment, decree (except as imposed by laws of
general application) or order (except as imposed by laws of general application)
of any Governmental Authority, that would interfere with the use of his or her
best efforts to promote the interests of such Borrower or that would conflict
with its business as proposed to be and as currently conducted. To the Knowledge
of each of the Borrowers, there is no material violation by any Person of any
right of the Borrowers with respect to any Intellectual Property Rights owned or
used by it.
Section 4.13. Environmental Condition. Except as set forth on Schedule 4.13:
-----------------------
4.13.1. There exists no order, judgment or decree, and there is not
pending or, to the Knowledge of each Borrower, threatened, any action, suit,
proceeding or investigation relating to any actual or alleged liability arising
out of the presence or suspected presence of Hazardous Material, any actual or
alleged violation of Environmental Requirements or any actual or alleged
liability for Environmental Damages in connection with any Real Property or the
business or operations of any of the Borrowers that has had, or as to which
there is a reasonable possibility of an adverse determination that would have, a
Material Adverse Effect nor, to the Knowledge of each Borrower, does there exist
any basis for such action, suit, proceeding or investigation being instituted or
filed.
Section 4.14. Absence of Certain Restrictions. Except as set forth in Schedule
-------------------------------
4.14, none of the Borrowers is subject to any Contractual Obligation that
restricts or limits the ability of any Consolidated Subsidiary to (a) make
Restricted Payments to CI, (b) pay Debt owed to CI
44
or any Consolidated Subsidiary thereof, (c) make any loans or advances to CI
(except as provided in Section 5.11) or (d) except as provided in Contractual
Obligations respecting the specific assets subject to Permitted Liens, transfer
any of its property to CI.
Section 4.15. Labor Matters. There are no material strikes or other labor
-------------
disputes or grievances pending or, to the Knowledge of each Borrower, threatened
against any Borrower. Except as set forth in Schedule 4.15, there are no
collective bargaining agreements to which any Borrower thereof is a party. Each
of the Borrowers has complied in all material respects with the requirements of
the Worker Adjustment and Restraining Notification Act, 29 U.S.C. Section 2101
et seq. (the "WARN Act"). No claim under the WARN Act is pending or, to the
-- ---- --------
Knowledge of each Borrower, threatened against CI or any Consolidated Subsidiary
thereof nor is there any reasonable basis to anticipate any such claim, except
where the effect thereof, individually or in the aggregate, would not reasonably
be expected to have a Material Adverse Effect.
Section 4.16. Tax Returns. All tax returns required to be filed by the
-----------
Borrowers have been timely filed with the appropriate Governmental Authorities,
and all taxes, assessments, fees and other governmental charges payable pursuant
to such returns or otherwise have been paid or adequate reserves have been
provided for payment thereof. The Borrowers have no Knowledge of any pending
assessments or adjustments of income tax payable with respect to any year,
except for amounts which are contested in good faith and for which the Borrowers
have reserved under GAAP.
Section 4.17. Year 2000 Matters. Except as set forth on Schedule 4.17, all of
-----------------
the Material computer software, computer hardware (whether general or special
purpose), and other similar or related items of automated, computerized or
software systems that are used or relied on by the Borrowers in the conduct of
their businesses, will not malfunction, will not cease to function, will not
generate incorrect data, and will not produce incorrect results when processing,
providing or receiving (a) date-related data into and between the twentieth and
twenty-first centuries and (b) date-related data in connection with any valid
date in the twentieth and twenty-first centuries.
Section 4.18. Disclosure. The information in each document, certificate or
----------
written statement (other than information referred to in Section 4.4) furnished
to the Lender Parties by or on behalf of any Borrower or any Consolidated
Subsidiary with respect to the business, assets, results of operation or
financial condition of any Borrower for use in connection with the transactions
contemplated by this Agreement at the time of delivery thereof, was true and
correct in all Material respects and did not omit, when considered as a whole,
any material fact necessary in order to make the statements made not misleading,
in light of the circumstances under which they were made. There is no fact known
to any Borrower (other than matters of a general economic nature) that has had
or could reasonably be expected to have a Material Adverse Effect and that has
not been disclosed herein or in such other documents, certificates or
statements.
45
ARTICLE 5.
AFFIRMATIVE COVENANTS OF THE BORROWERS
--------------------------------------
So long as any portion of the Working Capital Revolving Commitments or the
Revolving Acquisition Commitments is in effect or any Obligations remain unpaid
or have not been performed in full:
Section 5.1. Financial Statements and Other Reports. CI shall deliver to the
--------------------------------------
Lender Parties:
5.1.1. as soon as practicable and in any event within 90 days after the
end of each Fiscal Year, the consolidated balance sheet of CI and the
Consolidated Subsidiaries as of the end of such year and the related
consolidated statements of income, stockholders' equity and cash flow of CI and
the Consolidated Subsidiaries for such Fiscal Year, setting forth in each case
in comparative form the consolidated figures for the previous Fiscal Year, all
in reasonable detail and (i) in the case of such consolidated financial
statements, accompanied by an unqualified report thereon of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP
or other independent certified public accountants of recognized national
standing selected by CI and reasonably satisfactory to the Required Lenders,
which report shall state that such consolidated financial statements fairly
present the consolidated financial position of CI and the Consolidated
Subsidiaries as of the date indicated and their results of operations and cash
flows for the periods indicated are in conformity with GAAP (except as otherwise
stated therein) and that the examination by such accountants in connection with
such consolidated financial statements has been made in accordance with
generally accepted auditing standards and (ii) in the case of such consolidating
financial statements, certified by the chief financial officer of CI as being
fairly stated in all material respects when considered in relation to the
audited consolidated financial statements of CI and the Consolidated
Subsidiaries;
5.1.2. as soon as practicable and in any event within 45 days after the
end of each Fiscal Quarter a consolidated balance sheet of CI and the
Consolidated Subsidiaries as of the end of such quarter and the related
consolidated statements of income, stockholders' equity and cash flow for such
quarter and the portion of the Fiscal Year ended at the end of such quarter,
setting forth in each case in comparative form the consolidated figures for the
corresponding periods of the prior Fiscal Year, all in reasonable detail and
certified by CI's chief financial officer as fairly presenting the consolidated
financial condition of CI and its Consolidated Subsidiaries as of the dates
indicated, and their consolidated results of operations and cash flows for the
periods indicated, in conformity with GAAP, subject to normal year-end
adjustments and the absence of footnotes;
5.1.3. together with each delivery of financial statements pursuant to
Sections 5.1.1 and 5.1.2 above, and not later than one (1) Business Day after
the consummation of any Permitted Acquisition, a certificate of the chief
financial officer of CI substantially in the form of Exhibit F-6 (a "Compliance
----------
Certificate"), duly completed and setting forth the calculations required to
-----------
establish compliance with Section 6.5 on the date of such financial statements
or such Permitted Acquisition, as the case may be;
46
5.1.4. within three Business Days after any Senior Officer of CI becomes
aware of the occurrence of any Default or Event of Default, written or
telephonic notice of the nature of such Default or Event of Default, and within
seven days thereafter, a certificate of a Senior Officer of CI setting forth the
details thereof and the action that CI is taking or proposes to take with
respect thereto;
5.1.5. promptly upon their becoming available, copies of all financial
statements, reports, notices and proxy statements sent or made available by CI
to its security holders, all registration statements (other than the exhibits
thereto) and annual, quarterly or monthly reports, if any, filed by CI with the
SEC and all press releases by CI or any Consolidated Subsidiary thereof
concerning material developments in the business of CI or any such Consolidated
Subsidiary;
5.1.6. within three days after CI becomes aware of the occurrence of (a)
any Reportable Event in connection with any Plan, or (b) any Prohibited
Transaction in connection with any Plan (or any trust created thereunder),
notice providing reasonable details about such Reportable Event or Prohibited
Transaction;
5.1.7. within three days after CI obtains Knowledge of the threat or
commencement of litigation or proceedings affecting any Borrower, or of any
material development in any pending or future litigation, (a) that involves
alleged liability in excess of $1,000,000 (in the aggregate), (b) in which
injunctive or similar relief is sought that, if obtained, could reasonably be
expected to have a Material Adverse Effect or (c) that questions the validity or
enforceability of any Loan Document, notice providing reasonable details about
the threat or commencement of such litigation or about such material
development;
5.1.8. within three days after receipt thereof, copies of all final
reports or letters submitted to CI by its independent certified public
accountants in connection with each audit of the financial statements of CI or
its Consolidated Subsidiaries made by such accountants, including any management
report, which reports CI agrees to obtain in connection with each of its annual
audits;
5.1.9. within 60 days after the end of each Fiscal Year of CI, a forecast
for the next succeeding Fiscal Year of the consolidated balance sheet and the
consolidated results of operations and cash flow of CI and its Consolidated
Subsidiaries, together with (a) an outline of the major assumptions upon which
the forecast is based, and (b) a calculation in reasonable detail evidencing
compliance with all covenants set forth herein on the basis of, and after giving
effect to, such forecast;
5.1.10. within three days after the receipt thereof by any Senior Officer
of CI, a copy of any notice, summons, citation or written communication
concerning any actual, alleged, suspected or threatened violation of
Environmental Requirements, or liability of CI or any of its Subsidiaries for
Environmental Damages;
5.1.11. within five days after the availability thereof, copies of all
amendments to the charter, bylaws or other organizational documents of CI or any
of its Subsidiaries;
47
5.1.12. not less than five Business Days before the anticipated
consummation of a proposed acquisition by CI, a certificate from a Responsible
Officer of CI certifying that such proposed acquisition meets the requirements
set forth in the definition of "Permitted Acquisition" and copies of
documentation demonstrating to the Agent's reasonable satisfaction that the
requirements set forth in the definition of "Permitted Acquisition" are met with
respect to the proposed acquisition; and
5.1.13. from time to time, such additional information regarding CI or its
Subsidiaries or its business, assets, liabilities, prospects, results of
operation or financial condition as any Lender Party may reasonably request.
Section 5.2. Records and Inspection. Each Borrower shall, and shall cause each
----------------------
of its Subsidiaries to, maintain adequate books, records and accounts as may be
required or necessary to permit the preparation of consolidated financial
statements in accordance with sound business practices and GAAP. Each Borrower
shall, and shall cause each of its Subsidiaries to, permit such Persons as the
Agent may designate, at reasonable times and as often as may be reasonably
requested, under reasonable circumstances, to (a) visit and inspect any of its
properties, (b) inspect and copy its books and records, and (c) discuss with its
officers and employees, its investment bankers and its independent accountants,
its business, assets, liabilities, prospects, results of operation or financial
condition, provided that so long as no Event of Default has occurred and is
continuing, the Agent shall conduct no more than three such visits and
inspections per year and no more than one such visit and inspection in any
Fiscal Quarter.
Section 5.3. Audits of the Collateral. Each Borrower shall permit, and shall
------------------------
cause each of its Subsidiaries to permit, the Agent or its designee to perform
audits of the Collateral as the Agent may reasonably request, provided that so
long as no Event of Default has occurred and is continuing, Agent shall perform
no more than three such audits in any year and no more than one such audit in
any Fiscal Quarter.
Section 5.4. Corporate Existence, Etc. Each Borrower shall, and shall cause
------------------------
each of its Subsidiaries to, at all times preserve and keep in full force and
effect its corporate existence and all Material rights and franchises; provided,
however, that the corporate existence of any Consolidated Subsidiary of any
Borrower may be terminated (a) as contemplated and permitted by Section 6.6 or
(b) if such termination is determined by the Board of Directors of the relevant
Borrower to be in the best interest of such Borrower and is not disadvantageous
in any Material respect to the Lender Parties.
Section 5.5. Payment of Taxes. Each Borrower shall, and shall cause each of its
----------------
Subsidiaries to, pay and discharge all Taxes imposed upon it or any of its
properties or in respect of any of its franchises, business, income or property
before any penalty shall be incurred with respect to such Taxes; provided,
however, that, unless and until foreclosure, distraint, levy, sale or similar
proceedings shall have commenced, Borrowers and the Subsidiaries need not pay or
discharge any such Tax so long as the validity or amount thereof is being
contested in good faith and by appropriate proceedings and so long as any
reserves or other appropriate provisions as may be required by GAAP shall have
been made therefor.
48
Section 5.6. Maintenance of Properties. Each Borrower shall, and shall cause
-------------------------
each of its Subsidiaries to, maintain or cause to be maintained in good repair,
working order and condition (ordinary wear and tear excepted), all properties
and other assets useful or necessary to its business, and from time to time each
Borrower shall make or cause to be made all appropriate repairs, renewals and
replacements thereto.
Section 5.7. Maintenance of Insurance.
------------------------
5.7.1. Each Borrower shall, and shall cause each of its Subsidiaries to,
maintain with financially sound and reputable insurance companies insurance in
at least such amounts, of such character and against at least such risks as is
usually maintained by companies of established repute engaged in the same or a
similar business in the same general area. All liability insurance policies
shall name the Agent as a loss payee. Each insurance policy covering Collateral
shall include endorsements or stipulations providing that coverages will not be
canceled or diminished without at least 10 days' prior written notice to the
Agent and further providing, if available on commercially reasonable terms, that
coverage in favor of the Agent will not be impaired in any way by any act,
omission or default of the Borrowers or any other Person. In connection with
all policies of insurance covering Collateral, the Borrowers will provide the
Agent with such loss payable or other endorsements as the Agent may reasonably
require.
5.7.2. In addition to any requirements under the Collateral Documents, (a)
all property loss or damage insurance policies with respect to any assets of any
Borrower or any Consolidated Subsidiary shall contain lender's loss payable
endorsements in favor of the Agent in form and substance satisfactory to it,
which shall provide that all insurance proceeds (i) in excess of $500,000 or
(ii) payable after the insurer has received written notice from the Agent that
an Event of Default then exists (until a contrary notice is received), shall be
payable directly to the Agent, (b) all insurance policies shall (i) provide that
no cancellation, reduction in amount or material adverse change in coverage
thereof shall be effective until at least 30 days after receipt by the Agent of
written notice thereof, (ii) insure the interests of the Lender Parties
regardless of any breach of or violation by the Borrowers or any other Person of
any warranties, declarations or conditions contained therein, (iii) provide that
the Lender Parties shall have no obligation or liability for premiums,
commissions, assessments or calls in connection with such insurance or in
connection with any representation or warranty made by the Borrowers or any
Consolidated Subsidiary thereof in connection with obtaining of such insurance,
(c) all business interruption and extra expense insurance shall name the Agent
as a loss payee, and (d) all applicable insurance policies shall contain such
other provisions as are required under the relevant Collateral Documents.
