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EXHIBIT 10.1
SECOND AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
Dated as of March 30, 1999
by and among
WASTE CONNECTIONS, INC.
AND ITS SUBSIDIARIES
(the "Borrowers")
THE LENDING INSTITUTIONS PARTY HERETO
(the "Banks")
and
BANKBOSTON, N.A., AS AGENT
AND
UNION BANK OF CALIFORNIA, N.A.,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
COMERICA BANK - CALIFORNIA,
LASALLE NATIONAL BANK,
each as Co-Agent
With
BANCBOSTON ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INC., as Arranger
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TABLE OF CONTENTS
Section 1. DEFINITIONS AND RULES OF INTERPRETATION.................................1
Section 1.1. Definitions.................................................1
Section 1.2. Rules of Interpretation....................................16
Section 2. THE REVOLVING CREDIT FACILITY..........................................17
Section 2.1. Commitment to Lend.........................................17
Section 2.2. Reduction and Increase of Total Commitment.................17
Section 2.2.2. Increase of Total Commitment...............................17
Section 2.3. The Revolving Credit Notes.................................18
Section 2.4. Interest on Loans..........................................18
Section 2.5. Election of Eurodollar Rate; Notice of Election;
Interest Periods; Minimum Amounts..........................18
Section 2.6. Requests for Revolving Credit Loans........................19
Section 2.7. Funds for Revolving Credit Loans...........................20
Section 2.8. Maturity of the Loans......................................21
Section 2.9. Mandatory Repayments of the Loans..........................21
Section 2.10. Optional Prepayments or Repayments of Loans................21
Section 2.11. Swing Line Loans; Settlements..............................21
Section 3. LETTERS OF CREDIT......................................................23
Section 3.1. Letter of Credit Commitments...............................23
Section 3.2. Reimbursement Obligation of the Borrowers..................24
Section 3.3. Letter of Credit Payments..................................25
Section 3.4. Obligations Absolute.......................................25
Section 3.5. Reliance by Agent..........................................26
Section 4 FEES, PAYMENTS, AND COMPUTATIONS; JOINT AND SEVERAL LIABILITY..........26
Section 4.1. Fees.......................................................26
Section 4.2. Payments...................................................27
Section 4.3. Computations...............................................28
Section 4.4. Capital Adequacy...........................................28
Section 4.5. Certificate................................................28
Section 4.6. Interest on Overdue Amounts................................29
Section 4.7. Interest Limitation........................................29
Section 4.8. Eurodollar Indemnity.......................................29
Section 4.9. Illegality; Inability to Determine Eurodollar Rate.........29
Section 4.10. Additional Costs, Etc......................................30
Section 4.11. Replacement of Banks.......................................31
Section 4.12. Concerning Joint and Several Liability of the Borrowers....31
Section 5. REPRESENTATIONS AND WARRANTIES.........................................33
Section 5.1. Corporate Authority........................................33
Section 5.2. Governmental Approvals.....................................34
Section 5.3. Title to Properties; Leases................................34
Section 5.4. Financial Statements; Solvency.............................34
Section 5.5. No Material Changes, Etc...................................34
Section 5.6. Permits, Franchises, Patents, Copyrights, Etc..............35
Section 5.7. Litigation.................................................35
Section 5.8. No Materially Adverse Contracts, Etc.......................35
Section 5.9. Compliance With Other Instruments, Laws, Etc...............35
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Section 5.10. Tax Status.................................................36
Section 5.11. No Event of Default........................................36
Section 5.12. Holding Company and Investment Company Acts................36
Section 5.13. Absence of Financing Statements, Etc.......................36
Section 5.14. Employee Benefit Plans.....................................36
Section 5.15. Use of Proceeds............................................37
Section 5.15.1. General....................................................37
Section 5.15.2. Regulations U and X........................................38
Section 5.15.3. Ineligible Securities......................................38
Section 5.16. Environmental Compliance...................................38
Section 5.17. Perfection of Security Interests...........................39
Section 5.18. Transactions with Affiliates...............................39
Section 5.19. Subsidiaries...............................................40
Section 5.20. True Copies of Charter and Other Documents.................40
Section 5.21. Disclosure.................................................40
Section 5.22. Capitalization.............................................40
Section 5.23. Year 2000 Issue............................................41
Section 6. AFFIRMATIVE COVENANTS OF THE BORROWERS.................................41
Section 6.1. Punctual Payment...........................................41
Section 6.2. Maintenance of Offices.....................................41
Section 6.3. Records and Accounts.......................................41
Section 6.4. Financial Statements, Certificates and Information.........41
Section 6.5. Corporate Existence and Conduct of Business................43
Section 6.6. Maintenance of Properties..................................43
Section 6.7. Insurance..................................................43
Section 6.8. Taxes......................................................44
Section 6.9. Inspection of Properties, Books, and Contracts.............44
Section 6.10. Compliance with Laws, Contracts, Licenses and Permits;
Maintenance of Material Licenses and Permits............44
Section 6.11. Environmental Indemnification..............................45
Section 6.12. Further Assurances.........................................45
Section 6.13. Notice of Potential Claims or Litigation...................45
Section 6.14. Notice of Certain Events Concerning Insurance
and Environmental Claims................................45
Section 6.15. Response Actions...........................................46
Section 6.16. Notice of Default..........................................46
Section 6.17. New Subsidiaries...........................................46
Section 6.18. Employee Benefit Plans.....................................47
Section 6.19. Notice of Loss of Material Contracts.......................47
Section 7. CERTAIN NEGATIVE COVENANTS OF THE BORROWERS...........................47
Section 7.1. Restrictions on Indebtedness...............................47
Section 7.2. Restrictions on Liens......................................48
Section 7.3. Restrictions on Investments................................49
Section 7.4. Merger, Consolidation and Disposition of Assets............50
Section 7.4.1. Mergers and Acquisitions...................................50
Section 7.4.2. Disposition of Assets......................................52
Section 7.5. Sale and Leaseback.........................................52
Section 7.6. Restricted Distributions and Redemptions...................52
Section 7.7. Employee Benefit Plans.....................................52
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Section 7.8. Negative Pledges...........................................53
Section 7.9. Business Activities........................................53
Section 7.10. Transactions with Affiliates...............................53
Section 7.11. Subordinated Debt..........................................53
Section 8. FINANCIAL COVENANTS....................................................53
Section 8.1. Leverage Ratio.............................................54
Section 8.2. Funded Debt to Capitalization Ratio........................54
Section 8.3. Interest Coverage Ratio....................................54
Section 8.4. Profitable Operations......................................54
Section 8.5. Capital Expenditures.......................................54
Section 9. CLOSING CONDITIONS.....................................................54
Section 9.1. Corporate Action...........................................55
Section 9.2. Loan Documents, Etc........................................55
Section 9.3. Certificate of Secretary; Good Standing Certificates.......55
Section 9.4. Validity of Liens..........................................55
Section 9.5. Perfection Certificates and UCC Search Results.............55
Section 9.6. Certificates of Insurance..................................56
Section 9.7. Legal Opinions.............................................56
Section 9.8. Environmental Permit Certificate...........................56
Section 9.9. Payment of Fees............................................56
Section 9.10. Closing Certificate........................................56
Section 10. CONDITIONS OF ALL LOANS...............................................56
Section 10.1. Representations True; No Event of Default..................56
Section 10.2. Performance; No Event of Default...........................57
Section 10.3. No Legal Impediment........................................57
Section 10.4. Governmental Regulation....................................57
Section 10.5. Proceedings and Documents..................................57
Section 11. COLLATERAL SECURITY...................................................57
Section 12. EVENTS OF DEFAULT; ACCELERATION; TERMINATION OF COMMITMENT............58
Section 12.1. Events of Default and Acceleration.........................58
Section 12.2. Termination of Commitments.................................61
Section 12.3. Remedies...................................................61
Section 13. SETOFF................................................................61
Section 14. THE AGENT.............................................................62
Section 14.1. Appointment of Agent, Powers and Immunities................62
Section 14.2. Actions By Agent...........................................63
Section 14.3. INDEMNIFICATION............................................63
Section 14.4. Reimbursement..............................................63
Section 14.5. Documents..................................................64
Section 14.5.1. Closing Documentation.....................................64
Section 14.5.2. Other Documents...........................................64
Section 14.6. Non-Reliance on Agent and Other Banks......................64
Section 14.7. Resignation or Removal of Agent............................65
Section 14.8. Consents, Amendments, Waivers, Etc.........................65
Section 14.9. Delinquent Banks...........................................66
Section 14.10. Co-Agents..................................................66
Section 15. EXPENSES AND INDEMNIFICATION..........................................67
Section 15.1. Expenses...................................................67
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Section 15.2. Indemnification....................................................67
Section 15.3. Survival...........................................................68
Section 16. SURVIVAL OF COVENANTS, ETC............................................68
Section 17. ASSIGNMENT AND PARTICIPATION..........................................68
Section 18. PARTIES IN INTEREST...................................................69
Section 19. NOTICES, ETC..........................................................69
Section 20. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.........................70
Section 20.1. Sharing of Information with Section 20 Subsidiary..................70
Section 20.2. Confidentiality....................................................70
Section 20.3. Prior Notification.................................................71
Section 20.4. Other..............................................................71
Section 21. MISCELLANEOUS.........................................................71
Section 22. ENTIRE AGREEMENT, ETC.................................................71
Section 23. WAIVER OF JURY TRIAL..................................................72
Section 24. GOVERNING LAW.........................................................72
Section 25. SEVERABILITY..........................................................72
SCHEDULES & EXHIBITS
Exhibit A Form of Revolving Credit Note
Exhibit B Form of Loan and Letter of Credit Request
Exhibit C Form of Swing Line Note
Exhibit D Form of Compliance Certificate
Exhibit E Form of Environmental Compliance Certificate
Exhibit F Form of Assignment and Acceptance
Schedule 1 Banks; Addresses; Commitment Percentages
Schedule 2 Subsidiaries
Schedule 5.7 Litigation
Schedule 5.9 Material Contracts
Schedule 5.16 Environmental Matters
Schedule 5.18 Transactions with Affiliates
Schedule 7.2(i) Scheduled Contracts
Schedule 7.3 Existing Investments
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SECOND AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
This SECOND AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT is made as
of March 30, 1999 (the "Credit Agreement"), by and among (a) WASTE CONNECTIONS,
INC., a Delaware corporation (the "Parent"), the subsidiaries of the Parent
identified on Schedule 2 hereto (the "Subsidiaries," and collectively with the
Parent, the "Borrowers"), (b) BANKBOSTON, N.A., a national banking association
having its principal place of business at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (acting in its individual capacity, "BKB") and the other
banks and lending institutions which are identified on Schedule 1 attached
hereto (collectively, the "Banks"), (c) BANKBOSTON, N.A., as administrative
agent for the Banks (the "Agent"), and (d) UNION BANK OF CALIFORNIA, N.A., BANK
OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, COMERICA BANK - CALIFORNIA,
N.A., and LASALLE NATIONAL BANK, each as a co-agent for the Banks (each a
"Co-Agent" and, collectively, the "Co-Agents").
W I T N E S S E T H:
WHEREAS, the Borrowers and the Agent are party to that certain Amended
and Restated Revolving Credit Agreement dated as of November 20, 1998, (as
amended and in effect as of the date hereof, the "Prior Credit Agreement"); and
WHEREAS, the Borrowers have requested, among other things, additional
financing and the Banks are willing to provide such financing on the terms and
conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
and agreements set forth herein below, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree that on the Closing Date, the Prior Credit Agreement shall
be amended and restated in its entirety by this Credit Agreement, the terms of
which are as follows:
SECTION 1. DEFINITIONS AND RULES OF INTERPRETATION.
SECTION 1.1. DEFINITIONS. The following terms shall have the meanings
set forth in this Section 1 or elsewhere in the provisions of this Credit
Agreement referred to below:
Accountants. An independent accounting firm of national standing
reasonably acceptable to the Banks and the Agent.
Affected Bank. See Section 4.11.
Agent. See Preamble.
Agent's Head Office. The Agent's head office located at ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or such other location as the Agent may
designate from time to time.
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Applicable Base Rate Margin. The applicable margin with respect to Base
Rate Loans as set forth in the Pricing Table.
Applicable Commitment Rate. The applicable rate with respect to the
Commitment Fee as set forth in the Pricing Table.
Applicable Eurodollar Margin. The applicable margin with respect to
Eurodollar Loans as set forth in the Pricing Table.
Applicable Laws. See Section 6.10.
Applicable L/C Margin. The applicable margin with respect to the Letter
of Credit Fee as set forth in the Pricing Table.
Arranger. BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
Assignment and Acceptance. See Section 17.
Balance Sheet Date. December 31, 1998.
Banks. See Preamble.
Base Rate. The higher of (a) the annual rate of interest announced from
time to time by the Agent at the Agent's Head Office as its "base rate" (it
being understood that such rate is a reference rate and not necessarily the
lowest rate of interest charged by the Agent) or (b) one-half of one percent
(1/2%) above the overnight federal funds effective rate, as published by the
Board of Governors of the Federal Reserve System, as in effect from time to
time.
Base Rate Loans. Loans bearing interest calculated by reference to the
Base Rate.
BKB. See Preamble.
Borrowers. See Preamble.
Business Day. Any day on which banking institutions in Boston,
Massachusetts, New York, New York; Chicago, Illinois; and Los Angeles,
California are open for the transaction of banking business.
Capital Assets. Fixed assets, both tangible (such as land, buildings,
fixtures, machinery and equipment) and intangible (such as patents, copyrights,
trademarks, franchises and goodwill); provided that Capital Assets shall not
include (a) any item customarily charged directly to expense or depreciated over
a useful life of twelve (12) months or less in accordance with generally
accepted accounting principles, or (b) any item obtained through an acquisition
permitted by Section 7.4 hereof.
Capital Expenditures. Amounts paid or indebtedness incurred by the
Borrowers and their Subsidiaries in connection with (i) the purchase or lease of
Capital Assets that would be required to be capitalized and shown on the balance
sheet of such Person in
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accordance with GAAP or (ii) the lease of any assets by the Borrowers or any
Subsidiary as lessee under any Synthetic Lease to the extent that such assets
would have been Capital Assets had the Synthetic Lease been treated for
accounting purposes as a Capitalized Lease.
Capitalized Leases. Leases under which any Borrower is the lessee or
obligor, the discounted future rental payment obligations under which are
required to be capitalized on the balance sheet of the lessee or obligor in
accordance with GAAP.
CERCLA. See definition of Release.
Certified. With respect to the financial statements of any Person, such
statements as audited by a firm of independent auditors, whose report expresses
the opinion, without qualification, that such financial statements present
fairly the financial position of such Person.
CFO. See Section 6.4(b).
Closing Date. The date on which the conditions precedent set forth in
Section 9 are satisfied.
Co-Agent(s). See preamble.
Code. The Internal Revenue Code of 1986, as amended and in effect from
time to time.
Collateral. All of the property, rights and interests of the Borrowers
that are or are intended to be subject to the security interests created by the
Security Documents.
Columbia Bond. The $13,000,000 Solid Waste Transfer Station Revenue
Bonds, Columbia Resource Company Project, Series 1991, issued by the Industrial
Revenue Bond Public Corporation of ▇▇▇▇▇ County, Washington.
Columbia Bond Documents. The documentation executed in connection with
the Columbia Bond.
Columbia Issuing Bank. U.S. Bank National Association, a national
banking association and a Bank hereunder.
Columbia Letter of Credit. The direct pay letter of credit issued by the
Columbia Issuing Bank to support the Columbia Bond in the original stated amount
of $13,598,805.32, as such face amount is reduced pursuant to the terms of such
letter of credit from time to time.
Commitment. With respect to each Bank, the amount determined by
multiplying such Bank's Commitment Percentage by the Total Commitment specified
in Section 2.1 hereof, as the same may be reduced from time to time.
Commitment Fee. See Section 4.1.
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Commitment Percentage. With respect to each Bank, the percentage
initially set forth beside its name on Schedule 1 (subject to adjustment in
accordance with Sections 2.2.2 and 17).
Compliance Certificate. See Section 6.4(c).
Consolidated or consolidated. With reference to any term defined herein,
shall mean that term as applied to the accounts of the Borrowers and their
Subsidiaries consolidated in accordance with GAAP.
Consolidated Earnings Before Interest and Taxes or EBIT. For any period,
the Consolidated Net Income (or Deficit) of the Borrowers determined in
accordance with GAAP, plus (a) interest expense, (b) income taxes, (c) non-cash
stock compensation charges of up to $388,000 in the aggregate taken during the
four (4) fiscal quarters ending March 31, 1999 and no more than $360,000 in the
aggregate thereafter, to the extent that each was deducted in determining
Consolidated Net Income (or Deficit), all as determined in accordance with GAAP,
(d) non-cash special charge for interest expense attributable to loan fees paid
to BKB in connection with the refinancing of the then existing credit facilities
of up to $815,000 (after tax) in the aggregate taken during the fiscal quarter
ending June 30, 1998, up to $212,000 (after tax) in the aggregate taken during
the fiscal quarter ending December 31, 1998 and up to $180,000 in the aggregate
taken during the fiscal quarter ending March 31, 1999, (e) pooling charges taken
in connection with any acquisition permitted under Section 7.4.1 hereof to the
extent such pooling charges were deducted in determining Consolidated Net Income
(or deficit), and (f) EBIT (plus nonrecurring company expenses that are (i)
discontinued or adjusted upon acquisition by any of the Borrowers, such as owner
compensation and adjustments to depreciation to conform to the Parent's
accounting treatment, and (ii) approved by the Agent) for the prior twelve (12)
months of any company acquired (either through an acquisition of such company's
stock or through an acquisition of all or substantially all of such company's
assets) during the period reported in a Compliance Certificate and other
appropriate documentation (including, without limitation, historical financial
results and balance sheets of the acquired companies), in form and substance
satisfactory to the Agent, delivered to the Agent and the Banks pursuant to
Sections 6.4 or 7.4.1(a) shall be included in the calculation of EBIT if (x) the
financial statements of such acquired Subsidiaries have been audited, or (y) the
Agent consents to such inclusion after being furnished with other acceptable
financial statements and (z) the Compliance Certificate delivered to the Agent
and the Banks for the period in which such acquisition was made shall report
such acquisition.
Consolidated Earnings Before Interest, Taxes, Depreciation, and
Amortization or EBITDA. For any period (without duplication), EBIT plus the
depreciation expense and amortization expense, to the extent that each was
deducted in determining Consolidated Net Income (or Deficit), determined in
accordance with GAAP, plus the depreciation expense and amortization expense
(without duplication) of any company whose EBIT was included as an adjustment as
set forth in the definition of EBIT.
Consolidated Net Income (or Deficit). The consolidated net income (or
deficit) of the Borrowers after deduction of all expenses, taxes, and other
proper charges (including,
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without limitation, pooling charges taken in connection with acquisitions
permitted under Section 7.4.1), determined in accordance with GAAP.
Consolidated Net Worth. The excess of Consolidated Total Assets over
Consolidated Total Liabilities, less, to the extent otherwise includable in the
computation of Consolidated Net Worth, any subscriptions receivable.
Consolidated Total Assets. All assets of the Borrowers and their
Subsidiaries determined on a consolidated basis in accordance with GAAP, plus
(i) without duplication, all assets leased by the Borrowers or any Subsidiary as
lessee under any Synthetic Lease to the extent that such assets would have been
consolidated balance sheet assets had the Synthetic Lease been treated for
accounting purposes as a Capitalized Lease, plus (ii) without duplication, all
sold receivables referred to in clause (vii) of the definition of the term
"Indebtedness" to the extent that such receivables would have been consolidated
balance sheet assets had they not been sold.
Consolidated Total Interest Expense. For any period, the aggregate
amount of interest required to be paid or accrued by the Borrowers and their
Subsidiaries during such period on all Indebtedness of the Borrowers and their
Subsidiaries outstanding during all or any part of such period, whether such
interest was or is required to be reflected as an item of expense or
capitalized, including payments consisting of interest in respect of any
Capitalized Lease or any Synthetic Lease and including commitment fees, agency
fees, facility fees, balance deficiency fees and similar fees or expenses in
connection with the borrowing of money.
Consolidated Total Liabilities. All liabilities of the Borrowers
determined on a consolidated basis in accordance with GAAP and classified as
such on the consolidated balance sheet of the Borrowers.
Credit Agreement. See Preamble.
▇▇▇▇▇. ▇▇▇▇▇ Transfer & Recycling, Inc., an Oregon corporation and a
wholly-owned Subsidiary of the Parent.
Default. See Section 12.
Delinquent Bank. See Section 14.9.
Disposal (or Disposed). See definition of Release.
Distribution. The declaration or payment of any dividend or distribution
on or in respect of any shares of any class of capital stock, any partnership
interests or any membership interests of any Person (other than dividends or
other distributions payable solely in shares of common stock, partnership
interests or membership units of such Person, as the case may be); the purchase,
redemption, or other retirement of any shares of any class of capital stock,
partnership interests or membership units of such Person, directly or indirectly
through a Subsidiary or otherwise; the return of equity capital by any Person to
its shareholders, partners or members as such; or any other distribution on
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or in respect of any shares of any class of capital stock, partnership interest
or membership unit of such Person.
Dollars or $. Dollars in lawful currency of the United States of
America.
Drawdown Date. The date on which any Revolving Credit Loan or Swing Line
Loan is made or is to be made, and the date on which any Revolving Credit Loan
is converted or continued in accordance with Section 2.5.
Eligible Assignee. Any of (a) a commercial bank organized under the laws
of the United States, or any State thereof or the District of Columbia, and
having total assets in excess of $1,000,000,000; (b) a savings and loan
association or savings bank organized under the laws of the United States, or
any State thereof or the District of Columbia, and having a net worth of at
least $100,000,000, calculated in accordance with generally accepted accounting
principles; (c) a commercial bank organized under the laws of any other country
which is a member of the Organization for Economic Cooperation and Development
(the "OECD"), or a political subdivision of any such country, and having total
assets in excess of $1,000,000,000, provided that such bank is acting through a
branch or agency located in the country in which it is organized or another
country which is also a member of the OECD; (d) the central bank of any country
which is a member of the OECD; and (e) if, but only if, any Event of Default has
occurred and is continuing, any other bank, insurance company, commercial
finance company or other financial institution approved by the Agent, such
approval not to be unreasonably withheld.
Eligible Foreign Bank. (a) Any commercial bank organized under the laws
of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of any such
country, provided that such bank is acting through a branch or agency located in
the country in which it is organized or another country which is also a member
of the OECD; or (b) the central bank of any country which is a member of the
OECD.
Employee Benefit Plan. Any employee benefit plan within the meaning of
Section 3(3) of ERISA maintained or contributed to by the Borrowers or any ERISA
Affiliate, other than a Guaranteed Pension Plan or a Multiemployer Plan.
Environmental Laws. See Section 5.16(a).
EPA. See Section 5.16(b).
Equipment Financing. Indebtedness of the Borrowers with respect to
equipment leases or equipment chattel mortgages, including any such Indebtedness
assumed in connection with an acquisition permitted under Section 7.4.
ERISA. The Employee Retirement Income Security Act of 1974, as amended
and in effect from time to time.
ERISA Affiliate. Any Person which is treated as a single employer with
the Borrowers under Section 414 of the Code.
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ERISA Reportable Event. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of Section 4043 of ERISA and the regulations
promulgated thereunder.
Eurodollar Business Day. Any Business Day on which dealings in foreign
currency and exchange are carried on among banks in London, England.
Eurodollar Interest Determination Date. For any Interest Period, the
date two Eurodollar Business Days prior to the first day of such Interest
Period.
Eurodollar Loans. Revolving Credit Loans bearing interest calculated by
reference to the Eurodollar Rate.
Eurodollar Offered Rate. The rate per annum at which deposits of dollars
are offered to the Agent by prime banks in whatever Eurodollar interbank market
may be selected by the Agent, in its sole discretion, acting in good faith, at
or about 11:00 a.m. local time in such interbank market, on the Eurodollar
Interest Determination Date, for a period equal to the requested Interest Period
in an amount substantially equal to the principal amount requested to be loaned
at or converted to a rate based on the Eurodollar Rate.