5.7.3. Thirty days prior to the expiration date of each insurance policy
maintained hereunder, the Borrowers shall either (a) deliver to the Agent either
(i) if available, a copy of the renewal of such policy or (ii) a copy of the
binder for such renewal or (b) notify the Agent that such policy has not been
renewed. If a copy of a binder is delivered pursuant to clause (a)(i) hereof,
then as soon as it is available, but in any event not more than sixty (60) days
after the effective date of renewal of the policy, the Borrowers shall deliver
to the Agent a copy of such
49
policy, certified to be true and correct by the insurer named therein. If at any
time after the Closing Date CI or any Consolidated Subsidiary thereof obtains
any new property loss or damage insurance policy providing coverage in excess of
$500,000, CI shall, within 30 days after such new policy is obtained, give
notice to the Agent describing the new insurance and provide to the Agent a copy
of such policy, including endorsements as required hereby, certified to be true
and correct by the insurer named therein.
Section 5.8. Conduct of Business and Compliance with Laws. Each Borrower shall,
---------------------------------------------
and shall cause each of its Subsidiaries to, engage only in the businesses in
which such Borrower or Consolidated Subsidiary is engaged on the date hereof,
except for other businesses that are ancillary, incidental or necessary to its
ongoing business as presently conducted. Each Borrower shall, and shall cause
each of its Subsidiaries to, conduct its business in compliance in all material
respects with all Applicable Law, including without limitation, ERISA, and all
its Contractual Obligations and in such a way so that it will not be in breach
of any of its representations and warranties contained in Section 4.10.
Section 5.9. Future Information. All data, certificates, reports, statements,
------------------
documents and other information required to be furnished to the Lender Parties
in connection with the Loan Documents shall, at the time the information is
furnished, not contain any untrue statement of a material fact, shall be
complete and correct in all material respects to the extent necessary to give
the Lender Parties sufficient and accurate knowledge of the subject matter
thereof, and shall not omit to state a material fact necessary in order to make
the statements contained therein not misleading in light of the circumstances
under which such information is furnished.
Section 5.10. New Borrowers and Additional Collateral.
---------------------------------------
5.10.1. Upon the creation or acquisition after the date hereof of any
Consolidated Subsidiary, CI shall cause such Consolidated Subsidiary to execute
and deliver a Working Capital Revolving Loan Note and a Revolving Acquisition
Note in favor of each Lender and to become jointly and severally liable with the
already-existing Borrowers with respect to their Obligations hereunder, in form
and substance satisfactory to the Agent, and CI shall grant, or cause to be
granted, a first priority Lien on the Capital Stock of such Consolidated
Subsidiary and on the assets of such Consolidated Subsidiary, pursuant to
documents in form and substance satisfactory to the Agent. Upon the acquisition
or lease by any Borrower or any Borrower's Subsidiaries of any Material personal
property asset that is not then subject to a first priority Lien in favor of the
Agent, such Borrower shall execute and deliver, or shall cause such Consolidated
Subsidiary to execute and deliver, to the Agent a Collateral Document creating
such a first priority Lien, in each case in form and substance satisfactory to
the Agent. Such Borrower and such Consolidated Subsidiary, at their own
expense, shall execute and deliver, or cause to be executed and delivered, and
thereafter cause to be registered, filed or recorded with the appropriate
Governmental Authority, any and all documents and instruments deemed by the
Agent to be necessary or desirable for the creation and perfection of the
foregoing Liens and shall pay all Taxes and fees related to such registration,
filing or recording.
50
Section 5.11. Subordination of Intercompany Debt. The Borrowers shall cause all
----------------------------------
Intercompany Debt to be subordinated to the prior payment in full in cash of the
Obligations on terms of subordination satisfactory to the Required Lenders;
provided, however, that as long as no Event of Default then exists, the
Borrowers may pay such Intercompany Debt in the ordinary course of business
consistent with past practice.
Section 5.12. Environmental Compliance. Each Borrower shall comply, and shall
------------------------
cause its Subsidiaries to comply, in all material respects with all
Environmental Requirements.
Section 5.13. Year 2000. The Borrowers shall perform all acts reasonably
---------
necessary to ensure that (a) the Borrowers and any business in which the
Borrowers hold a substantial interest, and (b) all customers, suppliers and
vendors that are material to the Borrowers' business or any business in which
the Borrowers hold a substantial interest, become Year 2000 Compliant in a
timely manner. Such acts shall include, without limitation, performing a
comprehensive review and assessment of all the Borrowers' systems and adopting a
detailed plan, with itemized budget, for the remediation, monitoring and testing
of such systems. As used in this paragraph, "Year 2000 Compliant" shall mean, in
-------------------
regard to any Person, that all software, hardware, firmware, equipment, goods or
systems utilized by or material to the business operations or financial
condition of such Person, will properly perform date sensitive functions before,
during and after the year 2000. The Borrowers shall, immediately upon request,
provide to the Agent such certifications or other evidence of the Borrowers'
compliance with the terms of this paragraph as the Agent may from time to time
specify.
Section 5.14. New Consolidated Subsidiaries To Become Borrowers. CI shall cause
-------------------------------------------------
each Person that becomes a Consolidated Subsidiary after the Closing Date
immediately to become a Co-Borrower hereunder and to execute and deliver this
Agreement, the Working Capital Revolving Notes, the Revolving Acquisition Notes,
the Swingline Note, the Security Agreement, a UCC-1 financing statements, and
each of the other documents set forth on Schedule 5.14.
ARTICLE 6.
NEGATIVE COVENANTS OF THE BORROWERS
-----------------------------------
So long as any portion of the Working Capital Revolving Commitments or the
Revolving Acquisition Commitments is in effect or any Obligations remain unpaid
or have not been performed in full:
Section 6.1. Liens. No Borrower shall, or shall permit any of its Subsidiaries
-----
to, directly or indirectly, create, incur, assume or permit to exist any Lien on
or with respect to any asset of any Borrower or any Consolidated Subsidiary of
any Borrower, whether now owned or hereafter acquired, except, without
duplication:
6.1.1. Liens securing the Obligations;
6.1.2. Existing Liens on assets of the entities listed on Schedule R-1
hereto;
51
6.1.3. (a) Liens for taxes, assessments or charges of any Governmental
Authority for claims that are not Material and are not yet due or being
contested in good faith by appropriate proceedings and with respect to which
adequate reserves or other appropriate provisions are being maintained in
accordance with of GAAP; (b) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen, bankers and other Liens imposed by law and
created in the ordinary course of business for amounts that are not Material and
are not yet due or being contested in good faith by appropriate proceedings and
with respect to which adequate reserves or other appropriate provisions are
being maintained in accordance with GAAP; (c) Liens incurred and deposits made
in the ordinary course of business for purchase-money obligations, in an
aggregate amount not exceeding $1,000,000 at any time, or Liens incurred and
deposits made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social security benefits
or to secure the performance (including by way of surety bonds or appeal bonds)
of tenders, bids, leases, contracts, statutory obligations or similar
obligations or arising as a result of progress payments under contracts, in each
case in the ordinary course of business and not relating to the repayment of
Debt; (d) easements, rights-of-way, covenants, consents, reservations,
encroachments, variations and other restrictions, charges or encumbrances
(whether or not recorded) that do not Materially interfere with the ordinary
conduct of business, Materially detract from the value of the asset to which
they attach or Materially impair the use thereof; (e) building restrictions,
zoning laws and other statutes, laws, rules, regulations, ordinances and
restrictions; and (f) leases or subleases granted in the ordinary course of
business to others not Materially interfering with the business of, and
consistent with past practices of, the Borrowers, provided that clauses (a), (b)
and (c) shall not apply to Environmental Liens, Liens that, under Applicable
Law, would have priority over the Lien of the Collateral Documents or Liens
imposed under ERISA;
6.1.4. any attachment or judgment Lien not constituting an Event of
Default;
6.1.5. Liens on assets securing Debt permitted to be incurred or assumed on
a secured basis pursuant to Section 6.2.8, including any interest or title of a
lessor under any Capitalized Lease, provided that any such Lien does not
encumber any property other than assets acquired, constructed or improved with
the proceeds of such Debt;
6.1.6. Liens existing on assets of any Person at the time such Person
becomes a Consolidated Subsidiary, provided (a) such Lien was not created in
contemplation of such Person becoming a Consolidated Subsidiary, and (b) such
Lien does not encumber any assets other than the assets subject to such Lien at
the time such Person becomes a Consolidated Subsidiary;
6.1.7. any Lien constituting a renewal, extension or replacement of any
Existing Lien or any Lien permitted by Section 6.1.5 or 6.1.6, provided (a) the
principal amount of Debt or other obligation secured by such renewal, extension
or replacement Lien does not exceed the principal amount of the Debt or other
obligation renewed, extended or replaced unless such excess is otherwise
permitted hereby at the time of the extension, renewal or replacement, (b) the
average weighted maturity of such Debt or other obligation is not shortened and
(c) such Lien is limited to all or a part of the property subject to the Lien
extended, renewed or replaced.
52
Section 6.2. Debt. No Borrower shall, or shall permit any of its Subsidiaries
----
to, directly or indirectly, create, incur, assume, guarantee, or otherwise
become or remain liable with respect to, any Debt, except:
6.2.1. the Obligations;
6.2.2. Existing Debt of entities that are listed on Schedule R-1 hereto;
6.2.3. Intercompany Debt of a Consolidated Subsidiary to a Borrower or to
a Consolidated Subsidiary of a Borrower, to the extent otherwise permitted
hereunder and in compliance with Section 5.11;
6.2.4. Contingent Obligations (i) in connection with a Permitted
Acquisition or (ii) with respect to Letters of Credit, provided that such Debt
(a) is incurred in the ordinary course of business, (b) is unsecured and (c)
remains contingent;
6.2.5. Contingent Obligations of a Borrower or any Consolidated Subsidiary
with respect to Debt of other Borrowers or their Subsidiaries that is otherwise
permitted under this Section 6.2;
6.2.6. Debt incurred to refinance Debt described in Section 6.2.2;
provided that (a) the unpaid principal balance is not increased (except to the
extent the increase is then otherwise permitted hereunder), and (b) if such
refinanced Debt is repaid prior to its scheduled maturity, such refinancing Debt
shall comply with the provisions of Section 6.9.2; and
6.2.7. Debt incurred in connection with a Permitted Acquisition; and
6.2.8. Debt incurred in the ordinary course of business for purchase-money
obligations, in an amount not exceeding $1,000,000 at any time.
Section 6.3. Restricted Payments. No Borrower shall, nor shall any Borrower
-------------------
permit any Consolidated Subsidiary to, directly or indirectly, declare, pay or
make, or agree to declare, pay or make, any Restricted Payment. Notwithstanding
anything to the contrary in the preceding sentence, during any twelve month
period commencing on or after the Closing Date, CI may, directly or indirectly,
redeem, purchase or acquire outstanding shares of Capital Stock of CI up to an
aggregate value of $10,000,000 so long as the Leverage Ratio is less than 2.25
to 1.00 after giving effect to any such redemption, purchase or acquisition. If
the Leverage Ratio shall at any time be equal to or greater than 2.25 to 1.00,
CI shall not, directly or indirectly, redeem, purchase or acquire outstanding
shares of Capital Stock of CI until the Borrowers' Leverage Ratio shall be less
than 2.25 to 1.00 . For purposes of this Section 6.3, the amount of any
redemption, purchase or acquisition shall be the amount actually paid to any
stockholder plus any commissions or expenses relating to such redemption,
purchase or acquisition.
Section 6.4. Investments. No Borrower shall, nor shall any Borrower permit any
-----------
Consolidated Subsidiary to, directly or indirectly, make or own any Investment,
except:
53
6.4.1. (a) marketable direct obligations issued or unconditionally
guaranteed by the United States Government or issued by any agency thereof and
backed by the full faith and credit of the United States, in each case maturing
within one year from the date of acquisition thereof, (b) marketable direct
obligations issued by any state of the United States or any political
subdivision of any such state or any public instrumentality thereof maturing
within one year from the date of acquisition thereof and having, at the time of
acquisition, the highest rating obtainable from either Standard & Poor's Rating
Group or ▇▇▇▇▇'▇ Investors Service, Inc., (c) commercial paper having, at the
time of acquisition, the highest rating obtainable from either Standard & Poor's
Rating Group or ▇▇▇▇▇'▇ Investors Service, Inc., (d) demand deposits,
certificates of deposit, other time deposits, and bankers' acceptances maturing
within one year from the date of acquisition thereof issued by any bank
operating under the laws of the United States or any state thereof or the
District of Columbia that has combined capital and surplus of not less than
$500,000,000, or (e) institutional money market funds organized under the laws
of the United States of America or any state thereof that are described on
Schedule 1.1, or approved in writing by the Agent or, if not so described or
approved, substantially all of whose assets are securities of the types
described in the foregoing clauses (a), (b), (c), and (d);
6.4.2. (a) trade credit extended on usual and customary terms in the
ordinary course of business, and (b) advances to employees for moving,
relocation and travel expenses, drawing accounts and similar expenditures in the
ordinary course of business;
6.4.3. any Investment identified on Schedule 4.3, limited to the amount of
such Investment on September 12, 1997;
6.4.4. Permitted Acquisitions; and
6.4.5. Investments in non-cash proceeds of permitted Asset Dispositions.
Section 6.5. Financial Covenants.
-------------------
6.5.1. Leverage Ratio. The Leverage Ratio, as of the last day of any
--------------
Fiscal Quarter ending (a) after the Closing Date and on or before December 31,
2001, shall not exceed 3.25 to 1.00 and (b) after January 1, 2002 and ending
prior to the Termination Date, shall not exceed 2.50 to 1.00.
6.5.2. Minimum Net Worth. As of the last day of each Fiscal Quarter, Net
-----------------
Worth shall not be less than the sum of (i) $97,006,500, plus (ii) with respect
to each Permitted Acquisition which is accounted for as a "pooling of interests"
an amount equal to 100% of the positive increase in Net Worth as a result of
such Permitted Acquisition, plus (iii) an amount equal to 75% of the cumulative
positive Net Income since January 1, 1999, plus (iv) an amount equal to 100% of
the net proceeds of all issuances of Capital Stock by CI on or after January 1,
1999.