Eurodollar Rate. The rate per annum, rounded upwards to the nearest 1/16
of 1%, determined by the Agent with respect to an Interest Period in accordance
with the following formula:
Eurodollar Rate = Eurodollar Offered Rate
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1 - Reserve Rate
Event of Default. See Section 12.
Excluded Assets. The containers, vehicles, equipment and inventory in
which the Banks are precluded from taking a security interest pursuant to any
Scheduled Contract during the term of such Scheduled Contract.
Excluded Contracts. The Single Family Recyclables Collection Contract
between City of Vancouver and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Industries of Washington, Inc.,
dated as of December 2, 1996, as amended and in effect from time to time.
Financial Letter of Credit. A Letter of Credit where the event which
triggers payment is financial, such as the failure to pay money, and not
performance-related, such as failure to ship a product or provide a service, as
set forth in greater detail in the letter dated March 30, 1995 from the Board of
Governors of the Federal Reserve System or in any applicable directive or letter
ruling of the Board of Governors of the Federal Reserve System issued subsequent
thereto.
Funded Debt. Consolidated Indebtedness of the Borrowers for borrowed
money, the net present value (using the Base Rate as the discount rate) of every
obligation of such Person issued or assumed as the deferred purchase price of
property or services
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(including securities repurchase agreements but excluding trade accounts payable
or accrued liabilities arising in the ordinary course of business which are not
overdue or which are being contested in good faith), and guarantees of such
Indebtedness, recorded on the Consolidated balance sheet of the Borrowers,
including reimbursement obligations of the Borrowers with respect to letters of
credit and the amount of any Indebtedness of such Persons for Capitalized Leases
which corresponds to principal.
generally accepted accounting principles or GAAP. When used in general,
generally accepted accounting principles means (a) principles that are
consistent with the principles promulgated or adopted by the Financial
Accounting Standards Board and its predecessors, in effect for the fiscal year
ended on the Balance Sheet Date, as shall be concurred in by independent
certified public accountants of recognized standing whose report expresses an
unqualified opinion (other than a qualification regarding changes in generally
accepted accounting principles) as to financial statements in which such
principles have been applied; and (b) when used with reference to the Borrowers,
such principles shall include (to the extent consistent with such principles)
the accounting practices reflected in the consolidated financial statements for
the year ended on the Balance Sheet Date.
Guaranteed Pension Plan. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA maintained or contributed to by the Borrowers
or any ERISA Affiliate, the benefits of which are guaranteed on termination in
full or in part by the PBGC pursuant to Title IV of ERISA, other than a
Multiemployer Plan.
Hazardous Substances. See Section 5.16(b).
Indebtedness. As to any Person and whether recourse is secured by or is
otherwise available against all or only a portion of the assets of such Person
and whether or not contingent, but without duplication:
(i) every obligation of such Person for money borrowed,
(ii) every obligation of such Person evidenced by bonds,
debentures, notes or other similar instruments, including obligations
incurred in connection with the acquisition of property, assets or
businesses,
(iii) every reimbursement obligation of such Person with respect
to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person,
(iv) the net present value (using the Base Rate as the discount
rate) of every obligation of such Person issued or assumed as the
deferred purchase price of property or services (including securities
repurchase agreements but excluding (A) trade accounts payable or
accrued liabilities arising in the ordinary course of business which are
not overdue or which are being contested in good faith and (B)
contingent purchase price obligations solely to the extent that the
contingency upon which such obligation is conditioned has not yet
occurred),
(v) every obligation of such Person under any Capitalized Lease,
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(vi) every obligation of such Person under any Synthetic Lease,
(vii) all sales by such Person of (A) accounts or general
intangibles for money due or to become due, (B) chattel paper,
instruments or documents creating or evidencing a right to payment of
money or (C) other receivables (collectively, "receivables"), whether
pursuant to a purchase facility or otherwise, other than in connection
with the disposition of the business operations of such Person relating
thereto or a disposition of defaulted receivables for collection and not
as a financing arrangement, and together with any obligation of such
Person to pay any discount, interest, fees, indemnities, penalties,
recourse, expenses or other amounts in connection therewith, provided,
however, that sales referred to in clauses (B) and (C) shall not
constitute Indebtedness to the extent that such sales are non-recourse
to such Person;
(viii) every obligation of such Person (an "equity related
purchase obligation") to purchase, redeem, retire or otherwise acquire
for value any shares of capital stock of any class issued by such
Person, any warrants, options or other rights to acquire any such
shares, or any rights measured by the value of such shares, warrants,
options or other rights,
(ix) every obligation of such Person under any forward contract,
futures contract, swap, option or other financing agreement or
arrangement (including, without limitation, caps, floors, collars and
similar agreements), the value of which is dependent upon interest
rates, currency exchange rates, commodities or other indices,
(x) every obligation in respect of Indebtedness of any other
entity (including any partnership in which such Person is a general
partner) to the extent that such Person is liable therefor as a result
of such Person's ownership interest in or other relationship with such
entity, except to the extent that the terms of such Indebtedness provide
that such Person is not liable therefor and such terms are enforceable
under applicable law,
(xi) every obligation, contingent or otherwise, of such Person
guaranteeing, or having the economic effect of guarantying or otherwise
acting as surety for, any obligation of a type described in any of
clauses (i) through (x) (the "primary obligation") of another Person
(the "primary obligor"), in any manner, whether directly or indirectly,
and including, without limitation, any obligation of such Person (A) to
purchase or pay (or advance or supply funds for the purchase of) any
security for the payment of such primary obligation, (B) to purchase
property, securities or services for the purpose of assuring the payment
of such primary obligation, or (C) to maintain working capital, equity
capital or other financial statement condition or liquidity of the
primary obligor so as to enable the primary obligor to pay such primary
obligation.
The "amount" or "principal amount" of any Indebtedness at any time of
determination represented by (v) any Indebtedness, issued at a price that is
less than the principal amount at maturity thereof, shall be the amount of the
liability in respect thereof determined in accordance with generally accepted
accounting principles, (w) any
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Capitalized Lease shall be the principal component of the aggregate of the
rentals obligation under such Capitalized Lease payable over the term thereof
that is not subject to termination by the lessee, (x) any sale of receivables
shall be the amount of unrecovered capital or principal investment of the
purchaser (other than the Borrowers) thereof, excluding amounts representative
of yield or interest earned on such investment, (y) any Synthetic Lease shall be
the stipulated loss value, termination value or other equivalent amount and (z)
any equity related purchase obligation shall be the maximum fixed redemption or
purchase price thereof inclusive of any accrued and unpaid dividends to be
comprised in such redemption or purchase price.
Ineligible Securities. Securities which may not be underwritten or dealt
in by member banks of the Federal Reserve System under Section 16 of the Banking
Act of 1993 (12 U.S.C. Section 24, Seventh), as amended.
Interest Period. With respect to each Eurodollar Loan:
(a) initially, the period commencing on the date of the making
of a Eurodollar Loan or the conversion from a Base Rate Loan into a Eurodollar
Loan and ending one (1), two (2), three (3), or six (6) months thereafter, as
selected by the Borrowers in a Loan and Letter of Credit Request; and
(b) thereafter, each subsequent Interest Period shall begin on
the last day of the preceding Interest Period and shall end one (1), two (2),
three (3), or six (6) months thereafter, as selected by the Borrowers in a Loan
and Letter of Credit Request;
provided, however, that whenever the first day of any Interest
Period occurs on a day of an initial calendar month for which there is no
numerically corresponding day in the calendar month that succeeds such initial
calendar month by the number of months equal to the number of months in such
Interest Period, such Interest Period shall end on the last Business Day of such
succeeding calendar month.
Letter of Credit Applications. Letter of Credit Applications in such
form as may be agreed upon by the Borrowers and the Agent from time to time
which are entered into pursuant to Section 3 hereof, as such Letter of Credit
Applications are amended, varied or supplemented from time to time.
Letter of Credit Fee. See Section 4.1(b).
Letter of Credit Participation. See Section 3.1(b).
Letters of Credit. Standby Letters of Credit, the Madera Letter of
Credit and the Columbia Letter of Credit issued or to be issued by the Agent or,
with respect to the Columbia Letter of Credit, the Columbia Issuing Bank under
Section 3 hereof for the account of the Borrowers
Leverage Ratio. See Section 8.1.
Loan and Letter of Credit Request. See Section 2.6.
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Loan Documents. This Credit Agreement, the Notes, the Letter of Credit
Applications, the Letters of Credit, and the Security Documents, each as amended
and in effect from time to time.
Loans. Collectively, the Revolving Credit Loans and Swing Line Loans.
Madera. Madera Disposal Systems, Inc., a California corporation and a
wholly-owned Subsidiary of the Parent.
Madera Bond. The $1,800,000 Variable Rate Demand Solid Waste Disposal
Revenue Bonds, Madera Disposal Systems, Inc. Project, Series 1998A, issued by
the California Pollution Control Financing Authority.
Madera Bond Documents. The documentation executed in connection with the
Madera Bond.
Madera Letter of Credit. The direct pay letter of credit to support the
Madera Bond.
Majority Banks. As of any date, the Banks holding fifty-one percent
(51%) of the outstanding principal amount of the Revolving Credit Loans on such
date; and if no such principal is outstanding, the Banks whose aggregate
Commitments constitute fifty-one percent (51%) of the Total Commitment.
Material Acquisition. See Section 7.4.1.
Material Contract. Any contract, franchise agreement or G Permit from
which the Borrowers derived more than five percent (5%) of their consolidated
revenues for the fiscal year most recently ending.
Maturity Date. March 30, 2004.
Maximum Drawing Amount. The maximum aggregate amount from time to time
that the beneficiaries may draw under outstanding Letters of Credit.
Maximum Rate. With respect to each Bank, the maximum lawful nonusurious
rate of interest (if any) which under Applicable Law such Bank may charge the
Borrowers on the Loans and other Obligations from time to time.
Multiemployer Plan. Any multiemployer plan within the meaning of Section
3(37) of ERISA maintained or contributed to by the Borrowers or any ERISA
Affiliate.
Notes. Collectively, the Revolving Credit Notes and Swing Line Notes.
Obligations. All indebtedness, obligations and liabilities of the
Borrowers to any of the Banks or the Agent, individually or collectively,
existing on the date of this Credit Agreement or arising thereafter, direct or
indirect, joint or several, absolute or contingent, matured or unmatured,
liquidated or unliquidated, secured or unsecured, arising by contract, operation
of law or otherwise, arising or incurred under this Credit Agreement
17
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or any of the other Loan Documents, or under any Swap Contract between the
Borrowers and any Bank, or in respect of any of the Loans made or Reimbursement
Obligations incurred or the Letters of Credit, the Notes or any other instrument
at any time evidencing any thereof.
Oregon Waste. Oregon Waste Technology, Inc., an Oregon corporation and a
wholly-owned Subsidiary of ▇▇▇▇▇.
Parent Stock Pledge Agreement. The Second Amended and Restated Stock
Pledge Agreement, to be dated as of the Closing Date, as amended and in effect
from time to time, between the Parent and the Agent, pursuant to which 100% of
the capital stock of the Subsidiaries (other than Oregon Waste) is pledged to
the Agent for the benefit of the Banks.
PBGC. The Pension Benefit Guaranty Corporation created by Section 4002
of ERISA and any successor entity or entities having similar responsibilities.
Performance Letter of Credit. A Letter of Credit which is not a
Financial Letter of Credit.
Permitted Liens. See Section 7.2.
Person. Any individual, corporation, partnership, trust, unincorporated
association, business, or other legal entity, and any government or any
governmental agency or political subdivision thereof.
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Pricing Table:
APPLICABLE APPLICABLE
EURODOLLAR BASE RATE APPLICABLE APPLICABLE
MARGIN MARGIN L/C MARGIN COMMITMENT RATE
LEVERAGE RATIO (PER ANNUM) (PER ANNUM) (PER ANNUM) (PER ANNUM)
-------------- ----------- ----------- ----------- ---------------
Less than 2.00:1 1.25% 0.00% 1.25% 0.250%
Greater than or 1.50% 0.00% 1.50% 0.375%
equal to 2.00:1
but less than 2.50:1
Greater than or 1.75% 0.00% 1.75% 0.375%
equal to 2.50:1
but less than 3.00:1
Greater than or 2.00% 0.00% 2.00% 0.50%
equal to 3.00:1
but less than 3.50:1
Greater than or 2.25% 0.25% 2.25% 0.50%
equal to 3.50:1
Initial Pricing 1.75% 0.00% 1.75% 0.375%
Any change in the applicable margin shall become effective on the first day
after receipt by the Banks of financial statements delivered pursuant to Section
6.4(a) or (b) which indicate a change in the Leverage Ratio. If at any time such
financial statements are not delivered within the time periods specified in
Section 6.4(a) or (b), the applicable margin shall be the highest rate set forth
in the respective column of the Pricing Table, subject to adjustment upon actual
receipt of such financial statements. The initial pricing set forth in the table
above shall be effective until the Borrowers deliver to the Agent a calculation
of the Leverage Ratio for the fiscal quarter ending March 31, 1999.
Pro Forma Interest Expense (as used in a Compliance Certificate
delivered in connection with a Material Acquisition). The annual interest
obligations at the current rates of interest on existing Indebtedness of the
Borrowers and the Indebtedness to be assumed or incurred in connection with an
acquisition.
Prior Credit Agreement. See preamble.
RCRA. See definition of Release.
Real Property. All real property heretofore, now, or hereafter owned or
leased by the Borrowers.
Reimbursement Obligation. The Borrowers' obligation to reimburse the
Agent and the Banks on account of any drawing under any Letter of Credit as
provided in Section 3.2.
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Release. Shall have the meaning specified in the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C.
Sections 9601 et seq. ("CERCLA") and the term "Disposal" (or "Disposed") shall
have the meaning specified in the Resource Conservation and Recovery Act of
1976, 42 U.S.C. Sections 6901 et seq. ("RCRA") and regulations promulgated
thereunder; provided that in the event either CERCLA or RCRA is amended so as to
broaden the meaning of any term defined thereby, such broader meaning shall
apply as of the effective date of such amendment and provided further, to the
extent that the laws of a state wherein the property lies establishes a meaning
for "Release" or "Disposal" which is broader than specified in either CERCLA or
RCRA, such broader meaning shall apply.
Replacement Bank. See Section 4.11.
Replacement Notice. See Section 4.11.
Reserve Rate. The rate, expressed as a decimal, at which the Banks would
be required to maintain reserves under Regulation D of the Board of Governors of
the Federal Reserve System (or any subsequent or similar regulation relating to
such reserve requirements) against "Eurocurrency Liabilities" (as such term is
defined in Regulation D), or against any other category of liabilities which
might be incurred by the Banks to fund Eurodollar Loans, if such liabilities
were outstanding.
Revolving Credit Loans. Revolving credit loans made or to be made by the
Banks to the Borrowers pursuant to Section 2.
Revolving Credit Notes. The promissory notes of the Borrowers evidencing
the Revolving Credit Loans hereunder, dated as of the date hereof and in
substantially the form of Exhibit A hereto.
Scheduled Contracts. The certain contracts referenced in Schedule 7.2(i)
to this Credit Agreement, on terms and conditions and as in effect on the date
hereof.
Section 20 Subsidiary. A subsidiary of the bank holding company
controlling any Bank, which subsidiary has been granted authority by the Federal
Reserve Board to underwrite and deal in certain Ineligible Securities.
Security Agreement. The Second Amended and Restated Security Agreement
among the Borrowers and the Agent, to be dated as of the Closing Date, as
amended and in effect from time to time.
Security Documents. The Security Agreement, Stock Pledge Agreements, and
any other instruments or documents evidencing or perfecting the Agent's lien on
the assets of the Borrowers for the benefit of the Banks.
Seller Debt. Indebtedness of the Borrowers, including assumed
obligations, incurred in connection with acquisitions of any stocks of,
partnership or joint venture interests in, or assets of any Person and owing to
the seller(s) of such stocks, partnership or joint venture interests, or assets
(excluding Indebtedness of acquired companies which
20
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is discharged within 30 days of such acquisition); provided that such
acquisitions are otherwise permitted pursuant to Section 7.4.
Settlement. The making or receiving of payments, in immediately
available funds, by the Banks to or from the Agent in accordance with Section
2.11 hereof to the extent necessary to cause each such Bank's actual share of
the outstanding amount of the Revolving Credit Loans to be equal to such Bank's
Commitment Percentage of the outstanding amount of such Revolving Credit Loans,
in any case when, prior to such action, the actual share is not so equal.
Settlement Amount. See Section 2.11(b).
Settlement Date. See Section 2.11(b).
Settling Bank. See Section 2.11(b).
Stock Pledge Agreements. Collectively, (a) the Parent Stock Pledge
Agreement, and (b) the Amended and Restated Stock Pledge Agreement between ▇▇▇▇▇
and the Agent, pursuant to which 100% of the stock of Oregon Waste is pledged to
the Agent for the benefit of the Banks, each to be dated as of the Closing Date,
as amended and in effect from time to time.
Subordinated Debt. Unsecured Indebtedness of the Borrowers that is
expressly subordinated and made junior to the payment and performance in full of
the Obligations, and evidenced as such by a written instrument containing
subordination provisions on terms and in form and substance acceptable to the
Agent and Majority Banks.
Subsidiary. Any corporation, association, trust, or other business
entity of which any Borrower shall at any time own directly, or indirectly
through a Subsidiary or Subsidiaries, at least a majority of the outstanding
capital stock or other interest entitled to vote generally.
Sunshine. Sunshine Sanitation, Incorporated, a South Dakota corporation
and a wholly-owned Subsidiary of the Parent.
Swap Contracts. Any agreement (including any master agreement and any
agreement, whether or not in writing, relating to any single transaction) that
is an interest rate swap agreement, basis swap, forward rate agreement,
commodity swap, commodity option, equity or equity index swap or option, bond
option, interest rate option, forward foreign exchange agreement, rate cap,
collar or floor agreement, currency swap agreement, cross-currency rate swap
agreement, swaption, currency option or other similar agreement (including any
option to enter into any of the foregoing).
Swing Line Loan(s). See Section 2.11(a).
Swing Line Note. See Section 2.11(b).
Synthetic Lease. Any lease treated as an operating lease under generally
accepted accounting principles and as a loan or financing for U.S. income tax
purposes.
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Total Commitment. See Section 2.1.
Washington Merger. The pooling-of-interests merger among ▇▇▇▇▇▇'▇
Disposal Company, Inc., American Disposal Company, Inc., ▇.▇. Disposal Co.,
Inc., Tacoma Recycling Company, Inc. and certain Subsidiaries of Parent pursuant
to that certain Agreement and Plan of Merger, dated as of October 22, 1998.
Year 2000 Issue. The risk that computer applications used by the
Borrowers may be unable to recognize and properly perform date-sensitive
functions involving certain dates prior to, and any date after, December 31,
1999.
SECTION 1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to time in
accordance with its terms and the terms of this Credit Agreement.
(b) The singular includes the plural and the plural includes the
singular.
(c) A reference to any law includes any amendment or
modification to such law.
(d) A reference to any Person includes its permitted successors
and permitted assigns.
(e) Accounting terms capitalized but not otherwise defined
herein have the meanings assigned to them by generally accepted accounting
principles applied on a consistent basis by the accounting entity to which they
refer.
(f) The words "include," "includes" and "including" are not
limiting.
(g) All terms not specifically defined herein or by generally
accepted accounting principles, which terms are defined in the Uniform
Commercial Code as in effect in the Commonwealth of Massachusetts, have the
meanings assigned to them therein.
(h) Reference to a particular "Section " refers to that section
of this Credit Agreement unless otherwise indicated.
(i) The words "herein," "hereof," "hereunder" and words of like
import shall refer to this Credit Agreement as a whole and not to any particular
section or subdivision of this Credit Agreement.
(j) Unless otherwise expressly indicated, in the computation of
periods of time from a specified date to a later specified date, the word "from"
means "from and including," the words "to" and "until" each mean "to but
excluding," and the word "through" means "to and including."
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SECTION 2. THE REVOLVING CREDIT FACILITY.
SECTION 2.1. COMMITMENT TO LEND. Subject to the terms and conditions set
forth in this Credit Agreement, each of the Banks severally, but not jointly,
agrees to lend to the Borrowers, and the Borrowers may borrow, repay, and
reborrow from time to time from the Closing Date to the Maturity Date, upon
notice by the Borrowers to the Agent given in accordance with Section 2.6, its
Commitment Percentage of the Revolving Credit Loans as are requested by the
Borrowers, provided that the outstanding amount of Revolving Credit Loans, Swing
Line Loans, unpaid Reimbursement Obligations, and the Maximum Drawing Amount
shall not exceed a maximum aggregate amount outstanding of $210,000,000 at any
time, as such amount may be reduced or increased, as the case may be, pursuant
to Section 2.2 hereof (the "Total Commitment"). The Revolving Credit Loans shall
be made pro rata in accordance with each Bank's Commitment Percentage. Each
request for a Loan hereunder shall constitute a representation and warranty by
the Borrowers that the conditions set forth in Section 9 and Section 10, as the
case may be, have been satisfied on the date of such request.
SECTION 2.2. REDUCTION AND INCREASE OF TOTAL COMMITMENT.
SECTION 2.2.1. REDUCTION OF TOTAL COMMITMENT.
(a) The Borrowers shall have the right at any time and from time to time
upon five (5) Business Days' prior written notice to the Agent to reduce by
$1,000,000 or integral multiples of $500,000 in excess thereof, or terminate
entirely, the Total Commitment, whereupon the Commitments of the Banks shall be
reduced pro rata in accordance with their respective Commitment Percentages of
the amount specified in such notice or, as the case may be, terminated. The
Agent will notify the Banks promptly after receiving any notice of the Borrowers
delivered pursuant to this Section 2.2.1.
(b) No reduction or termination of the Commitments once made may be
revoked; the portion of the Commitments reduced or terminated may not be
reinstated; and amounts in respect of such reduced or terminated portion may not
be reborrowed.
SECTION 2.2.2. INCREASE OF TOTAL COMMITMENT. Unless a Default or Event
of Default has occurred and is continuing, the Borrowers may request that the
Total Commitment be increased by an aggregate amount of up to $15,000,000
provided that the Total Commitment shall not in any event exceed $225,000,000
hereunder, subject to the approval of the Agent, provided, however, that (i) any
Bank which is a party to this Credit Agreement prior to such increase shall have
the first option, and may elect, to fund its pro rata share of the increase,
thereby increasing its Commitment hereunder, but no Bank shall have any
obligation to do so, (ii) in the event that it becomes necessary to include a
new Bank to provide additional funding under this Section 2.2.2, such new Bank
must be reasonably acceptable to the Agent and the Borrowers, and (iii) the
Banks' Commitment Percentages shall be correspondingly adjusted, as necessary,
to reflect any increase in the total commitment and Schedule 1 shall be amended
to reflect such adjustments.
SECTION 2.3. THE REVOLVING CREDIT NOTES. The Revolving Credit Loans
shall be evidenced by separate promissory notes of the Borrowers in
substantially the form of
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Exhibit A hereto (each a "Revolving Credit Note"), dated as of the Closing Date
and completed with appropriate insertions. One Revolving Credit Note shall be
payable to the order of each Bank in a principal amount equal to such Bank's
Commitment or, if less, the outstanding amount of all Revolving Credit Loans
made by such Bank, plus interest accrued thereon, as set forth below. The
Borrowers irrevocably authorize each Bank to make or cause to be made, in
connection with a Drawdown Date of any Revolving Credit Loan or at the time of
receipt of any payment of principal on such Bank's Revolving Credit Note, an
appropriate notation on such Bank's records reflecting the making of such Loan
or the receipt of such payment (as the case may be). The outstanding amount of
the Loans set forth on such Bank's record shall be prima facie evidence of the
principal amount thereof owing and unpaid to such Bank, but the failure to
record, or any error in so recording, any such amount shall not limit or
otherwise affect the obligation of the Borrowers hereunder or under any
Revolving Credit Note to make payments of principal of or interest on any
Revolving Credit Note when due.
SECTION 2.4. INTEREST ON LOANS. The outstanding principal amount of the
Loans shall bear interest at the rate per annum equal to (a) the Base Rate plus
the Applicable Base Rate Margin on Base Rate Loans or (b) the Eurodollar Rate
plus the Applicable Eurodollar Margin on Eurodollar Loans. Interest shall be
payable (i) quarterly in arrears on the first Business Day of each calendar
quarter, commencing April 1, 1999, on Base Rate Loans, (ii) on the last day of
the applicable Interest Period, and if such Interest Period is longer than three
(3) months, also on the day which is three (3) months after the commencement of
such Interest Period, on Eurodollar Loans, and (iii) on the Maturity Date for
all Revolving Credit Loans and Swing Line Loans.
SECTION 2.5. ELECTION OF EURODOLLAR RATE; NOTICE OF ELECTION; INTEREST
PERIODS; MINIMUM AMOUNTS.
(a) At the Borrowers' option, so long as no Default or Event of
Default has occurred and is then continuing, the Borrowers may (i) elect to
convert any Revolving Credit Loan which is a Base Rate Loan or a portion thereof
to a Eurodollar Loan, (ii) at the time of any Loan and Letter of Credit Request,
specify that a requested Revolving Credit Loan shall be a Eurodollar Loan, or
(iii) upon expiration of the applicable Interest Period, elect to maintain an
existing Eurodollar Loan as such, provided that the Borrowers give notice to the
Agent pursuant to Section 2.5(b) hereof. Upon determining any Eurodollar Rate,
the Agent shall forthwith provide notice thereof to the Borrowers and the Banks,
and each such notice to the Borrowers and the Banks shall be considered prima
facie correct and binding, absent manifest error.
(b) Three (3) Eurodollar Business Days prior to the making of
any Eurodollar Loan or the conversion of any Base Rate Loan to a Eurodollar
Loan, or, in the case of an outstanding Eurodollar Loan, the expiration date of
the applicable Interest Period, the Borrowers shall give telephonic notice
(confirmed by telecopy on the same Eurodollar Business Day) to the Agent not
later than 11:00 a.m. (Boston time) of their election pursuant to Section
2.5(a). Each such notice delivered to the Agent shall specify the aggregate
principal amount of the Loans to be borrowed or maintained as or converted to
Eurodollar Loans and the requested duration of the Interest Period that will be
applicable to such Eurodollar Loan, and shall be irrevocable and binding upon
the Borrowers. If the
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Borrowers shall fail to give the Agent notice of their election hereunder
together with all of the other information required by this Section 2.5(b) with
respect to any Revolving Credit Loan, such Loan shall be deemed a Base Rate
Loan. In the event that the Borrowers fail to provide any such notice with
respect to the continuation of any Eurodollar Loan as such, then such Eurodollar
Loan shall be automatically converted to a Base Rate Loan at the end of the then
expiring Interest Period relating thereto.
(c) Notwithstanding anything herein to the contrary, the
Borrowers may not specify an Interest Period that would extend beyond the
Maturity Date.
(d) All Revolving Credit Loans shall be in a minimum amount of
$1,000,000 or integral multiples of $500,000 in excess thereof. In no event
shall the Borrowers have more than six (6) different maturities of Eurodollar
Loans outstanding at any time.
SECTION 2.6. REQUESTS FOR REVOLVING CREDIT LOANS. The Borrowers shall
give to the Agent written notice in the form of Exhibit B hereto (or telephonic
notice confirmed by telecopy on the same Business Day in the form of Exhibit B
hereto) of each Revolving Credit Loan requested hereunder (a "Loan and Letter of
Credit Request") not later than (a) 11:00 a.m. Boston time one (1) Business Day
prior to the proposed Drawdown Date of any Base Rate Loan, or (b) 11:00 a.m.
Boston time three (3) Eurodollar Business Days prior to the proposed Drawdown
Date of any Eurodollar Loan. Each such notice shall be given by the Borrowers
and shall specify the principal amount of the Revolving Credit Loan requested
and shall include a current Loan and Letter of Credit Request reflecting the
aggregate amount of Revolving Credit Loans and Swing Line Loans outstanding and
the Maximum Drawing Amount. Each Loan and Letter of Credit Request shall be
irrevocable and binding on the Borrowers and shall obligate the Borrowers to
accept the Revolving Credit Loan requested from the Banks on the proposed
Drawdown Date. Each of the representations and warranties made by or on behalf
of the Borrowers to the Banks or the Agent in this Credit Agreement or any other
Loan Document shall be true and correct in all material respects when made and
shall, for all purposes of this Credit Agreement, be deemed to be repeated on
and as of the date of the submission of any Loan and Letter of Credit Request
and on and as of the Drawdown Date of such Loan, or the date of issuance of such
Letter of Credit (except to the extent of changes resulting from transactions
contemplated or permitted by this Credit Agreement and the other Loan Documents
and changes occurring in the ordinary course of business that singly or in the
aggregate are not materially adverse, or to the extent that such representations
and warranties expressly relate solely to an earlier date). The Agent shall
promptly notify each Bank of each Loan and Letter of Credit Request received by
the Agent.
SECTION 2.7. FUNDS FOR REVOLVING CREDIT LOANS.
(a) Not later than 1:00 p.m. (Boston time) on the proposed Drawdown Date
of any Revolving Credit Loan, each of the Banks will make available to the
Agent, at the Agent's Head Office, in immediately available funds, the amount of
such Bank's Commitment Percentage of the amount of the requested Revolving
Credit Loans. Upon receipt from each Bank of such amount, and upon receipt of
the documents required by Sections 9 and 10 and the satisfaction of the other
conditions set forth therein, to the extent
25
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applicable, the Agent will make available to the Borrowers in immediately
available funds the aggregate amount of such Revolving Credit Loans made
available to the Agent by the Banks. The failure or refusal of any Bank to make
available to the Agent at the aforesaid time and place on any Drawdown Date the
amount of its Commitment Percentage of the requested Revolving Credit Loans
shall not relieve any other Bank from its several obligation hereunder to make
available to the Agent the amount of such other Bank's Commitment Percentage of
any requested Revolving Credit Loans.
(b) The Agent may, unless notified to the contrary by any Bank prior to
a Drawdown Date, assume that such Bank has made available to the Agent on such
Drawdown Date the amount of such Bank's Commitment Percentage of the Revolving
Credit Loans to be made on such Drawdown Date, and the Agent may (but shall not
be required to), in reliance upon such assumption, make available to the
Borrowers a corresponding amount. If any Bank makes available to the Agent such
amount on a date after such Drawdown Date, such Bank shall pay to the Agent on
demand an amount equal to the product of (i) the average computed for the period
referred to in clause (iii) below, of the weighted average interest rate paid by
the Agent for federal funds acquired by the Agent during each day included in
such period, times (ii) the amount of such Bank's Commitment Percentage of such
Revolving Credit Loans, times (iii) a fraction, the numerator of which is the
number of days that elapse from and including such Drawdown Date to the date on
which the amount of such Bank's Commitment Percentage of such Revolving Credit
Loans shall become immediately available to the Agent, and the denominator of
which is 365. A statement of the Agent submitted to such Bank with respect to
any amounts owing under this paragraph shall be prima facie evidence, absent
manifest error, of the amount due and owing to the Agent by such Bank. If the
amount of such Bank's Commitment Percentage of such Revolving Credit Loans is
not made available to the Agent by such Bank within three (3) Business Days
following such Drawdown Date, the Agent shall be entitled to recover such amount
from the Borrowers on demand, with interest thereon at the rate per annum
applicable to the Revolving Credit Loans made on such Drawdown Date.
SECTION 2.8. MATURITY OF THE LOANS. The Loans shall be due and payable
on the Maturity Date. The Borrowers jointly and severally promise to pay on the
Maturity Date all Loans outstanding on such date, together with any and all
accrued and unpaid interest thereon.
SECTION 2.9. MANDATORY REPAYMENTS OF THE LOANS. If at any time the
outstanding amount of the Revolving Credit Loans plus Swing Line Loans plus the
Maximum Drawing Amount plus unpaid Reimbursement Obligations exceeds the Total
Commitment, whether by reduction of the Total Commitment or otherwise, then the
Borrowers shall immediately pay the amount of such excess to the Agent for
application to the Revolving Credit Loans, or if no Revolving Credit Loans shall
be outstanding, to the Swing Line Loans, or if no Swing Line Loans shall be
outstanding, to be held by the Agent as collateral security for the
Reimbursement Obligations, provided, however, that if the amount of cash
collateral held by the Agent pursuant to this Section 2.9 exceeds the amount of
the Obligations, the Agent shall return such excess to the Borrowers.
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SECTION 2.10. OPTIONAL PREPAYMENTS OR REPAYMENTS OF LOANS. The Borrowers
shall have the right, at their election, to repay or prepay the outstanding
amount of the Loans, as a whole or in part, at any time without penalty or
premium (other than the obligation to reimburse the Banks and the Agent pursuant
to Section 4.8 hereof). The Borrowers shall give written notice to the Agent (or
telephonic notice confirmed in writing) no later than (a) 1:00 p.m. (Boston
time) on the Business Day of the proposed prepayment or repayment of any Base
Rate Loan or (b) 1:00 p.m. (Boston time) three (3) Eurodollar Business Days
prior to the proposed prepayment or repayment of any Eurodollar Loan, in each
case specifying the proposed date of prepayment or repayment of Loans and the
principal amount to be paid. Each such partial repayment of the Loans shall be
$500,000 or integral multiples of $500,000 in excess thereof, and shall be
accompanied by the payment of accrued interest on the principal prepaid to the
date of repayment and shall be applied, in the absence of instruction by the
Borrowers, first to the principal of Base Rate Loans and then to the principal
of Eurodollar Loans. Each partial prepayment shall be allocated among the Banks,
in proportion, as nearly as practicable, to the respective unpaid principal
amount of each Bank's Revolving Credit Loans, with adjustments to the extent
practicable to equalize any prior repayments not exactly in proportion.
SECTION 2.11. SWING LINE LOANS; SETTLEMENTS.
(a) So long as BKB has not received written notice from the Borrowers of
an Event of Default and otherwise made in accordance with the provisions of this
Credit Agreement, solely for ease of administration of the Revolving Credit
Loans, BKB may, upon receipt of a Loan and Letter of Credit Request no later
than 2:00 p.m. (Boston time) on the proposed date of funding, but shall not be
required to, fund Base Rate Loans ("Swing Line Loans") for periods not to exceed
seven (7) days in any one case, bearing interest as set forth for Base Rate
Loans in Section 2.4. The Swing Line Loans shall be evidenced by a promissory
note of the Borrowers in substantially the form of Exhibit C hereto (the "Swing
Line Note") dated as of the Closing Date, and shall each be in a minimum amount
of $500,000 or integral multiples of $100,000 in excess thereof, provided that
the outstanding amount of Swing Line Loans advanced by BKB hereunder shall not
exceed $15,000,000 at any time. Each Bank shall remain severally, but not
jointly, and unconditionally liable to fund its pro rata share (based upon each
Bank's Commitment Percentage) of such Swing Line Loans on each Settlement Date
and, in the event BKB chooses not to fund all Base Rate Loans requested on any
date, to fund its Commitment Percentage of the Base Rate Loans requested,
subject to satisfaction of the provisions hereof relating to the making of Base
Rate Loans. Prior to each Settlement, all payments or repayments of the
principal of, and interest on, Swing Line Loans shall be credited to the account
of BKB.
(b) The Banks shall effect Settlements on (i) the Business Day
immediately following any day which the Agent gives written notice to the Banks
to effect a Settlement, (ii) the Business Day immediately following the Agent's
becoming aware of the existence of any Default or Event of Default, (iii) the
Maturity Date, (iv) any date on which the Borrowers wish to convert a Swing Line
Loan into a Base Rate Loan, and (v) in any event, the seventh day on which any
Swing Line Loan remains outstanding (each such date, a "Settlement Date"). One
(1) Business Day prior to each such Settlement
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Date, the Agent shall give telephonic notice to the Banks of (A) the respective
outstanding amount of Revolving Credit Loans made by each Bank as at the close
of business on the prior day, (B) the amount that any Bank, as applicable (a
"Settling Bank"), shall pay to effect a Settlement (a "Settlement Amount"). A
statement of the Agent submitted to the Banks with respect to any amounts owing
hereunder shall be prima facie evidence of the amount due and owing. Each
Settling Bank shall, not later than 1:00 p.m. (Boston time) on each Settlement
Date, effect a wire transfer of immediately available funds to the Agent at the
Agent's Head Office in the amount of such Bank's Settlement Amount. All funds
advanced by any Bank as a Settling Bank pursuant to this Section 2.11 shall for
all purposes be treated as a Base Rate Loan to the Borrowers.
(c) The Agent may (unless notified to the contrary by any Settling Bank
by 12:00 noon (Boston time) one (1) Business Day prior to the Settlement Date)
assume that each Settling Bank has made available (or will make available by the
time specified in Section 2.8(b)) to the Agent its Settlement Amount, and the
Agent may (but shall not be required to), in reliance upon such assumption,
effect Settlements. If the Settlement Amount of such Settling Bank is made
available to the Agent on a date after such Settlement Date, such Settling Bank
shall pay the Agent on demand an amount equal to the product of (i) the average,
computed for the period referred to in clause (iii) below, of the weighted
average annual interest rate paid by the Agent for federal funds acquired by the
Agent during each day included in such period times (ii) such Settlement Amount
times (iii) a fraction, the numerator of which is the number of days that elapse
from and including such Settlement Date to but not including the date on which
such Settlement Amount shall become immediately available to the Agent, and the
denominator of which is 365. Upon payment of such amount such Settling Bank
shall be deemed to have delivered its Settlement Amount on the Settlement Date
and shall become entitled to interest payable by the Domestic Borrowers with
respect to such Settling Bank's Settlement Amount as if such share were
delivered on the Settlement Date. If such Settlement Amount is not in fact made
available to the Agent by such Settling Bank within five (5) Business Days of
such Settlement Date, the Agent shall be entitled to recover such amount from
the Borrowers, with interest thereon at the Base Rate.
(d) After any Settlement Date, any payment by the Borrowers of Swing
Line Loans hereunder shall be allocated pro rata among the Banks, in accordance
with such Bank's Commitment Percentage.
(e) If, prior to the making of a Revolving Credit Loan pursuant to
paragraph (b) of this Section 2.11, a Default or Event of Default has occurred
and is continuing, each Bank will, on the date such Revolving Credit Loan was to
have been made, purchase an undivided participating interest in the outstanding
Swing Line Loans in an amount equal to its Commitment Percentage of such Swing
Line Loans. Each Bank will immediately transfer to the Agent, in immediately
available funds, the amount of its participation and upon receipt thereof the
Agent will deliver to such Bank a Swing Line participation certificate dated the
date of receipt of such funds and in such amount.
(f) Whenever, at any time after the Agent has received from any Bank
such Bank's participating interest in the Swing Line Loans pursuant to clause
(e) above, the
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Agent receives any payment on account thereof, the Agent will distribute to such
Bank its participating interest in such amount (appropriately adjusted, in the
case of interest payments, to reflect the period of time during which such
Bank's participating interest was outstanding and funded) in like funds as
received; provided, however, that in the event that such payment received by the
Agent is required to be returned, such Bank will return to the Agent any portion
thereof previously distributed by the Agent to it in like funds as such payment
is required to be returned by the Agent.
(h) Each Bank's obligation to purchase participating interests pursuant
to clause (e) above shall be absolute and unconditional and shall not be
affected by any circumstance, including, without limitation, (i) any set-off,
counterclaim, recoupment, defense or other right which such Bank may have
against the Agent, the Borrowers or any other Person for any reason whatsoever;
(ii) the occurrence or continuance of a Default or Event of Default; (iii) any
adverse change in the condition (financial or otherwise) of the Borrowers or any
other Person; (iv) any breach of this Credit Agreement by the Borrowers or any
other Bank or Agent; or (v) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing.
SECTION 3. LETTERS OF CREDIT.
SECTION 3.1. LETTER OF CREDIT COMMITMENTS.
(a) Subject to the terms and conditions hereof and the execution
and receipt of a Loan and Letter of Credit Request reflecting the Maximum
Drawing Amount of all Letters of Credit (including the requested Letter of
Credit) and a Letter of Credit Application, the Agent on behalf of the Banks and
in reliance upon the agreement of the Banks set forth in Section 3.1(b) and upon
the representations and warranties of the Borrowers contained herein, agrees to
issue standby letters of credit in such form as may be requested from time to
time by the Borrowers and agreed to by the Agent; provided, however, that, after
giving effect to such request, the Maximum Drawing Amount shall not exceed the
lesser of (i) $20,000,000 or (ii) the Total Commitment minus the aggregate
outstanding amount of the Revolving Credit Loans and Swing Line Loans. No Letter
of Credit shall have an expiration date later than thirty (30) days prior to the
Maturity Date and in addition no Letter of Credit (other than the Madera Letter
of Credit or the Columbia Letter of Credit) shall have an expiration date later
than one (1) year after the date of issuance of such Letter of Credit (which may
incorporate automatic renewals for periods of up to one (1) year, provided that
the Agent may, upon 30 days' notice to the beneficiary, cancel such Letter of
Credit which has been renewed beyond its initial one (1) year term).
(b) Each Bank severally agrees that it shall be absolutely
liable, without regard to the occurrence of any Default or Event of Default or
any other condition precedent whatsoever, to the extent of such Bank's
Commitment Percentage thereof, to reimburse the Agent or, with respect to the
Columbia Letter of Credit, the Columbia Issuing Bank on demand for the amount of
each draft paid by the Agent or the Columbia Issuing Bank (as the case may be)
under each Letter of Credit issued in accordance with the terms hereof to the
extent that such amount is not reimbursed by the
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Borrowers pursuant to Section 3.2 (such agreement for a Bank being called herein
the "Letter of Credit Participation" of such Bank).
(c) Each such payment made by a Bank shall be treated as the
purchase by such Bank of a participating interest in the Borrowers'
Reimbursement Obligation under Section 3.2 in an amount equal to such payment.
Each Bank shall share in accordance with its participating interest in any
interest which accrues pursuant to Section 3.2.
(d) The parties hereby agree that the Letters of Credit issued
under the Prior Credit Agreement shall be Letters of Credit under this Credit
Agreement. In addition, this Credit Agreement shall constitute the Reimbursement
Agreement referred to in the Madera Bond Documents and the Columbia Bond
Documents.
SECTION 3.2. REIMBURSEMENT OBLIGATION OF THE BORROWERS. In order to
induce the Agent or the Columbia Issuing Bank (as the case may be) to issue,
extend and renew each Letter of Credit and the Banks to participate therein, the
Borrowers hereby agree to reimburse or pay to the Agent or the Columbia Issuing
Bank (as the case may be) with respect to each Letter of Credit issued, extended
or renewed by the Agent or the Columbia Issuing Bank hereunder as follows:
(a) on each date that any draft presented under any Letter of
Credit is honored by the Agent or the Columbia Issuing Bank or the Agent or the
Columbia Issuing Bank otherwise makes payment with respect thereto, (i) the
amount paid by the Agent or the Columbia Issuing Bank under or with respect to
such Letter of Credit, and (ii) the amount of any taxes, fees, charges or other
costs and expenses whatsoever incurred by the Agent, the Columbia Issuing Bank
or any Bank in connection with any payment made by the Agent, the Columbia
Issuing Bank or any Bank under, or with respect to, such Letter of Credit;
provided however, if the Borrowers do not reimburse the Agent or the Columbia
Issuing Bank (as the case may be) on the Drawdown Date, such amount shall,
provided that no Event of Default under Sections 12.1(h) or 12.1(i) has
occurred, become automatically a Revolving Credit Loan which is a Base Rate Loan
advanced hereunder in an amount equal to such sum; and
(b) upon the Maturity Date, or the termination of the Total
Commitment, or the acceleration of the Reimbursement Obligations in accordance
with Section 12, an amount equal to the Maximum Drawing Amount, which amount
shall be held by the Agent for the benefit of the Columbia Issuing Bank, the
Banks and the Agent as cash collateral for all Reimbursement Obligations.
SECTION 3.3. LETTER OF CREDIT PAYMENTS. If any draft shall be presented
or other demand for payment shall be made under any Letter of Credit, the Agent
or the Columbia Issuing Bank (as the case may be) shall notify the Borrowers of
the date and amount of the draft presented or demand for payment and of the date
and time when it expects to pay such draft or honor such demand for payment. On
the date that such draft is paid or other payment is made by the Agent or the
Columbia Issuing Bank, the Agent shall promptly notify the Banks of the amount
of any unpaid Reimbursement Obligation. No later than 3:00 p.m. (Boston time) on
the Business Day next following the receipt of such notice, each Bank shall make
available to the Agent, at the Agent's Head Office, in
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immediately available funds, such Bank's Commitment Percentage of such
Reimbursement Obligation, together with an amount equal to the product of (a)
the weighted average, computed for the period referred to in clause (c) below,
of the interest rate paid by the Agent or the Columbia Issuing Bank (as the case
may be) for federal funds acquired by the Agent or the Columbia Issuing Bank
during each day included in such period, times (b) the amount equal to such
Bank's Commitment Percentage of such unpaid Reimbursement Obligation, times (c)
a fraction, the numerator of which is the number of days that have elapsed from
and including the date the Agent or the Columbia Issuing Bank paid the draft
presented for honor or otherwise made payment until the date on which such
Bank's Commitment Percentage of such unpaid Reimbursement Obligation shall
become immediately available to the Agent or the Columbia Issuing Bank, and the
denominator of which is 365. The responsibility of the Agent or the Columbia
Issuing Bank to the Borrowers and the Banks shall be only to determine that the
documents (including each draft) delivered under each Letter of Credit in
connection with such presentment shall be in conformity in all material respects
with such Letter of Credit.
SECTION 3.4. OBLIGATIONS ABSOLUTE. The Borrowers' obligations under this
Section 3 shall be absolute and unconditional under any and all circumstances
and irrespective of the occurrence of any Default or Event of Default or any
condition precedent whatsoever or any setoff, counterclaim or defense to payment
which the Borrowers may have or have had against the Agent, the Columbia Issuing
Bank or any Bank or any beneficiary of a Letter of Credit. Subject to the
obligations of the Banks pursuant to Article V of the Uniform Commercial Code
and the obligations of the Agent and the Columbia Issuing Bank pursuant to the
last sentence of Section 3.3, the Borrowers further agree with the Agent, the
Columbia Issuing Bank and the Banks that the Agent, the Columbia Issuing Bank
and the Banks shall not be responsible for, and the Borrowers' Reimbursement
Obligations under Section 3.2 shall not be affected by, among other things, the
validity or genuineness of documents or of any endorsements thereon, even if
such documents should in fact prove to be in any or all respects invalid,
fraudulent or forged, or any dispute between or among the Borrowers, the
beneficiary of any Letter of Credit or any financing institution or other party
to which any Letter of Credit may be transferred or any claims or defenses
whatsoever of the Borrowers against the beneficiary of any Letter of Credit or
any such transferee. The Agent, the Columbia Issuing Bank and the Banks shall
not be liable for any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with any Letter of Credit. The Borrowers agree that any action taken
or omitted by the Agent, the Columbia Issuing Bank or any Bank under or in
connection with each Letter of Credit and the related drafts and documents, if
done in good faith, shall be binding upon the Borrowers and shall not result in
any liability on the part of the Agent, the Columbia Issuing Bank or any Bank to
the Borrowers.
SECTION 3.5. RELIANCE BY AGENT. To the extent not inconsistent with
Section 3.4, the Agent and the Columbia Issuing Bank shall be entitled to rely,
and shall be fully protected in relying upon, any Letter of Credit, draft,
writing, resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document believed by it to be genuine and correct and to have been signed, sent
or made
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by the proper Person or Persons and upon advice and statements of legal counsel,
independent accountants or other experts selected by the Agent.
SECTION 4. FEES, PAYMENTS, AND COMPUTATIONS; JOINT AND SEVERAL
LIABILITY.