6.5.3. Debt Service Coverage Ratio. The Debt Service Coverage Ratio as of
---------------------------
the last day of each Fiscal Quarter ending (a) after the Closing Date and on or
before March 31,
54
2001, shall not be less than 2.50 to 1.00, and (b) after April 1, 2001 and
ending prior to the Termination Date, shall not be less than 1.50 to 1.00
Section 6.6. Restriction on Fundamental Changes. No Borrower shall, and no
----------------------------------
Borrower shall permit any Consolidated Subsidiary to, directly or indirectly,
enter into any merger, consolidation, reorganization or recapitalization,
reclassify its Capital Stock, liquidate, wind up or dissolve or sell, lease,
transfer or otherwise dispose of, in one transaction or a series of
transactions, a significant portion of its or their business or assets, whether
now owned or hereafter acquired, provided that as long as no Default or Event of
Default shall exist after giving effect to such merger, consolidation or sale,
any Consolidated Subsidiary of any Borrower may be merged or consolidated with
or into any Borrower or any Wholly-Owned Subsidiary of any Borrower or be
liquidated, wound up or dissolved, or all or substantially all of its business
or assets may be sold, leased, transferred or otherwise disposed of, in one
transaction or a series of transactions, to any Borrower or any Wholly-Owned
Subsidiary of any Borrower.
Section 6.7. Asset Dispositions; Sales of Receivables.
----------------------------------------
6.7.1. No Borrower shall, and no Borrower shall permit any Consolidated
Subsidiary to, directly or indirectly, make or agree to make, any Asset
Disposition unless
6.7.1.1. the Board of Directors of CI has reasonably determined in
good faith that the terms of such transaction are fair and reasonable to CI
or such Consolidated Subsidiary, as the case may be, if the transaction
involves assets having a Material fair market value; and
6.7.1.2. the Asset Disposition is otherwise permissible under the
Collateral Documents and under Sections 6.6 and 6.8 and if the transaction
involves assets having a Material fair market value, the terms of such
transaction shall have been approved in advance by the Required Lenders.
6.7.2. As promptly as practicable but in no event later than 10 days after
any Asset Disposition (other than an Asset Disposition required to be approved
by the Required Lenders), CI shall deliver to the Agent a certificate, duly
executed by a Senior Officer of CI, setting forth in detail a description of
such Asset Disposition, copies of any related agreements, the date or scheduled
date of such Asset Disposition, the determination of the net cash proceeds of
such Asset Disposition, the description of any non-cash proceeds and the
Collateral arrangements with respect thereto and such other documents and
information as is necessary to demonstrate compliance with this Section 6.7.
6.7.3. No Borrower shall, nor shall any Borrower permit any Consolidated
Subsidiary to, directly or indirectly, sell with or without recourse, discount
(except in the ordinary course of business consistent with past practice to
compromise disputes with customers) or otherwise sell for less than the face
value thereof or for consideration other than cash, any of its Accounts
Receivable and other receivables.
55
Section 6.8. Transactions with Affiliates. No Borrower shall, and no Borrower
----------------------------
shall permit any Consolidated Subsidiary to, directly or indirectly, enter into
any transaction (including the transfer or lease of any property or the
rendering of any service) with any Affiliate of any Borrower, unless (a) such
transaction is in the ordinary course of business of such Borrower, and (b) such
transaction is on fair and reasonable terms no less favorable to such Borrower
or its Consolidated Subsidiary, as the case may be, than those terms that might
be obtained at the time in a comparable arm's length transaction with a Person
who is not an Affiliate of such Borrower or, if such transaction is not one that
by its nature could be obtained from such other Person, is on fair and
reasonable terms and was negotiated in good faith, (c) if such transaction is
Material, such Borrower shall have delivered to the Agent a certified resolution
of its Board of Directors determining that the standards set forth in clause (b)
above are satisfied with respect to such transaction and (d) if such transaction
is Material, such Borrower shall deliver to the Agent an opinion of a recognized
appraisal or valuation firm that the transaction is fair to CI from a financial
point of view, provided that this Section 6.8 shall not restrict (i) dividends,
distributions and other payments and transfers on account of the Capital Stock
of a Borrower or any Wholly-Owned Subsidiary of a Borrower, (ii) payments
pursuant to the terms of any Contractual Obligations in effect on the date
hereof listed on Schedule 6.8, or (iii) any transaction in the ordinary course
of business between a Borrower and any Wholly-Owned Subsidiary of a Borrower.
Section 6.9. Prepayment of Debt. No Borrower shall, nor shall any Borrower
------------------
permit any Consolidated Subsidiary to, directly or indirectly, make any payment
or distribution on account of, or voluntarily purchase, acquire, redeem or
retire, any Debt, prior to 30 days before its originally stated maturity (or its
stated maturity on the date hereof, in the case of Debt outstanding on the date
hereof), or in the case of interest, its stated due date, or directly or
indirectly become obligated to do any of the foregoing by amending the terms
thereof or otherwise, except for:
6.9.1. Prepayments of the Loans or of other amounts pursuant to the Loan
Documents;
6.9.2. Prepayments made with the proceeds of new Debt incurred for the
purpose of refinancing the Debt being prepaid, provided that (a) no portion of
such new Debt matures or is required to be prepaid, purchased or otherwise
retired earlier than the corresponding portion of the Debt being prepaid, (b)
such new Debt has the same priority vis-a-vis other Debt, and the same provision
for recourse, as the Debt being paid, (c) no Default or Event of Default then
exists or would result from such prepayment or refinancing; and
6.9.3. Prepayments by Subsidiaries of Debt owed to any Borrower.
Section 6.10. Employee Benefit Plans. Except as specified on Schedule 6.10 or
----------------------
to the extent that a Borrower gives thirty (30) days' prior written notice to
the Agent, no Borrower will sponsor or contribute to any new Plan, make any
change to any existing Plan, or incur any obligations in respect of any
Multiemployer Plan that would in any Material way increase the obligations of
the Borrowers in any Material respect.
56
Section 6.11. Amendments of Charter Documents. No Borrower shall amend its
-------------------------------
charter, bylaws or other charter documents in any respect that affects the
voting rights of Capital Stock included in the Collateral or holders thereof,
increases payment obligations of a Borrower, affects the validity or
enforceability of any Loan Document or Lien thereunder or that otherwise could
reasonably be expected to have a Material Adverse Effect, without in each case
obtaining the prior written consent of the Required Lenders.
Section 6.12. Restrictive Agreements. No Borrower shall, nor shall any Borrower
----------------------
permit any Consolidated Subsidiary to, enter into any Contractual Obligation
that, directly or indirectly, restricts or limits the ability of such
Consolidated Subsidiary to (a) pay dividends or make distributions on its
Capital Stock, (b) pay Debt owed to CI or any Consolidated Subsidiary, (c) make
any loans or advances to CI (except as provided in Section 5.11), or (d) except
as provided in Contractual Obligations respecting the specific assets subject to
Permitted Liens, transfer any of its property to CI.
Section 6.13. Negative Pledges, Etc. No Borrower shall, or shall permit any
---------------------
Consolidated Subsidiary to, enter into or otherwise become subject to, directly
or indirectly, any agreement (other than this Agreement):
6.13.1. prohibiting or restricting a Borrower or any Consolidated
Subsidiary of a Borrower in any manner (including by way of covenant,
representation or default), from (a) incurring, creating or assuming any Debt or
Lien upon any of its assets, (b) selling or otherwise disposing of any of its
assets, (c) making any Investments or Capital Expenditures, (d) suffering any
change of control, or (e) amending any Loan Document, except that clauses (a)
and (b) shall not apply to any Debt otherwise permissible under Section 6.2; or
6.13.2. providing that any default by a Borrower that is not a party to
such agreement with respect to any obligation not arising under such agreement
is a default under such agreement.
ARTICLE 7.
EVENTS OF DEFAULT
-----------------
Section 7.1. Events of Default. The occurrence of any one or more of the
-----------------
following events, acts or occurrences shall constitute an event of default
(each an "Event of Default"):
----------------
7.1.1. Failure to Make Payments. A Borrower (a) shall fail to pay as and
------------------------
when due (whether at stated maturity, upon acceleration, upon required
prepayment or otherwise) any principal of any Loan or any reimbursement for a
drawing under any Letter of Credit, or (b) shall fail to pay any interest, Fees
or other amounts payable under the Loan Documents within three Business Days
after the date when due under the Loan Documents; or
7.1.2. Default in Other Debt. (a) Any Borrower or any Consolidated
---------------------
Subsidiary of any Borrower shall default in the payment (whether at stated
maturity, upon acceleration, upon required prepayment or otherwise), beyond any
period of grace provided therefor, of any
57
principal of or interest on any other Debt with a principal amount, individually
or in the aggregate, in excess of $400,000 or (b) any other breach or default
(or other event or condition) shall occur under any agreement, indenture or
instrument relating to any such other Debt, if the effect of such breach or
default (or such other event or condition) is to cause, or to permit the holder
or holders of such other Debt (or a Person on behalf of such holder or holders)
to cause (upon the giving of notice, the lapse of time or both, or otherwise),
such other Debt to become or be declared due and payable, or required to be
prepaid, redeemed, purchased or defeased (or an offer of prepayment, redemption,
purchase or defeasance be made), prior to its stated maturity (other than by a
scheduled mandatory prepayment); or
7.1.3. Breach of Certain Covenants. Any Borrower shall fail to perform,
---------------------------
comply with or observe any agreement, covenant or obligation under Section 2.4,
Section 5.1.4, Section 5.4 (insofar as it requires the preservation of the
corporate existence of any Borrower), or any Section of Article 6 not covered by
7.1.4 hereof; or
7.1.4. Certain Defaults Under Article 6. Any Borrower shall fail to
--------------------------------
perform, comply with or observe any agreement, covenant or obligation under any
provision of Sections 6.1 through 6.4 (inclusive), 6.7, 6.8, 6.12, and 6.13
(inclusive of subsections thereof) and such failure shall not have been remedied
within ten (10) days after a Senior Officer of Borrower has Knowledge of such
failure; provided, however, that no such ten (10) day cure period shall be
available with respect to any failure by any Borrower that by its nature is
incapable of being remedied; or
7.1.5. Other Defaults Under Loan Documents. Any Borrower shall fail to
-----------------------------------
perform, comply with or observe any agreement, covenant or obligation under any
provision of any Loan Document (other than those provisions referred to in
Sections 7.1.1 through 7.1.3) and such failure shall not have been remedied
within 20 days after a Senior Officer of CI has Knowledge of such failure; or
7.1.6. Breach of Warranty. Any representation or warranty or certification
------------------
made or furnished by any Borrower under any Loan Document shall prove to have
been false or incorrect in any material respect when made (or deemed made); or
7.1.7. Involuntary Bankruptcy; Appointment of Receiver, Etc. There shall
----------------------------------------------------
be commenced against any Borrower, or any Consolidated Subsidiary, an
involuntary case seeking the liquidation or reorganization of such Borrower or
Consolidated Subsidiary under Chapter 7 or Chapter 11, respectively, of the
Bankruptcy Code or any similar proceeding under any other Applicable Law or an
involuntary case or proceeding seeking the appointment of a receiver,
liquidator, sequestrator, custodian, trustee or other officer having similar
powers of such Borrower or Consolidated Subsidiary or to take possession of all
or a substantial portion of its property or to operate all or a substantial
portion of its business, and any of the following events occurs: (a) such
Borrower or Consolidated Subsidiary consents to the institution of the
involuntary case or proceeding; (b) such petition commencing the involuntary
case or proceeding is not timely controverted; (c) the petition commencing the
involuntary case or proceeding
58
remains undismissed and unstayed for a period of 60 days; or (d) an order for
relief shall have been issued or entered therein; or
7.1.8. Voluntary Bankruptcy; Appointment of Receiver, Etc. Any Borrower
--------------------------------------------------
or any Consolidated Subsidiary shall institute a voluntary case seeking
liquidation or reorganization under Chapter 7 or Chapter 11, respectively, of
the Bankruptcy Code or any similar proceeding under any other Applicable Law, or
shall consent thereto; or shall consent to the conversion of an involuntary case
to a voluntary case; or shall file a petition, answer a complaint or otherwise
institute any proceeding seeking, or shall consent to or acquiesce in the
appointment of, a receiver, liquidator, sequestrator, custodian, trustee or
other officer with similar powers of it or to take possession of all or a
substantial portion of its property or to operate all or a substantial portion
of its business; or shall make a general assignment for the benefit of
creditors; or shall generally not pay its debts as they become due; or the Board
of Directors of such Borrower or Consolidated Subsidiary (or any committee
thereof) adopts any resolution or otherwise authorizes action to approve any of
the foregoing; or
7.1.9. Change of Control. A Change of Control shall occur at any time; or
-----------------
7.1.10. Termination of Loan Documents, Etc. Any Loan Document, or any
----------------------------------
material provision thereof, shall cease to be in full force and effect for any
reason, or any Lien in favor of the Agent thereunder shall fail to have the
priority required thereunder with respect to any Material item of Collateral,
except upon a release or termination of such Loan Document or Lien pursuant to
the terms thereof; or any Borrower shall contest or purport to repudiate or
disavow any of its obligations under or the validity of enforceability of any
Loan Document or any Material provision thereof; or
7.1.11. Material Adverse Change. A Material Adverse Change shall have
-----------------------
occurred since the Closing Date; or
7.1.12. Judgments and Attachments. (a) Any Borrower or any Consolidated
-------------------------
Subsidiary shall suffer any money judgments, fines, writs or warrants of
attachment or similar processes that, individually or in the aggregate, involve
an amount or value in excess of $400,000 (excluding therefrom money judgments to
the extent covered by insurance as to which the carrier has accepted liability
in writing) and such judgments, writs, warrants or other orders shall continue
unsatisfied and unstayed for a period of 30 days or, in any event, within 10
days prior to the date of any proposed sale thereunder; or (b) a judgment
creditor shall obtain possession of any Material portion of the assets of any
Borrower by any means, including levy, distraint, replevin or self-help.
Section 7.2. Remedies. Upon the occurrence of an Event of Default:
7.2.1. If an Event of Default occurs under Section 7.1.7 or 7.1.8, then
the Working Capital Revolving Commitments and the Revolving Acquisition
Commitments shall automatically and immediately terminate, and the obligation of
the Lenders to make any Loan or issue any Letter of Credit hereunder shall
cease, and the unpaid principal amount of the Loans and all other Obligations
shall automatically become immediately due and payable, without
59
presentment, demand, protest, notice or other requirements of any kind, all of
which are hereby expressly waived by each Borrower.
7.2.2. If an Event of Default occurs, other than under Section 7.1.7 or
7.1.8, the Agent may, or upon written request of the Required Lenders shall, by
written notice to CI, (a) declare the Working Capital Revolving Commitments and
the Revolving Acquisition Commitments terminated, whereupon the obligation of
the Lenders to make any Loan or issue any Letter of Credit hereunder shall
cease, and/or (b) declare the unpaid principal amount of the Loans and all other
Obligations to be, and the same shall thereupon become, due and payable, without
presentment, demand, protest, any additional notice or other requirements of any
kind, all of which are hereby expressly waived by each Borrower; and the Agent
may, as set forth in Article 8, pursue the remedies available to it pursuant to
Applicable Law.