SECTION 4.1. FEES.
(a) CLOSING. The Borrowers jointly and severally agree to pay to
the Agent, for the respective accounts of each Bank, a fee as set forth in the
Closing Fee Letter, dated March 30, 1999, among the Borrowers and the Agent.
(b) AGENT'S FEE AND ARRANGEMENT FEES. The Borrowers jointly and
severally agree to pay to the Agent and the Arranger those fees set forth in the
Agent's Fee and Arrangement Fee Letter, dated March 30, 1999, among the
Borrowers and the Agent.
(c) COMMITMENT FEE. The Borrowers jointly and severally agree to
pay to the Agent, for the respective account of each Bank, a fee (the
"Commitment Fee") equal to the Applicable Commitment Rate multiplied by the
average daily amount of the unused portion of such Bank's Commitment during each
calendar quarter or portion thereof from the Closing Date to the Maturity Date
(or to the date of termination in full of the Total Commitment, if earlier). The
Commitment Fee shall be payable quarterly in arrears on the first day of each
calendar quarter for the immediately preceding calendar quarter commencing on
April 1, 1999, with a final payment on the Maturity Date.
(d) LETTER OF CREDIT FEES. The Borrowers shall pay a fee (the
"Letter of Credit Fee") equal to (i) the Applicable L/C Margin multiplied by the
Maximum Drawing Amount of each Financial Letter of Credit plus (ii) 50% of the
Applicable L/C Margin multiplied by the Maximum Drawing Amount of each
Performance Letter of Credit. Such Letter of Credit Fee shall be payable to the
Agent for the account of the Banks, to be shared pro rata by the Banks in
accordance with their respective Commitment Percentages. The Borrowers shall
also pay a fee (the "Issuance Fee") to the Agent or the Columbia Issuing Bank
(as the case may be), for its own account, equal to 0.125% per annum on the
Maximum Drawing Amount of all Letters of Credit issued by such Bank, plus its
customary administrative charges. The Letter of Credit Fee and the Issuance Fee
shall be payable for the number of days each Letter of Credit is outstanding,
and shall be payable quarterly in arrears on the first day of each calendar
quarter for the immediately preceding calendar quarter, and on the Maturity
Date.
SECTION 4.2. PAYMENTS.
(a) All payments of principal, interest, Reimbursement
Obligations, fees and any other amounts due hereunder or under any of the other
Loan Documents shall be made to the Agent, for the respective accounts of the
Banks and the Agent, to be received at the Agent's Head Office in immediately
available funds by 12:00 p.m. (Boston time) on any due date.
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(b) All payments by the Borrowers hereunder and under any of the
other Loan Documents shall be made without setoff or counterclaim and free and
clear of and without deduction for any taxes, levies, imposts, duties, charges,
fees, deductions, withholdings, compulsory loans, restrictions or conditions of
any nature now or hereafter imposed or levied by any jurisdiction or any
political subdivision thereof or taxing or other authority therein unless the
Borrowers are compelled by law to make such deduction or withholding. If any
such obligation is imposed upon the Borrowers with respect to any amount payable
by them hereunder or under any of the other Loan Documents, the Borrowers will
pay to the Agent, for the account of the Banks or (as the case may be) the
Agent, on the date on which such amount is due and payable hereunder or under
such other Loan Document, such additional amount in Dollars as shall be
necessary to enable the Banks or the Agent to receive the same net amount which
the Banks or the Agent would have received on such due date had no such
obligation been imposed upon the Borrowers. In the event that the Borrowers are
required to make such deduction or withholding as a result of the fact that a
Bank is organized outside of the United States, such Bank shall use its
reasonable best efforts to transfer its Loans to an affiliate organized within
the United States if such transfer would have no adverse effect on such Bank or
the Loans. The Borrowers will deliver promptly to the Bank certificates or other
valid vouchers for all taxes or other charges deducted from or paid with respect
to payments made by the Borrowers hereunder or under such other Loan Document.
(c) Whenever a payment hereunder or under any of the other Loan
Documents becomes due on a day that is not a Business Day, the due date for such
payment shall be extended to the next succeeding Business Day, and interest
shall accrue during such extension; provided that any Interest Period for any
Eurodollar Loan which ends on a day that is not a Eurodollar Business Day shall
end on the next succeeding Eurodollar Business Day unless the result of such
extension would be to carry such Interest Period into another calendar month, in
which event such Interest Period shall end on the immediately preceding
Eurodollar Business Day.
SECTION 4.3. COMPUTATIONS. All computations of interest on Base Rate
Loans and of Commitment Fees, Letter of Credit Fees or other fees shall, unless
otherwise expressly provided herein, be based on a 365-day year (or 366-day
year, as applicable) and paid for the actual number of days elapsed. All
computations of interest on Eurodollar Loans shall, unless otherwise expressly
provided herein, be based on a 360-day year and paid for the actual number of
days elapsed.
SECTION 4.4. CAPITAL ADEQUACY. If any present or future law,
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law) or the interpretation thereof by a court or
governmental authority with appropriate jurisdiction affects the amount of
capital required or expected to be maintained by any Bank or the Agent or any
corporation controlling such Bank or the Agent, and such Bank or the Agent
determines that the amount of capital required to be maintained by it is
increased by or based upon the existence of such Bank's or the Agent's Loans,
Letter of Credit Participations or Letters of Credit, or commitment with respect
thereto, then such Bank or the Agent may notify the Borrowers of such fact. To
the extent that the costs of such increased capital requirements are not
reflected in the Base Rate (if relating to Base Rate
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Loans), the Borrowers and such Bank or (as the case may be) the Agent shall
thereafter attempt to negotiate in good faith, within thirty (30) days of the
day on which the Borrowers receive such notice, an adjustment payable hereunder
that will adequately compensate such Bank or the Agent in light of these
circumstances. If the Borrowers and such Bank or the Agent are unable to agree
to such adjustment within thirty (30) days of the date on which the Borrowers
receive such notice, then commencing on the date of such notice (but not earlier
than the effective date of any such increased capital requirement), the fees
payable hereunder shall increase by an amount that will, in such Bank's or the
Agent's reasonable determination, provide adequate compensation. Each Bank and
the Agent shall allocate such cost increases among its customers in good faith
and on an equitable basis.
SECTION 4.5. CERTIFICATE. A certificate setting forth any additional
amounts payable pursuant to Section 4.4 and a reasonable explanation of such
amounts which are due, submitted by any Bank or the Agent to the Borrowers,
shall be conclusive, absent manifest error, that such amounts are due and owing.
SECTION 4.6. INTEREST ON OVERDUE AMOUNTS. Overdue principal and (to the
extent permitted by applicable law) interest on the Loans and all other overdue
amounts payable hereunder or under any of the other Loan Documents shall bear
interest compounded monthly and payable on demand at a rate per annum equal to
the Base Rate plus the Applicable Base Rate Margin plus two (2) percentage
points (2.00%) until such amount shall be paid in full (after, as well as
before, judgment).
SECTION 4.7. INTEREST LIMITATION. Notwithstanding any other term of this
Credit Agreement or any Note or any other document referred to herein or
therein, the maximum amount of interest which may be charged to or collected
from any person liable hereunder or under any Note by any Bank shall be
absolutely limited to, and shall in no event exceed, the maximum amount of
interest which could lawfully be charged or collected under applicable law
(including, to the extent applicable, the provisions of Section 5197 of the
Revised Statutes of the United States of America, as amended, 12 U.S.C. Section
85, as amended), so that the maximum of all amounts constituting interest under
applicable law, howsoever computed, shall never exceed as to any Person liable
therefor such lawful maximum, and any term of this Credit Agreement, the Notes,
the Letter of Credit Applications, or any other document referred to herein or
therein which could be construed as providing for interest in excess of such
lawful maximum shall be and hereby is made expressly subject to and modified by
the provisions of this paragraph.
SECTION 4.8. EURODOLLAR INDEMNITY. The Borrowers agree to indemnify the
Banks and the Agent and to hold them harmless from and against any loss, cost or
expenses (including loss of anticipated profits) that the Banks and the Agent
may sustain or incur as a consequence of (a) default by the Borrowers in payment
of the principal amount of or any interest on any Eurodollar Loans as and when
due and payable, including any such loss or expense arising from interest or
fees payable by any Bank or the Agent to lenders of funds obtained by it in
order to maintain its Eurodollar Loans, (b) a prepayment of principal on any
Eurodollar Loan, including prepayments which are the result of acceleration by
the Banks, or (c) default by the Borrowers in making a borrowing or conversion
after the Borrowers have given (or are deemed to have given) notice pursuant
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to Section 2.5 or Section 2.6, the making of any payment of a Eurodollar Loan or
the making of any conversion of any such Eurodollar Loan to a Base Rate Loan on
a day that is not the last day of the applicable Interest Period with respect
thereto, including interest or fees payable by any Bank to lenders of funds
obtained by it in order to maintain any such Loans.
SECTION 4.9. ILLEGALITY; INABILITY TO DETERMINE EURODOLLAR RATE.
Notwithstanding any other provision of this Credit Agreement, if (a) the
introduction of, any change in, or any change in the interpretation of, any law
or regulation applicable to the Agent or any Bank shall make it unlawful, or any
central bank or other governmental authority having jurisdiction thereof shall
assert that it is unlawful, for any Bank or the Agent to perform its obligations
in respect of any Eurodollar Loans, or (b) if any Bank or the Agent shall
reasonably determine with respect to Eurodollar Loans that (i) by reason of
circumstances affecting any Eurodollar interbank market, adequate and reasonable
methods do not exist for ascertaining the Eurodollar Rate which would otherwise
be applicable during any Interest Period, or (ii) deposits of Dollars in the
relevant amount for the relevant Interest Period are not available to such Bank
or the Agent in any Eurodollar interbank market, or (iii) the Eurodollar Rate
does not or will not accurately reflect the cost to such Bank or the Agent of
obtaining or maintaining the applicable Eurodollar Loans during any Interest
Period, then such Bank or the Agent shall promptly give telephonic, telex or
cable notice of such determination to the Borrowers (which notice shall be
conclusive and binding upon the Borrowers). Upon such notification by such Bank
or the Agent, the obligation of such Bank or the Agent to make Eurodollar Loans
shall be suspended until such Bank or the Agent determines that such
circumstances no longer exist, and the outstanding Eurodollar Loans shall
continue to bear interest at the applicable rate based on the Eurodollar Rate
until the end of the applicable Interest Period, and thereafter shall be deemed
converted to Base Rate Loans in equal principal amounts.
SECTION 4.10. ADDITIONAL COSTS, ETC. If any present or future applicable
law, which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Bank by any central bank or other fiscal, monetary or
other authority (whether or not having the force of law), shall impose on any
Bank any tax, levy, impost, duty, charge fees, deduction or withholdings of any
nature or requirements with respect to this Credit Agreement, the other Loan
Documents, the Loans, such Bank's Commitment, the Letters of Credit or any class
of loans or commitments or letters of credit of which any of the Loans, the
Commitments or the Letters of Credit forms a part, and the result of any of the
foregoing is:
(i) to increase the cost to such Bank of making, funding,
issuing, renewing, extending or maintaining the Loans, such Bank's Commitment,
or the Letters of Credit; or
(ii) to reduce the amount of principal, interest or other amount
payable to such Bank hereunder on account of such Bank's Commitment, the Loans,
or drawings under the Letters of Credit, or
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(iii) to require such Bank to make any payment or to forego any
interest or other sum payable hereunder, the amount of which payment or foregone
interest or other sum is calculated by reference to the gross amount of any sum
receivable or deemed received by such Bank from the Borrowers hereunder,
then, and in each such case, the Borrowers will, upon demand made by such Bank
at any time and from time to time and as often as the occasion therefor may
arise, pay to such Bank such additional amounts as will be sufficient to
compensate such Bank for such additional cost, reduction, payment or foregone
interest or other sum (after such Bank shall have allocated the same fairly and
equitably among all customers of any class generally affected thereby).
SECTION 4.11. REPLACEMENT OF BANKS. If any Bank (an "Affected Bank") (i)
makes demand upon the Borrowers for (or if the Borrowers are otherwise required
to pay) amounts pursuant to Sections 4.4 or 4.10 or (ii) is unable to make or
maintain Eurodollar Loans as a result of a condition described in Section 4.9,
the Borrowers may, within 90 days of receipt of such demand or notice (or the
occurrence of such other event causing the Borrowers to be required to pay such
compensation or causing Section 4.9 to be applicable), by notice in writing to
the Agent and such Affected Bank (a "Replacement Notice") (A) request the
Affected Bank to cooperate with the Borrowers in obtaining a replacement bank
satisfactory to the Agent and the Borrowers (the "Replacement Bank"); (B)
request the non-Affected Banks to acquire and assume all of the Affected Bank's
Loans and Commitment, as provided herein, but none of such Banks shall be under
an obligation to do so; or (C) designate a Replacement Bank reasonably
satisfactory to the Agent. If any satisfactory Replacement Bank shall be
obtained, and/or any of the non-Affected Banks shall agree to acquire and assume
all of the Affected Bank's Loans and Commitment, then such Affected Bank shall,
so long as no Event of Default shall have occurred and be continuing, assign, in
accordance with Section 17, all of its Commitment, Loans, Notes and other rights
and obligations under this Credit Agreement and all other Loan Documents to such
Replacement Bank or non-Affected Banks, as the case may be, in exchange for
payment of the principal amount so assigned and all interest and fees accrued on
the amount so assigned, plus all other Obligations then due and payable to the
Affected Bank; provided, however, that (i) such assignment shall be without
recourse, representation or warranty and shall be on terms and conditions
reasonably satisfactory to such Affected Bank and such Replacement Bank and/or
non-Affected Banks, as the case may be, and (ii) prior to any such assignment,
the Borrowers shall have paid to such Affected Bank all amounts properly
demanded and unreimbursed under Sections 4.4, 4.8, 4.9 and 4.10. Upon the
effective date of such assignment, the Borrowers shall issue replacement Notes
to such Replacement Bank and/or non-Affected Banks, as the case may be, and such
institution shall become a "Bank" for all purposes under this Credit Agreement
and the other Loan Documents.
SECTION 4.12. CONCERNING JOINT AND SEVERAL LIABILITY OF THE BORROWERS.
(a) Each of the Borrowers is accepting joint and several liability
hereunder and under the other Loan Documents in consideration of the financial
accommodations to be provided by the Banks under this Credit Agreement, for the
mutual benefit, directly and
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indirectly, of each of the Borrowers and in consideration of the undertakings of
each other Borrower to accept joint and several liability for the Obligations.
(b) Each of the Borrowers, jointly and severally, hereby irrevocably and
unconditionally accepts, not merely as a surety but also as a co-debtor, joint
and several liability with the other Borrowers with respect to the payment and
performance of all of the Obligations (including, without limitation, any
Obligations arising under this Section 4.12), it being the intention of the
parties hereto that all of the Obligations shall be the joint and several
Obligations of each of the Borrowers without preferences or distinction among
them.
(c) If and to the extent that any of the Borrowers shall fail to make
any payment with respect to any of the Obligations as and when due or to perform
any of the Obligations in accordance with the terms thereof, then in each such
event the other Borrowers will make such payment with respect to, or perform,
such Obligation.
(d) The Obligations of each of the Borrowers under the provisions of
this Section 4.12 constitute full recourse Obligations of each of the Borrowers
enforceable against each such corporation to the full extent of its properties
and assets, irrespective of the validity, regularity or enforceability of this
Credit Agreement or any other circumstance whatsoever.
(e) Except as otherwise expressly provided in this Credit Agreement,
each of the Borrowers hereby waives notice of acceptance of its joint and
several liability, notice of any Loans made under this Credit Agreement, notice
of any action at any time taken or omitted by the Banks under or in respect of
any of the Obligations, and, generally, to the extent permitted by applicable
law, all demands, notices and other formalities of every kind in connection with
this Credit Agreement. Each of the Borrowers hereby assents to, and waives
notice of, any extension or postponement of the time for the payment of any of
the Obligations, the acceptance of any payment of any of the Obligations, the
acceptance of any partial payment thereon, any waiver, consent or other action
or acquiescence by the Banks at any time or times in respect of any default by
any of the Borrowers in the performance or satisfaction of any term, covenant,
condition or provision of this Credit Agreement, any and all other indulgences
whatsoever by the Banks in respect of any of the Obligations, and the taking,
addition, substitution or release, in whole or in part, at any time or times, of
any security for any of the Obligations or the addition, substitution or
release, in whole or in part, of any of the Borrowers. Without limiting the
generality of the foregoing, each of the Borrowers assents to any other action
or delay in acting or failure to act on the part of the Banks with respect to
the failure by any of the Borrowers to comply with any of its respective
Obligations, including, without limitation, any failure strictly or diligently
to assert any right or to pursue any remedy or to comply fully with applicable
laws or regulations thereunder, which might, but for the provisions of this
Section 4.12, afford grounds for terminating, discharging or relieving any of
the Borrowers, in whole or in part, from any of its Obligations under this
Section 4.12, it being the intention of each of the Borrowers that, so long as
any of the Obligations hereunder remain unsatisfied, the Obligations of such
Borrowers under this Section 4.12 shall not be discharged except by performance
and then only
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to the extent of such performance. The Obligations of each of the Borrowers
under this Section 4.12 shall not be diminished or rendered unenforceable by any
winding up, reorganization, arrangement, liquidation, re-construction or similar
proceeding with respect to any of the Borrowers or the Banks. The joint and
several liability of the Borrowers hereunder shall continue in full force and
effect notwithstanding any absorption, merger, amalgamation or any other change
whatsoever in the name, membership, constitution or place of formation of any of
the Borrowers or the Banks.
(f) The provisions of this Section 4.12 are made for the benefit of the
Banks and their successors and assigns, and may be enforced in good faith by
them from time to time against any or all of the Borrowers as often as the
occasion therefor may arise and without requirement on the part of the Banks
first to marshal any of their claims or to exercise any of their rights against
any other Borrower or to exhaust any remedies available to them against any
other Borrower or to resort to any other source or means of obtaining payment of
any of the Obligations hereunder or to elect any other remedy. The provisions of
this Section 4.12 shall remain in effect until all of the Obligations shall have
been paid in full or otherwise fully satisfied. If at any time, any payment, or
any part thereof, made in respect of any of the Obligations, is rescinded or
must otherwise be restored or returned by the Banks upon the insolvency,
bankruptcy or reorganization of any of the Borrowers, or otherwise, the
provisions of this Section 4.12 will forthwith be reinstated in effect, as
though such payment had not been made.
SECTION 5. REPRESENTATIONS AND WARRANTIES. The Borrowers jointly and
severally represent and warrant to the Banks that on and as of the date of this
Credit Agreement, each Drawdown Date, and the date of issuance of any Letter of
Credit (with any disclosure on a schedule pursuant to this Section 5 applying to
all relevant representations and warranties, regardless of whether such schedule
is referenced in each relevant representation):
SECTION 5.1. CORPORATE AUTHORITY.
(a) INCORPORATION; GOOD STANDING. Each Borrower (i) is a corporation
duly organized, validly existing and in good standing or in current status under
the laws of its respective state of incorporation, (ii) has all requisite
corporate power to own its property and conduct its business as now conducted
and as presently contemplated, and (iii) is in good standing as a foreign
corporation and is duly authorized to do business in each jurisdiction in which
its property or business as presently conducted or contemplated makes such
qualification necessary except where a failure to be so qualified would not have
a material adverse effect on the business, assets or financial condition of such
Borrower.
(b) AUTHORIZATION. The execution, delivery and performance of the Loan
Documents and the transactions contemplated hereby and thereby (i) are within
the corporate authority of each Borrower, (ii) have been duly authorized by all
necessary corporate proceedings, (iii) do not conflict with or result in any
material breach or contravention of any provision of law, statute, rule or
regulation to which any Borrower is subject or any judgment, order, writ,
injunction, license or permit applicable to any Borrower so as to materially
adversely affect the assets, business or any activity of the
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Borrowers, and (iv) do not conflict with any provision of the corporate charter
or bylaws of any Borrower or any agreement or other instrument binding upon
them.
(c) ENFORCEABILITY. The execution, delivery and performance of the Loan
Documents will result in valid and legally binding obligations of the Borrowers
enforceable against each in accordance with the respective terms and provisions
hereof and thereof, except as enforceability is limited by bankruptcy,
insolvency, reorganization, moratorium or other laws relating to or affecting
generally the enforcement of creditors' rights and except to the extent that
availability of the remedy of specific performance or injunctive relief is
subject to the discretion of the court before which any proceeding therefor may
be brought.
SECTION 5.2. GOVERNMENTAL APPROVALS. The execution, delivery and
performance by the Borrowers of the Loan Documents and the transactions
contemplated hereby and thereby do not require any approval or consent of, or
filing with, any governmental agency or authority other than those already
obtained.
SECTION 5.3. TITLE TO PROPERTIES; LEASES. The Borrowers own all of the
assets reflected in the consolidated balance sheets as at the Balance Sheet Date
or acquired since that date (except property and assets sold or otherwise
disposed of in the ordinary course of business since that date), subject to no
mortgages, capitalized leases, conditional sales agreements, title retention
agreements, liens or other encumbrances except Permitted Liens.
SECTION 5.4. FINANCIAL STATEMENTS; SOLVENCY.
(a) There has been furnished to the Banks audited consolidated
financial statements of the Borrowers dated the Balance Sheet Date. Said
financial statements have been prepared in accordance with GAAP and fairly
present in all material respects the financial condition of the Borrowers on a
consolidated basis, as at the close of business on the date thereof and the
results of operations for the period then ended. There are no contingent
liabilities of the Borrowers involving material amounts, known to the officers
of the Borrowers, which have not been disclosed in said balance sheets and the
related notes thereto or otherwise in writing to the Banks.
(b) The Borrowers on a consolidated basis (both before and after
giving effect to the transactions contemplated by this Credit Agreement) are and
will be solvent (i.e., they have assets having a fair value in excess of the
amount required to pay their probable liabilities on their existing debts as
they become absolute and matured) and have, and expect to have, the ability to
pay their debts from time to time incurred in connection therewith as such debts
mature.
SECTION 5.5. NO MATERIAL CHANGES, ETC. Since the Balance Sheet Date,
there have occurred no material adverse changes in the financial condition or
businesses of the Borrowers, taken as a whole, as shown on or reflected in the
consolidated balance sheet of the Borrowers as of the Balance Sheet Date, or the
consolidated statement of income for the fiscal year then ended. Since the
Balance Sheet Date, there have not been any Distributions other than as
permitted by Section 7.6 hereof.
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SECTION 5.6. PERMITS, FRANCHISES, PATENTS, COPYRIGHTS, ETC. Each
Borrower possess all franchises, patents, copyrights, trademarks, trade names,
licenses and permits, and rights in respect of the foregoing, adequate for the
conduct of their businesses substantially as now conducted without known
conflict with any rights of others.
SECTION 5.7. LITIGATION. Except as shown on Schedules 5.7 and 5.16
hereto, there are no actions, suits, proceedings or investigations of any kind
pending or, to the knowledge of any Borrower, threatened against any Borrower
before any court, tribunal or administrative agency or board which, if adversely
determined, might, either in any individual case or in the aggregate, materially
adversely affect the properties, assets, financial condition or business of the
Borrowers, taken as a whole, or materially impair the right of the Borrowers,
taken as a whole, to carry on business substantially as now conducted, or result
in any substantial liability not adequately covered by insurance, or for which
adequate reserves are not maintained on the consolidated balance sheet or which
question the validity of any of the Loan Documents or any action taken or to be
taken pursuant hereto or thereto.
SECTION 5.8. NO MATERIALLY ADVERSE CONTRACTS, ETC. No Borrower is
subject to any charter, corporate or other legal restriction, or any judgment,
decree, order, rule or regulation which in the judgment of the Borrowers'
officers has or is expected in the future to have a materially adverse effect on
the business, assets or financial condition of the Borrowers, taken as a whole.
No Borrower is a party to any contract or agreement which in the judgment of the
Borrowers' officers has or is expected to have any materially adverse effect on
the business of the Borrowers, taken as a whole, except as otherwise reflected
in adequate reserves.
SECTION 5.9. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. No Borrower
is violating any provision of its charter documents or by-laws or any agreement
or instrument by which any of them may be subject or by which any of them or any
of their properties may be bound or any decree, order, judgment, or any statute,
license, rule or regulation, in a manner which could result in the imposition of
substantial penalties or materially and adversely affect the financial
condition, properties or business of any Borrower. All Material Contracts (a
complete and accurate list of which is attached hereto as Schedule 5.9) are in
full force and effect, and no default or event of default has occurred and is
continuing under any Material Contract.
SECTION 5.10. TAX STATUS. Each Borrower has made or filed all federal
and state income and all other tax returns, reports and declarations required by
any jurisdiction to which any of them is subject (unless and only to the extent
that such Borrower has set aside on its books provisions reasonably adequate for
the payment of all unpaid and unreported taxes); and have paid all taxes and
other governmental assessments and charges that are material in amount, shown or
determined to be due on such returns, reports and declarations, except those
being contested in good faith; and have set aside on their books provisions
reasonably adequate for the payment of all taxes for periods subsequent to the
periods to which such returns, reports or declarations apply. There are no
unpaid taxes in any material amount claimed to be due by the taxing authority of
any jurisdiction, and the officers of the Borrowers know of no basis for any
such claim.
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SECTION 5.11. NO EVENT OF DEFAULT. No Default or Event of Default has
occurred and is continuing as of the date of this Credit Agreement.
SECTION 5.12. HOLDING COMPANY AND INVESTMENT COMPANY ACTS. No Borrower
is a "holding company," or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company," as such terms are defined in the Public
Utility Holding Company Act of 1935; nor is any of them a "registered investment
company," or an "affiliated company" or a "principal underwriter" of a
"registered investment company," as such terms are defined in the Investment
Company Act of 1940, as amended.
SECTION 5.13. ABSENCE OF FINANCING STATEMENTS, ETC. Other than Permitted
Liens, there is no financing statement, security agreement, chattel mortgage,
real estate mortgage or other document filed or recorded with any filing
records, registry, or other public office, which purports to cover, affect or
give notice of any present or possible future lien on, or security interest in,
any assets or property of any Borrower, or any rights relating thereto.
SECTION 5.14. EMPLOYEE BENEFIT PLANS.
(a) Each Employee Benefit Plan and each Guaranteed Pension Plan has been
maintained and operated in compliance in all material respects with the
provisions of ERISA and, to the extent applicable, the Code, including but not
limited to the provisions thereunder respecting prohibited transactions and the
bonding of fiduciaries and other persons handling plan funds as required by
Section 412 of ERISA. Each Borrower has heretofore delivered to the Agent the
most recently completed annual report, Form 5500, with all required attachments,
and actuarial statement required to be submitted under Section 103(d) of ERISA,
with respect to each Guaranteed Pension Plan.
(b) No Employee Benefit Plan, which is an employee welfare benefit plan
within the meaning of Section 3(1) or Section 3(2)(B) of ERISA, provides benefit
coverage subsequent to termination of employment, except as required by Title I,
Part 6 of ERISA or the applicable state insurance laws. A Borrower may terminate
each such Plan at any time (or at any time subsequent to the expiration of any
applicable bargaining agreement) in the discretion of such Borrower without
liability to any Person other than for claims arising prior to termination.
(c) Each contribution required to be made to a Guaranteed Pension Plan,
whether required to be made to avoid the incurrence of an accumulated funding
deficiency, the notice or lien provisions of Section 302(f) of ERISA, or
otherwise, has been timely made. No waiver of an accumulated funding deficiency
or extension of amortization periods has been received with respect to any
Guaranteed Pension Plan, and no Borrower nor any ERISA Affiliate is obligated to
or has posted security in connection with an amendment to a Guaranteed Pension
Plan pursuant to Section 307 of ERISA or Section 401(a)(29) of the Code. No
liability to the PBGC (other than required insurance premiums, all of which have
been paid) has been incurred by any Borrower or any ERISA Affiliate with respect
to any Guaranteed Pension Plan and there has not been any ERISA Reportable Event
(other than an ERISA Reportable Event as to which the requirement of 30 days
notice has been waived), or any other event or condition which
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presents a material risk of termination of any Guaranteed Pension Plan by the
PBGC. Based on the latest valuation of each Guaranteed Pension Plan (which in
each case occurred within twelve months of the date of this representation), and
on the actuarial methods and assumptions employed for that valuation, the
aggregate benefit liabilities of all such Guaranteed Pension Plans within the
meaning of Section 4001 of ERISA did not exceed the aggregate value of the
assets of all such Guaranteed Pension Plans, disregarding for this purpose the
benefit liabilities and assets of any Guaranteed Pension Plan with assets in
excess of benefit liabilities.
(d) No Borrower nor any ERISA Affiliate has incurred any material
liability (including secondary liability) to any Multiemployer Plan as a result
of a complete or partial withdrawal from such Multiemployer Plan under Section
4201 of ERISA or as a result of a sale of assets described in Section 4204 of
ERISA. No Borrower nor any ERISA Affiliate has been notified that any
Multiemployer Plan is in reorganization or insolvent under and within the
meaning of Section 4241 or Section 4245 of ERISA or is at risk of entering
reorganization or becoming insolvent, or that any Multiemployer Plan intends to
terminate or has been terminated under Section 4041A of ERISA.
SECTION 5.15. USE OF PROCEEDS.
SECTION 5.15.1. GENERAL. The proceeds of the Loans shall be used
solely as follows: (a) to refinance existing Indebtedness of the Borrowers under
the Prior Credit Agreement, (b) to finance acquisitions permitted pursuant to
Section 7.4; and (c) for capital expenditures, working capital, and general
corporate purposes.
SECTION 5.15.2. REGULATIONS U AND X. No portion of any Loan is
to be used, and no portion of any Letter of Credit is to be obtained, for the
purpose of purchasing or carrying any "margin security" or "margin stock" as
such terms are used in Regulations U and X of the Board of Governors of the
Federal Reserve System, 12 C.F.R. Parts 221 and 224.
SECTION 5.15.3. INELIGIBLE SECURITIES. No portion of the
proceeds of any Loans is to be used, and no portion of any Letter of Credit is
to be obtained, for the purpose of (a) knowingly purchasing, or providing credit
support for the purchase of, Ineligible Securities from a Section 20 Subsidiary
during any period in which such Section 20 Subsidiary makes a market in such
Ineligible Securities, (b) knowingly purchasing, or providing credit support for
the purchase of, during the underwriting or placement period, any Ineligible
Securities being underwritten or privately placed by a Section 20 Subsidiary, or
(c) making, or providing credit support for the making of, payments of principal
or interest on Ineligible Securities underwritten or privately placed by a
Section 20 Subsidiary and issued by or for the benefit of the Borrowers or other
Affiliate of the Borrowers.
SECTION 5.16. ENVIRONMENTAL COMPLIANCE. Each Borrower has investigated
the past and present condition and usage of the Real Property and the operations
conducted thereon and, based upon such diligent investigation, has determined
that, except as shown on Schedule 5.16:
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(a) No Borrower, nor any operator of the Borrowers' properties, is in
violation, or alleged violation, of any judgment, decree, order, law, permit,
license, rule or regulation pertaining to environmental matters, including
without limitation, those arising under RCRA, CERCLA, the Superfund Amendments
and Reauthorization Act of 1986, the Federal Clean Water Act, the Federal Clean
Air Act, the Toxic Substances Control Act, or any state or local statute,
regulation, ordinance, order or decree relating to health, safety or the
environment (the "Environmental Laws"), which violation would have a material
adverse effect on the business, assets or financial condition of the Borrowers
on a consolidated basis.
(b) No Borrower has received notice from any third party, including,
without limitation: any federal, state or local governmental authority, (i) that
any of the Borrowers has been identified by the United States Environmental
Protection Agency ("EPA") as a potentially responsible party under CERCLA with
respect to a site listed on the National Priorities List, 40 C.F.R. Part ▇▇▇
▇▇▇▇▇▇▇▇ ▇; (ii) that any hazardous waste, as defined by 42 U.S.C. Section
6903(5), any hazardous substances as defined by 42 U.S.C. Section 9601(14), any
pollutant or contaminant as defined by 42 U.S.C. Section 9601(33) or any toxic
substance, oil or hazardous materials or other chemicals or substances regulated
by any Environmental Laws ("Hazardous Substances") which any of the Borrowers
has generated, transported or disposed of has been found at any site at which a
federal, state or local agency or other third party has conducted or has ordered
that any Borrower conduct a remedial investigation, removal or other response
action pursuant to any Environmental Law; or (iii) that it is or shall be a
named party to any claim, action, cause of action, complaint, legal or
administrative proceeding arising out of any third party's incurrence of costs,
expenses, losses or damages of any kind whatsoever in connection with the
release of Hazardous Substances.
(c) Except where it would not have a material adverse effect on the
value of the Real Property, (i) no portion of the Real Property has been used
for the handling, processing, storage or disposal of Hazardous Substances; and
no underground tank or other underground storage receptacle for Hazardous
Substances is located on such properties; (ii) in the course of any activities
conducted by the Borrowers, or operators of the Real Property, no Hazardous
Substances have been generated or are being used on such properties; (iii) there
have been no unpermitted Releases or threatened Releases of Hazardous Substances
on, upon, into or from the Real Property; (iv) to the best of the Borrowers'
knowledge, there have been no Releases on, upon, from or into any real property
in the vicinity of the Real Property which, through soil or groundwater
contamination, may have come to be located on such properties; and (v) in
addition, when required under applicable Environmental Laws, any Hazardous
Substances that have been generated on the Real Property have been transported
offsite only by carriers having an identification number issued by the EPA,
treated or disposed of only by treatment or disposal facilities maintaining
valid permits as required under applicable Environmental Laws, which
transporters and facilities, to the best of the Borrowers' knowledge, have been
and are operating in material compliance with such permits and applicable
Environmental Laws.
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(d) None of the Real Property is or shall be subject to any applicable
environmental clean-up responsibility law or environmental restrictive transfer
law or regulation, by virtue of the transactions set forth herein and
contemplated hereby.
SECTION 5.17. PERFECTION OF SECURITY INTERESTS. All filings,
assignments, pledges and deposits of documents or instruments have been made and
all other actions have been taken that are necessary or advisable under
applicable law to establish and perfect the Agent's security interest in the
Collateral. The Collateral and the Agent's rights with respect to the Collateral
are not subject to any setoff, claims, withholdings or other defenses.
SECTION 5.18. TRANSACTIONS WITH AFFILIATES. Except as disclosed in
Schedule 5.18 or filings made by the Borrowers under the Securities Exchange Act
of 1934 prior to the Closing Date, and except for arm's length transactions
pursuant to which a Borrower makes payments in the ordinary course of business
upon terms no less favorable than such Borrower could obtain from third parties,
none of the officers, directors, or employees of any Borrower is presently a
party to any transaction with another Borrower (other than for services as
employees, officers and directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property to or from, or otherwise requiring payments
to or from any officer, director or such employee or, to the knowledge of any
Borrower, any corporation, partnership, trust or other entity in which any
officer, director, or any such employee has a substantial interest or is an
officer, director, trustee or partner.
SECTION 5.19. SUBSIDIARIES. Schedule 2 sets forth a complete and
accurate list of the Subsidiaries of the Parent, including the name of each
Subsidiary, the location of its chief executive office, and its jurisdiction of
incorporation, together with the number of authorized and outstanding shares of
each Subsidiary. Each Subsidiary listed on Schedule 2 is (a) wholly owned by the
Parent (except as noted in such Schedule) and (b) is a Borrower hereunder, 100%
of the assets and stock of which have been pledged to the Agent on behalf of the
Banks (subject to Section 7.2(h)) pursuant to the Security Documents. The Parent
has good and marketable title to all of the shares it purports to own of the
stock of each such Subsidiary, and each other Borrower has good and marketable
title to all of the shares it purports to own of the stock of such Subsidiary,
free and clear in each case of any lien. All such shares have been duly issued
and are fully paid and non-assessable.
SECTION 5.20. TRUE COPIES OF CHARTER AND OTHER DOCUMENTS. Each Borrower
has furnished the Agent copies, in each case true and complete as of the Closing
Date, of its (a) charter and other incorporation documents and (b) by-laws, each
including any amendments thereto.
SECTION 5.21. DISCLOSURE. Neither this Credit Agreement, nor any of the
other Loan Documents, nor any document or information furnished by the Borrowers
in connection therewith contains any untrue statement of a material fact or
omits to state a material fact (known to any Borrower in the case of any
document or information not furnished by the Borrowers) necessary in order to
make the statements herein or therein not misleading.
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There is no fact known to any Borrower which materially adversely affects, or
which is reasonably likely in the future to materially adversely affect, the
business, assets, or financial condition of any Borrower, exclusive of effects
resulting from changes in general economic conditions, legal standards or
regulatory conditions.
SECTION 5.22. CAPITALIZATION. (a) As of March 26, 1999, the authorized
capital stock of the Parent consists of 50,000,000 shares of common stock (par
value $0.01 per share) of which 16,985,539 shares were outstanding as of such
date. All of such outstanding shares are fully paid and non-assessable. In
addition, as of March 26, 1999, the Board of Directors of the Parent has duly
reserved 1,141,952 shares of the Parent's common stock for issuance pursuant to
outstanding warrants, and has reserved twelve percent (12%) of shares of the
Parent's common stock outstanding at any given time for issuance upon the
exercise of employee stock options granted pursuant to the Parent's stock option
plan.
(b) The shares of the capital stock of the Subsidiaries pledged to the
Agent pursuant to the Stock Pledge Agreements are held of record as set forth on
the respective Annex A to each Stock Pledge Agreement. Such capital stock
constitutes, of record, 100% of the outstanding capital stock of each such
Subsidiary, and, to our knowledge, on a fully-diluted basis, 100% of such
outstanding capital stock.
SECTION 5.23. YEAR 2000 ISSUE. The Borrowers have reviewed the areas
within their business and operations which could be adversely affected by, and
have developed or are developing a program to address on a timely basis, the
Year 2000 Issue. Based on such review and program, the Year 2000 Issue will not
have a material adverse effect on their business and operations.
SECTION 6. AFFIRMATIVE COVENANTS OF THE BORROWERS. The Borrowers jointly
and severally covenant and agree that, so long as any Loan or Note is
outstanding or the Banks have any obligation to make Loans or the Agent has any
obligation to issue, extend, or renew any Letters of Credit hereunder:
SECTION 6.1. PUNCTUAL PAYMENT. The Borrowers will duly and punctually
pay or cause to be paid the principal and interest on the Loans, all
Reimbursement Obligations, fees and other amounts provided for in this Credit
Agreement and the other Loan Documents, all in accordance with the terms of this
Credit Agreement and such other Loan Documents.
SECTION 6.2. MAINTENANCE OF OFFICES. The Parent will maintain its chief
executive offices at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, and each Subsidiary will maintain its chief executive offices at the
location set forth on Schedule 2, or at such other place in the United States as
the Borrowers shall designate upon 30 days' prior written notice to the Agent.
SECTION 6.3. RECORDS AND ACCOUNTS. Each Borrower will (i) keep true and
accurate records and books of account in which full, true and correct entries
will be made in accordance with generally accepted accounting principles, (ii)
maintain adequate accounts and reserves for all taxes (including income taxes),
depreciation, depletion, obsolescence and amortization of its properties,
contingencies, and other reserves, and
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(iii) at all times engage the Accountants as the independent certified public
accountants of the Borrowers.
SECTION 6.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The
Borrowers will deliver to the Banks:
(a) as soon as practicable, but, in any event not later than 90 days
after the end of each fiscal year of the Borrowers, the consolidated and
consolidating balance sheets of the Borrowers as at the end of such year,
statements of cash flows, and the related consolidated and consolidating
statements of operations, each setting forth in comparative form the figures for
the previous fiscal year, all such consolidated and consolidating financial
statements to be in reasonable detail, prepared in accordance with GAAP and,
with respect to the consolidated financial statements, certified by the
Accountants. In addition, simultaneously therewith, the Borrowers shall use
reasonable efforts to provide the Banks with a written statement from the
Accountants to the effect that the Borrowers are in compliance with the
covenants set forth in Section 8 hereof, and that, in making the examination
necessary to said certification, nothing has come to the attention of the
Accountants that would indicate that any Default or Event of Default exists, or,
if the Accountants shall have obtained knowledge of any then existing Default or
Event of Default they shall disclose in such statement any such Default or Event
of Default; provided that the Accountants shall not be liable to the Banks for
failure to obtain knowledge of any Default or Event of Default;
(b) as soon as practicable, but in any event not later than 45 days
after the end of each fiscal quarter of the Borrowers, copies of the
consolidated and consolidating balance sheets and statement of operations of the
Borrowers as at the end of such quarter, subject to year end adjustments, and
the related statement of cash flows, all in reasonable detail and prepared in
accordance with GAAP, with a certification by the principal financial or
accounting officer of the Borrowers (the "CFO") that the consolidated financial
statements are prepared in accordance with GAAP and fairly present the
consolidated financial condition of the Borrowers as at the close of business on
the date thereof and the results of operations for the period then ended;
(c) simultaneously with the delivery of the financial statements
referred to in (a) and (b) above, a statement in the form of Exhibit D hereto
(the "Compliance Certificate") certified by the CFO that the Borrowers are in
compliance with the covenants contained in Sections 6, 7 and 8 hereof as of the
end of the applicable period setting forth in reasonable detail computations
evidencing such compliance, provided that if the Borrowers shall at the time of
issuance of such certificate or at any other time obtain knowledge of any
Default or Event of Default, the Borrowers shall include in such certificate or
otherwise deliver forthwith to the Banks a certificate specifying the nature and
period of existence thereof and what action the Borrowers propose to take with
respect thereto and a certificate of the Borrowers' Chief Operating Officer in
the form attached hereto as Exhibit E with respect to environmental matters;
(d) contemporaneously with or promptly following the delivery thereof to
the boards of directors of the Borrowers, copies of the financial statements,
financial
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projections and annual budget concerning the Borrowers in substantially the same
form in which such information is supplied to the boards of directors of the
Borrowers;
(e) contemporaneously with, or promptly following, the filing or mailing
thereof, copies of all material of a financial nature filed with the Securities
and Exchange Commission or sent to the stockholders of the Borrowers; and
(f) from time to time, such other financial data and other information
(including accountants' management letters) as the Banks may reasonably request.
The Borrowers hereby authorize the Banks to disclose any information
obtained pursuant to this Credit Agreement to all appropriate governmental
regulatory authorities where required by law; provided, however, that this
authorization shall not be deemed to be a waiver of any rights to object to the
disclosure by the Banks of any such information which the Borrowers have or may
have under the federal Right to Financial Privacy Act of 1978, as in effect from
time to time.
SECTION 6.5. CORPORATE EXISTENCE AND CONDUCT OF BUSINESS. Each Borrower
will do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence, corporate rights and franchises;
effect and maintain its foreign qualifications, licensing, domestication or
authorization except as terminated by such Borrower's Board of Directors in the
exercise of its reasonable judgment and except where the failure of a Borrower
to remain so qualified would not materially adversely impair the financial
condition of the Borrowers on a consolidated basis; use its best efforts to
comply with all applicable laws; and shall not become obligated under any
contract or binding arrangement which, at the time it was entered into would
materially adversely impair the financial condition of the Borrowers on a
consolidated basis. Each Borrower will continue to engage primarily in the
businesses now conducted by it and in related businesses.
SECTION 6.6. MAINTENANCE OF PROPERTIES. The Borrowers will cause all
material properties used or useful in the conduct of their businesses to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and will cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of the Borrowers may be necessary so that the businesses carried on in
connection therewith may be properly and advantageously conducted at all times;
provided, however, that nothing in this section shall prevent the Borrowers from
discontinuing the operation and maintenance of any of their properties if such
discontinuance is, in the judgment of the Borrowers, desirable in the conduct of
their business and which does not in the aggregate materially adversely affect
the businesses of the Borrowers on a consolidated basis.
SECTION 6.7. INSURANCE. The Borrowers will maintain with financially
sound and reputable insurance companies, funds or underwriters' insurance of the
kinds, covering the risks (other than risks arising out of or in any way
connected with personal liability of any officers and directors thereof) and in
the relative proportionate amounts usually carried by reasonable and prudent
companies conducting businesses similar to that of the Borrowers, but in no
event less than that required under Section 7 of the Security Agreement. In
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addition, the Borrowers will furnish from time to time, upon the Agent's
request, a summary of the insurance coverage of each of the Borrowers, which
summary shall be in form and substance satisfactory to the Agent and, if
requested by the Agent, will furnish to the Agent copies of the applicable
policies.
SECTION 6.8. TAXES. The Borrowers will duly pay and discharge, or cause
to be paid and discharged, before the same shall become overdue, all taxes,
assessments and other governmental charges (other than taxes, assessments and
other governmental charges imposed by foreign jurisdictions which in the
aggregate are not material to the business or assets of any Borrower on an
individual basis or of the Borrowers on a consolidated basis) imposed upon it
and its real properties, sales and activities, or any material part thereof, or
upon the income or profits therefrom, as well as all claims for labor,
materials, or supplies, which if unpaid might by law become a lien or charge
upon any material portion of its property, unless such lien is a Permitted Lien;
provided, however, that any such tax, assessment, charge, levy or claim need not
be paid if the validity or amount thereof shall currently be contested in good
faith by appropriate proceedings and if such Borrower shall have set aside on
its books adequate reserves with respect thereto; and provided, further, that
the Borrowers will pay all such taxes, assessments, charges, levies or claims
forthwith upon the commencement of proceedings to foreclose any lien which may
have attached as security therefor.
SECTION 6.9. INSPECTION OF PROPERTIES, BOOKS, AND CONTRACTS. The
Borrowers will permit the Banks, the Agent or any of their designated
representatives, upon reasonable notice and during normal business hours, to
visit and inspect any of their properties, to examine their books of account
(including the making of periodic accounts receivable reviews), or contracts
(and to make copies thereof and extracts therefrom), and to discuss their
affairs, finances and accounts with, and to be advised as to the same by, their
officers, all at such times and intervals as the Banks may reasonably request.
SECTION 6.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES AND PERMITS;
MAINTENANCE OF MATERIAL LICENSES AND PERMITS. The Borrowers will (i) comply with
the provisions of their charter documents and by-laws and all agreements and
instruments by which they or any of their properties may be bound; and (ii)
comply with all applicable laws and regulations (including Environmental Laws),
decrees, orders, judgments, licenses and permits, including, without limitation,
all environmental permits hereto ("Applicable Laws"), except where noncompliance
with such Applicable Laws would not have a material adverse effect in the
aggregate on the consolidated financial condition, properties or businesses of
the Borrowers. If at any time while the Notes, or any Loan or Letter of Credit
is outstanding or any Bank or the Agent has any obligation to make Loans or
issue Letters of Credit hereunder, any authorization, consent, approval, permit
or license from any officer, agency or instrumentality of any government shall
become necessary or required in order that the Borrowers may fulfill any of
their obligations hereunder, the Borrowers will immediately take or cause to be
taken all reasonable steps within the power of the Borrowers to obtain such
authorization, consent, approval, permit or license and furnish the Banks with
evidence thereof.
SECTION 6.11. ENVIRONMENTAL INDEMNIFICATION. Each Borrower covenants and
agrees that it will indemnify and hold the Banks harmless from and against any
and all claims,
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expense, damage, loss or liability incurred by the Banks (including all costs of
legal representation incurred by the Banks) relating to (a) any release or
threatened release of hazardous substances on the Real Property; (b) any
violation of any Environmental Laws with respect to conditions at the Real
Property or the operations conducted thereon; or (c) the investigation or
remediation of offsite locations at which any Borrower or its predecessors are
alleged to have directly or indirectly disposed of hazardous substances. It is
expressly acknowledged by each Borrower that this covenant of indemnification
shall include claims, expense, damage, loss or liability incurred by the Banks
based upon the Banks' negligence, and this covenant shall survive any
foreclosure or any modification, release or discharge of the Loan Documents or
the payment of the Loans and shall inure to the benefit of the Banks, their
successors and assigns.