7.2.3. If an Event of Default occurs under Section 7.1.7 or 7.1.8 or if
any other Event of Default occurs and the Agent declares the Loans due and
payable, the Borrowers shall be immediately obligated, without presentment,
demand, protest, notice or other requirements of any kind, all of which are
hereby expressly waived by the Borrowers, to pay immediately to the Agent, an
amount of cash equal to the Letter of Credit Liability. Any amounts so received
shall be deposited in an interest bearing account maintained by the Agent as
Cash Collateral Cover for all Obligations of the Borrowers. At any time after
any such Obligations shall become due and payable (whether by drawing on a
Letter of Credit or otherwise) the Cash Collateral Cover may be applied in whole
or in part by the Agent against or on account of all or any part of the
Obligations that have become so due and payable.
ARTICLE 8.
THE AGENT AND THE BANKS
-----------------------
Section 8.1. Authorization and Action.
------------------------
8.1.1. Each Lender and the L/C Issuer hereby irrevocably appoints and
authorizes the Agent to act as its agent hereunder and under the other Loan
Documents (including as its collateral agent under the Collateral Documents), to
execute and deliver or accept, on its behalf, the other Loan Documents and any
other documents, instruments and agreements related thereto or hereto to take
such action on its behalf under the provisions hereof and thereof and to
exercise such rights, remedies, powers and privileges hereunder and thereunder
as are delegated to the Agent by the terms hereof and thereof, together with
such rights, remedies, powers and privileges as are reasonably incidental
thereto.
8.1.2. Except for any matters expressly subject to the consent or approval
of the Agent under the Loan Documents, the Agent shall not, without the prior
approval of the Required Lenders (or, as provided in Section 9.3, all of the
Lenders), consent to any departure by any Borrower from the terms of, waive any
default or otherwise amend this Agreement or any other Loan Document. The Agent
will, to the extent practicable under the circumstances, consult with the other
Lender Parties prior to taking action on their behalf under the Loan Documents
and in acting as their Agent thereunder. The Agent will not take any action
contrary to the
60
written direction of Required Lenders, will take any lawful action not contrary
to the provisions of the Loan Documents prescribed in written instructions of
the Required Lenders (or, as provided in Section 9.3, all the Lenders) and, as
to any matters not expressly provided for by the Loan Documents (including
enforcement or collection), may decline to take any action, except upon the
written instructions of the Required Lenders (or, as provided in Section 9.3,
all the Lenders). If such instructions are requested reasonably promptly, the
Agent shall be absolutely entitled to refrain from taking any action and shall
not have any liability to CI or any Lender for refraining from taking any action
until it shall have received such instructions; provided, however, that the
Agent shall in no event be required to take or refrain from taking any action
that would, in the Agent's opinion, be inconsistent with the Agent's practice in
similar situations when acting solely for its own account or be contrary to the
provisions of any Loan Document or Applicable Law.
8.1.3. The Agent shall not have any duties or responsibilities except those
expressly set forth in the Loan Documents. No duty to act, or refrain from
acting, and no other obligation whatsoever, shall be implied on the basis of any
right, power or authority granted to the Agent or shall become effective in the
event of any temporary or partial exercise of such rights, power or authority.
The Agent shall not be required to exercise any right, power, remedy or
privilege granted to it in any Loan Document, to ascertain or inquire whether
any Default or Event of Default has occurred and is continuing (except with
respect to defaults in the payment of principal, interest and fees required to
be paid to the Agent for the account of the Lenders), or to inspect the property
(including the books and records) of any Borrower or to take any other
affirmative action, except as provided in Section 7.2, or unless requested or
directed to do so in accordance with Section 8.1.2.
8.1.4. The duties of the Agent shall be mechanical and administrative in
nature. The Agent shall not have, by reason of this Agreement or any other Loan
Document, a fiduciary relationship in respect of any Lender. Except for
notices, reports and other documents and information expressly required to be
furnished to the Lenders by the Agent hereunder, the Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the affairs, financial condition or business of the
Borrowers that may come into the possession of the Agent or any of its
Affiliates.
8.1.5. Neither the Syndication Agent nor the Documentation Agent nor the Co
Agent shall have any duties under this Agreement in their agency capacities;
provided, however that this Section 8.1.5 shall not relieve any of the
Syndication Agent, the Documentation Agent, and the Co-Agent of their duties as
Lenders hereunder.
Section 8.2. Exculpation; Agent's Reliance; Etc. Neither the Agent nor the any
-----------------------------------
of its directors, officers, agents, attorneys or employees shall be liable to
the Borrowers or any other Lender Party for any action taken or omitted to be
taken by it or them under or in connection with any Loan Document (a) with the
consent or at the request of the Required Lenders (or, as provided in Section
9.3, all the Lenders), or (b) in any other circumstances, except for its or
their own gross negligence or willful misconduct as determined by a final
judgment of a court of competent jurisdiction. The Agent makes no warranty or
representation to any other Lender
61
Party and shall not be responsible to any other Lender Party for any recitals,
statements, warranties or representations made in, or in connection with, any
Loan Document or for the execution, effectiveness, genuineness, validity,
enforceability, collectibility, or sufficiency of any Loan Document or any
financial information, opinions of counsel or other documents executed and
delivered pursuant thereto, or for the financial condition of the Borrowers. The
Agent shall not be responsible to any Lender for the satisfaction of any
condition specified in Article 3, except receipt of items required to be
delivered to the Agent, or for the value, effectiveness, priority, genuineness,
validity, of any Collateral or any Lien thereon. The Agent may treat the payee
of any Note as the holder thereof until the Agent receives the related
Assignment and Acceptance signed by such holder and the assignee and in form
satisfactory to the Agent. The Agent shall be entitled to rely upon any notice,
certificate or other writing believed by the Agent to be genuine and correct and
to have been signed or sent by the proper Person or Persons. The Agent shall be
entitled to consult with legal counsel, independent public accountants and other
experts selected by the Agent and to act in reliance upon the advice of such
counsel and other experts concerning its actions and duties hereunder.
Section 8.3. Agent and Affiliates. The Agent and each Lender that is a party
--------------------
hereto as a Lender and in some other capacity shall, in its capacity as a
Lender, have the same rights, powers and obligations under this Agreement and
the other Loan Documents as any other Lender and may exercise or refrain from
exercising the same as though it were not the Agent or such Lender, including
the right to give or deny consent to any action requiring consent or direction
of the Required Lenders or all the Lenders. The Agent, each Lender and their
respective Affiliates may accept deposits from, lend money to, act as trustee
under indentures of, and generally engage in any kind of business with, any
Borrower, any Consolidated Subsidiary and any Affiliate of any Borrower, all as
if the Agent or such Lender were not the Agent or such Lender and without any
duty to account therefor to the Lenders. The Agent or such Lender shall be
entitled to receive from any Borrower its Fees or portions thereof in connection
with this transaction without any liability to account therefor to any other
Lender, except as the Agent or such Lender may have expressly agreed.
Section 8.4. Lender Credit Decision. Each Lender acknowledges that it has,
----------------------
independently and without reliance upon the Agent or any other Lender and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the Agent or
any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents.
Section 8.5. Indemnification. The Agent shall in no event be required to take
---------------
any action under the Loan Documents or in relation thereto unless it shall first
be indemnified to its satisfaction by the other Lender Parties against any and
all liability and expense that it may incur by reason of taking any such action.
Each Lender agrees to indemnify and hold the Agent harmless (to the extent not
promptly paid or reimbursed by a Borrower), ratably according to its Total
Commitment, from and against any and all (a) costs, expenses and other amounts
incurred by the Agent otherwise payable by a Borrower pursuant to Section 9.1
and (b) Indemnified
62
Liabilities that may be imposed on, incurred by, or asserted against the Agent,
except to the extent they are finally adjudged by a court of competent
jurisdiction to have directly resulted from the gross negligence or willful
misconduct of the Agent. Without limitation of the foregoing, each Lender agrees
to reimburse the Agent promptly upon demand for its ratable share of any out-of-
pocket expenses (including counsel fees) incurred by the 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,
the Loan Documents, to the extent that the Agent is not promptly reimbursed for
such expenses by a Borrower.
Section 8.6. Successor Agent. The Agent may resign at any time as Agent under
---------------
the Loan Documents by giving written notice thereof to the Lenders and CI and
the Agent may be removed at any time with or without cause by written action of
the Required Lenders (not including the Agent) delivered to the Agent. Upon any
such resignation or removal, the Required Lenders shall have the right to
appoint a successor Agent. If no successor Agent shall have been so appointed by
the Required Lenders and shall have accepted such appointment, within 30 days
after the retiring Agent's notice of resignation or the removal of the Agent,
then the retiring or removed Agent may, on behalf of the other Lender Parties,
appoint a successor Agent, which shall be a financial institution having a
combined capital and surplus of at least $100,000,000, or a branch or agency of
such a financial institution, organized or licensed to do business under the
laws of the United States of America or any State thereof. Upon the acceptance
of any appointment as the Agent by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Agent, and the retiring Agent shall be discharged of
any further duties and obligations under the Loan Documents. Upon any retiring
Agent's resignation or removal, the provisions of this Article 8 (as well as
other expense reimbursement, indemnification and exculpatory provisions in the
other Loan Documents) shall continue in effect for its benefit as to any actions
taken or omitted by it while it was Agent.
Section 8.7. Excess Payments. If any Lender Party shall obtain any payment or
---------------
other recovery (whether voluntary, involuntary, by application of setoff or
otherwise) on account of any Obligations in excess of its pro rata share of
payments and other recoveries on account of such Obligations obtained by all
Lender Parties, such Lender Party shall purchase from the other Lender Parties
such participations in such Obligations held by them as shall be necessary to
cause such purchasing Lender Party to share the excess payment or other recovery
ratably with each of the other Lender Parties; provided, however, that if all or
any portion of the excess payment or other recovery is thereafter recovered from
such purchasing Lender Party, the purchase shall be rescinded and the purchase
price restored to such Lender Party to the extent of such recovery, but without
interest. Each Borrower agrees that any Lender Party so purchasing a
participation from another Lender Party pursuant to this Section 8.7 may, to the
fullest extent permitted by Applicable Law and by Section 9.10, exercise all of
its rights of payment (including setoff) with respect to such participation as
fully as if such Lender Party were the direct creditor of each Borrower in the
amount of such participation.
63
Section 8.8. Lender Parties. The provisions of this Article 8 are solely for
--------------
the benefit of the Agent and the other Lender Parties and no Borrower shall have
any rights to rely on or enforce any of the provisions hereof (except that (i)
the provisions of Sections 8.6 and 8.9.5 are also for the benefit of each
Borrower and (ii) each Borrower is entitled to rely on any release executed by
the Agent as authorized by Section 8.9). In performing its functions and duties
under the Loan Documents, the Agent shall act solely as agent of the Lenders and
does not assume and shall not be deemed to have assumed any obligation toward or
relationship of agency or trust with or for any Borrower.
Section 8.9. Collateral Matters.
------------------
8.9.1. Except as specifically otherwise provided in any of the Collateral
Documents, the Agent is hereby authorized on behalf of all of the Lenders,
without assumption of any duty or obligation in respect of and without the
necessity of any notice to or further consent from any other Lender, to take any
action with respect to any Collateral or Collateral Documents that may be
necessary to perfect and maintain perfected the Agent's Liens upon the
Collateral.
8.9.2. The Lenders hereby irrevocably authorize the Agent, in its
discretion, to release any Lien held by the Agent upon any Collateral (a) from
and after the day of termination of any Collateral Document pursuant to the
terms thereof; (b) constituting property being sold or disposed of if CI
certifies to the Agent that the sale or disposition is permitted under the
relevant Collateral Document (and the Agent may rely conclusively on any such
certificate, without further inquiry, unless notified to the contrary by the
Required Lenders); or (c) if approved, authorized or ratified in writing by all
Lender Parties in accordance with Section 9.3; provided, however, that (i) the
Agent shall not be required to execute any such documents on terms that create
any obligation or entail any consequence other than the release of such Liens
without recourse or warranty, and (ii) such release shall not in any manner
discharge, affect or impair the Obligations or any Liens upon (or obligations of
the Borrowers in respect of) all assets retained by the Borrowers, including the
proceeds of any Asset Disposition, all of which shall continue to constitute
part of the Collateral. Upon request by the Agent at any time, the other Lender
Parties will confirm in writing the Agent's authority to release particular
types or items of Collateral pursuant to this Section 8.9.2.
8.9.3. The Agent shall have no obligation whatsoever to any other Lender
Party or other Person to assure that the Collateral exists or is owned by a
Borrower or (except as otherwise expressly required by the Collateral Documents)
is cared for, protected or insured, or that the Liens of the Agent thereunder
have been properly created, perfected, protected or enforced or are entitled to
any particular priority.
8.9.4. Except as otherwise provided in the Loan Documents, the Agent may
act in any manner it deems appropriate in respect of the Collateral, in its
discretion, given the Agent's own interest in the Collateral as a Lender, and
the Agent shall have no duty or liability whatsoever with respect thereto to any
other Lender Party.
64
8.9.5. Each Lender hereby approves the form of the other Loan Documents
attached as exhibits to this Agreement and hereby authorizes the Agent on its
behalf to accept from the Borrowers and execute and deliver as Agent, the other
Loan Documents in substantially the form of such exhibits, with such changes,
additions or deletions as the Agent, in its discretion, may approve as necessary
or appropriate, such approval to be conclusively evidenced by the Agent's
acceptance or execution thereof. Each Lender also authorizes the Agent to
accept, or execute and deliver, such additional documents (including financing
statements, opinions, certificates and other documents in form and substance
satisfactory to the Agent, in its discretion) in connection with the closing
pursuant to Section 3.1 or any subsequent closing for the pledge of any other
Collateral or any additional guaranties as the Agent, in its discretion, may
approve, such approval to be conclusively evidenced by the Agent's acceptance or
execution thereof.
8.9.6. Each Lender Party agrees with and in favor of each other (which
agreement shall not be for the benefit of any Borrower or Consolidated
Subsidiary) that the Borrowers' obligations to such Lender Party under this
Agreement and the other Loan Documents are not and shall not be secured by any
real property collateral now or hereafter acquired by such Lender Party.
Section 8.10. Payments; Availability of Funds; Certain Notices.
------------------------------------------------
8.10.1. If the Agent shall fail to deliver to any other Lender Party its
share of any payment received from any Borrower as and when required by Section
2.10, the Agent shall pay to such Lender its share of such payment together with
interest on such amount at the Federal Funds Effective Rate, for each day from
the date such amount was required to be paid to such Lender until the date the
Agent pays such amount to such Lender, calculated as set forth in Section 2.5.4.
8.10.2. Unless (a) the Agent shall have been notified by a Lender prior
to the date upon which a Loan is to be made or (b) the Agent shall have been
notified by any Borrower prior to the date on which the Borrowers are required
to make any payment hereunder that such Lender or the Borrowers, as the case may
be (the "Obligated Party"), do not intend to make available to the Agent the
----------------
Obligated Party's portion of such Loan or such payment, the Agent may assume
that the Obligated Party will make such amount available to the Agent on such
date and the Agent may, in reliance upon such assumption (but shall not be
required to), make available to CI (in the case of a Loan) or the Lenders (in
the case of a payment by the Borrowers) a corresponding amount. If such
corresponding amount is not in fact made available to the Agent by the Obligated
Party, the Agent shall be entitled to recover such amount on demand from the
Obligated Party (or, in the case of a Loan, if the Lender that is the Obligated
Party fails to pay such amount forthwith upon such demand, from the Borrowers).
Such amount shall be payable, together with interest thereon from the day on
which such corresponding amount was made available by the Agent to the Lender or
CI, as applicable, to the date of payment by the Obligated Party (or the
Borrowers, as applicable), at a rate of interest equal to (i) in the case of any
payment by any other Lender, the Federal Funds Effective Rate, and (ii) in the
case of any payment by the Borrowers, the interest rate applicable to the Loan.
65
8.10.3. The Agent shall promptly notify the Lenders by telecopy of each
Interest Period chosen by CI, the Adjusted LIBOR Rate for each Interest Period
(and the relevant interest rate), the date of any expected payment and all other
material notices transmitted by CI.
Section 8.11. Obligations of Lenders Several; Enforcement by the Agent.
--------------------------------------------------------
8.11.1. Each Lender's obligations hereunder are several, and not joint or
joint and several. The failure of any Lender to make any Loan or otherwise to
perform its obligations hereunder will not increase the obligations of any other
Lender Party. Notwithstanding the foregoing, any Lender may assume, but shall
have no obligation to any Person to assume, any non-performing Lender's
obligation to make a Loan. Nothing contained in this Agreement and no action
taken by the Agent or any other Lender Party pursuant to this Agreement shall be
deemed to constitute the Agent and any other Lender Party to be a partnership,
an association, a joint venture or any other kind of Person.
8.11.2. Each Lender agrees that, except with the prior written consent of
the Agent or as provided in Section 9.10, it shall not have any right
individually to realize upon the Collateral or otherwise enforce any Loan
Document or any provision thereof, or make demand thereunder, it being agreed
that such rights and remedies may only be exercised by the Agent for the ratable
benefit of the Lender Parties upon the terms of this Agreement.
ARTICLE 9.
MISCELLANEOUS
-------------
Section 9.1. Expenses. The Borrowers shall pay within 10 days (or, in the case
--------
of costs and expenses incurred prior to the Closing Date, within one Business
Day) after demand:
9.1.1. any and all reasonable attorneys' fees and disbursements and all
reasonable out-of-pocket costs and expenses incurred by the Agent in connection
with (a) the development, drafting and negotiation of the Loan Documents and the
syndication and closing of the transactions contemplated thereby and (b) any
amendments to or the administration of the Loan Documents (including reasonable
costs and expenses incurred in connection with any appraisal or environmental
assessment); and
9.1.2. any and all costs and expenses (including fees and disbursements
of in-house and other attorneys, appraisers and consultants) incurred by the
Lender Parties in any workout, restructuring or similar arrangements or, after a
Default, in connection with the protection, preservation, exercise or
enforcement of any of the terms of the Loan Documents or in connection with any
foreclosure, collection or bankruptcy proceedings.
Section 9.2. Indemnity.
---------
9.2.1. The Borrowers shall, jointly and severally, indemnify, defend and
hold harmless each Lender Party and the officers, directors, employees, agents,
attorneys, affiliates, successors and assigns of each Lender Party
(collectively, the "Indemnitees") from and against
-----------
66
(a) any and all transfer taxes, documentary taxes, assessments or charges made
by any Governmental Authority by reason of the execution and delivery of the
Loan Documents or the making of the Loans or the issuance of Letters of Credit,
and (b) any and all liabilities, losses, damages, penalties, judgments, claims,
costs and expenses of any kind or nature whatsoever (including reasonable
attorneys' fees, including allocated costs of in-house counsel, and
disbursements in connection with any actual or threatened investigative,
administrative or judicial proceeding, whether or not such Indemnitee shall be
designated a party thereto) that may be imposed on, incurred by or asserted
against such Indemnitee, in any manner relating to or arising out of the Loan
Documents, Letters of Credit, the Loans, the use or intended use of the proceeds
of the Loans or Letters of Credit (including the failure of the L/C Issuer to
honor a drawing as a result of any act or omission, whether rightful or
wrongful, of any Governmental Authority) (the "Indemnified Liabilities");
------------------------
provided that (i) no Indemnitee shall have the right to be indemnified or held
harmless hereunder for its own gross negligence or willful misconduct, as
determined by a final judgment of a court of competent jurisdiction, and (ii) no
Borrower shall have any obligation hereunder in respect of (A) legal proceedings
between the Lender Parties or between any Lender Party and any participant or
(B) Indemnified Liabilities arising from a breach of any Loan Document by the
Indemnitee making a claim hereunder.
9.2.2. Each Indemnitee will promptly notify CI of each event of which it
has knowledge that may give rise to a claim under clause (b) of Section 9.2.1,
provided that the failure to so notify CI shall in no way impair the Borrowers'
obligations under this Section 9.2 (except to the extent that such failure to so
notify arises from the gross negligence or willful misconduct of such Indemnitee
and has an adverse effect on the Borrowers, taken as a whole). If any
investigative, judicial or administrative proceeding is brought against any
Indemnitee indemnified or intended to be indemnified pursuant to this Section
9.2, CI, to the extent and in the manner directed by the Indemnitee, will resist
and defend such proceeding with counsel designated by CI (which counsel shall be
reasonably satisfactory to the Indemnitee). Each Indemnitee will use its best
efforts to cooperate in the defense of any such action, writ, or proceeding. CI
shall keep such Indemnitee advised of the status of such defense and consult
with such Indemnitee prior to taking any material position with respect thereto.
Such Indemnitee shall, however, be entitled to employ counsel separate from
counsel for CI and from any other party in such proceeding if such Indemnitee
shall reasonably determine that a conflict of interest or other circumstance
exists that makes representation by counsel chosen by CI not advisable. The
reasonable fees and disbursements of such separate counsel shall be paid by CI.
Such Indemnitee shall not agree to the settlement of any such claim without the
consent of CI, unless CI shall have been given notice of the commencement of an
action and shall have failed to provide the defense thereof as herein provided
or an Event of Default shall have occurred.
9.2.3. To the extent that the undertaking to indemnify and hold harmless
set forth in Section 9.2.1 may be unenforceable as violative of any Applicable
Law or public policy, the Borrowers shall make the maximum contribution to the
payment and satisfaction of each of the Indemnified Liabilities that is
permissible under Applicable Law. All Indemnified Liabilities shall be payable
on demand.
67
Section 9.3. Waivers; Amendments in Writing.
------------------------------
9.3.1. No amendment of any provision of this Agreement or any other Loan
Document (including a waiver thereof or consent relating thereto) shall be
effective unless the same shall be in writing and signed by the Agent and the
Required Lenders. Notwithstanding the foregoing:
9.3.1.1. no amendment that has the effect of (a) reducing the rate or
amount, or extending the stated maturity or due date, of any amount payable
by the Borrowers to any Lender under the Loan Documents, (b) increasing the
amount, or extending the stated termination or reduction date, of any
Lender's Total Commitment or subjecting any Lender Party to any additional
obligation to extend credit, (c) altering the rights and obligations of the
Borrowers to prepay the Loans, (d) permitting the creation of any Lien
ranking prior to or on a parity with the Lien under any Collateral
Document, releasing any part of the Collateral (except as permitted under
the Loan Documents) or depriving any Lender Party of the security afforded
by the Lien of under Collateral Document, or (e) changing this Section 9.3,
Section 8.7, any provision herein providing for consent or other action by
all of the Lenders, or the definition of the term "Required Lenders," shall
be effective unless the same shall be signed by or on behalf of all of the
Lenders;
9.3.1.2. no amendment that has the effect of (a) increasing the duties
or obligations of the Agent, (b) increasing the standard of care or
performance required on the part of the Agent, or (c) reducing or
eliminating the indemnities or immunities to which the Agent is entitled
(including any amendment of this Section 9.3.1.2), shall be effective
unless the same shall be signed by or on behalf of the Agent; and
9.3.1.3. no amendment that has the effect of (a) increasing the duties
or obligations of the Swingline Lender, (b) increasing the standard of care
or performance required on the part of the Swingline Lender, or (c)
reducing or eliminating the indemnities or immunities to which the
Swingline Lender is entitled (including any amendment of this Section
9.3.1.3), shall be effective unless the same shall be signed by or on
behalf of the Swingline Lender; and
9.3.1.4. no amendment that has the effect of (a) increasing the duties
or obligations of the L/C Issuer, (b) increasing the standard of care or
performance required on the part of the L/C Issuer, or (c) reducing or
eliminating the indemnities or immunities to which the L/C Issuer is
entitled (including any amendment of this Section 9.3.1.4), shall be
effective unless the same shall be signed by or on behalf of the L/C
Issuer; and
9.3.1.5. Notwithstanding anything to the contrary, Schedule 4.3 may be
amended by written notice by CI to the Agent, to the extent necessary to
reflect transactions occurring after the date hereof that are otherwise
permissible hereunder.
9.3.1.6. Any waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given. No notice to or
demand on any
68
Borrower in any case shall entitle such Borrower to any other or further
notice or demand in similar or other circumstances. Any amendment effected
in accordance with this Section 9.3 shall be binding upon each present and
future Lender Party and the Borrowers.
Section 9.4. Cumulative Remedies; Failure or Delay. The rights and remedies
-------------------------------------
provided for under this Agreement are cumulative and are not exclusive of any
rights and remedies that may be available to the Lender Parties under Applicable
Law or otherwise. No failure or delay on the part of any Lender Party in the
exercise of any power, right or remedy under the Loan Documents shall impair
such power, right or remedy or operate as a waiver thereof, nor shall any single
or partial exercise of any such power, right or remedy preclude other or further
exercise thereof or of any other power, right or remedy.
Section 9.5. Notices, Etc. All notices and other communications under this
------------
Agreement shall be in writing and (except for financial statements, other
related informational documents and routine communications, which may be sent by
first-class mail, postage prepaid) shall be personally delivered or sent by
prepaid courier, by overnight, registered or certified mail (postage prepaid),
or by prepaid telecopy, and shall be deemed given when received by the intended
recipient thereof. Unless otherwise specified in a notice sent or delivered in
accordance with this Section 9.5, all notices and other communications shall be
given to the parties hereto at their respective addresses (or to their
respective telecopier numbers) indicated on Schedule 1.1.B (in the case of the
Lender Parties) or 9.5 (in the case of the Borrowers).
Section 9.6. Successors and Assigns.
----------------------
9.6.1. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and permitted assigns. No
Borrower may assign or transfer any interest hereunder without the prior written
consent of each Lender Party.
9.6.2. Each Lender shall have the right at any time to assign (an
"Assignment") all or any portion of such Lender's Total Commitment,
----------
participation in Letters of Credit, and outstanding Loans to one or more banks
or other institutions; provided, however, that (a) each Assignment shall be of a
portion of the Total Commitment of at least equal to $5,000,000, (b) unless
otherwise agreed by the Agent, each Assignment shall be of a constant, and not a
varying, percentage of all of the assigning Lender's rights and obligations
under this Agreement and the other Loan Documents; (c) unless a Default or Event
of Default then exists, no Assignment (other than an Assignment to a Person that
is then a Lender or an Affiliate of a Lender) shall be effective without the
consent of CI and the Agent, which consents shall not be unreasonably withheld
or delayed; (d) the parties to the Assignment shall execute and deliver to the
Agent an Assignment and Acceptance substantially in the form of Exhibit H (an
"Assignment and Acceptance"); and (e) the assigning Lender Party shall pay to
--------------------------
the Agent a processing and recording fee of $2,500; and no Assignment shall be
effective for any purpose unless and until the Agent accepts such Assignment and
makes an appropriate entry thereof in the Register (as defined below). Upon
satisfaction of the conditions in clauses (a) through (e) of the proviso to the
immediately preceding sentence with respect to any proposed Assignment, the
Agent shall
69
accept the Assignment, make appropriate entries thereof in the Register and send
notice thereof to CI and all other Lender Parties. From and after the date on
which the conditions in the foregoing clauses and the Assignment and Acceptance
have been satisfied, the assignee shall be a "Lender" hereunder and, to the
extent that rights and obligations hereunder have been assigned to it, shall
have the rights and obligations (including the obligation to participate in
Letters of Credit) of the assigning Lender hereunder, and the assigning Lender
shall, to the extent that rights and obligations hereunder have been assigned by
it, relinquish its rights and be released from its obligations under this
Agreement (and, in the case of an Assignment covering all or the remaining
portion of the assigning Lender's rights and obligations under this Agreement,
cease to be a party hereto).
9.6.3. The Agent shall maintain at the Agent's Office a copy of each
Assignment and Acceptance delivered to it and a register (the "Register") for
--------
the recordation of the names of the Lender Parties and their respective Total
Commitments. The entries in the Register shall be conclusive as against CI and
each Lender Party, in the absence of manifest error, notwithstanding notice to
the contrary. The Register shall be available for inspection by CI at any
reasonable time and from time to time upon reasonable prior notice.
9.6.4. Each Lender shall have the right at any time to grant or sell
participations (each a "Participation") in all or any portion of such Lender's
-------------
Total Commitment, participation in Letters of Credit and outstanding Loans to
one or more banks or other institutions, subject to the terms and conditions set
forth in this Section 9.6.4. If any Lender sells or grants a Participation, (a)
such Lender shall make and receive all payments for the account of its
participant, (b) such Lender's obligations under this Agreement shall remain
unchanged, (c) such Lender shall continue to be the sole holder of its Notes and
other Loan Documents subject to the Participation and shall have the sole right
to enforce its rights and remedies under the Loan Documents, (d) the Borrowers
and the other Lender Parties shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations under the
Loan Documents, and (e) the Participation agreement shall not restrict such
Lender's ability to agree to any amendment of the terms of the Loan Documents,
or to exercise or refrain from exercising any powers or rights that such Lender
may have under or in respect of the Loan Documents or any Collateral, except
that the participant may be granted the right to consent to any (a) reduction of
the rate or amount, or any extension of the stated maturity or due date, of any
principal, interest or Fees payable by the Borrowers and subject to the
Participation, (b) increase in the amount or extension of the stated termination
or any reduction date of the affected Total Commitment or (c) release of all or
substantially all of the Collateral, except to the extent otherwise provided in
the Loan Documents. A participant shall have the rights of the Lenders under
Sections 2.12, 2.13, 2.14, 9.2 and 9.10, subject to the obligations imposed by
such Sections; provided that amounts payable to any participant shall not exceed
the amounts that would have been payable under such Sections to the Lender
granting the Participation, had such Participation not been granted, unless the
Participation is made with the prior written consent of CI.
9.6.5. Each Lender may at any time assign or pledge any portion of its
rights under the Loan Documents to a Federal Reserve Bank. No such assignment or
pledge shall be subject to the provisions of Sections 9.6.2 or 9.6.4.
70
9.6.6. Subject to the provisions of Section 9.7, each Lender Party shall
have the right at any time to furnish one or more potential assignees or
participants with any information concerning the Borrowers and the Subsidiaries
that has been supplied by any Borrower to any Lender Party. The Borrowers shall
supply all reasonably requested information and execute and deliver all such
instruments and take all such further action (including, in the case of an
Assignment, the execution and delivery of replacement Notes) as the Agent may
reasonably request in connection with any Assignment or Participation
arrangement.
9.6.7. Notwithstanding anything to the contrary in the Loan Documents, in
no event shall any of the Borrowers be liable for any fee or expense as to any
Assignment.
Section 9.7. Confidentiality. Each Lender Party will maintain any confidential
---------------
information that it may receive from any Borrower or Consolidated Subsidiary
pursuant to this Agreement confidential and shall not disclose such information
to third parties without the prior consent of CI, except for disclosure: (a) to
legal counsel, accountants and other professional advisors to the Lender Party;
(b) to regulatory officials having jurisdiction over the Lender Party; (c)
required by Applicable Law or in connection with any legal proceeding; (d) to
any other Lender Party;(e) to another Person in connection with a potential
Assignment or Participation, provided such Person shall have agreed in writing
to be subject to this Section 9.7; (f) to prospective purchasers of Collateral
after an Event of Default; (g) to an Affiliate of the Lender Party and (h) of
information that has been previously disclosed publicly without breach of this
provision.
Section 9.8. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
-------------
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA (OTHER THAN CHOICE OF
LAW RULES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANY OTHER
JURISDICTION). THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS, AS MOST
RECENTLY PUBLISHED BY THE INTERNATIONAL CHAMBER OF COMMERCE, SHALL IN ALL
RESPECTS BE INCORPORATED INTO SECTION 2.3 AND SHALL APPLY TO ALL LETTERS OF
CREDIT.
Section 9.9. Choice of Forum.
---------------
9.9.1. All actions or proceedings arising in connection with this
Agreement shall be tried and litigated in state or Federal courts located in
County of Suffolk, Commonwealth of Massachusetts, unless such actions or
proceedings are required to be brought in another court to obtain subject matter
jurisdiction over the matter in controversy. EACH BORROWER AND EACH OF THE
LENDER PARTIES WAIVES ANY RIGHT IT MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON
---------
CONVENIENS, TO ASSERT THAT IT IS NOT SUBJECT TO THE JURISDICTION OF SUCH COURTS
----------
OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH
THIS SECTION.
9.9.2. IN ANY ACTION AGAINST ANY BORROWER, SERVICE OF PROCESS MAY BE MADE
UPON CI BY REGISTERED OR CERTIFIED MAIL,
71
RETURN RECEIPT REQUESTED, TO ITS ADDRESS INDICATED IN SCHEDULE 9.5, WHICH
SERVICE SHALL BE DEEMED SUFFICIENT FOR PERSONAL JURISDICTION AND SHALL BE DEEMED
EFFECTIVE 10 DAYS AFTER MAILING.
9.9.3. Nothing contained in this Section shall preclude the Lender
Parties from bringing any action or proceeding arising out of or relating to
this Agreement in the courts of any place where CI or any of its assets may be
found or located. TO THE EXTENT PERMITTED BY THE APPLICABLE LAWS OF ANY SUCH
JURISDICTION, EACH BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF
ANY SUCH COURT AND EXPRESSLY WAIVES, IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING, THE JURISDICTION OF ANY OTHER COURT OR COURTS THAT NOW OR HEREAFTER,
BY REASON OF SUCH PARTY'S PRESENT OR FUTURE DOMICILE, OR OTHERWISE, MAY BE
AVAILABLE TO IT.
Section 9.10. Set Off. In addition to any rights now or hereafter granted under
-------
Applicable Law, during the existence of any Event of Default, each Lender Party
is hereby irrevocably authorized by each Borrower, at any time or from time to
time, without notice to any Borrower or to any other Person, any such notice
being hereby expressly waived, to set off and to appropriate and to apply any
and all deposits (general or special, including certificates of deposit, whether
matured or unmatured, but not including trust accounts) and any other
indebtedness, in each case whether direct or indirect or contingent or matured
or unmatured at any time held or owing by such Lender Party to or for the credit
or the account of CI, against and on account of the obligations of CI to such
Lender Party under the Loan Documents to which CI is a party, irrespective of
whether or not such Lender Party shall have made any demand for payment and
although such obligations may be contingent and unmatured.
Section 9.11. Changes in Accounting Principles. If any changes in generally
--------------------------------
accepted accounting principles after the date of this Agreement result from the
promulgation of rules, regulations, pronouncements, or opinions of, or the
imposition of requirements by, the Financial Accounting Standards Board or the
American Institute of Certified Public Accountants (or successors thereto or
agencies with similar functions), or there shall occur any change in CI's fiscal
or tax years and, as a result of any such changes, there shall result a change
in the method of calculating any of the negative covenants, standards or other
terms or conditions found in this Agreement, then the parties hereto agree to
enter into negotiations in order to amend such provisions so as to equitably
reflect such changes with the desired result that the criteria for evaluating
the Borrowers' financial condition shall be the same after such changes as if
such changes had not been made.
Section 9.12. Headings. The Article and Section headings used in this Agreement
--------
are for convenience of reference only and shall not affect the construction
hereof.
Section 9.13. Severability. If any provision of this Agreement shall be held to
------------
be invalid, illegal or unenforceable under Applicable Law in any jurisdiction,
such provision shall be ineffective only to the extent of such invalidity,
illegality or unenforceability, which shall not
72
affect any other provisions hereof or the validity, legality or enforceability
of such provision in any other jurisdiction.
Section 9.14. Survival of Agreements, Representations and Warranties. All
------------------------------------------------------
agreements, representations and warranties made herein shall survive the
execution and delivery of this Agreement, the Closing and all extensions of
credit hereunder and shall continue until payment and performance of any and all
Obligations (including the expiration of all Letters of Credit issued hereunder
and satisfaction of all obligations with respect thereto, including any Letters
of Credit with expiration dates after the Stated Termination Date). Any
investigation at any time made by or on behalf of the Lender Parties shall not
diminish the Lender Parties' right to rely thereon. The agreements and
obligations of the Borrowers contained in Sections 2.12, 2.13, 2.14, 9.1 and
9.2, and the obligations of the Lenders under Section 8.5 and 9.7 shall survive
the payment in full of all other Obligations.
Section 9.15. Execution in Counterparts. This Agreement may be executed in any
-------------------------
number of counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute but one and the same Agreement. This Agreement
shall become effective upon the execution of a counterpart hereof by each of the
parties hereto. Faxed signatures to this Agreement shall be binding for all
purposes.
Section 9.16. Complete Agreement. This Agreement, together with the other Loan
------------------
Documents, is intended by the parties as the final expression of their
agreements regarding the subject matter hereof and thereof and as a complete and
exclusive statement of the terms and conditions of such agreements.
Section 9.17. Limitation of Liability. No claim shall be made by any Borrower or
-----------------------
any Consolidated Subsidiary of any Borrower against any Lender Party or the
Affiliates, directors, officers, employees or agents of any Lender Party for any
special, indirect, consequential or punitive damages in respect of any claim for
breach of contract or under any other theory of liability arising out of or
related to the transactions contemplated by this Agreement, or any act, omission
or event occurring in connection therewith; and the Borrowers waive, releases
and agrees not to ▇▇▇ upon any claim for any such damages, whether or not
accrued and whether or not known or suspected to exist in its favor.
Section 9.18. WAIVER OF TRIAL BY JURY. THE BORROWERS AND THE LENDER PARTIES
-----------------------
WAIVE THE RIGHT TO A TRIAL BY JURY IN ANY ACTION UNDER THIS AGREEMENT OR ANY
ACTION ARISING OUT OF THE TRANSACTIONS CONTEMPLATED HEREBY, REGARDLESS OF WHICH
PARTY INITIATES SUCH ACTION OR ACTIONS.
Section 9.19 Supersession of Original Credit Agreement.
-----------------------------------------
This Agreement amends and restates the terms of the Original Credit
Agreement.
73
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered as of the date first set forth above.
Agent:
BankBoston, N.A.,
a national banking association,
as Agent, Swingline Lender, L/C Issuer
and a Lender
By:___________________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
Lenders:
--------
U.S. Bank,
a national banking association
By:___________________________________
Name:_________________________________
Title:________________________________
Fleet National Bank,
a national banking association
By:___________________________________
Name:_________________________________
Title:________________________________
Bank of America National Trust and Savings
Association,
a national banking association
By:___________________________________
Name:_________________________________
Title:________________________________
▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
By:__________________________________
Name:________________________________
Title:_______________________________
By:__________________________________
Name:________________________________
Title:_______________________________
Borrowers:
---------
Cotelligent, Inc.,
a Delaware corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
Cotelligent of Boston, Inc.,
a Massachusetts corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent Dallas, Inc.,
a Texas corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent Dunwoody, Inc.,
a Georgia corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
▇▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Inc.,
a Florida corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent Jonesboro, Inc.,
a Georgia corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent Metro New York, Inc.,
a New Jersey corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent Minneapolis, Inc.,
a Minnesota corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent Philadelphia, Inc.,
a Pennsylvania corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent Pittsburgh, Inc.,
a Pennsylvania corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Assistant Secretary
76
Cotelligent Portland, Inc.,
an Oregon corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent Orange County, Inc.,
a California corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent San ▇▇▇▇, Inc.,
a California corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent San Mateo, Inc.,
a California corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent Seattle, Inc.,
a Washington corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Cotelligent USA, Inc.,
a California corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
77
Fastech, Inc.,
a Pennsylvania corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
GRI, Inc. d/b/a Global Resources,
a California corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
HC Associates International, Inc.,
a Georgia corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
Information Systems Resources, Inc.,
a Florida corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
▇▇▇▇▇▇ Enterprises, Inc. d/b/a Intellitron,
a California corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
The ▇▇▇▇▇ Companies, Inc.,
a Florida corporation
By:__________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Secretary
78
SCHEDULE R-1
CONSOLIDATED SUBSIDIARIES OF BORROWER
Cotelligent Orange County, Inc.:
-------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent Metro New York, Inc.:
--------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ I
▇▇▇ ▇▇▇▇▇ ▇▇▇-▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Confidential Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent San Mateo, Inc.
---------------------------
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent Jonesboro, Inc.:
---------------------------
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent Fort Lauderdale, Inc.:
---------------------------------
Cypress Centre
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent of Boston, Inc.:
---------------------------
▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent Dunwoody, Inc.:
--------------------------
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent Dallas, Inc.:
------------------------
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇.▇. ▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent Minneapolis, Inc.:
-----------------------------
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent Seattle, Inc.:
-------------------------
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
GRI, Inc. d/b/a Global Resources:
--------------------------------
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
HC Associates International, Inc.:
---------------------------------
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Information Systems Resources, Inc.:
-----------------------------------
▇▇▇▇-▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ Enterprises, Inc. DBA Intellitron:
----------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent Pittsburgh, Inc.:
----------------------------
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent San ▇▇▇▇, Inc.
--------------------------
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent Portland, Inc.:
--------------------------
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent Philadelphia, Inc.:
------------------------------
▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent USA, Inc.:
---------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax:(▇▇▇) ▇▇▇-▇▇▇▇
Fastech, Inc.:
-------------
▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
The ▇▇▇▇▇ Companies, Inc.:
-------------------------
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
SCHEDULE 1.1.A
COMMITMENTS
----------------------------------------------------------------------------------------------------------
Working Capital Revolving Acquisition Total
Lender Revolving Commitment Commitment Commitments
----------------------------------------------------------------------------------------------------------
BankBoston, N.A. $ 6,250,000 $18,750,000 $ 25,000,000
----------------------------------------------------------------------------------------------------------
U.S. Bank $ 5,000,000 $15,000,000 $ 20,000,000
----------------------------------------------------------------------------------------------------------
Fleet National Bank, N.A. $ 5,000,000 $15,000,000 $ 20,000,000
----------------------------------------------------------------------------------------------------------
Bank of America NT&SA $ 5,000,000 $15,000,000 $ 20,000,000
----------------------------------------------------------------------------------------------------------
Banque Nationale de Paris $ 3,750,000 $11,250,000 $ 15,000,000
----------------------------------------------------------------------------------------------------------
Total $25,000,000 $75,000,000 $100,000,000
----------------------------------------------------------------------------------------------------------
SCHEDULE 1.1.B
LENDER INFORMATION
Agent's Office:
BankBoston, N.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Tax: (▇▇▇)-▇▇▇-▇▇▇▇
Phone: (▇▇▇)-▇▇▇-▇▇▇▇/(▇▇▇)-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇
Agent's Account (for funding of Loans by the Lenders and payments by CI):
Method of Payment: Fed Wire
Account No.: ▇▇▇▇▇▇▇▇
Reference: Cotelligent
ABA No.: ▇▇▇▇▇▇▇▇▇
Attn: The Hightech Adm. 50
Lenders:
---------------------------------------------------------------------------------------------
Lender Domestic Lending Office LIBOR Lending Office
---------------------------------------------------------------------------------------------
U.S. Bank ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇ Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------------------------------------------------------------
Fleet National Bank, One Federal Street One Federal Street
N.A. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇ / 4246 Phone: (▇▇▇) ▇▇▇-▇▇▇▇ / 4246
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ / ▇▇▇▇ ▇▇▇▇▇▇ Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ / ▇▇▇▇ ▇▇▇▇▇▇
---------------------------------------------------------------------------------------------
Bank of America, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇&▇▇ Concourse Level, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇ Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇ Attn: ▇▇▇▇ ▇▇▇▇▇▇
---------------------------------------------------------------------------------------------
Banque Nationale de ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇ Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇ Attn: ▇▇▇ ▇▇▇▇
---------------------------------------------------------------------------------------------
SCHEDULE 1.1.C
EXISTING DEBT
Creditor: Various Capitalized Leases
Commencement of Leases: Various
Payment Terms: Various
Balance at January 31, 1999: $238,169
Notes Payable
-------------
Cotelligent Metro New York, Inc.
--------------------------------
Creditor: ▇▇▇▇▇▇ ▇'▇▇▇▇▇▇▇
Commencement of Note: February 1996
Payment Terms: $100,000/Year for 4 years; $75,000/Year for 1 year
SCHEDULE 1.1.D
EXISTING LIENS
Generally, the various capitalized leases referred to in Schedule 1.1.C
(office equipment leases) are secured by the property leased thereunder.
SCHEDULE 1.1.E
APPLICABLE MARGIN
The "Applicable Margin" in respect of LIBOR Rate Loans (and amounts not
-----------------
paid when due) for any day are the respective rates per annum set forth below in
the applicable row under the column corresponding to the Pricing Level that
applies on such day:
---------------------------------------------------------------------------------------------------
Pricing Level Level I Level II Level III Level IV Level V
Pricing Pricing Pricing Pricing Pricing
---------------------------------------------------------------------------------------------------
Applicable Margin (LIBOR 1.875 1.50 1.25 1.00 0.875
Rate Loans and amounts
not paid when due)
---------------------------------------------------------------------------------------------------
For purposes of this Schedule, the following terms have the following
meanings:
"Level I Pricing" applies during any Pricing Period if (i) in the case of
---------------
Compliance Certificates prepared in conjunction with financial statements
delivered pursuant to Sections 5.1.1 and 5.1.2, at the end of the Fiscal Quarter
most recently ended prior to the first day of such Pricing Period, and (ii) in
the case of Compliance Certificates prepared in conjunction with Permitted
Acquisitions, as of the day on which such Compliance Certificate is delivered
(as reflected in the pro forma calculations included in such Compliance
Certificate), the Leverage Ratio was greater than 3.00 to 1.00.
"Level II Pricing" applies during any Pricing Period if no higher Pricing
----------------
Level applies and, if, (i) in the case of Compliance Certificates prepared in
conjunction with financial statements delivered pursuant to Sections 5.1.1 and
5.1.2, at the end of the Fiscal Quarter most recently ended prior to the first
day of such Pricing Period, and (ii) in the case of Compliance Certificates
prepared in conjunction with Permitted Acquisitions, as of the day on which such
Compliance Certificate is delivered (as reflected in the pro forma calculations
included in such Compliance Certificate) the Leverage Ratio was less than or
equal to 3.00 to 1.00, but greater than 2.50 to 1.00.
"Level III Pricing" applies during any Pricing Period if no higher Pricing
-----------------
Level applies and if, (i) in the case of Compliance Certificates prepared in
conjunction with financial statements delivered pursuant to Sections 5.1.1 and
5.1.2, at the end of the Fiscal Quarter most recently ended prior to the first
day of such Pricing Period, and (ii) in the case of Compliance Certificates
prepared in conjunction with Permitted Acquisitions, as of the day on which such
Compliance Certificate is delivered (as reflected in the pro forma calculations
included in such Compliance Certificate) the Leverage Ratio was less than or
equal to 2.50 to 1.00, but greater than 2.00 to 1.00.
"Level IV Pricing" applies during any Pricing Period if no higher Pricing
----------------
Level applies and if, (i) in the case of Compliance Certificates prepared in
conjunction with financial statements delivered pursuant to Sections 5.1.1 and
5.1.2, at the end of the Fiscal Quarter most recently ended prior to the first
day of such Pricing Period, and (ii) in the case of Compliance
Certificates prepared in conjunction with Permitted Acquisitions, as of the day
on which such Compliance Certificate is delivered (as reflected in the pro forma
calculations included in such Compliance Certificate) the Leverage Ratio was
less than or equal to 2.00 to 1.00, but greater than 1.50 to 1.00.
"Level V Pricing" applies during any Pricing Period if no higher Pricing
---------------
Level applies and if, (i) in the case of Compliance Certificates prepared in
conjunction with financial statements delivered pursuant to Sections 5.1.1 and
5.1.2, at the end of the Fiscal Quarter most recently ended prior to the first
day of such Pricing Period, and (ii) in the case of Compliance Certificates
prepared in conjunction with Permitted Acquisitions, as of the day on which such
Compliance Certificate is delivered (as reflected in the pro forma calculations
included in such Compliance Certificate) the Leverage Ratio was less than 1.50
to 1.00.
"Pricing Period" means a period beginning on (and including) the day on
--------------
which a Compliance Certificate required pursuant to Section 5.1.2 is delivered,
and ending on (and excluding) the day on which the next such Compliance
Certificate is delivered, except that the first Pricing Period shall begin on
the Closing Date and shall end on the earlier to occur of (i) the day on which
the Compliance Certificate in respect of the first Permitted Acquisition to be
closed after the Closing Date is delivered and (ii) the day on which the
Compliance Certificate required in respect of the Fiscal Quarter ending March
31, 1999 is delivered.
"Pricing Level" refers to such of Level I Pricing, Level II Pricing, Level
-------------
III Pricing, Level IV Pricing or Level V Pricing as applies during any
particular day. The numbering of Pricing Levels is in descending order (e.g.,
Level II Pricing is referred to as a "lower" Pricing Level than Level I
Pricing).
SCHEDULE 2.18
CERTAIN WAIVERS
Each Co-Borrower hereby waives, to the extent permitted by Applicable Law,
each of the following with respect to the Obligations:
(a) the right to require the Lender Parties to proceed against CI or any
other Co-Borrower, to proceed against or exhaust any Collateral or to pursue any
other remedy in any Lender Party's power whatsoever and the right to have the
property of CI or any other Co-Borrower first applied to the discharge of the
Obligations;
(b) all rights and benefits under Section 2809 of the California Civil
Code and any other Applicable Law purporting to reduce a guarantor's obligations
in proportion to the obligation of the principal or providing that the
obligation of a surety or guarantor must neither be larger nor in other respects
more burdensome than that of the principal;
(c) the benefit of any statute of limitations affecting the Obligations or
any of CI's or any other Co-Borrower's liability in respect thereof and of
Section 359.5 of the California Code of Civil Procedure;
(d) any requirement of marshaling or any other principle of election of
remedies and all rights and defenses arising out of an election of remedies by
any Lender Party, even though that election of remedies, such as nonjudicial
foreclosure with respect to the security for a guaranteed obligation, has
destroyed any Co-Borrower's rights of subrogation and reimbursement against CI
by operation of Section 580d of the California Code of Civil Procedure or
otherwise;
(e) any right to assert against any Lender Party any defense (legal or
equitable), set-off, counterclaim and other right that such Co-Borrower may now
or any time hereafter have against CI or any other Co-Borrower;
(f) presentment, demand for payment or performance (including diligence in
making demands under this Agreement), notice of dishonor or nonperformance,
protest, acceptance and notice of acceptance of this Agreement, and all other
notices of any kind, including (i) notice of the existence, creation or
incurrence of new or additional Obligations, (ii) notice of any action taken or
omitted by the Lender Parties in reliance hereon, (iii) notice of any default by
CI or any other Co-Borrower, (iv) notice that any portion of the Obligations is
due, (v) notice of any action against CI or any other Co-Borrower, or any
enforcement of other action with respect to any Collateral, or the assertion of
any right of any Lender Party hereunder;
(g) all defenses that at any time may be available to any Co-Borrower by
virtue of any valuation, stay, moratorium or other similar law now or hereafter
in effect;
(h) any rights, defenses and other benefits any Co-Borrower may have by
reason of the failure of any Lender Party to hold a commercially reasonable
public or private foreclosure sale or otherwise to comply with Applicable Law in
connection with a disposition of Collateral; and
(i) without limiting the generality of the foregoing or any other
provision of this Agreement, all rights and benefits under California Civil Code
Sections 2810, 2819, 2839, 2845, 2848, 2849, 2850, 2899 and 3433.
SCHEDULE 3.1.2
CLOSING DOCUMENTS
TITLE SIGNATORIES
--------------------------------------------------------------------------------------------------------------------
Amended and Restated Senior Secured Credit Agreement BKB (as Agent, Swingline Lender, Lender), ▇▇
▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇, ▇▇▇, ▇▇, ▇▇▇, ▇▇▇,
▇▇▇, ▇▇▇, CJI, CMN, CMI, CPH, CPI, CPL, COC,
CSJ, CSM, CSI, CUSA, FI, GRI, HCSM, ISR,
MEI, THC
--------------------------------------------------------------------------------------------------------------------
Swingline Note -- BankBoston, N.A. CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI, CPH,
CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI, GRI,
HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Working Capital Revolving Loan Note -- BankBoston, N.A. CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI, CPH,
CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI, GRI,
HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Working Capital Revolving Loan Note -- ▇.▇.▇▇▇▇ CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI, CPH,
CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI, GRI,
HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Working Capital Revolving Loan Note -- Bank of America CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI, CPH,
CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI, GRI,
HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Working Capital Revolving Loan Note -- Fleet Bank CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI, CPH,
CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI, GRI,
HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Working Capital Revolving Loan Note -- Banque Nationale de Paris CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI, CPH,
CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI, GRI,
HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Acquisition Loan Note -- BankBoston CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI, CPH,
CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI, GRI,
HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Acquisition Loan Note -- U.S. Bank CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI, CPH,
CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI, GRI,
HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Acquisition Loan Note -- Bank of America CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI, CPH,
CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI, GRI,
HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Acquisition Loan Note -- Fleet Bank CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI, CPH,
CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI, GRI,
HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Acquisition Loan Note -- Banque Nationale de Paris CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI, CPH,
CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI, GRI,
HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Amended and Restated Security Agreement BKB, CI, CBI, CDI, CDW, CFL, CJI, CMN, CMI,
CPH, CPI, CPL, COC, CSJ, CSM, CSI, CUSA, FI,
GRI, HCSM, ISR, MEI, THC
--------------------------------------------------------------------------------------------------------------------
Amended and Restated Pledge Agreement BKB, CI
--------------------------------------------------------------------------------------------------------------------
Pledge Agreement BKB, CPI
--------------------------------------------------------------------------------------------------------------------
Officer's Closing Certificate (in form of Exhibit F-3) CI
--------------------------------------------------------------------------------------------------------------------
Opinion of TR&P (in form of Exhibit G-1) TR&P
--------------------------------------------------------------------------------------------------------------------
Opinion of Cotelligent In-house Counsel (in form of Exhibit G-2) CI
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Cotelligent, Inc. BKB, CI
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Cotelligent of Boston, Inc. BKB, CBI
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Cotelligent Dallas, Inc. BKB, CDI
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Cotelligent Dunwoody, Inc. BKB, CDW
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Cotelligent Fort Lauderdale, Inc. BKB, CFL
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Cotelligent Jonesboro, Inc. BKB, CJI
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Cotelligent Metro New York, Inc. BKB, CMN
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Cotelligent Minneapolis, Inc. BKB, CMI
--------------------------------------------------------------------------------------------------------------------
UCC-1 Financing Statement - Cotelligent Philadelphia, Inc. CPH
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Cotelligent Pittsburgh, Inc. BKB, CPI
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Cotelligent Portland, Inc. BKB, CPL
-----------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Cotelligent Orange County, Inc. BKB, COC
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement - Cotelligent San ▇▇▇▇, Inc. BKB, CSJ
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement - Cotelligent San Mateo, Inc. BKB, CSM
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement - Cotelligent Seattle, Inc. BKB, CSI
---------------------------------------------------------------------------------------------------------------------------------
UCC-1 Financing Statement - Cotelligent USA, Inc. CUSA
--------------------------------------------------------------------------------------------------------------------
UCC-1 Financing Statement - Fastech, Inc FI
--------------------------------------------------------------------------------------------------------------------
UCC-1 Financing Statement -- GRI, Inc. d/b/a Global Resources GRI
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- HC Associates International, Inc. BKB, HCSM
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- Information Systems Resources, Inc. BKB, ISR
--------------------------------------------------------------------------------------------------------------------
UCC-2 Financing Statement -- ▇▇▇▇▇▇ Enterprises, Inc. DBA Intellitron BKB, MEI
--------------------------------------------------------------------------------------------------------------------
UCC-1 Financing Statement - The ▇▇▇▇▇ Companies THC
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent of Boston, Inc. CBI
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent Dallas, Inc. CDI
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent Dunwoody, Inc. CDW
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent Fort Lauderdale, Inc. CFL
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent Jonesboro, Inc. CJI
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent Metro New York, Inc. CMN
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent Minneapolis, Inc. CMI
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent Philadelphia, Inc. CPH
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent Pittsburgh, Inc. CPI
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent Portland, Inc. CPL
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent Orange County, Inc. COC
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent San ▇▇▇▇, Inc. CSJ
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent San Mateo, Inc. CSM
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent Seattle, Inc. CSI
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Cotelligent USA, Inc. CUSA
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Fastech, Inc. FI
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - GRI, Inc. d/b/a Global Resources GRI
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - HC Associates International, Inc. HCSM
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - Information Systems Resources, Inc. ISR
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - ▇▇▇▇▇▇ Enterprises, Inc. DBA Intellitron MEI
--------------------------------------------------------------------------------------------------------------------
Stock Certificate (with Stock Power) - The ▇▇▇▇▇ Companies THC
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent, Inc. Delaware Secretary of State
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent of Boston, Inc. Massachusetts authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent Dallas, Inc. Missouri Secretary of State
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent Dunwoody, Inc. Georgia authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent Fort Lauderdale, Inc. Florida authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent Jonesboro, Inc. Georgia authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent Metro New York, Inc. New Jersey Secretary of State
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent Minneapolis, Inc. Minnesota authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate - Cotelligent Philadelphia, Inc. Pennsylvania authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent Pittsburgh, Inc. Pennsylvania authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent Portland, Inc. Oregon Secretary of State
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent Orange County, Inc. California Secretary of State
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent San ▇▇▇▇, Inc. California Secretary of State
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent San Mateo, Inc. California Secretary of State
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Cotelligent Seattle, Inc. Washington authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate - Cotelligent USA, Inc. California authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate - Fastech, Inc. Pennsylvania authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- GRI, Inc. d/b/a Global Resources California Secretary of State
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- HC Associates International, Inc. Georgia authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- Information Systems Resources, Inc. Florida authority
--------------------------------------------------------------------------------------------------------------------
Good Standing Certificate-- ▇▇▇▇▇▇ Enterprises, Inc. DBA Intellitron California Secretary of State
--------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
Good Standing Certificate - The ▇▇▇▇▇ Companies Florida authority
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent, Inc.) CI
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent of Boston, Inc.) CBI
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent Dallas, Inc.) CDI
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent Dunwoody, Inc.) CDW
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent Fort Lauderdale, Inc.) CFL
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent Jonesboro, Inc.) CJI
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent Metro New York, Inc.) CMN
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent Minneapolis, Inc.) CMI
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent Philadelphia, Inc.) CPH
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent Pittsburgh, Inc.) CPI
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent Portland, Inc.) CPL
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent Orange County, Inc.) COC
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent San ▇▇▇▇, Inc.) CSJ
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent San Mateo, Inc.) CSM
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent Seattle, Inc.) CSI
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Cotelligent USA, Inc.) CUSA
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Fastech, Inc.) FI
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (GRI, Inc. d/b/a Global Resources) GRI
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (HC Associates International, Inc.) HCSM
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (Information Systems Resources, Inc.) ISR
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution: Borrowing (▇▇▇▇▇▇ Enterprises, Inc. DBA Intellitron) MEI
-----------------------------------------------------------------------------------------------------------------------
Corporate Resolution : Borrowing (The ▇▇▇▇▇ Companies) THC
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent, Inc.) (in form of Exhibit F-3) CI
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent of Boston, Inc.) (in form of Exhibit F-3) CBI
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent Dallas, Inc.) (in form of Exhibit F-3) CDI
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent Dunwoody, Inc.) (in form of Exhibit F-3) CDW
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent Fort Lauderdale, Inc.) (in form of Exhibit F-3) CFL
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent Jonesboro, Inc.) (in form of Exhibit F-3) CJI
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent Metro New York, Inc.) (in form of Exhibit F-3) CMN
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent Minneapolis, Inc.) (in form of Exhibit F-3) CMI
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent Philadelphia, Inc.) (in form of Exhibit F-3) CPH
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent Pittsburgh, Inc.) (in form of Exhibit F-3) CPI
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent Portland, Inc.) (in form of Exhibit F-3) CPL
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent Orange County, Inc.) (in form of Exhibit F-3) COC
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent San ▇▇▇▇, Inc.) (in form of Exhibit F-3) CSJ
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent San Mateo, Inc.) (in form of Exhibit F-3) CSM
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent Seattle, Inc.) (in form of Exhibit F-3) CSI
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Cotelligent USA, Inc.) (in form of Exhibit F-3) CUSA
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Fastech, Inc.) (in form of Exhibit F-3) FI
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (GRI, Inc. dba Global Resources) (in form of Exhibit F-3) GRI
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (HC Associates International, Inc.) (in form of Exhibit F-3) HCSM
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (Information Systems Resources, Inc.) (in form of Exhibit F-3) ISR
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (▇▇▇▇▇▇ Enterprises, Inc. DBA Intellitron) (in form of Exhibit F-3) MEI
-----------------------------------------------------------------------------------------------------------------------
Secretary's Certificate (The ▇▇▇▇▇ Companies) (in form of Exhibit F-3) THC
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent, Inc.) CI
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent of Boston, Inc.) CBI
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent Dallas, Inc.) CDI
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent Dunwoody, Inc.) CDW
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent Fort Lauderdale, Inc.) CFL
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent Jonesboro, Inc.) CJI
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent Metro New York, Inc.) CMN
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent Minneapolis, Inc.) CMI
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent Philadelphia) CPH
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent Pittsburgh, Inc.) CPI
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent Portland, Inc.) CPL
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent Orange County, Inc.) COC
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent San ▇▇▇▇, Inc.) CSJ
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent San Mateo, Inc.) CSM
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent Seattle, Inc.) CSI
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Cotelligent USA, Inc.) CUSA
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Fastech, Inc.) FI
-----------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (GRI, Inc. d/b/a Global Resources) GRI
-----------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (HC Associates International, Inc.) HCSM
-------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (Information Systems Resources, Inc.) ISR
-------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (▇▇▇▇▇▇ Enterprises, Inc. DBA Intellitron) MEI
-------------------------------------------------------------------------------------------------------------------
Certified Articles of Incorporation (The ▇▇▇▇▇ Companies) THC
-------------------------------------------------------------------------------------------------------------------
Interim Unaudited Financial Statements (December 31, 1998) CI
-------------------------------------------------------------------------------------------------------------------
Consolidated Balance Sheet for Borrower and Consolidated Subsidiaries (dated as of March 31 1998) CI
-------------------------------------------------------------------------------------------------------------------
Quarterly Statements as of December 31, 1998 CI
-------------------------------------------------------------------------------------------------------------------
Projected Consolidated Statements of Income and Cash Flow for Borrower and Consolidated CI
Subsidiaries (for the period from April 1,1999 to March 31, 2004)
-------------------------------------------------------------------------------------------------------------------
Projected Annual Consolidated Balance Sheets for each fiscal year through for Borrower and CI
Consolidated Subsidiaries
-------------------------------------------------------------------------------------------------------------------
Evidence of Insurance CI
-------------------------------------------------------------------------------------------------------------------
SCHEDULE 4.1
ORGANIZATION OF BORROWER AND
SUBSIDIARIES
NAME OF COMPANY STATE OF INCORPORATION OWNERSHIP INTEREST
1. Cotelligent, Inc. Delaware Parent
2. Cotelligent Orange County, Inc. California 100% by Cotelligent, Inc.
3. Cotelligent Metro New York, Inc. New Jersey 100% by Cotelligent, Inc.
4. Cotelligent San Mateo, Inc. California 100% by Cotelligent, Inc.
5. Cotelligent Jonesboro, Inc. Georgia 100% by Cotelligent, Inc.
6. Cotelligent Fort Lauderdale, Inc. Florida 100% by Cotelligent, Inc.
7. Cotelligent of Boston, Inc. Massachusetts 100% by Cotelligent, Inc.
8. Cotelligent Dunwoody, Inc. Georgia 100% by Cotelligent, Inc.
9. Cotelligent Dallas, Inc. Texas 100% by Cotelligent, Inc.
10. Cotelligent Minneapolis, Inc. Minnesota 100% by Cotelligent, Inc.
11. Cotelligent Seattle, Inc. Washington 100% by Cotelligent, Inc.
12. Global Resources d/b/a GRI, Inc. California 100% by Cotelligent, Inc.
13. HC Associates International, Inc. Georgia 100% by Cotelligent, Inc.
14. Information Systems Resources, Inc. Florida 100% by Cotelligent, Inc.
15. The ▇▇▇▇▇ Companies, Inc. Florida 100% by Cotelligent, Inc.
16. ▇▇▇▇▇▇ Enterprises, Inc. DBA Intellitron California 100% by Cotelligent, Inc.
17. Cotelligent Pittsburgh, Inc. Pennsylvania 100% by Cotelligent, Inc.
18. Cotelligent San ▇▇▇▇, Inc. California 100% by Cotelligent, Inc.
19. Cotelligent Portland, Inc. Oregon 100% by Cotelligent, Inc.
20. Cotelligent Philadelphia, Inc. Pennsylvania 100% by Cotelligent, Inc.
21. Fastech, Inc. Pennsylvania 100% by Cotelligent
Philadelphia, Inc.
22. Cotelligent USA, Inc. California 100% by Cotelligent, Inc.
SCHEDULE 4.3
SUBSIDIARIES AND OTHER INVESTMENTS
SUBSIDIARIES
------------
NAME OF COMPANY STATE OF INCORPORATION OWNERSHIP INTEREST
1. Cotelligent, Inc. Delaware Parent
2. Cotelligent Orange County, Inc. California 100% by Cotelligent, Inc.
3. Cotelligent Metro New York, Inc. New Jersey 100% by Cotelligent, Inc.
4. Cotelligent San Mateo, Inc. California 100% by Cotelligent, Inc.
5. Cotelligent Jonesboro, Inc. Georgia 100% by Cotelligent, Inc.
6. Cotelligent Fort Lauderdale, Inc. Florida 100% by Cotelligent, Inc.
7. Cotelligent of Boston, Inc. Massachusetts 100% by Cotelligent, Inc.
8. Cotelligent Dunwoody, Inc. Georgia 100% by Cotelligent, Inc.
9. Cotelligent Dallas, Inc. Texas 100% by Cotelligent, Inc.
10. Cotelligent Minneapolis, Inc. Minnesota 100% by Cotelligent, Inc.
11. Cotelligent Seattle, Inc. Washington 100% by Cotelligent, Inc.
12. Global Resources d/b/a GRI, Inc. California 100% by Cotelligent, Inc.
13. HC Associates International, Inc. Georgia 100% by Cotelligent, Inc.
14. Information Systems Resources, Inc. Florida 100% by Cotelligent, Inc.
15. The ▇▇▇▇▇ Companies, Inc. Florida 100% by Cotelligent, Inc.
16. ▇▇▇▇▇▇ Enterprises, Inc. DBA Intellitron California 100% by Cotelligent, Inc.
17. Cotelligent Pittsburgh, Inc. Pennsylvania 100% by Cotelligent, Inc.
18. Cotelligent San ▇▇▇▇, Inc. California 100% by Cotelligent, Inc.
19. Cotelligent Portland, Inc. Oregon 100% by Cotelligent, Inc.
20. Cotelligent Philadelphia, Inc. Pennsylvania 100% by Cotelligent, Inc.
21. Fastech, Inc. Pennsylvania 100% by Cotelligent
Philadelphia, Inc.
22. Cotelligent USA, Inc. California 100% by Cotelligent, Inc.
OTHER INVESTMENTS
-----------------
None.
SCHEDULE 4.6
MATERIAL LITIGATION
None.
SCHEDULE 4.13
ENVIRONMENTAL CONDITION
None.
SCHEDULE 4.14
CERTAIN RESTRICTIONS
None.
SCHEDULE 4.15
LABOR MATTERS
None.
SCHEDULE 4.17
YEAR 2000
See Attached
SCHEDULE 5.14
OTHER LOAN DOCUMENTS TO BE PROVIDED BY NEW CO-BORROWER
1. Certified Articles of Incorporation and Bylaws
2. Secretary's Certificate
3. Corporate Resolutions: Borrowing
4. Certificate of Good Standing
5. Pledge Agreement (if applicable)
6. Stock Power with respect to such Consolidated Subsidiary's shares
7. Stock Certificate
8. Officer's Closing Certificate
9. Financial Statements
10. Evidence of Insurance
SCHEDULE 6.8
EXISTING CONTRACTUAL OBLIGATIONS
Indenture of Lease dated October 26, 1995 between Data Arts and Sciences, Inc.
and ▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇, as Trustees of Strathmore Realty Trust for
offices.
Demand Note in the amount of $150,000 from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ to Cotelligent Group,
Inc.
Stock Purchase Agreement dated August 27, 1997 between ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and
Cotelligent Group, Inc. for the purchase of EPIC Consulting Group, Ltd.
Business Lease dated December 31, 1990 between CMN Co., Inc. and CMN Properties,
a partnership partially owned by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ for office furniture and
equipment.
Business Lease dated December 31, 1989 between CMN Co., Inc. and CMN Properties,
a partnership partially owned by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ for office furniture and
equipment.
Lease Agreement dated April 1, 1995 between CMN Systems [tradename for CMN Co.,
Inc.] and CMN Properties, a partnership partially owned by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ for
offices.
Employment Agreement between Cotelligent Group, Inc. and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ dated
February 20, 1996.
Employment Agreement between Cotelligent Group, Inc. and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ dated
February 20, 1996.
Employment Agreement between Cotelligent Group, Inc. and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ dated
February 20, 1996.
Employment Agreement by and among Cotelligent Group, Inc., CMN Co., Inc. and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ dated February 20, 1996.
Employment Agreement by and among Cotelligent Group, Inc., CMN Co., Inc. and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ dated February 20, 1996.
Employment Agreement by and among Cotelligent Group, Inc., CMN Co., Inc. and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ dated February 20, 1996.
Employment Agreement by and among Cotelligent Group, Inc., ▇▇▇▇▇▇▇▇▇▇▇
Associates, Inc. and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ dated February 20, 1996.
Employment Agreement by and among Cotelligent Group, Inc., Data Arts & Sciences,
Inc. and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ dated February 20, 1996.
Employment Agreement between INNOVA Solutions, Inc. and ▇▇▇▇▇ ▇. ▇▇▇▇▇ dated
June 28, 1996.
Employment Agreement among Cotelligent Group, Inc., Jastech, Inc. and ▇▇▇▇
▇▇▇▇▇▇▇ dated September 30, 1996.
Employment Agreement between Pittsburgh Business Consultants, Inc. and ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇ dated December 1, 1996.
Employment Agreement between Cotelligent/CSJ Acquisition Corporation and ▇▇▇▇▇
▇. ▇▇▇▇ dated February 10, 1997.
Employment Agreement between Innova Solutions, Inc. and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ dated
August 27, 1997.
SCHEDULE 6.10
EMPLOYEE BENEFIT PLANS
CI may decide to match employee contributions to the 401(k) plan. Whether such
matching payments will be made and the details of the matching are to be
determined.
SCHEDULE 9.5
BORROWER INFORMATION
Address for Notices:
Cotelligent, Inc.:
-----------------
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax:(▇▇▇) ▇▇▇-▇▇▇▇
Cotelligent Orange County, Inc.:
-------------------------------
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Cotelligent Metro New York, Inc.:
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Cotelligent San Mateo, Inc.
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Cotelligent Jonesboro, Inc.:
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Cotelligent Fort Lauderdale, Inc.:
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Cypress Centre
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Cotelligent of Boston, Inc.:
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Cotelligent Dunwoody, Inc.:
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Cotelligent Dallas, Inc.:
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Cotelligent Minneapolis, Inc.:
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Cotelligent Seattle, Inc.:
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GRI, Inc. d/b/a Global Resources:
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HC Associates International, Inc.:
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Information Systems Resources, Inc.:
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▇▇▇▇▇▇ Enterprises, Inc. DBA Intellitron:
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Cotelligent Pittsburgh, Inc.:
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Cotelligent San ▇▇▇▇, Inc.
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Cotelligent Portland, Inc.:
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Cotelligent Philadelphia, Inc.:
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Cotelligent USA, Inc.:
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Fastech, Inc.:
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The ▇▇▇▇▇ Companies, Inc.:
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Borrower Account (for the funding of Loans): U.S. Bank, Account No. 0747239416