SECTION 6.12. FURTHER ASSURANCES. The Borrowers will cooperate with the
Banks and execute such further instruments and documents as the Banks shall
reasonably request to carry out to the Banks' satisfaction the transactions
contemplated by this Credit Agreement and the Loan Documents.
SECTION 6.13. NOTICE OF POTENTIAL CLAIMS OR LITIGATION. The Borrowers
will deliver to the Banks, within 30 days of receipt thereof, written notice of
the initiation of any action, claim, complaint, or any other notice of dispute
or potential litigation (including without limitation any alleged violation of
any Environmental Law), wherein the potential liability is in excess of
$250,000, together with a copy of each such notice received by any Borrower.
SECTION 6.14. NOTICE OF CERTAIN EVENTS CONCERNING INSURANCE AND
ENVIRONMENTAL CLAIMS.
(a) The Borrowers will provide the Banks with written notice as
to any material cancellation or material change in any insurance of the
Borrowers within ten (10) Business Days after the Borrowers' receipt of any
notice (whether formal or informal) of such cancellation or change by any of
their insurers.
(b) The Borrowers will promptly notify the Banks in writing of
any of the following events:
(i) upon any Borrower obtaining knowledge of any
violation of any Environmental Law regarding the Real Property or any Borrower's
operations, which violation could have a material adverse effect on the Real
Property or on such Borrower's operations; (ii) upon any Borrower obtaining
knowledge of any potential or known Release or threat of Release of any
Hazardous Substance at, from, or into the Real Property which any Borrower
reports in writing or is reportable by it in writing to any governmental
authority and which is material in amount or nature or which could materially
affect the value of the Real Property; (iii) upon any Borrower's receipt of any
notice of violation of any Environmental Laws or of any Release or threatened
Release of Hazardous Substances, including a notice or claim of liability or
potential responsibility from any third party (including without limitation any
federal, state or local governmental officials) and including notice of any
formal inquiry, proceeding, demand, investigation or other action with regard to
(A) any Borrower's or any Person's operation of the Real
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Property, (B) contamination on, from or into the Real Property, or (C)
investigation or remediation of offsite locations at which any Borrower or any
of its predecessors is alleged to have directly or indirectly Disposed of
Hazardous Substances, which violation or Release in any such case could have a
material adverse effect on the Real Property or on any Borrower's operations; or
(iv) upon any Borrower obtaining knowledge that any material expense or loss has
been incurred by such governmental authority in connection with the assessment,
containment, removal or remediation of any Hazardous Substances with respect to
which any Borrower may be liable or for which a lien may be imposed on the Real
Property.
SECTION 6.15. RESPONSE ACTIONS. The Borrowers covenant and agree that if
any Release or Disposal of Hazardous Substances shall occur or shall have
occurred on the Real Property, the Borrowers will cause the prompt containment
and removal of such Hazardous Substances and remediation of the Real Property as
necessary to comply with all Environmental Laws or to preserve the value of the
Real Property.
SECTION 6.16. NOTICE OF DEFAULT. The Borrowers will promptly notify the
Banks in writing of the occurrence of any Default or Event of Default. If any
Person shall give any notice or take any other action in respect of a claimed
default (whether or not constituting an Event of Default) under this Credit
Agreement or any other note, evidence of Indebtedness, indenture or other
obligation evidencing Indebtedness in excess of $250,000 as to which any
Borrower is a party or obligor, whether as principal or surety, the Borrowers
shall forthwith give written notice thereof to the Banks, describing the notice
of action and the nature of the claimed default.
SECTION 6.17. NEW SUBSIDIARIES.
(a) Any newly-created or acquired Subsidiaries permitted under Section
7.4 shall become Borrowers hereunder by (i) signing a joinder agreement or
entering into an amendment to this Credit Agreement and the Security Documents,
as applicable, with the other parties hereto and thereto, in form and substance
satisfactory to the Agent, providing that such Subsidiary shall become a
Borrower hereunder, 100% of the stock and assets of which shall be pledged to
the Agent for the benefit of the Banks (subject to Section 7.2(h)), and (ii)
providing such other documentation as the Banks or the Agent may reasonably
request, including, without limitation, documentation with respect to the
conditions specified in Section 9 hereof. In such event, the Agent is hereby
authorized by the parties to amend Schedule 2 to include such new Subsidiary.
(b) The Parent shall at all times directly or indirectly through a
Subsidiary own all of the shares of capital stock of each of the Subsidiaries
which are corporations, and such shares shall at all times be pledged to the
Agent pursuant to the Stock Pledge Agreements. The Parent shall at all times
directly or indirectly through a Subsidiary own all of the partnership or joint
venture interests in each of the Subsidiaries which are partnerships or joint
ventures, and such interests shall at all times be pledged to the Agent pursuant
to a partnership pledge agreement in form and substance satisfactory to the
Agent.
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SECTION 6.18. EMPLOYEE BENEFIT PLANS. The Borrowers will (i) promptly
upon filing the same with the Department of Labor or Internal Revenue Service,
upon request of the Agent, furnish to the Agent a copy of the most recent
actuarial statement required to be submitted under Section 103(d) of ERISA and
Annual Report, Form 5500, with all required attachments, in respect of each
Guaranteed Pension Plan and (ii) promptly upon receipt or dispatch, furnish to
the Agent any notice, report or demand sent or received in respect of a
Guaranteed Pension Plan under Sections 302, 4041, 4042, 4043, 4063, 4065, 4066
and 4068 of ERISA, or in respect of a Multiemployer Plan, under Sections 4041A,
4202, 4219, 4242, or 4245 of ERISA.
SECTION 6.19. NOTICE OF LOSS OF MATERIAL CONTRACTS. The Borrowers will
promptly (and in any event within fifteen (15) Business Days after the
occurrence thereof) notify the Banks in writing of the termination, or (if
earlier) the receipt of a notice of termination of, or any default by any
Borrower under, any Material Contract.
SECTION 7. CERTAIN NEGATIVE COVENANTS OF THE BORROWERS. Each Borrower
agrees that, so long as any Loan or any Note or other Obligation is outstanding
or the Banks have any obligation to make Loans or the Agent has any obligation
to issue, extend or renew any Letters of Credit hereunder:
SECTION 7.1. RESTRICTIONS ON INDEBTEDNESS. No Borrower shall become or
be a guarantor or surety of, or otherwise create, incur, assume, or be or remain
liable, contingently or otherwise, with respect to any Indebtedness, or become
or be responsible in any manner (whether by agreement to purchase any
obligations, stock, assets, goods or services, or to supply or advance any
funds, assets, goods or services or otherwise) with respect to any undertaking
or Indebtedness of any other Person, or incur any Indebtedness other than:
(a) Indebtedness to the Banks and the Agent arising under this Credit
Agreement or the Loan Documents;
(b) incurrence of guaranty, suretyship or indemnification obligations in
connection with the Borrowers' performance of services for their respective
customers in the ordinary course of their businesses;
(c) Indebtedness of one Borrower to another Borrower;
(d) Equipment Financing (subject to Section 8.5), Seller Debt, and other
Indebtedness, in an aggregate amount not to exceed $25,000,000 at any time;
(e) Indebtedness of the Borrowers with respect to performance bonds
existing as of the Closing Date, including extensions and renewals thereof, in
an aggregate amount not to exceed $5,000,000; and
(f) Indebtedness represented by the Madera Bond and the Columbia Bond.
SECTION 7.2. RESTRICTIONS ON LIENS. No Borrower shall create or incur or
suffer to be created or incurred or to exist any lien, encumbrance, mortgage,
pledge, charge,
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restriction or other security interest of any kind upon any property or assets
of any character, whether now owned or hereafter acquired, or upon the income or
profits therefrom; or transfer any of such property or assets or the income or
profits therefrom for the purpose of subjecting the same to the payment of
Indebtedness or performance of any other obligation in priority to payment of
its general creditors; or acquire, or agree or have an option to acquire, any
property or assets upon conditional sale or other title retention or purchase
money security agreement, device or arrangement; or suffer to exist for a period
of more than 30 days after the same shall have been incurred any Indebtedness or
claim or demand against it which if unpaid might by law or upon bankruptcy or
insolvency, or otherwise, be given any priority whatsoever over its general
creditors; or sell, assign, pledge or otherwise transfer any accounts, contract
rights, general intangibles or chattel paper, with or without recourse, except
as follows (the "Permitted Liens"):
(a) Liens to secure taxes, assessments and other government charges in
respect of obligations not overdue or liens on properties to secure claims for
labor, material or supplies in respect of obligations not overdue;
(b) Deposits or pledges made in connection with, or to secure payment
of, workmen's compensation, unemployment insurance, old age pensions or other
social security obligations;
(c) Liens in respect of judgments or awards which have been in force for
less than the applicable period for taking an appeal so long as execution is not
levied thereunder or in respect of which the applicable Borrower shall at the
time in good faith be prosecuting an appeal or proceedings for review and in
respect of which a stay of execution shall have been obtained pending such
appeal or review and in respect of which such Borrower maintains adequate
reserves;
(d) Liens of carriers, warehousemen, mechanics and materialmen, and
other like liens, in existence less than 120 days from the date of creation
thereof in respect of obligations not overdue, provided that such liens may
continue to exist for a period of more than 120 days if the validity or amount
thereof shall currently be contested by the applicable Borrower in good faith by
appropriate proceedings and if such Borrower shall have set aside on its books
adequate reserves with respect thereto as required by GAAP and provided further
that such Borrower will pay any such claim forthwith upon commencement of
proceedings to foreclose any such lien;
(e) Encumbrances on Real Property consisting of easements, rights of
way, zoning restrictions, restrictions on the use of real property and defects
and irregularities in the title thereto, landlord's or lessor's liens under
leases to which any Borrower is a party, and other minor liens or encumbrances
none of which in the opinion of such Borrower interferes materially with the use
of the property affected in the ordinary conduct of the business of such
Borrower, which defects do not individually or in the aggregate have a material
adverse effect on the business of such Borrower individually or of the Borrowers
on a consolidated basis;
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(f) Liens securing Equipment Financing permitted under Section 7.1(d)
incurred in connection with the lease or acquisition of property or fixed assets
useful or intended to be used in carrying on the business of the Borrowers,
provided that such Liens shall encumber only the property or assets so acquired
and shall not exceed the fair market value thereof;
(g) First-priority liens securing Seller Debt and other Indebtedness
permitted by Section 7.1(d), provided that liens securing Seller Debt shall
encumber only the property or assets so acquired or the property or assets of
any Subsidiary whose stock is so acquired and shall not exceed the fair market
value thereof;
(h) Liens in favor of the Agent for the benefit of the Banks and the
Agent under the Loan Documents; and
(i) Liens granted in favor of certain governmental entities pursuant to
any Scheduled Contract listed on Schedule 7.2(i); provided, that such liens (i)
encumber only the containers, bins, carts and vehicles used in connection with
such Scheduled Contract and (ii) are promptly released as soon as such release
is not prohibited under the terms of such Scheduled Contract.
SECTION 7.3. RESTRICTIONS ON INVESTMENTS. No Borrower shall purchase or
acquire, or make any commitment therefor, any capital stock, equity interest, or
other obligations or securities of, or any interest in, any other Person, or
make or commit to make any acquisition under Section 7.4, or make or commit to
make any advance, loan, extension of credit or capital contribution to or any
other investment in, any other Person, other than:
(a) marketable direct or guaranteed obligations of the United States of
America that mature within one (1) year from the date of purchase;
(b) demand deposits, certificates of deposit, bankers acceptances and
time deposits of United States banks or Eligible Foreign Banks having unimpaired
capital and surplus in excess of $250,000,000;
(c) securities commonly known as "commercial paper" issued by a
corporation organized and existing under the laws of the United States of
America or any state thereof that at the time of purchase have been rated and
the ratings for which are not less than "P 1" if rated by ▇▇▇▇▇'▇ Investors
Service, Inc., and not less than "A 1" if rated by Standard and Poor's Rating
Group;
(d) extensions of credit in the nature of accounts receivable or notes
receivable arising from the sale or lease of goods or services in the ordinary
course of business;
(e) investments existing on the date hereof and listed on Schedule 7.3;
(f) loans and advances by any Borrower to another Borrower;
(g) investments with respect to Seller Debt permitted under Section
7.1(d);
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(h) investments permitted under Section 7.4;
(i) loans to employees of the Parent for the purpose of financing such
employees' acquisition of equity of the Parent (through the exercise of stock
options or otherwise) or for relocation costs and expenses in an aggregate
principal amount not to exceed $200,000 at any time outstanding.
SECTION 7.4. MERGER, CONSOLIDATION AND DISPOSITION OF ASSETS.
SECTION 7.4.1. MERGERS AND ACQUISITIONS. The Borrowers will not
become a party to any merger or consolidation, or agree to or effect any asset
acquisition or stock acquisition (other than the acquisition of assets in the
ordinary course of business consistent with past practices) except the merger or
consolidation of, or asset or stock acquisitions between existing Borrowers and
except as otherwise provided in this Section 7.4.1. The Borrowers may purchase
or otherwise acquire all or substantially all of the assets or stock or other
equity interests of any other Person provided that:
(a) the Borrowers are in current compliance with and, giving effect to
the proposed acquisition (including any borrowings made or to be made in
connection therewith), will continue to be in compliance with all of the
covenants in Section 8 hereof on a pro forma historical combined basis as if the
transaction occurred on the first day of the period of measurement; provided,
that, in the case of transactions involving cash consideration to be paid by the
Borrowers (including cash deferred payments, contingent or otherwise, and the
aggregate amount of all Funded Debt assumed) in excess of $15,000,000, the Agent
and the Banks shall have received a Compliance Certificate demonstrating
compliance with Sections 8.1-8.3 on a pro forma historical combined basis as if
the transaction occurred on the first day of the period of measurement;
(b) at the time of such acquisition, no Default or Event of Default has
occurred and is continuing, and such acquisition will not otherwise create a
Default or an Event of Default hereunder;
(c) the business to be acquired is predominantly in the same lines of
business as the Borrowers, or businesses reasonably related or incidental
thereto (e.g., non-hazardous solid waste collection, transfer, hauling,
recycling, or disposal);
(d) the business to be acquired operates predominantly in the
continental United States;
(e) all of the assets to be acquired shall be owned by an existing or
newly created Subsidiary of the Parent which Subsidiary shall be a Borrower,
100% of the assets and stock or other equity interests of which have been or,
simultaneously with such acquisition, will be pledged to the Agent on behalf of
the Banks (subject to Section 7.2(h)) or, in the case of a stock or other equity
interest acquisition, the acquired company, simultaneously with such
acquisition, shall become a Borrower or shall be merged with and into a wholly
owned Subsidiary that is a Borrower and such newly acquired or created
Subsidiary shall otherwise comply with the provisions of Section 6.17 hereof;
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(f) not later than seven (7) days prior to the proposed acquisition
date, a copy of the purchase agreement and financial projections, together with
audited (if available, or otherwise unaudited) financial statements for any
Subsidiary to be acquired or created, for the preceding two (2) fiscal years or
such shorter period of time as such Subsidiary has been in existence shall have
been furnished to the Agent, only in cases of Material Acquisitions or upon
request by the Agent;
(g) not later than seven (7) days prior to the proposed acquisition
date, (1) a summary of the Borrowers' results of their standard due diligence
review, and (2) in the case of a landfill acquisition, a review by a Consulting
Engineer and a copy of the Consulting Engineer's report shall have been
furnished to the Agent, only in cases of Material Acquisitions or upon request
by the Agent;
(h) the board of directors and (if required by applicable law) the
shareholders, or the equivalent thereof, of the business to be acquired has
approved such acquisition;
(i) if such acquisition is made by a merger, a Borrower, or a
wholly-owned Subsidiary of the Parent which shall become a Borrower in
connection with such merger, shall be the surviving entity; and
(j) cash consideration to be paid by such Borrower in connection with
any such acquisition or series of related acquisitions (including cash deferred
payments, contingent or otherwise, and the aggregate amount of all Funded Debt
assumed), shall not exceed $20,000,000 without the consent of the Agent and the
Majority Banks (any acquisition requiring cash consideration in excess of
$20,000,000 being referred to as a "Material Acquisition").
SECTION 7.4.2. DISPOSITION OF ASSETS. No Borrower will become a
party to or agree to or effect any disposition of assets in excess of $250,000
in the aggregate (the "Basket"), provided that the proceeds of any such
disposition shall be applied toward repayment of the Revolving Credit Loans.
Notwithstanding the foregoing, the sale of inventory, the licensing of
intellectual property and the disposition of obsolete assets, in each case in
the ordinary course of business consistent with past practices, are permitted
hereunder without being charged against the Basket.
SECTION 7.5. SALE AND LEASEBACK. The Borrowers shall not enter into any
arrangement, directly or indirectly, whereby any Borrower shall sell or transfer
any property owned by it in order then or thereafter to lease such property or
lease other property which such Borrower intends to use for substantially the
same purpose as the property being sold or transferred, without the prior
written consent of the Majority Banks.
SECTION 7.6. RESTRICTED DISTRIBUTIONS AND REDEMPTIONS. The Borrowers
shall not redeem, convert, retire or otherwise acquire shares of any class of
its capital stock, or make any Distributions, except that any Borrower may make
Distributions to another Borrower. In addition, the Borrowers shall not effect
or permit any change in or amendment to any document or instrument pertaining to
the terms of any Borrower's capital stock. Notwithstanding the foregoing, no
Borrower shall make any Distribution
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under this Section 7.6 if a Default or Event of Default exists or would be
created by the making of such Distribution.
SECTION 7.7. EMPLOYEE BENEFIT PLANS. No Borrower nor any ERISA Affiliate
will:
(a) engage in any "prohibited transaction" within the meaning of Section
406 of ERISA or Section 4975 of the Code which could result in a material
liability for any Borrower; or
(b) permit any Guaranteed Pension Plan to incur an "accumulated funding
deficiency", as such term is defined in Section 302 of ERISA, whether or not
such deficiency is or may be waived; or
(c) fail to contribute to any Guaranteed Pension Plan to an extent
which, or terminate any Guaranteed Pension Plan in a manner which, could result
in the imposition of a lien or encumbrance on the assets of any Borrower
pursuant to Section 302(f) or Section 4068 of ERISA; or
(d) amend any Guaranteed Pension Plan in circumstances requiring the
posting of security pursuant to Section 307 of ERISA or Section 401(a)(29) of
the Code; or
(e) permit or take any action which would result in the aggregate
benefit liabilities (within the meaning of Section 4001 of ERISA) of all
Guaranteed Pension Plans exceeding the value of the aggregate assets of such
Plans, disregarding for this purpose the benefit liabilities and assets of any
such Plan with assets in excess of benefit liabilities.
SECTION 7.8. NEGATIVE PLEDGES. Except as required by any Scheduled
Contract in effect on the date hereof, no Borrower shall enter into or permit to
exist any arrangement or agreement, enforceable under applicable law, which
directly or indirectly prohibits such Borrower from creating or incurring any
lien, encumbrance, mortgage, pledge, charge, restriction or other security
interest in favor of the Agent for the benefit of the Banks and the Agent under
the Loan Documents other than customary anti-assignment provisions in leases and
licensing agreements entered into by such Borrower in the ordinary course of its
business.
SECTION 7.9. BUSINESS ACTIVITIES. No Borrower will engage directly or
indirectly (whether through Subsidiaries or otherwise) in any type of business
other than the businesses conducted by such Borrower on the Closing Date and in
related businesses.
SECTION 7.10. TRANSACTIONS WITH AFFILIATES. No Borrower will engage in
any transaction with any Affiliate (other than for services as employees,
officers and directors), including any contract, agreement or other arrangement
providing for the furnishing of services to or by, providing for rental of real
or personal property to or from, or otherwise requiring payments to or from any
such Affiliate or, to the knowledge of the Borrowers, any corporation,
partnership, trust or other entity in which any such Affiliate has a substantial
interest or is an officer, director, trustee or partner, on terms
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more favorable to such Person than would have been obtainable on an arm's-length
basis in the ordinary course of business.
SECTION 7.11. SUBORDINATED DEBT. No Borrower will amend, supplement or
otherwise modify the terms of any of the Subordinated Debt or any of the
documents evidencing such Subordinated Debt or prepay, redeem or repurchase any
of the Subordinated Debt; provided, however, so long as no Default or Event of
Default has occurred and is continuing, the Borrowers shall be permitted to make
regularly scheduled payments of interest and principal on the Subordinated Debt.
SECTION 8. FINANCIAL COVENANTS. The Borrowers covenant and agree that,
so long as any Loan, any Note, or any Reimbursement Obligation is outstanding or
the Banks have any obligation to make Loans or the Agent has any obligation to
issue, extend or renew any Letters of Credit hereunder:
SECTION 8.1. LEVERAGE RATIO. As of the end of any fiscal quarter of the
Borrowers commencing with the fiscal quarter ending March 31, 1999, the ratio of
Funded Debt to EBITDA (the "Leverage Ratio") shall not exceed 4.00:1. For the
purposes of this Section 8.1, EBITDA shall be calculated for the four fiscal
quarters ending on such date.
SECTION 8.2. FUNDED DEBT TO CAPITALIZATION RATIO. The Borrowers shall
not at any time permit the ratio of (a) Funded Debt to (b) the sum of Funded
Debt plus Consolidated Net Worth to exceed 65%.
SECTION 8.3. INTEREST COVERAGE RATIO. As of the end of any fiscal
quarter of the Borrowers commencing with the fiscal quarter ending March 31,
1999, the ratio of (a) EBIT to (b) Consolidated Total Interest Expense shall not
be less than 2.00:1; provided, that, any adjustments made pursuant to clause (f)
of the definition of EBIT shall not be included in the calculation of this
Section 8.3. The Interest Coverage Ratio shall be calculated for the four fiscal
quarters ending on such date.
SECTION 8.4. PROFITABLE OPERATIONS. The Borrowers will not permit
Consolidated Net Income to be less than $1.00 for any fiscal quarter, provided
that Consolidated Net Income may exclude (a) non-cash charges for interest
expense attributable to loan fees paid to BKB in connection with the Prior
Credit Agreement of up to $180,000 (after tax) in the aggregate taken in the
fiscal quarter ending ▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇) non-cash stock compensation charges of
up to $360,000 in the aggregate (to the extent deducted in determining
Consolidated Net Income), and (c) pooling charges taken in connection with any
acquisition permitted under Section 7.4.1 hereof to the extent such pooling
charges were deducted in determining Consolidated Net Income (or deficit).
SECTION 8.5. CAPITAL EXPENDITURES. The Borrowers will not make Capital
Expenditures in fiscal year 1998 in excess of $6,250,000 in the aggregate, and
in any fiscal year thereafter, in excess of, in the aggregate, 2.0 times the
actual depreciation expenses for such fiscal year.
SECTION 9. CLOSING CONDITIONS. The obligations of the Banks to make the
Loans and the Agent to issue Letters of Credit on the Closing Date and otherwise
be bound by
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the terms of this Credit Agreement shall be subject to the satisfaction of each
of the following conditions precedent:
SECTION 9.1. CORPORATE ACTION. All corporate action necessary for the
valid execution, delivery and performance by the Borrowers of the Loan Documents
shall have been duly and effectively taken, and satisfactory evidence thereof
shall have been provided to the Agent.
SECTION 9.2. LOAN DOCUMENTS, ETC. Each of the Loan Documents shall have
been duly and properly authorized, executed and delivered by the respective
parties thereto and shall be in full force and effect in a form satisfactory to
the Banks.
SECTION 9.3. CERTIFICATE OF SECRETARY; GOOD STANDING CERTIFICATES. The
Agent shall have received from each Borrower a certificate as to the good
standing of each from the Secretary of State or other appropriate official of
the state of its organization, dated no earlier than March 1, 1999. The Agent
shall also have received from each Borrower a certificate of its Secretary
certifying the following attachments thereto: (a) a copy of its certificate or
articles of incorporation or constitutive documents, in each case as amended to
date, certified by the Secretary of State or other appropriate official of the
state of its organization, (b) a true and correct copy of its by-laws, including
all amendments thereto, (c) a true and correct copy of the resolutions of its
board of directors authorizing the transactions contemplated hereunder and under
the other Loan Documents. Such Secretary's Certificate shall also give the name
and bear a specimen signature of each individual who shall be authorized (i) to
sign the Loan Documents on behalf of the Borrowers; (ii) to make Loan and Letter
of Credit Requests; and (iii) to give notices and to take other action on the
Borrowers' behalf under the Loan Documents.
SECTION 9.4. VALIDITY OF LIENS. The Security Documents shall be
effective to create in favor of the Agent a legal, valid and enforceable first
(except for Permitted Liens entitled to priority under applicable law) security
interest in and lien upon the Collateral. All filings, recordings, deliveries of
instruments and other actions necessary or desirable in the opinion of the Agent
to protect and preserve such security interests shall have been duly effected.
The Agent shall have received evidence thereof in form and substance
satisfactory to the Agent.
SECTION 9.5. PERFECTION CERTIFICATES AND UCC SEARCH RESULTS. The Agent
shall have received from each Borrower a completed and fully executed Perfection
Certificate and the results of UCC searches with respect to the Collateral,
indicating no liens other than Permitted Liens and otherwise in form and
substance satisfactory to the Agent.
SECTION 9.6. CERTIFICATES OF INSURANCE. The Agent shall have received a
certificate of insurance signed by the insurer or an agent authorized to bind
the insurer dated as of the Closing Date, or within 15 days prior thereto,
identifying insurers, types of insurance, insurance limits, and policy terms,
and otherwise describing the Borrowers' insurance coverage obtained in
accordance with the provisions of the Security Agreement.
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SECTION 9.7. LEGAL OPINIONS. The Agent shall have received a favorable
legal opinion from counsel to the Borrowers, addressed to the Agent and the
Banks, dated as of the Closing Date, in form and substance satisfactory to the
Agent.
SECTION 9.8. ENVIRONMENTAL PERMIT CERTIFICATE. The Banks shall have
received an environmental permit certificate in substantially the form of
Exhibit E from the Borrowers satisfactory to the Agent concerning principal
operating permits at the Borrowers' principal operating facilities.
SECTION 9.9. PAYMENT OF FEES. The Borrowers shall have paid any fees
(including, without limitation, those fees set forth in Section 4.1) owing to
any of the Banks, the Agent or the Arranger.
SECTION 9.10. CLOSING CERTIFICATE. The Borrowers shall have delivered to
the Agent a certificate, dated as of the Closing Date, stating that, as of such
date (a) the representations and warranties set forth herein or in any other
Loan Document are true and correct (b) no Default or Event of Default has
occurred and is continuing, and (c) each Material Contract is in full force and
effect, and no default or event of default has occurred and is continuing under
any Material Contract.
SECTION 10. CONDITIONS OF ALL LOANS. The obligations of the Banks to
make any Loan (including without limitation the obligation of the Agent to
issue, extend or renew any Letter of Credit) on and subsequent to the Closing
Date is subject to the following conditions precedent:
SECTION 10.1. REPRESENTATIONS TRUE; NO EVENT OF DEFAULT. Each of the
representations and warranties of the Borrowers contained in this Credit
Agreement or in any document or instrument delivered pursuant to or in
connection with this Credit Agreement shall be true as of the date as of which
they were made and shall also be true at and as of the time of any Drawdown Date
or the issuance of any Letter of Credit with the same effect as if made at and
as of that time (except to the extent of changes resulting from transactions
contemplated or permitted by this Credit Agreement and changes occurring in the
ordinary course of business which singly or in the aggregate are not materially
adverse, or to the extent that such representations and warranties relate solely
and expressly to an earlier date) and no Default or Event of Default shall have
occurred and be continuing.
SECTION 10.2. PERFORMANCE; NO EVENT OF DEFAULT. The Borrowers shall have
performed and complied with all terms and conditions herein required to be
performed or complied with by the Borrowers prior to or at the time of any Loan,
and at the time of any Loan, there shall exist no Event of Default or condition
which would result in an Event of Default upon consummation of such Loan
(including without limitation any amounts to be drawn under a Letter of Credit).
Each request by the Borrowers for a Loan (including without limitation each
request for issuance of a Letter of Credit) subsequent to the first Loan shall
constitute certification by the Borrowers that the conditions specified in
Sections 10.1 and 10.2 will be duly satisfied on the date of such Loan or Letter
of Credit issuance.
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SECTION 10.3. NO LEGAL IMPEDIMENT. No change shall have occurred in any
law or regulations thereunder or interpretations thereof which in the reasonable
opinion of the Banks would make it illegal for the Banks to make Loans
hereunder.
SECTION 10.4. GOVERNMENTAL REGULATION. The Banks shall have received
such statements in form and substance reasonably satisfactory to the Banks as
they shall require for the purpose of compliance with any applicable regulations
of the Comptroller of the Currency or the Board of Governors of the Federal
Reserve System.
SECTION 10.5. PROCEEDINGS AND DOCUMENTS. All proceedings in connection
with the transactions contemplated by this Credit Agreement and all documents
incident thereto shall have been delivered to the Banks as of the date hereof in
form and substance satisfactory to the Banks, including without limitation a
Loan and Letter of Credit Request in the form attached hereto as Exhibit B, and
the Banks shall have received all information and such counterpart originals or
certified or other copies of such documents as the Banks may reasonably request.
SECTION 11. COLLATERAL SECURITY.
(a) The Obligations shall be secured by a (i) perfected first
priority security interest (subject only to Permitted Liens entitled to priority
under applicable law or under Section 7.2(h)) in all of the assets of the
Borrowers, whether now owned or hereafter acquired, pursuant to the terms of the
Security Documents to which the Borrowers are a party, and (ii) a pledge of all
of the stock of each Subsidiary pursuant to the terms of the Stock Pledge
Agreements.
(b) The Borrowers hereby acknowledge that (i) any and all
Uniform Commercial Code financing statements filed in connection with the Prior
Credit Agreement naming BankBoston, N.A., as Agent, as secured party, and such
Borrower, as debtor, shall be effective to perfect the Agent's security interest
granted by such Borrower pursuant to this Credit Agreement to the extent that
such security interest may be perfected by the filing of Uniform Commercial Code
financing statements and (ii) such prior filings represent pre-filings of
Uniform Commercial Code financing statements for purposes of so perfecting the
security interest granted by the Borrowers hereunder. Until all of the
Obligations have been finally paid and satisfied in full, the provisions of this
Section 11(b) shall continue to apply, and such pre-filings shall continue to be
effective and not subject to any right of termination in respect of the security
interests granted herein, whether any obligations under the Prior Credit
Agreement are to be discharged with the proceeds of any of the Loans or are to
continue independently or otherwise.
SECTION 12. EVENTS OF DEFAULT; ACCELERATION; TERMINATION OF COMMITMENT.
SECTION 12.1. EVENTS OF DEFAULT AND ACCELERATION. If any of the
following events ("Events of Default" or, if the giving of notice or the lapse
of time or both is required, then, prior to such notice and/or lapse of time,
"Defaults") shall occur:
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(a) if the Borrowers shall fail to pay any principal of the Loans or any
Reimbursement Obligation when the same shall become due and payable, whether at
the Maturity Date or any accelerated date of maturity or at any other date fixed
for payment;
(b) if the Borrowers shall fail to pay any interest or fees or other
amounts owing hereunder within five (5) Business Days after the same shall
become due and payable whether at the Maturity Date or any accelerated date of
maturity or at any other date fixed for payment;
(c) if the Borrowers shall fail to comply with the covenants contained
in Sections 6.1, 6.7, 6.8, 6.10, 6.13, 6.14, 6.16, 6.17, 6.19, 7 or 8;
(d) if the Borrowers shall fail to comply with the covenants contained
in (i) Sections 6.2, 6.3, 6.5, 6.6, 6.9, 6.11, 6.12, 6.15, or 6.18 within thirty
(30) days of the Borrowers' knowledge of a violation of such covenants or (ii)
Section 6.4 within five (5) days of the Borrowers' knowledge of a violation of
such covenant;
(e) if the Borrowers shall fail to perform any term, covenant or
agreement contained herein or in any of the other Loan Documents (other than
those specified in subsections (a), (b), (c) and (d) above) within 30 days after
written notice of such failure has been given to the Borrowers by the Agent or
any Bank;
(f) if any representation or warranty contained in this Credit Agreement
or in any document or instrument delivered pursuant to or in connection with
this Credit Agreement shall prove to have been false in any material respect
upon the date when made or repeated;
(g) if any Borrower shall fail to pay at maturity, or within any
applicable period of grace, any and all obligations for borrowed money (other
than the Obligations) or any guaranty with respect thereto in an aggregate
amount greater than $250,000 or fail to observe or perform any material term,
covenant or agreement contained in any agreement by which it is bound,
evidencing or securing borrowed money in an aggregate amount greater than
$250,000 for such period of time as would, or would have permitted (assuming the
giving of appropriate notice if required) the holder or holders thereof or of
any obligations issued thereunder to accelerate the maturity thereof, unless the
same shall have been waived by the holder(s) thereof; or
(h) if any Borrower makes an assignment for the benefit of creditors, or
admits in writing its inability to pay or generally fails to pay its debts as
they mature or become due, or petitions or applies for the appointment of a
trustee or other custodian, liquidator or receiver of any Borrower or of any
substantial part of the assets of any Borrower or commences any case or other
proceeding relating to any Borrower under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or liquidation or
similar law of any jurisdiction, now or hereafter in effect, or takes any action
to authorize or in furtherance of any of the foregoing, or if any such petition
or application is filed or any such case or other proceeding is commenced
against any Borrower or such Borrower indicates its approval thereof, consent
thereto or
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acquiescence therein, or such petition or application shall not have been
dismissed within sixty (60) days following the filing thereof;
(i) a decree or order is entered appointing any such trustee, custodian,
liquidator or receiver or adjudicating any Borrower bankrupt or insolvent, or
approving a petition in any such case or other proceeding, or a decree or order
for relief is entered in respect of any Borrower in an involuntary case under
federal bankruptcy laws as now or hereafter constituted;
(j) if there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty (30) days, whether or not consecutive, any final
judgment against any Borrower which, with other outstanding final judgments
against the Borrowers, exceeds in the aggregate $250,000 after taking into
account any undisputed insurance coverage;
(k) any Borrower or any ERISA Affiliate incurs any liability to the PBGC
or a Guaranteed Pension Plan pursuant to Title IV of ERISA in an aggregate
amount exceeding $250,000, or any Borrower or any ERISA Affiliate is assessed
withdrawal liability pursuant to Title IV of ERISA by a Multiemployer Plan
requiring aggregate annual payments exceeding $250,000, or any of the following
occurs with respect to a Guaranteed Pension Plan: (i) an ERISA Reportable Event,
or a failure to make a required installment or other payment (within the meaning
of Section 302(f)(1) of ERISA), provided that the Agent determines in its
reasonable discretion that such event (A) could be expected to result in
liability of any Borrower to the PBGC or such Guaranteed Pension Plan in an
aggregate amount exceeding $250,000 and (B) could constitute grounds for the
termination of such Guaranteed Pension Plan by the PBGC, for the appointment by
the appropriate United States District Court of a trustee to administer such
Guaranteed Pension Plan or for the imposition of a lien in favor of such
Guaranteed Pension Plan; or (ii) the appointment by a United States District
Court of a trustee to administer such Guaranteed Pension Plan; or (iii) the
institution by the PBGC of proceedings to terminate such Guaranteed Pension
Plan;
(l) if any of the Loan Documents shall be cancelled, terminated, revoked
or rescinded or the Agent's security interests or liens in a substantial portion
of the Collateral shall cease to be perfected, or shall cease to have the
priority contemplated by the Security Documents, in each case otherwise than in
accordance with the terms thereof or with the express prior written agreement,
consent or approval of the Banks, or any action at law, suit or in equity or
other legal proceeding to cancel, revoke or rescind any of the Loan Documents
shall be commenced by or on behalf of any Borrower or any stockholder of any
Borrower who is an officer or director of such Borrower, or any court or any
other governmental or regulatory authority or agency of competent jurisdiction
shall make a determination that, or issue a judgment, order, decree or ruling to
the effect that, any one or more of the Loan Documents is illegal, invalid or
unenforceable in accordance with the terms thereof;
(m) (i) the Parent shall at any time, legally or beneficially own less
than one hundred percent (100%) of the shares of the capital stock of each other
Borrower (directly or indirectly in accordance with Section 6.17), or (ii) any
person or group of persons (within the meaning of Section 13 or 14 of the
Securities Exchange Act of 1934, as
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amended) other than existing shareholders of the Parent as of the Closing Date
shall have acquired beneficial ownership (within the meaning of Rule 13d-3
promulgated by the Securities and Exchange Commission under said Act) of 20% or
more of the outstanding shares of common stock of the Parent; or, during any
period of twelve consecutive calendar months, individuals who were directors of
the Parent on the first day of such period shall cease to constitute a majority
of the board of directors; provided, however, that any such change of control
resulting from an acquisition permitted under Section 7.4 shall not constitute a
Default or an Event of Default hereunder; or
(n) the early termination or cancellation of, or any material default by
a Borrower under, any Material Contract;
then, and in any such event, so long as the same may be continuing, the Agent
may, and at the request of the Majority Banks shall, by notice in writing to the
Borrowers, declare all amounts owing with respect to this Credit Agreement, the
Notes and the other Loan Documents and all Reimbursement Obligations to be, and
they shall thereupon forthwith become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Borrowers; provided that in the event of any
Event of Default specified in Sections 12.1(h) or 12.1(i), all such amounts
shall become immediately due and payable automatically and without any
requirement of notice from the Agent or any Bank. Upon demand by the Banks after
the occurrence of any Event of Default, the Borrowers shall immediately provide
to the Agent cash in an amount equal to the Maximum Drawing Amount, to be held
by the Agent as collateral security for the Obligations, provided that in the
event of any Event of Default specified in Sections 12.1(h) or 12.1(i), all such
amounts shall become immediately due and payable automatically and without any
requirement of notice from the Agent or any Bank.
SECTION 12.2. TERMINATION OF COMMITMENTS. If any Event of Default shall
occur, the Agent may, and at the request of the Majority Banks shall, by notice
to the Borrowers, terminate the unused portion of the Total Commitment
hereunder, and upon such notice being given, such unused portion of the Total
Commitment hereunder shall terminate immediately and the Banks shall be relieved
of all further obligations to make Loans to or issue Letters of Credit for the
account of the Borrowers hereunder, provided that in the event of any Event of
Default specified in Sections 12.1(h) or 12.1(i), all such amounts shall become
immediately due and payable automatically and without any requirement of notice
from the Agent or any Bank. No termination of any portion of the Total
Commitment hereunder shall relieve the Borrowers of any of their existing
Obligations to the Banks hereunder or elsewhere.
SECTION 12.3. REMEDIES. Subject to Section 13, in case any one or more
Events of Default shall have occurred and be continuing, and whether or not the
Banks shall have accelerated the maturity of the Loans pursuant to Section 12.1,
each Bank, if owed any amount with respect to the Loans or the Reimbursement
Obligations, may, with the consent of the Majority Banks but not otherwise, and
if the Agent shall have received opinions of nationally recognized law firms
specializing in California law, Louisiana law, and the law of any other state,
as applicable, having a one form of action rule to the effect that actions by
such Bank under such circumstances shall not constitute an action for purposes
of
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such state's one form of action rule or in any other way impair the Collateral
or the other Banks' rights hereunder or under the other Loan Documents, proceed
to protect and enforce its rights by suit in equity, action at law or other
appropriate proceeding, whether for the specific performance of any covenant or
agreement contained in this Credit Agreement and the other Loan Documents or any
instrument pursuant to which the Obligations to such Bank are evidenced,
including, without limitation, as permitted by applicable law the obtaining of
the ex parte appointment of a receiver, and, if such amount shall have become
due, by declaration or otherwise, proceed to enforce the payment thereof or any
legal or equitable right of such Bank. No remedy herein conferred upon any Bank
or the Agent or the holder of any Note or purchaser of any Letter of Credit
Participation is intended to be exclusive of any other remedy and each and every
remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute or any
other provision of law.
SECTION 13. SETOFF. Regardless of the adequacy of any collateral, during
the continuance of an Event of Default, any deposits or other sums credited by
or due from any Bank to the Borrowers and any securities or other property of
the Borrowers in the possession of such Bank may be applied to or set off
against the payment of the Obligations and any and all other liabilities, direct
or indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, of the Borrowers to the Banks. The Banks agree among
themselves that, if a Bank shall obtain payment on any Obligation outstanding
under this Credit Agreement through the exercise of a right of offset, banker's
lien or counterclaim, or from any other source including under Section 12.3
(other than by way of a pro rata payment under this Credit Agreement), it shall
promptly make such adjustments with the other Banks as shall be equitable to the
end that all the Banks shall share the benefits of such payments pro rata in
accordance with the aggregate unpaid amount of the Revolving Credit Notes held
by each Bank immediately prior to the payment obtained by such Bank as
aforesaid. The Banks further agree among themselves that if any payment to a
Bank obtained by such Bank through the exercise of a right of offset, banker's
lien or counterclaim, or from any other source (other than by way of a pro rata
payment) as aforesaid shall be rescinded or must otherwise be restored, the
Banks who shall have shared the benefit of such payment shall return their share
of that benefit to the Bank whose payment shall have been rescinded or otherwise
restored.
SECTION 14. THE AGENT.
SECTION 14.1. APPOINTMENT OF AGENT, POWERS AND IMMUNITIES. Each Bank
hereby irrevocably appoints and authorizes the Agent to act as its agent
hereunder and under the other Loan Documents, provided, however, the Agent is
hereby authorized to serve only as an administrative and collateral agent for
the Banks and to exercise such powers as are reasonably incidental thereto and
as are set forth in this Credit Agreement and the other Loan Documents. The
Agent hereby acknowledges that it does not have the authority to negotiate any
agreement which would bind the Banks or agree to any amendment, waiver or
modification of any of the Loan Documents or bind the Banks except as set forth
in this Credit Agreement or the Loan Documents. Except as provided in this
Section 14 and in the other Loan Documents, the Agent shall take action or
refrain from acting only upon
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instructions of the Banks and no action taken or failure to act without the
consent of the Banks shall be binding on any Bank which has not consented. Each
Bank irrevocably authorizes the Agent to execute the Security Documents and all
other instruments relating thereto and to take such action on behalf of each of
the Banks and to exercise all such powers as are expressly delegated to the
Agent under the Loan Documents and all related documents, together with such
other powers as are reasonably incidental thereto. It is agreed that the duties,
rights, privileges and immunities of BKB, in its capacity as issuer of Letters
of Credit hereunder, shall be identical to its duties, rights, privileges and
immunities as a Bank as provided in this Section 14. The Agent shall not have
any duties or responsibilities or any fiduciary relationship with any Bank
except those expressly set forth in this Credit Agreement. Neither the Agent nor
any of its affiliates shall be responsible to the Banks for any recitals,
statements, representations or warranties made by the Borrowers or any other
Person whether contained herein or otherwise or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Credit
Agreement, the other Loan Documents or any other document referred to or
provided for herein or therein or for any failure by the Borrowers or any other
Person to perform its obligations hereunder or thereunder or in respect of the
Notes. The Agent may employ agents and attorneys-in-fact and shall not be
responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. The Agent shall exercise
the same care in administering the Loans as it exercises with respect to similar
transactions entered into solely for its own account; however, neither the Agent
nor any of its directors, officers, employees or agents shall be responsible for
any action taken or omitted to be taken in good faith by it or them hereunder or
in connection herewith, except for its or their own gross negligence or willful
misconduct. The Bank in its separate capacity as a Bank shall have the same
rights and powers hereunder as any other Bank.
SECTION 14.2. ACTIONS BY AGENT. The Agent shall be fully justified in
failing or refusing to take any action under this Credit Agreement as it
reasonably deems appropriate unless it shall first have received such advice or
concurrence of the Banks and shall be indemnified to its reasonable satisfaction
by the Banks against any and all liability and expense which may be incurred by
it by reason of taking or continuing to take any such action. The Agent shall in
all cases be fully protected in acting, or in refraining from acting, under this
Credit Agreement or any of the Loan Documents in accordance with a request of
the Majority Banks, and such request and any action taken or failure to act
pursuant thereto shall be binding upon the Banks and all future holders of the
Notes or any Letter of Credit Participation.
SECTION 14.3. INDEMNIFICATION. Without limiting the obligations of the
Borrowers under this Credit Agreement or any other Loan Document, the Banks
ratably agree hereby to indemnify and hold harmless the Agent, the Arranger, and
their affiliates from and against any and all claims, actions and suits (whether
groundless or otherwise), losses, damages, costs, expenses (including any
expenses for which the Agent, the Arranger or such affiliate has not been
reimbursed by the Borrowers as required by Section 15), and liabilities of every
nature and character arising out of or related to this Credit Agreement, the
Notes, or any of the other Loan Documents or the transactions contemplated or
evidenced hereby or thereby, or the Agent's actions taken hereunder
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or thereunder, except to the extent that any of the same shall be directly
caused by the Agent's willful misconduct or gross negligence, it being the
intent of the parties hereto that all such indemnified parties shall be
indemnified for their ordinary sole or contributory negligence.
SECTION 14.4. REIMBURSEMENT. Without limiting the provisions of Section
14.3, the Banks and the Agent hereby agree that the Agent shall not be obliged
to make available to any Person any sum which the Agent is expecting to receive
for the account of that Person until the Agent has determined that it has
received that sum. The Agent may, however, disburse funds prior to determining
that the sums which the Agent expects to receive have been finally and
unconditionally paid to the Agent, if the Agent wishes to do so. If and to the
extent that the Agent does disburse funds and it later becomes known that the
Agent did not then receive a payment in an amount equal to the sum paid out,
then any Person to whom the Agent made the funds available shall, on demand from
the Agent, refund to the Agent the sum paid to that Person. If, in the opinion
of the Agent, the distribution of any amount received by it in such capacity
hereunder or under the Loan Documents might involve it in liability, it may
refrain from making distribution until its right to make distribution shall have
been adjudicated by a court of competent jurisdiction. If a court of competent
jurisdiction shall adjudge that any amount received and distributed by the Agent
is to be repaid, each Person to whom any such distribution shall have been made
shall either repay to the Agent its proportionate share of the amount so
adjudged to be repaid or shall pay over the same in such manner and to such
Persons as shall be determined by such court.
SECTION 14.5. DOCUMENTS.
SECTION 14.5.1. CLOSING DOCUMENTATION. For purposes of
determining compliance with the conditions set forth in Section 9, each Bank
that has executed this Credit Agreement shall be deemed to have consented to,
approved or accepted, or to be satisfied with, each document and matter either
sent, or made available, by the Agent or the Arranger to such Bank for consent,
approval, acceptance or satisfaction, or required thereunder to be consented to
or approved by or acceptable or satisfactory to such Bank, unless the Agent
shall have received notice from such Bank prior to the Closing Date specifying
such Bank's objection thereto and such objection shall not have been withdrawn
by notice to the Agent to such effect on or prior to the Closing Date.
SECTION 14.5.2. OTHER DOCUMENTS. The Agent will forward to each
Bank, promptly after the Agent's receipt thereof, a copy of each notice or other
document furnished to the Agent for such Bank hereunder; provided, however, that
notwithstanding the foregoing, the Agent may furnish to the Banks a monthly
summary with respect to Letters of Credit issued hereunder in lieu of copies of
the related Letter of Credit Applications.
SECTION 14.6. NON-RELIANCE ON AGENT AND OTHER BANKS. Each Bank
represents that it has, independently and without reliance on the Agent or any
other Bank, and based on such documents and information as it has deemed
appropriate, made its own appraisal of the financial condition and affairs of
the Borrowers and decision to enter into this Credit Agreement and the other
Loan Documents and agrees that it will, independently and
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without reliance upon the Agent or any other Bank, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own appraisals and decisions in taking or not taking action under this Credit
Agreement or any other Loan Document. The Agent shall not be required to keep
informed as to the performance or observance by the Borrowers of this Credit
Agreement, the other Loan Documents or any other document referred to or
provided for herein or therein or by any other Person of any other agreement or
to make inquiry of, or to inspect the properties or books of, any Person. Except
for notices, reports and other documents and information expressly required to
be furnished to the Banks by the Agent hereunder, the Agent shall not have any
duty or responsibility to provide any Bank with any credit or other information
concerning any person which may come into the possession of the Agent or any of
its affiliates. Each Bank shall have access to all documents relating to the
Agent's performance of its duties hereunder at such Bank's request. Unless any
Bank shall promptly object to any action taken by the Agent hereunder (other
than actions to which the provisions of Section 14.8 are applicable and other
than actions which constitute gross negligence or willful misconduct by the
Agent), such Bank shall conclusively be presumed to have approved the same.
SECTION 14.7. RESIGNATION OR REMOVAL OF AGENT. The Agent may resign at
any time by giving 60 days' prior written notice thereof to the Banks and the
Borrowers. Upon any such resignation, the Banks shall have the right to appoint
a successor Agent. If no successor Agent shall have been so appointed by the
Banks (and, provided that no Default or Event of Default shall have occurred and
be continuing, approved by the Borrowers, such approval not to be unreasonably
withheld) and shall have accepted such appointment within 30 days after the
retiring Agent's giving of notice of resignation, then the retiring Agent may,
on behalf of the Banks, appoint a successor Agent, which shall be a financial
institution having a combined capital and surplus in excess of $150,000,000.
Upon the acceptance of any appointment as Agent hereunder 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 from its duties and obligations hereunder. After any
retiring Agent's resignation, the provisions of this Credit Agreement shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as Agent. Any new Agent appointed pursuant to
this Section 14.7 shall immediately issue new Letters of Credit in place of
Letters of Credit previously issued by the Agent (to the extent such Letters of
Credit are returned by the beneficiaries for purposes of such exchange).
SECTION 14.8. CONSENTS, AMENDMENTS, WAIVERS, ETC. Any consent or
approval required or permitted by this Credit Agreement to be given by the Banks
may be given, and any term of this Credit Agreement, the other Loan Documents or
any other instrument related hereto or mentioned herein may be amended, and the
performance or observance by the Borrowers of any terms of this Credit
Agreement, the other Loan Documents or such other instrument or the continuance
of any Default or Event of Default may be waived (either generally or in a
particular instance and either retroactively or prospectively) with, but only
with, the written consent of the Borrowers and the written consent of the
Majority Banks, provided however, that the Agent may, in its reasonable
discretion, release Collateral with an aggregate value of $500,000 or less in
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any calendar year. Notwithstanding the foregoing, no amendment, waiver or
consent shall do any of the following unless in writing and signed by the
Borrowers and each of the Banks affected thereby: (a) increase the Commitments
of the Banks or subject any Bank to any additional obligations (other than in
accordance with Section 2.2.2 hereof), or (b) reduce the principal of or the
rate of interest on the Notes (including, without limitation, interest on
overdue amounts) or any fees payable hereunder; and FURTHER, no amendment,
waiver or consent shall do any of the following unless in writing and signed by
ALL of the Banks: (c) postpone the Maturity Date or any date fixed for any
payment in respect of principal or interest (including, without limitation,
interest on overdue amounts) on the Notes, (d) change the definition of
"Majority Banks" or the number of Banks which shall be required for the Banks or
any of them to take any action under the Loan Documents; (e) amend Section
2.2.2, this Section 14.8 or Section 18; (f) release any Collateral with an
aggregate value exceeding $500,000 in any calendar year or (g) release any
Borrower from its obligations hereunder.
No waiver shall extend to or affect any obligation not expressly waived
or impair any right consequent thereon. No course of dealing or delay or
omission on the part of the Agent or any Bank in exercising any right shall
operate as a waiver thereof or otherwise be prejudicial thereto. No notice to or
demand upon the Borrowers shall entitle the Borrowers to other or further notice
or demand in similar or other circumstances.
SECTION 14.9. DELINQUENT BANKS. Notwithstanding anything to the contrary
contained in this Credit Agreement or any of the other Loan Documents, any Bank
that fails (i) to make available to the Agent its pro rata share of any Loan or
to purchase any Letter of Credit Participation or (ii) to comply with the
provisions of Section 13 with respect to making dispositions and arrangements
with the other Banks, where such Bank's share of any payment received, whether
by setoff or otherwise, is in excess of its pro rata share of such payments due
and payable to all of the Banks, in each case as, when and to the full extent
required by the provisions of this Credit Agreement, shall be deemed delinquent
(a "Delinquent Bank") and shall be deemed a Delinquent Bank until such time as
such delinquency is satisfied. A Delinquent Bank shall be deemed to have
assigned any and all payments due to it from the Borrowers, whether on account
of outstanding Loans, Reimbursement Obligations, interest, fees or otherwise, to
the remaining nondelinquent Banks for application to, and reduction of, their
respective pro rata shares of all outstanding Loans and Reimbursement
Obligations. The Delinquent Bank hereby authorizes the Agent to distribute such
payments to the nondelinquent Banks in proportion to their respective pro rata
shares of all outstanding Loans and Reimbursement Obligations. A Delinquent Bank
shall be deemed to have satisfied in full a delinquency when and if, as a result
of application of the assigned payments to all outstanding Loans and
Reimbursement Obligations of the nondelinquent Banks, the Banks' respective pro
rata shares of all outstanding Loans and Reimbursement Obligations have returned
to those in effect immediately prior to such delinquency and without giving
effect to the nonpayment causing such delinquency.
SECTION 14.10. CO-AGENTS. None of the Co-Agents shall have any right,
power, obligation, liability, responsibility or duty under this Credit Agreement
other than those applicable to all Banks as such. Without limiting the
foregoing, none of the Co-Agents
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shall have or be deemed to have any fiduciary relationship with any Bank. Each
Bank acknowledges that it has not relied, and will not rely, on any Co-Agent in
deciding to enter into this Credit Agreement or not taking any action hereunder.
SECTION 15. EXPENSES AND INDEMNIFICATION.
SECTION 15.1. EXPENSES. Whether or not the transactions contemplated
herein shall be consummated, the Borrowers agree to pay (a) the reasonable costs
of producing and reproducing this Credit Agreement, the other Loan Documents and
the other agreements and instruments mentioned herein, (b) any taxes (including
any interest and penalties in respect thereto) payable by the Agent or any of
the Banks (other than taxes based upon the Agent's or any Bank's net income) on
or with respect to the transactions contemplated by this Credit Agreement (the
Borrowers hereby agreeing to indemnify the Agent and each Bank with respect
thereto), (c) the reasonable fees, expenses and disbursements of counsel to the
Agent incurred in connection with the preparation, syndication, administration
or interpretation of the Loan Documents and other instruments mentioned herein,
each closing hereunder, any amendments, modifications, approvals, consents or
waivers hereto or hereunder, or the cancellation of any Loan Document upon
payment in full in cash of all of the Obligations or pursuant to any terms of
such Loan Document providing for such cancellation, (d) the reasonable fees,
expenses and disbursements of the Agent, the Arranger, or any of their
affiliates incurred by the Agent, the Arranger, or such affiliate in connection
with the preparation, syndication, administration or interpretation of the Loan
Documents and other instruments mentioned herein, including all title insurance
premiums and surveyor, engineering and appraisal charges, (e) all reasonable
out-of-pocket expenses (including without limitation reasonable attorneys' fees
and costs, which attorneys may be employees of any Bank or the Agent, and
reasonable consulting, accounting, appraisal, investment banking and similar
professional fees and charges) incurred by any Bank or the Agent in connection
with (i) the enforcement of or preservation of rights under any of the Loan
Documents against the Borrowers or the administration thereof after the
occurrence of a Default or Event of Default and (ii) any litigation, proceeding
or dispute whether arising hereunder or under any of the other Loan Documents,
in any way related to any Bank's or the Agent's relationship with the Borrowers
and (f) all reasonable fees, expenses and disbursements of the Agent incurred in
connection with UCC searches and UCC filings.
SECTION 15.2. INDEMNIFICATION. The Borrowers agree to indemnify and hold
harmless the Agent, the Arranger, the Banks and each of their respective
affiliates, shareholders, officers, directors, employees and agents from and
against any and all claims, actions and suits whether groundless or otherwise,
and from and against any and all liabilities, losses, damages and expenses of
every nature and character arising out of this Credit Agreement or any of the
other Loan Documents or the transactions contemplated hereby including, without
limitation, (a) any actual or proposed use by the Borrowers of the proceeds of
any of the Loans or Letters of Credit, (b) the Borrowers entering into or
performing this Credit Agreement or any of the other Loan Documents or (c) with
respect to the Borrowers and their respective properties and assets, the
violation of any Environmental Law, the presence, disposal, escape, seepage,
leakage, spillage, discharge, emission, release or threatened release of any
Hazardous Substances or any action, suit, proceeding
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or investigation brought or threatened with respect to any Hazardous Substances
(including, but not limited to, claims with respect to wrongful death, personal
injury or damage to property), in each case including, without limitation, the
reasonable fees and disbursements of counsel and allocated costs of internal
counsel incurred in connection with any such investigation, litigation or other
proceeding. In litigation, or the preparation therefor, the Banks and the Agent,
the Arranger, and their affiliates shall be entitled to select their own counsel
and, in addition to the foregoing indemnity, the Borrowers agree to pay promptly
the reasonable fees and expenses of such counsel. If, and to the extent that the
obligations of the Borrowers under this Section 15.2 are unenforceable for any
reason, the Borrowers hereby agree to make the maximum contribution to the
payment in satisfaction of such obligations which is permissible under
applicable law.
SECTION 15.3. SURVIVAL. The covenants contained in this Section 15 shall
survive payment or satisfaction in full of all other Obligations.
SECTION 16. SURVIVAL OF COVENANTS, ETC. Unless otherwise stated herein,
all covenants, agreements, representations and warranties made herein, in the
other Loan Documents or in any documents or other papers delivered by or on
behalf of the Borrowers pursuant hereto shall be deemed to have been relied upon
by the Banks and the Agent, notwithstanding any investigation heretofore or
hereafter made by any of them, and shall survive the making by the Banks of the
Loans and the issuance, extension or renewal of any Letters of Credit, as herein
contemplated, and shall continue in full force and effect so long as any amount
due under this Credit Agreement, any Letter of Credit or the Notes remains
outstanding and unpaid or any Bank has any obligation to make any Loans or issue
any Letters of Credit hereunder. All statements contained in any certificate or
other paper delivered by or on behalf of the Borrowers pursuant hereto or in
connection with the transactions contemplated hereby shall constitute
representations and warranties by the Borrowers hereunder.
SECTION 17. ASSIGNMENT AND PARTICIPATION. It is understood and agreed
that each Bank shall have the right to assign or participate at any time all or
a portion of its Commitment and interests in the risk relating to any Loans and
outstanding Letters of Credit hereunder in an amount equal to or greater than
$5,000,000 (which assignment shall be of an equal percentage of such Bank's
Commitment, the Revolving Credit Loans and outstanding Letters of Credit) to
Eligible Assignees with the prior written consent of the Agent and, unless a
Default or an Event of Default shall have occurred and be continuing, the
Borrowers, which approvals shall not be unreasonably withheld. It is further
agreed that each Eligible Assignee which executes and delivers to the Banks and
the Borrowers an Assignment and Acceptance in substantially the form of Exhibit
F (an "Assignment and Acceptance") shall, on the date specified in such
Assignment and Acceptance, become a party to this Credit Agreement and the other
Loan Documents for all purposes of this Credit Agreement and the other Loan
Documents, and its Commitment shall be as set forth in such Assignment and
Acceptance. Upon the execution and delivery of such Assignment and Acceptance
and payment by the assigning bank of an assignment fee in the amount of $3,500
to the Agent, (a) the Borrowers shall issue to such Eligible Assignee a
Revolving Credit Note in the amount of such Eligible Assignee's Commitment dated
the Closing Date or such other date as may
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be specified by the Agent and otherwise completed in substantially the form of
Exhibit A hereto and, to the extent any assigning Bank has retained a portion of
its obligations hereunder, a replacement Revolving Credit Note to the assigning
Bank; (b) the Agent shall distribute to the Borrowers, the Banks and such
Eligible Assignee a schedule reflecting such changes; (c) this Credit Agreement
shall be appropriately amended to reflect (i) the status of such Eligible
Assignee as a party hereto and (ii) the status and rights of the Banks and Agent
hereunder; and (d) the Borrowers shall take such action as the Agent may
reasonably request to perfect any security interests in favor of the Banks,
including any Eligible Assignee which becomes a party to this Credit Agreement.
The documents evidencing any such participation may provide that, except with
the consent of the bank or financial institution that is a party thereto, such
Bank will not consent to (A) the reduction in or forgiveness of the stated
principal of or rate of interest on or Commitment Fee with respect to the
portion of any Loan subject to such participation or assignment, (B) the
extension or postponement of any stated date fixed for payment of principal or
interest or Commitment Fee with respect to the portion of any Loan subject to
such participation or assignment, or (C) the waiver or reduction of any right to
indemnification of such Bank hereunder. Notwithstanding the foregoing, no
syndication or participation shall operate to increase the Total Commitment
hereunder or otherwise alter the substantive terms of this Credit Agreement,
except as contemplated under Section 2.2.2. Anything contained in this Section
17 to the contrary notwithstanding, any Bank may at any time pledge all or any
portion of its interest and rights under this Credit Agreement (including all or
any portion of its Notes) to any of the twelve Federal Reserve Banks organized
under Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such
pledge or the enforcement thereof shall release the pledgor Bank from its
obligations hereunder or under any of the other Loan Documents.
SECTION 18. PARTIES IN INTEREST. All the terms of this Credit Agreement
and the other Loan Documents shall be binding upon and inure to the benefit of
and be enforceable by the respective successors and assigns of the parties
hereto and thereto; provided that the Borrowers shall not assign or transfer
their rights hereunder without the prior written consent of each Bank.
SECTION 19. NOTICES, ETC. Except as otherwise expressly provided in this
Credit Agreement, all notices and other communications made or required to be
given pursuant to this Credit Agreement or the other Loan Documents shall be in
writing and shall be delivered in hand, mailed by United States first-class
mail, postage prepaid, or sent by telex or facsimile and confirmed by letter,
addressed as follows:
(a) if to the Borrowers, at Waste Connections, Inc., ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
Executive Vice President and Chief Financial Officer, telephone number
▇▇▇-▇▇▇-▇▇▇▇, fax number ▇▇▇-▇▇▇-▇▇▇▇;
(b) if to the Agent or BKB, at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Director, telephone number ▇▇▇-▇▇▇-▇▇▇▇,
telecopy number ▇▇▇-▇▇▇-▇▇▇▇;
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or such other address for notice as shall have last been furnished in
writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (a) if delivered by hand to a responsible
officer of the party to which it is directed, at the time of the receipt thereof
by such officer, (b) if sent by registered or certified first-class mail,
postage prepaid, five Business Days after the posting thereof, (c) if sent by
telex or cable, at the time of the dispatch thereof, if in normal business hours
in the country of receipt, or otherwise at the opening of business on the
following Business Day, and (d) if sent by facsimile, when transmitted,
confirmation received. -73-
SECTION 20. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
SECTION 20.1. SHARING OF INFORMATION WITH SECTION 20 SUBSIDIARY.
The Borrowers acknowledge that from time to time financial advisory, investment
banking and other services may be offered or provided to the Borrowers, in
connection with this Credit Agreement or otherwise, by a Section 20 Subsidiary.
The Borrowers hereby authorize (a) such Section 20 Subsidiary to share with the
Agent and each Bank any information delivered to such Section 20 Subsidiary by
the Borrowers, and (b) the Agent and each Bank to share with such Section 20
Subsidiary any information delivered to the Agent or such Bank by the Borrowers
pursuant to this Credit Agreement, or in connection with the decision of such
Bank to enter into this Credit Agreement; it being understood, in each case,
that any such Section 20 Subsidiary receiving such information shall be bound by
the confidentiality provisions of this Credit Agreement. Such authorization
shall survive the payment and satisfaction in full of all of the Obligations.
SECTION 20.2. CONFIDENTIALITY. Each of the Banks and the Agent
agrees, on behalf of itself and each of their affiliates, directors, officers,
employees and representatives, to use reasonable precautions to keep
confidential, in accordance with their customary procedures for handling
confidential information of the same nature and in accordance with safe and
sound banking practices, any non-public information supplied to it by the
Borrowers pursuant to this Credit Agreement that is identified by such Person as
being confidential at the time the same is delivered to the Banks or the Agent,
provided that nothing herein shall limit the disclosure of any such information
(a) after such information shall have become public other than through a
violation of this Section 20, (b) to the extent required by statute, rule,
regulation or judicial process, (c) to counsel for any of the Banks or the
Agent, (d) to bank examiners or any other regulatory authority having
jurisdiction over any Bank or the Agent, or to auditors or accountants, (e) to
the Agent, any Bank or any Section 20 Subsidiary, (f) in connection with any
litigation to which any one or more of the Banks, the Agent or any Section 20
Subsidiary is a party, or in connection with the enforcement of rights or
remedies hereunder or under any other Loan Document, (g) to a subsidiary or
affiliate of such Bank as provided in Section 20.1 or (h) to any assignee or
participant (or prospective assignee or participant) so long as such assignee or
participant agrees to be bound by the provisions of this Section 20.
SECTION 20.3. PRIOR NOTIFICATION. Unless specifically prohibited
by applicable law or court order, each of the Banks and the Agent shall, prior
to disclosure thereof,
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notify the Borrowers of any request for disclosure of any such non-public
information by any governmental agency or representative thereof (other than any
such request in connection with an examination of the financial condition of
such Bank by such governmental agency) or pursuant to legal process.
SECTION 20.4. OTHER. In no event shall any Bank or the Agent be
obligated or required to return any materials furnished to it or any Section 20
Subsidiary by the Borrowers. The obligations of each Bank under this Section 20
shall supersede and replace the obligations of such Bank under any
confidentiality letter in respect of this financing signed and delivered by such
Bank to the Borrowers prior to the date hereof and shall be binding upon any
assignee of, or purchaser of any participation in, any interest in any of the
Loans or Reimbursement Obligations from any Bank.
SECTION 21. MISCELLANEOUS. The rights and remedies herein expressed are
cumulative and not exclusive of any other rights which the Banks or Agent would
otherwise have. The captions in this Credit Agreement are for convenience of
reference only and shall not define or limit the provisions hereof. This Credit
Agreement and any amendment hereof may be executed in several counterparts and
by each party on a separate counterpart, each of which when so executed and
delivered shall be an original, but all of which together shall constitute one
instrument. In proving this Credit Agreement it shall not be necessary to
produce or account for more than one such counterpart signed by the party
against whom enforcement is sought.
SECTION 22. ENTIRE AGREEMENT, ETC. The Loan Documents and any other
documents executed in connection herewith or therewith express the entire
understanding of the parties with respect to the transactions contemplated
hereby. Neither this Credit Agreement nor any term hereof may be changed,
waived, discharged or terminated, except as provided in Section 14.8. No waiver
shall extend to or affect any obligation not expressly waived or impair any
right consequent thereon. No course of dealing or omission on the part of the
Agent or any Bank in exercising any right shall operate as a waiver thereof or
otherwise be prejudicial thereto. No notice to or demand upon the Borrowers
shall entitle the Borrowers to other or further notice or demand in similar or
other circumstances.
SECTION 23. WAIVER OF JURY TRIAL. EACH BORROWER HEREBY WAIVES ITS RIGHT
TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE
IN CONNECTION WITH THIS CREDIT AGREEMENT, THE NOTES OR ANY OF THE OTHER LOAN
DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE
OF SUCH RIGHTS AND OBLIGATIONS. EXCEPT AS PROHIBITED BY LAW, EACH BORROWER
HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION
REFERRED TO IN THE PRECEDING SENTENCE ANY SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES. THE BORROWERS (a) CERTIFY THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF
ANY BANK OR THE AGENT HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH BANK OR
THE AGENT WOULD
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NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS AND (b)
ACKNOWLEDGE THAT THE AGENT AND THE BANKS HAVE BEEN INDUCED TO ENTER INTO THIS
CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS TO WHICH THEY ARE A PARTY BECAUSE
OF, AMONG OTHER THINGS, THE BORROWERS' WAIVERS AND CERTIFICATIONS CONTAINED
HEREIN.
SECTION 24. GOVERNING LAW. This Credit Agreement and each of the other
Loan Documents are contracts under the laws of the Commonwealth of Massachusetts
and shall for all purposes be construed in accordance with and governed by the
laws of said commonwealth (excluding the laws applicable to conflicts or choice
of law). The Borrowers consent to the jurisdiction of any of the federal or
state courts located in the Commonwealth of Massachusetts in connection with any
suit to enforce the rights of any Bank or the Agent under this Credit Agreement
or any of the other Loan Documents.
SECTION 25. SEVERABILITY. The provisions of this Credit Agreement are
severable and if any one clause or provision hereof shall be held invalid or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part thereof, in
such jurisdiction, and shall not in any manner affect such clause or provision
in any other jurisdiction, or any other clause or provision of this Credit
Agreement in any jurisdiction.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement under seal as of the date first set forth above.
THE BORROWERS:
WASTE CONNECTIONS, INC.
WASTE CONNECTIONS OF WASHINGTON, INC.
WASTE CONNECTIONS OF IDAHO, INC.
MADERA DISPOSAL SYSTEMS, INC.
WASTE CONNECTIONS OF WYOMING, INC.
SUNSHINE SANITATION, INCORPORATED
▇▇▇▇▇▇' SANITATION, INC.
T & T DISPOSAL, INC.
WASTE CONNECTIONS OF UTAH, INC.
B & B SANITATION, INC.
RED CARPET LANDFILL, INC.
DARLIN EQUIPMENT, INC.
ARROW SANITARY SERVICE, INC.
▇▇▇▇▇ TRANSFER & RECYCLING, INC.
OREGON WASTE TECHNOLOGY, INC.
▇▇▇▇▇▇▇ REFUSE AND RECYCLING SERVICE
COMPANY
WASTE CONNECTIONS OF NEBRASKA, INC.
J & J SANITATION INC.
BIG RED ROLL OFF INC.
EVERGREEN WASTE SYSTEMS INC.
SIUSLAW DISPOSAL, INC.
COLUMBIA SANITARY SERVICE, INC.
▇▇▇▇▇▇▇▇ SANITARY SERVICE, INC.
MOTHER LODE SANI-HUT, INC.
▇▇▇▇▇▇ DISPOSAL SERVICE, INC.
CITY SANITATION, INC.
▇▇▇▇▇▇ COUNTY LANDFILL, INC.
ROCHE & SONS, INC.
▇▇▇▇▇▇'▇ DISPOSAL COMPANY, INC.
AMERICAN DISPOSAL COMPANY, INC.
▇.▇. DISPOSAL CO., INC.
TACOMA RECYCLING COMPANY, INC.
CRX, INC.
▇▇▇▇▇▇▇▇ SANITARY SERVICE, INC.
BETTER DISPOSAL SERVICE, INC.
By:
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
President
75
THE LENDERS:
BANKBOSTON, N.A.,
individually and as Agent
By:
---------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Director
UNION BANK OF CALIFORNIA, N.A.
By:
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Name:
Title:
COMERICA BANK - CALIFORNIA
By:
---------------------------------
Name:
Title:
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION
By:
---------------------------------
Name:
Title:
LASALLE NATIONAL BANK
By:
---------------------------------
Name:
Title:
FLEET BANK, N.A.
By:
---------------------------------
Name:
Title:
CITY NATIONAL BANK
By:
---------------------------------
Name:
Title:
FIRST BANK OF CALIFORNIA
By:
---------------------------------
Name:
Title:
76
U.S. BANK NATIONAL ASSOCIATION
By:
---------------------------------
Name:
Title: