Exhibit 10.10
CREDIT FACILITIES AGREEMENT
among
GTSI CORP.
as Borrower
and
GE COMMERCIAL DISTRIBUTION FINANCE CORPORATION
as Administrative Agent
and
GE COMMERCIAL DISTRIBUTION FINANCE CORPORATION
and
THE OTHER LENDERS LISTED ON EXHIBIT 0 AND SIGNATURE PAGES HERETO
as Lenders
October 20, 2003
TABLE OF CONTENTS
Page
----
1. Effective Date.......................................................20
2. Definitions; Rules of Construction...................................20
2.1. Listed Definitions..........................................20
2.2. Other Definitions...........................................20
2.3. References to Borrower......................................20
2.4. References to Covered Person................................20
2.5. References to Required Lenders; Minimum Exposure............20
2.6. Accounting Terms............................................20
2.7. Meaning of Satisfactory.....................................21
2.8. Computation of Time Periods.................................21
2.9. Certificates of Borrower and Borrowing Officer, Advance
Requests; Borrowing Agent...................................21
2.10. General.....................................................22
3. Lenders' Facilities..................................................22
3.1. Revolving Loan Facility.....................................22
3.1.1. Aggregate Amount................................22
3.1.2. Limitation on Revolving Loan Advances...........22
3.1.3. Revolving Notes.................................23
3.1.4. Borrowing Base..................................23
3.1.5. Eligible Accounts...............................23
3.2. Floorplan Loan Facility.....................................25
3.2.1. Floorplan Loan Facility Generally...............25
3.2.2. Interim Floorplan Loan Advances.................25
3.2.3. Termination of Interim Floorplan Advances.......26
3.2.4. Limitations on Interim Floorplan Loan
Advances........................................26
3.2.5. Operation of Floorplan Loan Facility and
Interim Floorplan Loan Facility.................26
3.2.6. Floorplan Loan Approvals........................27
3.2.7. Inventory not Available for Floorplan Loans
and Interim Floorplan Loans.....................27
3.2.8. Termination of Floorplan Loan Facility and
Interim Floorplan Loan Facility.................27
3.2.9. Repurchase Agreements...........................28
3.3. Swingline Facility..........................................28
3.3.1. Swingline Advances..............................28
3.3.2. Termination of Swingline Facility...............28
3.3.3. Limitations on Swingline Advances...............29
3.3.4. Swingline Note..................................29
3.4. Letter of Credit Facility...................................29
3.5. Total Aggregate Facility Limit..............................30
3.6. Termination.................................................30
4. Interest; Yield Protection...........................................32
4.1. Interest on the Swingline Loan..............................32
4.2. Interest on Draws on Letters of Credit......................32
4.3. Interest on the Floorplan Loan and Interim Floorplan
Loan -- Administrative Agent and GECDF as a Lender Only...32
4.4. Interest on Aggregate Loans--Other than Floorplan Loans.....33
4.5. Interest on Floorplan Loans; Administrative Agent
Deficiency Amount...........................................34
4.6. Adjusted LIBOR Rate.........................................34
4.7. Base Rate...................................................34
4.8. Prime Increments and LIBOR Increments.......................36
4.9. Time of Accrual.............................................36
4.10. Conversion or Continuation of Loans.........................36
4.11. Computation.................................................36
4.12. Rate After Maturity and Rate After An Event of Default......36
4.12.1......................................................36
4.13. Taxes.......................................................37
4.14. Compensation for Increased Costs and Reduced Returns;
Capital Adequacy............................................39
4.15. Limitation on Types of Loans................................40
4.16. Illegality..................................................40
4.17. Treatment of Affected Loans.................................40
4.18. Usury.......................................................41
5. Fees.................................................................41
5.1. Letter of Credit Fees.......................................41
5.2. Other Letter of Credit Fees.................................41
5.3. Calculation of Fees.........................................41
6. Payments.............................................................41
6.1. Scheduled Payments on Loans; Applications to Loans..........41
6.1.1. Interest........................................41
6.1.2. Principal.......................................42
6.1.2.3. Maturity...........................44
6.2. Special Requirement for Payments on Floorplan Loans and
Interim Floorplan Loans.....................................44
6.3. Prepayments.................................................45
6.3.1. Voluntary Prepayments...........................45
6.3.2. Mandatory Prepayments...........................45
6.3.3. Other Mandatory Prepayments.....................45
6.3.3.1. Proceeds from Sales of Assets......45
6.3.3.2. Insurance Proceeds.................46
6.4. Reimbursement Obligations of Borrower.......................46
6.5. Manner of Payments and Timing of Application of Payments....46
6.5.1. Payment Requirement.............................46
6.5.2. Application of Payments and Proceeds............46
6.5.3. Interest Calculation............................47
6.6. Returned Instruments........................................47
6.7. Compelled Return of Payments or Proceeds....................47
6.8. Due Dates Not on Business Days..............................47
7. Procedure for Obtaining Advances.....................................47
7.1. Initial Advances............................................47
7.2. Subsequent Revolving Loan Advances..........................48
7.3. Subsequent Floorplan Loan Advances..........................48
7.4. Repayment of the Swingline Loan and the Interim
Floorplan Loan..............................................48
7.5. Letters of Credit...........................................49
7.6. Administrative Agent's Right to Make Other Certain
Advances....................................................49
7.6.1. Payment of Loan Obligations.....................49
7.6.2. Payments to Other Creditors.....................49
7.7. Fundings....................................................50
7.7.1. Advances........................................50
7.7.2. Draws on Letters of Credit......................50
7.7.3. All Fundings Ratable............................50
7.8. Administrative Agent's Availability Assumption..............51
7.9. Disbursement................................................52
7.10. Restrictions on Advances....................................52
7.11. Each Advance Request and Request for a Letter of Credit
Certification...............................................52
7.12. Requirements for Every Advance Request......................52
7.13. Requirements for Every Letter of Credit Request.............53
7.14. Exoneration of Administrative Agent and Lenders.............53
8. Security; Guaranties.................................................53
8.1. Landlord Consents...........................................53
8.2. Security Agreements.........................................53
8.3. Pledge Agreements...........................................53
8.4. Collateral Assignments......................................53
8.4.1. Account and Lockbox Assignments.................54
8.4.2. Intellectual Property Assignments...............54
8.4.3. Acquisition Documents Assignment................54
9. Power of Attorney....................................................54
10. Conditions of Lending................................................55
10.1. Conditions to Initial Advance...............................55
10.1.1. Listed Documents and Other Items................55
10.1.2. Financial Condition.............................55
10.1.3. Default.........................................55
10.1.4. Perfection of Security Interests................55
10.1.5. Representations and Warranties..................55
10.1.6. Material Adverse Change.........................55
10.1.7. Payment of Fees.................................55
10.1.8. Other Items.....................................55
10.1.9. No Material Proceedings.........................56
10.2. Conditions to Subsequent Advances...........................56
10.2.1. General Conditions..............................56
10.2.2. Representations and Warranties..................56
10.2.3. Approvals.......................................56
10.2.4. Default.........................................56
10.2.5. No Material Proceedings.........................56
10.2.6. Material Adverse Change.........................56
10.3. Conditions to Issuance of Letters of Credit.................56
10.3.1. Letter of Credit Application/Reimbursement
Agreement.......................................56
10.3.2. No Prohibitions.................................56
10.3.3. Representations and Warranties..................57
10.3.4. No Material Proceedings.........................57
10.3.5. No Default......................................57
10.3.6. Other Conditions................................57
11. Representations and Warranties.......................................57
11.1. Organization and Existence..................................57
11.2. Authorization...............................................57
11.3. Due Execution...............................................57
11.4. Enforceability of Obligations...............................57
11.5. Burdensome Obligations......................................57
11.6. Legal Restraints............................................58
11.7. Labor Contracts and Disputes................................58
11.8. No Material Proceedings.....................................58
11.9. Material Licenses...........................................58
11.10. Compliance with Material Laws...............................58
11.10.1. General Compliance with Environmental Laws
and Governmental Procurement Regulations........58
11.10.2. Proceedings.....................................58
11.10.3. Investigations..................................58
11.10.4. Notices and Reports Regarding Hazardous
Materials.......................................59
11.10.5. Hazardous Materials on Real Property............59
11.10.6. Environmental Property Transfer Acts............59
11.11. Other Names.................................................59
11.12. Prior Transactions..........................................59
11.13. Capitalization..............................................59
11.14. Solvency....................................................59
11.15. Projections.................................................59
11.16. Financial Statements........................................60
11.17. No Change in Condition......................................60
11.18. No Defaults.................................................60
11.19. Investments.................................................60
11.20. Indebtedness................................................60
11.21. Indirect Obligations........................................60
11.22. Encumbrances................................................60
11.23. Operating Leases............................................60
11.24. Capital Leases..............................................60
11.25. Other Creditor Indebtedness; Intercreditor Documents........60
11.26. Tax Liabilities; Governmental Charges.......................60
11.27. Pension Benefit Plans.......................................61
11.27.1. Prohibited Transactions.........................61
11.27.2. Claims..........................................61
11.27.3. Reporting and Disclosure Requirements...........61
11.27.4. Accumulated Funding Deficiency..................61
11.27.5. Multi-employer Plan.............................61
11.28. Welfare Benefit Plans.......................................61
11.29. Retiree Benefits............................................62
11.30. Distributions...............................................62
11.31. Real Property...............................................62
11.32. State of Collateral and other Property......................62
11.32.1. Accounts........................................62
11.32.2. Inventory.......................................63
11.32.3. Equipment.......................................63
11.32.4. Intellectual Property...........................64
11.32.5. Documents, Instruments and Chattel Paper........64
11.33. Chief Place of Business; Locations of Collateral............64
11.34. [Intentionally Omitted].....................................64
11.35. No Negative Pledges.........................................64
11.36. Security Documents..........................................65
11.36.1. Security Agreements.............................65
11.36.2. Collateral Assignments..........................65
11.36.2.1. Blocked Account Agreements........65
11.36.2.2. Intellectual Property
Assignments.......................65
11.36.2.3. Acquisition Documents
Assignment........................65
11.36.2.4. Pledge Agreement..................65
11.37. S Corporation...............................................65
11.38. Subsidiaries and Affiliates.................................65
11.39. Bank Accounts and Lockboxes.................................65
11.40. Margin Stock................................................66
11.41. Tax Matters.................................................66
11.42. Investment Company Act, Etc.................................66
11.43. No Material Misstatements or Omissions......................66
11.44. Filings.....................................................66
11.45. Broker's Fees...............................................66
11.46. Eligibility of Collateral...................................66
11.47. Loans to Shareholders.......................................66
11.48. Lease Transaction Accounting................................67
12. Modification and Survival of Representations.........................67
13. Affirmative Covenants................................................67
13.1. Use of Proceeds.............................................67
13.2. Corporate Existence.........................................67
13.3. Maintenance of Property and Leases..........................67
13.4. Inventory...................................................68
13.5. Insurance...................................................68
13.6. Payment of Taxes and Other Obligations......................69
13.7. Compliance With Laws........................................69
13.7.1. Environmental Laws..............................69
13.7.2. Pension Benefit Plans...........................69
13.7.3. Governmental Authority Procurement
Regulations.....................................69
13.8. Discovery and Clean-up of Hazardous Material................69
13.9. Termination of Pension Benefit Plan.........................70
13.10. Notice to Administrative Agent and Lenders of Material
Events......................................................70
13.12. Maintenance of Security Interests of Security Documents.....72
13.12.1. Preservation and Perfection of Security
Interests.......................................72
13.12.2. Collateral Held by Warehouseman, Bailee, etc....73
13.12.3. Compliance With Terms of Security Documents.....73
13.13. Accounting System...........................................73
13.13.1. Account Records.................................73
13.13.2. Inventory Records...............................74
13.13.3. Tracing of Proceeds.............................74
13.14. Financial Statements........................................74
13.14.1. Annual Financial Statements.....................74
13.14.2. Annual Projections..............................74
13.14.3. Monthly Financial Statements....................74
13.15. Other Financial Information.................................75
13.15.1. Periodic Borrowing Base Certificates............75
13.15.2. Daily Schedule of Deposits......................75
13.15.3. Weekly Summary Accounts Aging...................75
13.15.4. Semimonthly Sales Journal Report................75
13.15.5. Monthly Detailed Accounts Aging and
Inventory Reports...............................75
13.15.6. Monthly Locations of Inventory Report...........75
13.15.7. Monthly Cash Receipts Journal and Credit
Memo Entries....................................75
13.15.8. Semiannual Customer Address Listing.............75
13.16. Other Reports or Information Concerning Accounts or
Inventory...................................................76
13.17. Tax Notifications...........................................76
13.18. Stockholder and SEC Reports.................................76
13.19. Pension Benefit Plan Reports................................76
13.20. Other Information...........................................76
13.21. Review of Accounts..........................................76
13.22. Inventory...................................................76
13.23. Lease Servicing.............................................76
13.24. Examinations and Site Visits by Administrative Agent........77
13.25. Verification of Accounts and Notices to Account Debtors.....77
13.26. Appraisals of Collateral....................................77
13.27. Access to Officers and Auditors.............................77
13.28. Movement of Inventory.......................................78
13.29. Titled Assets...............................................78
13.30. Acquisition Documents.......................................78
13.31. Other Information...........................................78
13.32. Further Assurances..........................................78
14. Negative Covenants...................................................79
14.1. Investments.................................................79
14.2. Indebtedness................................................79
14.3. Payments on Other Creditor Indebtedness.....................80
14.4. Prepayments.................................................80
14.5. Indirect Obligations........................................80
14.6. Security Interests..........................................80
14.7. Acquisitions................................................81
14.8. Bailments; Consignments; Warehousing........................82
14.9. Disposal of Property........................................83
14.10. Distributions...............................................83
14.12. Capital Structure; Equity Securities........................83
14.13. Change of State of Formation; Change of Name................83
14.14. Change of Business..........................................83
14.15. Transactions With Affiliates................................83
14.16. Operating Leases............................................84
14.17. Conflicting Agreements......................................84
14.18. Investment Banking and Finder's Fees........................84
14.19. Sale and Leaseback Transactions.............................84
14.20. New Subsidiaries and Holding Company Reorganization.........84
14.20.1. New Subsidiaries................................84
14.20.2. Holding Company Reorganization..................84
14.21. Fiscal Year.................................................85
14.22. Leases......................................................85
14.23. S Corporation Status........................................85
14.24. Tax Consolidation...........................................85
14.25. Transactions Having a Material Adverse Effect...............85
14.26. Storage; Chief Executive Officer; State of Incorporation....85
14.27. Like-Kind Exchange..........................................85
15. Financial Covenants..................................................85
15.1. Special Definitions.........................................85
15.2. Minimum Tangible Net Worth..................................86
15.3. Maximum Total Liabilities to Tangible Net Worth.............86
15.4. Maximum Total Funded Indebtedness to EBITDA.................87
15.5. Minimum EBIT to Net Sales...................................87
16. Default..............................................................87
16.1. Events of Default...........................................87
16.1.1. Failure to Pay Principal or Interest............87
16.1.2. Failure to Pay Certain Other Amounts Owed to
Lenders.........................................87
16.1.3. Failure to Pay Examination and Appraisal
Costs...........................................87
16.1.4. Failure to Pay Amounts Owed to Other Persons....87
16.1.5. Representations or Warranties...................88
16.1.6. Certain Covenants with Cure Periods.............88
16.1.7. Certain Covenants Without Cure Periods..........88
16.1.8. Other Covenants.................................88
16.1.9. Acceleration of Other Indebtedness..............88
16.1.10. Default Under Other Agreements..................88
16.1.11. Other Creditor Indebtedness.....................88
16.1.12. Bankruptcy; Insolvency; Etc.....................88
16.1.13. Judgments; Attachment; Settlement; Etc..........89
16.1.14. Pension Benefit Plan Termination, Etc...........89
16.1.15. Liquidation or Dissolution......................89
16.1.16. Seizure of Assets...............................90
16.1.17. Loan Documents; Security Interests..............90
16.1.18. Loss to Collateral..............................90
16.1.19. Guaranty; Guarantor.............................90
16.1.20. Governmental Authority Bar......................90
16.1.21. Change of Control...............................90
16.2. Cross-Default...............................................91
16.3. Rights and Remedies.........................................91
16.3.1. Termination of Facilities.......................91
16.3.2. Acceleration; Funding...........................91
16.3.3. Right of Set-off................................91
16.3.4. Notice to Account Debtors.......................92
16.3.5. Entry Upon Premises and Access to Information...92
16.3.6. Completion of Uncompleted Inventory Items.......92
16.3.7. Borrower's Obligations..........................92
16.3.8. Secured Party Rights............................92
16.3.9. Joint and Several...............................93
16.3.10. Miscellaneous...................................94
16.4. Application of Funds........................................94
16.5. Limitation of Liability; Waiver.............................95
16.6. Notice......................................................95
17. Administrative Agent and Lenders.....................................95
17.1. Appointment, Powers, and Immunities.........................95
17.2. Reliance by Administrative Agent............................96
17.3. Employment of Administrative Agents and Counsel.............96
17.4. Defaults....................................................96
17.5. Rights as Lender............................................97
17.6. Indemnification.............................................97
17.7. Notification of Lenders.....................................98
17.8. Non-Reliance on Agent and Other Lenders.....................98
17.9. Resignation.................................................98
17.10. Collections and Distributions to Lenders by
Administrative Agent........................................99
17.11. Provision Regarding Payments................................99
18. General..............................................................99
18.1. Lenders' Right to Cure......................................99
18.2. Rights Not Exclusive.......................................100
18.3. Survival of Agreements.....................................100
18.4. Assignments................................................100
18.4.1. Permitted Assignments..........................100
18.4.2. Register; Consequences and Effect of
Assignments....................................101
18.4.3. Administrative Agent to Retain Copies of
Assignments and Acceptances....................102
18.4.4. Notice to Borrower of Assignment...............102
18.4.5. Assignment to Federal Reserve Bank.............102
18.4.6. Information....................................102
18.4.7. Sale of Participations.........................102
18.5. Payment of Expenses........................................103
18.6. General Indemnity..........................................103
18.7. Letters of Credit..........................................105
18.8. Changes in Accounting Principles...........................106
18.9. Loan Records...............................................106
18.10. Other Security and Guaranties..............................106
18.11. Loan Obligations Payable in Dollars........................107
18.12. Confidentiality............................................107
19. Binding Arbitration.................................................108
19.1. Arbitrable Claims..........................................108
19.2. Administrative Body........................................108
19.3. Hearings...................................................108
19.4. Discovery..................................................109
19.5. Exemplary or Punitive Damages..............................109
19.6. Confidentiality of Awards..................................109
19.7. Prejudgment and Provisional Remedies.......................109
19.8. Attorneys' Fees............................................109
19.9. Limitations................................................110
19.10. Survival After Termination.................................110
19.11. Invalidity/Unenforceability of Binding Arbitration; Jury
Trial Waiver; Service of Process; Forum....................110
19.11.1. Jury Trial Waiver..............................110
19.11.2. Choice of Forum................................110
19.11.3. Service of Process.............................111
20. Miscellaneous.......................................................111
20.1. Notices....................................................111
20.2. Amendments and Modifications; Waivers and Consents;
All Lenders................................................111
20.3. Course of Dealing..........................................112
20.4. Rights Cumulative..........................................112
20.5. Successors and Assigns.....................................112
20.6. Severability...............................................112
20.7. Counterparts...............................................112
20.8. Governing Law; No Third Party Rights.......................112
20.9. Counterpart Facsimile Execution............................113
20.10. No Other Agreements........................................113
20.11. Waiver of Right to Seek Punitive and Exemplary Damages.....113
20.12. Negotiated Transaction.....................................113
20.13. Incorporation By Reference.................................113
20.14. Statutory Notice-Insurance.................................113
20.15. Statutory Notice--Oral Commitments.........................114
CREDIT FACILITIES AGREEMENT
In consideration of the mutual agreements herein and other sufficient
consideration, the receipt of which is hereby acknowledged, GTSI Corp., a
Delaware corporation ("GTSI" or "Borrower"), and GE Commercial Distribution
Finance Corporation, a Nevada corporation ("GECDF"), as Administrative Agent,
and GECDF and the other lenders listed on Exhibit 3 and the signature pages
hereto (and their respective successors and permitted assigns), as "Lenders,"
agree as follows:
Effective Date. This Agreement is effective October 20, 2003.
Definitions; Rules of Construction.
-----------------------------------
Listed Definitions. Capitalized words defined in the Glossary and Index of
Defined Terms attached hereto as Exhibit 0 shall have such defined
meanings wherever used in this Agreement and the other Loan Documents.
Other Definitions. If a capitalized word in this Agreement is not defined in
the Glossary and Index of Defined Terms, it shall have such meaning as
defined elsewhere herein, or if not defined elsewhere herein, the
meaning defined in the UCC.
References to Borrower. If there is more than one Person who is a Borrower
hereunder, then the words "a Borrower," "any Borrower," "Borrower" and
"every Borrower" refer to each such Person both separately and
collectively, as though each such entity were actually listed, and
their Obligations and liabilities (including, the Loan Obligations)
under the Loan Documents are joint and several in all respects.
References to Covered Person. The words "Covered Person," "a Covered Person,"
"any Covered Person," "each Covered Person" and "every Covered Person"
refer to Borrower and each of its currently existing or later acquired,
created or organized Subsidiaries separately. The words "Covered
Persons" refers to Borrower and its currently existing or later
acquired, created or organized Subsidiaries collectively.
References to Required Lenders; Minimum Exposure. Subject to the provisions of
Section 0 with regards to a Defaulting Lender, the words "Required
Lenders" means any one or more Lenders whose shares of Lenders'
Exposure at the relevant time aggregate at least 66.6667%; provided,
however, while there are only two Lenders, Required Lenders shall mean
both Lenders. GECDF, in its capacity as a Lender, shall hold a pro-rata
portion of the Aggregate Facilities at least equal to or greater than
the Aggregate Facility of each other Lender individually; provided,
however, that after an acceleration of the Loan Obligations or upon the
occurrence and during the continuance of an Event of Default, GECDF
shall be permitted to assign all or any portion of its Facilities and
the foregoing restriction shall not be applicable after any such
assignment.
Accounting Terms. Unless the context otherwise requires, accounting terms that
are used but not defined herein shall be determined under GAAP. All
financial measurements contemplated hereunder respecting Borrower shall
be made and calculated for Borrower and all of its currently existing
or later acquired, created or organized Subsidiaries, if any, on a
20
consolidated and consolidating basis in accordance with GAAP unless
expressly provided otherwise herein.
Meaning of Satisfactory. Whenever herein a document or matter is required to be
satisfactory to Administrative Agent or satisfactory to Lenders or
satisfactory to Required Lenders, unless expressly stated otherwise
such document must be reasonably satisfactory to Administrative Agent,
Lenders or Required Lenders (as applicable) in both form and substance,
and unless expressly stated otherwise Administrative Agent, Lenders or
Required Lenders (as applicable) shall have the commercially reasonable
discretion to determine whether the document or matter is satisfactory.
Computation of Time Periods. In computing or defining periods of time from a
specified date to a later specified date, and in computing the accrual
of interest or fees, the word "from" shall mean "from and including"
and the words "to" and "until" shall each mean "to but excluding."
Periods of days referred to in this Agreement shall be counted in
calendar days unless Business Days are expressly prescribed, and
references in this Agreement to months and years are to calendar months
and calendar years unless otherwise specified.
Certificates of Borrower and Borrowing Officer, Advance Requests; Borrowing
Agent. This Section shall be applicable if there is more than one
Borrower. In such case, each Borrower hereby appoints GTSI as
"Borrowing Agent." Because the operations and business activities of
Borrowers are highly integrated and interdependent, at any particular
time it is impractical to determine which of Borrowers will directly
receive the proceeds of a Revolving Loan, Swingline Loan, Interim
Floorplan Loan, or Floorplan Loan or the benefit of the Letters of
Credit. Each of Borrowers hereby directs the Letter of Credit Issuer to
issue Letters of Credit and Administrative Agent to disburse the
proceeds of each Revolving Loan, Swingline Loan, Interim Floorplan
Loan, and Floorplan Loan to or at the direction of Borrowing Agent,
with such directions to be subject to approval of Administrative Agent
in its discretion, and such distribution will, in all circumstances, be
deemed to be made to each of Borrowers. Notwithstanding anything herein
to the contrary, proceeds of the initial Revolving Loan, and initial
Floorplan Loan used to satisfy the existing Indebtedness of a Borrower
will be advanced directly to the holders of such Indebtedness. From
time to time, Borrowing Agent shall further distribute the proceeds of
Revolving Loans, and Swingline Loans, to a particular Borrower or
Borrowers, jointly and severally, or direct the disbursement of the
Interim Floorplan Loan and Floorplan Loans for the account of Borrower,
and Borrower represents and warrants that the subsequent receipt and
use of such proceeds by any particular Borrower inures to the economic
benefit directly and indirectly of all other Borrowers. For so long as
the Loan Obligations remain outstanding and any Facility is in effect,
Borrower hereby covenants and agrees, and hereby grants to Borrowing
Agent an absolute and irrevocable power of attorney coupled with
interest, and irrevocably designates, appoints, authorizes and directs
Borrowing Agent to (i) execute and deliver any Borrowing Base
Certificates, (ii) certify the financial statements of Borrower, (iii)
request Advances, request issuance of Letters of Credit and execute and
deliver written requests for Advances and the issuance of Letters of
Credit, as the case may be, (iv) make any other deliveries required to
be delivered periodically hereunder to Administrative Agent or any
Lender, (v) act as its Borrowing Officer, and Administrative Agent and
each Lender is entitled to rely on any such document or certificate
signed by Borrowing Agent, and (vi) otherwise take all other actions
otherwise contemplated by this Section, and to act on behalf of such
Borrower for purposes of giving and receiving notices and
certifications under this Agreement or any other Loan Document.
Administrative Agent is entitled to rely and act on the instructions of
Borrowing Agent.
21
General. Unless the context of this Agreement clearly requires otherwise: (i)
references to the plural include the singular and vice versa; (ii)
references to any Person include such Person's successors and assigns
but, if applicable, only if such successors and assigns are permitted
by this Agreement; (iii) references to one gender include all genders;
(iv) "including" is not limiting; (v) "or" has the inclusive meaning
represented by the phrase "and/or;" (vi) the words "hereof," "herein,"
"hereby," "hereunder" and similar terms in this Agreement refer to this
Agreement as a whole, including its Exhibits, and not to any particular
provision of this Agreement; (vii) the word "Section" or "section" and
"Page" or "page" refer to a section or page, respectively, of, and the
word Exhibit refers to an Exhibit to this Agreement unless it expressly
refers to something else; (viii) reference to any agreement, document,
or instrument (including this Agreement and any other Loan Document or
other agreement, document or instrument defined herein), means such
agreement, document, or instrument as amended, modified, restated or
replaced and in effect from time to time in accordance with the terms
and conditions thereof and, if applicable, the terms and conditions
hereof, and includes all attachments thereto and documents incorporated
therein, if any; (ix) general and specific references to any Law means
such Law as amended, modified, codified or reenacted, in whole or in
part, and in effect from time to time; and (x) unless otherwise
expressly modified, the word "anniversary" shall refer to the annual
observance of such an event on that date in following years. Section
captions and the Table of Contents are for convenience only and shall
not affect the interpretation or construction of this Agreement or the
other Loan Documents.
Lenders' Facilities. Subject to the terms and conditions hereof, and in reliance
upon the Representations and Warranties:
Revolving Loan Facility.
Aggregate Amount. Subject to the limitations in Sections 0 and 0 and elsewhere
herein, each Lender shall make available to Borrower, such
Lender's pro-rata share (as listed on Exhibit 0) of an
"Aggregate Revolving Loan Facility" that is Ninety Million
Dollars ($90,000,000), by funding such Lender's pro-rata share
of Revolving Loan Advances made from time to time by
Administrative Agent as provided herein. Subject to the
limitations in Sections 0 and 0 and elsewhere herein, payments
and prepayments that are applied to reduce the Aggregate
Revolving Loan may be reborrowed by Borrower through Revolving
Loan Advances. Each Lender's Revolving Loan Facility is its
pro-rata share of the Aggregate Revolving Loan Facility. Upon
any reduction of the Aggregate Revolving Loan Facility
permitted in this Agreement, each Lender's Revolving Loan
Facility will automatically reduce by such Lender's pro-rata
share of such reduction of the Aggregate Revolving Loan
Facility.
Limitation on Revolving Loan Advances. No Revolving Loan Advance will be made
which would result in either: (i) the Aggregate Revolving Loan
exceeding the Maximum Available Amount; or (ii) the Lenders'
Exposure exceeding the Total Aggregate Facility Limit. No
Revolving Loan Advance will be made on or after the effective
date of any termination of the Aggregate Revolving Loan
Facility. Lenders may, however, in their absolute discretion
make such Revolving Loan Advances, but shall not be deemed by
doing so to have increased the Maximum Available Amount or the
Total Aggregate Facility Limit and shall not be obligated to
make any such Revolving Loan Advances thereafter. At any time
that an Event of Default has occurred and is continuing, the
Aggregate Revolving Loan Facility may be canceled as provided
herein. The "Maximum Available Amount" (which can be a
negative number) on any date shall be a Dollar amount equal to
the lesser of (i) the amount of the Aggregate Revolving Loan
22
Facility and (ii) the Borrowing Base on such date, minus the
sum of (a) the Swingline Loan, (b) the Floorplan Shortfall,
(c) the Other Creditor Indebtedness (unless an Intercreditor
Agreement has been executed between Administrative Agent and
the holders of such Other Creditor Indebtedness),and (d) the
Letter of Credit Exposure on such date (except to the extent
that a Revolving Loan Advance will be used immediately to
reimburse Letter of Credit Issuer for unreimbursed draws on a
Letter of Credit).
Revolving Notes. The obligation of Borrower to repay each Lender's Revolving
Loan shall be evidenced by a promissory note payable to the
order of such Lender in a maximum principal amount equal to
the amount of its Revolving Loan Facility and otherwise
satisfactory to Lenders.
Borrowing Base. The "Borrowing Base" on any date shall be 85% of the total
outstanding principal balance of all Eligible
Accounts (i) as of the close of business on such
date, or (ii) as certified in the Borrowing Base
Certificate most recently furnished to Administrative
Agent as required in Section 0, whichever is less,
minus (to the extent not deducted from Eligible
Accounts pursuant to Section 0) the Dollar amount, if
any, of Inventory that Borrower has been requested
(orally or in writing) to repurchase under any
repurchase agreement or similar arrangement,
including the Textron Agreement.
Eligible Accounts. "Eligible Accounts" include all of Borrowers' Accounts other
than the following, unless approved in writing by
Administrative Agent in each case: (i) any Account with
respect to which Administrative Agent does not have a valid
and enforceable, perfected first priority Security Interest;
(ii) any Account which remains unpaid as of 90 days after the
original date of the applicable invoice, except the foregoing
period shall be 120 days for any Account for which the Account
Debtor is a Governmental Authority; (iii) any Account of a
single Account Debtor if 50% or more of the balances due on
all Accounts of such Account Debtor are ineligible under
clause (i) or (ii); (iv) any Account for which the Account
Debtor is a Borrower, a Subsidiary or an Affiliate thereof or
an employee, officer, director or manager of Borrower or any
Subsidiary or Affiliate thereof; (v) any Account for which the
Account Debtor does not maintain its chief executive office
within the United States nor Canada and any Account for which
the Account Debtor is the government of any foreign country or
any municipality or other political subdivision thereof, or
any department, agency, public corporation or other
instrumentality thereof; (vi) any Account which is created
from the rental or lease of any Inventory not owned by
Borrower; (vii) any Account with respect to goods or services
whose delivery or performance has been rejected by the Account
Debtor or whose earlier acceptance has been revoked; (viii)
any Account arising from the delivery of goods or performance
of services for which an invoice has not been sent to the
Account Debtor within ten (10) days after such delivery or
performance; (ix) any Account for which the Account Debtor is
the subject of a bankruptcy or similar insolvency proceeding,
has made an assignment for the benefit of creditors, has
acknowledged that it is unable to pay its debts as they
mature, or whose assets have been transferred to a receiver or
trustee, or which has ceased business as a going concern; (x)
any Account for which the Account Debtor's obligation to pay
the Account is conditional upon such Account Debtor's approval
or is otherwise subject to any repurchase obligation or return
right (except for Accounts for which the Account Debtor is a
Governmental Authority pursuant to customary terms given by
Borrower to such Account Debtor in the ordinary course of
23
business which provide that non-customized goods may only be
returned by a buyer to Borrower within 30 days of invoice date
in their new or unopended condition), as with sales made on a
▇▇▇▇-and-hold (except for Accounts for which the Account
Debtor is a Governmental Authority, provided that such
Accounts do not exceed $5,000,000 in the aggregate and that
Borrower has segregated such sold items from its Inventory,
marked them "Sold and Invoiced - Shipment Pending at Buyer's
Request" or words to such effect and has received a written
acknowledgment from the Governmental Authority buyer that such
goods have been purchased but are being held by Borrower at
such buyer's request), guarantied sale, sale-and-return, sale
on approval (except with respect to Accounts for which Account
Debtors are entitled to return Inventory solely on the basis
of the quality of such Inventory) or consignment basis; (xi)
any Account for which the Account Debtor has disputed
liability or made any claim with respect to any other Account
due from such Account Debtor, or that has any right of set-off
against such Account, or to which Borrower is indebted in any
way, but only to the extent of such indebtedness, set-off,
dispute or claim; provided, however, that if the Account
Debtor is a Governmental Authority and such indebtedness or
set-off arises out of a Law which grants such Governmental
Authority the right of set-off then such set-off shall be
disregarded; (xii) any Account subject to a chargeback from a
volume discount or an advertising discount, but only to the
extent of such chargeback or discount; (xiii) any Account
which is created from the rental or lease of any Inventory or
other asset of Borrower; (xiv) any Account of an Account
Debtor with respect to particular goods still in the
possession of the creditor on the Account or included in
Inventory of such creditor and against which the Account
Debtor has filed a financing statement under the UCC or has
obtained or purported to have obtained a Security Interest;
(xv) any Account with respect to which the delivery of goods
or performance of services is bonded in favor of Borrower;
(xvi) except as to Accounts for which the Account Debtor is a
Governmental Authority, any Account as to which Administrative
Agent does not have the right or ability to obtain direct
payment to Administrative Agent; (xvii) any Account with
respect to which any of the covenants and agreements contained
in any of the Loan Documents or any of the Representations and
Warranties are not or have ceased to be true and correct;
(xviii) any Account which is evidenced by a promissory note or
other instrument or by chattel paper or which has been reduced
to judgment; (xix) any Account which arises out of a sale or
lease not made in the ordinary course of Borrower's business;
(xx) any Account for which payment terms greater than net
sixty (60) days from the date of invoice are provided or
permitted; (xxi) Accounts arising from payment made by credit
card, debit card, or similar instrument; (xxii) any Account
owing from any supplier or Vendor of any Borrower, including,
under or in connection with any rebate, subsidy, incentive or
similar program, (xxiii) any Account owing to any Person other
than Borrower, (xxiv) any Account arising from the leasing of
Inventory, (xxv) with regards to any Account arising from the
provision of services, any such Account which is invoiced
prior to the performance of the applicable services, (xxvi)
any Account with respect to which, in whole or in part, a
check or checks or other instruments for the payment of money
(the face amount of which checks and instruments in the
aggregate are in excess of 25% of the amount of the account)
have been received, presented for payment and returned
uncollected for any reason until payment in good funds is made
on such checks and instruments, (xxvii) any Account arising
from any real estate owned or leased by Borrower, (xxviii) any
Account not owned by Borrower or which Borrower invoices or
collects on behalf of any other Person, or (xxix) any Account,
other than for which the Account Debtor is a Federal
Authority, as to which Administrative Agent has determined in
its reasonable discretion that the prospect of payment or
collection on a timely basis is impaired or that
24
Administrative Agent otherwise deems in its reasonable
discretion to be uncreditworthy. Notwithstanding the
foregoing, (A) Accounts owned by a Target Company may be
included within the definition of "Eligible Accounts" and
within the Borrowing Base on the day of the closing of a
Permitted Acquisition to fund such Permitted Acquisition if
and only if such Accounts meet the eligibility requirements of
each clause of this Section immediately upon the closing of
such Permitted Acquisition, (B) if Accounts in which the
Account Debtor is Eyak Technology, LLC otherwise meet the
eligibility requirements of each clause of this Section, such
Accounts shall be included as Eligible Accounts up to a
maximum of $5,000,000 ($10,000,000 during the calendar months
of August, September, October and November), and (C) Accounts
arising out of the Textron Agreement may (if such Accounts
otherwise meet the eligibility requirements of each clause of
this Section) be included within the definition of "Eligible
Accounts" and within the Borrowing Base; provided, however,
that such Accounts are ineligible to the extent that (1) they
remain unpaid more than 30 days after the original date of the
applicable invoice, or (2) there exists, if not otherwise
deducted from the Borrowing Base pursuant to Section 0, any
unsatisfied request by Textron to Borrower to pay to Textron
the purchase price for Borrower's repurchase of Inventory
pursuant to the Textron Agreement.
Floorplan Loan Facility.
Floorplan Loan Facility Generally. Each Lender may, subject to the terms and
conditions hereof, make available to Borrower such Lender's
pro-rata share (as listed on Exhibit 3) of an "Aggregate
Floorplan Loan Facility" that is Seventy-Five Million Dollars
($75,000,000) by funding such Lender's pro-rata share thereof
as provided for herein. Each Lender's Floorplan Loan Facility
is its pro-rata share of the Aggregate Floorplan Loan
Facility. All Floorplan Loan Advances and Interim Floorplan
Loan Advances will be made directly to approved Vendors and
not to Borrower. No Floorplan Loan Advance will be made which
would result in either: (i) the sum of the Aggregate Floorplan
Loan, the Interim Floorplan Loan, and all unfunded Approvals,
exceeding the Aggregate Floorplan Loan Facility; or (ii) the
Lenders' Exposure exceeding the Total Aggregate Facility
Limit. Subject to the terms and conditions of this Agreement
and the other Loan Documents, payments and prepayments that
are applied to reduce the Aggregate Floorplan Loan may be
reborrowed by Borrower through subsequent Floorplan Loan
Advances. The Aggregate Floorplan Loan Facility is not a
commitment to lend or advance funds but is a discretionary
facility. From and after the date on which Administrative
Agent has actual knowledge of an Event of Default under
Section 0 or 0, no further Approvals will be issued and,
except with respect to existing unfunded Approvals, no further
Floorplan Loan Advances shall be made. From and after the date
on which Administrative Agent has actual knowledge of any
other Event of Default, no further Approvals will be issued if
Administrative Agent so chooses in its discretion to no longer
issue Approvals or if the Required Lenders direct
Administrative Agent to no longer issue Approvals, and if
Administrative Agent so chooses or the Required Lenders so
direct, except with respect to existing unfunded Approvals, no
further Floorplan Loan Advances shall be made. The Floorplan
Facility will not be evidenced by promissory notes.
Interim Floorplan Loan Advances. To reduce the frequency of fundings of
Floorplan Loan Advances by Lenders, but subject to the
limitations in Section 0 and elsewhere herein, Administrative
Agent may in its absolute discretion make ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇
Loan Advances for the account of and benefit of Borrower with
respect to an Approval issued by Administrative Agent from
time to time from the Effective Date to the effective date of
any termination of the Aggregate Floorplan Loan Facility. From
and after the date on which Administrative Agent has actual
knowledge of an Event of Default under Section 0 or 0, no
further Interim Floorplan Loan Advances shall be made. Each
Lender shall be obligated to funds its pro rata share of all
Approvals once issued (except any Approvals issued contrary to
the terms of the preceding sentence) regardless as to whether
at the time of issuance an Event of Default exists or after
the date of issuance of any Approval an Event of Default
occurs. From and after the date on which Administrative Agent
has actual knowledge of any other Event of Default, at the
sole discretion of Administrative Agent, no further Interim
Floorplan Loan Advances shall be made. Subject to the
limitations in Section 0 and elsewhere herein, payments and
prepayments that are applied to reduce the Interim Floorplan
Loan may be reborrowed by Borrower for new Inventory purchases
through Interim Floorplan Loan Advances. The Interim Floorplan
Loan Facility is not a commitment to lend or advance funds,
but is a discretionary facility. The Interim Floorplan
Facility will not be evidenced by promissory notes.
Termination of Interim Floorplan Advances. The Interim Floorplan Facility is not
a commitment to lend money. It is a discretionary facility
which Administrative Agent may terminate at any time in its
absolute discretion. If Administrative Agent terminates the
Interim Floorplan Facility, Borrower agrees that no prior
notice of any kind is required. Borrower will not be relieved
from any obligation to Administrative Agent arising out of
Interim Floorplan Facility made before the effective
termination date of the Interim Floorplan Facility.
Notwithstanding a termination of the Interim Floorplan
Facility, Administrative Agent and Lenders will retain all of
their rights, interests and remedies hereunder and in all
Collateral until Borrower has indefeasibly paid all of the
Loan Obligations in full in cash.
Limitations on Interim Floorplan Loan Advances. The maximum amount of the
Interim Floorplan Loan amount on any date shall be Twenty Five
Million Dollars ($25,000,000). Administrative Agent shall not
be obligated to make any particular Interim Floorplan Loan
Advance, the making of any particular Interim Floorplan Loan
Advance at any particular time being absolutely discretionary.
Administrative Agent will not without the prior consent of
each Lender (which may be written or oral), knowingly make any
Interim Floorplan Loan Advance which would cause the aggregate
amount of the Interim Floorplan Loan plus the Aggregate
Floorplan Loan plus all unfunded Approvals to exceed the
Aggregate Floorplan Loan Facility as of such date immediately
prior to the making of any such Interim Floorplan Loan Advance
or make any Interim Floorplan Loan Advance which would cause
the Lenders' Exposure to exceed the Total Aggregate Facility
Limit. Administrative Agent shall not be obligated to fund any
Interim Floorplan Loan Advances after the effective date of
termination of the Aggregate Floorplan Loan Facility or the
Interim Floorplan Loan Facility.
Operation of Floorplan Loan Facility and Interim Floorplan Loan Facility.
Subject to the terms of this Agreement, the Floorplan Loan
Facility and Interim Floorplan Loan Facility will be used by
Borrower from time to time to purchase inventory from vendors
approved by Administrative Agent in its sole and absolute
discretion ("Vendors").
26
Floorplan Loan Approvals. Borrower and each Lender acknowledges and agrees that:
(i) Administrative Agent may issue Approvals on a date that is
prior to the date of the funding of any Floorplan Loan Advance
or Interim Floorplan Loan Advance that are based on such
Approvals; (ii) once an Approval has been issued, then
Administrative Agent may, and may require the Lenders, to fund
the related Advance at any time, notwithstanding (a) any
Default or Event of Default that may arise on or prior to the
date of any such Advance, (b) whether the Loan Obligations
have been accelerated, (c) whether the Facilities have been
terminated, or (d) whether any such Advance shall occur after
the effective date of termination of the Aggregate Floorplan
Loan Facility for an Approval issued on or prior to such date;
and (iii) each Lender shall be obligated to fund its pro-rata
share of any such Advance once an Approval has been issued for
such Advance and after receipt of an invoice by Administrative
Agent from the applicable Vendor regardless of whether such
Advance has been funded by Administrative Agent. A request
from a Vendor to Administrative Agent to Borrower's purchase
of Inventory will be deemed to be a request from Borrower for
a Floorplan Loan Advance or an Interim Floorplan Loan Advance,
as the case may be.
Inventory not Available for Floorplan Loans and Interim Floorplan Loans. Only
Vendors (approved by Administrative Agent) will be eligible to
receive proceeds of Aggregate Floorplan Loan Facility and the
Interim Floorplan Loan Facility. Administrative Agent or the
Required Lenders may, at any time and without notice to
Borrower, elect not to finance any inventory sold by
particular Vendors, including any Vendors who are in default
of their obligations to GECDF, or with respect to which GECDF
or Administrative Agent deems itself insecure. Without
limiting the generality of the foregoing, any items produced
by International Business Machine Corporation and any
Inventory in which a Vendor claims a Security Interest in
Inventory and proceeds will not be available for financing
under the Aggregate Floorplan Loan Facility or the Interim
Floorplan Loan Facility without the prior written approval of
Administrative Agent. Except with respect to Approvals issued
by Administrative Agent on or before the effective date of the
termination of the Aggregate Floorplan Loan Facility, Lenders
shall not be obligated to fund any Floorplan Loan Advances
after such date.
Termination of Floorplan Loan Facility and Interim Floorplan Loan Facility. The
Aggregate Floorplan Loan Facility and the Interim Floorplan
Loan Facility are discretionary facilities. Administrative
Agent may terminate the Aggregate Floorplan Loan Facility at
any time in its absolute discretion. A termination of the
Aggregate Floorplan Loan Facility shall automatically
terminate the Interim Floorplan Facility on the date of any
notice of such termination of the Aggregate Floorplan Loan
Facility. The Aggregate Floorplan Loan Facility may be
terminated at any time by Administrative Agent or by the
Required Lenders prior to the Termination Date with respect to
any future Floorplan Loans or Interim Floorplan Loans which
have not been funded (whether or not an Approval has been
issued, but subject to any Vendor Agreements regarding
unfunded Approvals) upon written notice to Borrower from
Administrative Agent. If, however, Administrative Agent or the
Required Lenders terminate(s) the Aggregate Floorplan Loan
Facility when no Event of Default has occurred and is
continuing, Administrative Agent shall give Borrower 60 days
prior written notice of such termination (which notice is
acknowledged by Borrower to be sufficient and reasonable) and
Lenders shall continue to fund Advances for Approvals issued
on or before the expiration of such 60 day period and
repayment shall be in accordance with the applicable Statement
of Transaction and billing statement. Borrower will not be
27
relieved from any obligation to Administrative Agent or the
Lenders arising out of Floorplan Loans or Interim Floorplan
Loans made before the effective termination date of the
Aggregate Floorplan Loan Facility or the Interim Floorplan
Loan Facility or made after the effective termination date of
the Aggregate Floorplan Loan Facility or Interim Floorplan
Loan Facility in connection with Approvals issued on or before
such effective termination date. Notwithstanding a termination
of the Aggregate Floorplan Loan Facility and the Interim
Floorplan Loan Facility, Administrative Agent and Lenders will
retain all of their rights, interests and remedies hereunder
and in all Collateral until Borrower has indefeasibly paid all
of the Loan Obligations in full in cash, all Letters of Credit
have expired and the Letter of Credit Exposure is irrevocably
reduced to zero. Any notice by the Required Lenders to
terminate the Aggregate Floorplan Loan Facility or the Interim
Floorplan Loan Facility shall be given in writing to
Administrative Agent who shall then promptly send such notice
to Borrower.
Repurchase Agreements. Administrative Agent or GECDF have entered into
agreements with Vendors which will be receiving proceeds of
the Aggregate Floorplan Loan Facility and the Interim
Floorplan Loan Facility (each being a "Vendor Agreement" and
collectively, the "Vendor Agreements"). Neither Administrative
Agent, GECDF nor any Lender makes any representation or
warranty regarding the Vendor Agreements, including regarding
the enforceability thereof, whether any particular item of
Inventory purchased by Borrower is subject to repurchase
rights, or any repurchase rights that may be set forth
therein. Each Lender and Borrower acknowledges and agrees that
Administrative Agent or GECDF may take or refrain from taking
any actions under or in connection with the Vendor Agreements
in Administrative Agent's or GECDF's, as the case may be,
commercially reasonable judgment. No Vendor is a third party
beneficiary of this Agreement or the other Loan Documents.
Swingline Facility.
Swingline Advances. This Section shall be applicable if there are two or more
Lenders. In such case, to reduce the frequency of fundings of
Revolving Loan Advances by Lenders, but subject to the
limitations in Section 0 and elsewhere herein, Administrative
Agent may (provided an Advance Request in the form of Exhibit
0 is received by Administrative Agent) in its absolute
discretion make Swingline Advances to Borrower from time to
time from the Effective Date to the effective date of
termination of the Swingline Facility or the Aggregate
Revolving Loan Facility. From and after the date on which
Administrative Agent has actual knowledge of an Event of
Default under Section 0 or 0, no further Swingline Advances
shall be made unless the Required Lenders approve in writing
any further Swingline Advances or unless such Event of Default
is waived in writing by the Required Lenders. Subject to the
limitations in Section 0 and elsewhere herein, payments and
prepayments that are applied to reduce the Swingline Loan may
be reborrowed through Swingline Advances.
Termination of Swingline Facility. The Swingline Facility is not a commitment to
lend money and is a discretionary facility; Administrative
Agent may terminate the Swingline Facility at any time in its
absolute discretion. If Administrative Agent terminates the
Swingline Facility, Borrower agrees that no prior notice of
any kind is required to be provided to Borrower. Borrower will
not be relieved from any obligation to Administrative Agent
arising out of Swingline Facility made before the effective
termination date of the Swingline Facility. Notwithstanding a
28
termination of the Swingline Facility, Administrative Agent
and Lenders will retain all of their rights, interests and
remedies hereunder and in all Collateral until Borrower has
indefeasibly paid all of the Loan Obligations in full in cash.
Limitations on Swingline Advances. Administrative Agent shall not be obligated
to make any particular Swingline Advance, the making of any
particular Swingline Advance at any particular time being
absolutely discretionary. In any event, no Swingline Advance
will be made on or after the date the Aggregate Revolving Loan
Facility is terminated, and no Swingline Advance will be made
which would result in either: (i) the Swingline Loan exceeding
the Maximum Swingline Amount; or (ii) the Lenders' Exposure
exceeding the Total Aggregate Facility Limit. Administrative
Agent may, however, in its absolute discretion make such
Swingline Advances, but shall not be deemed by doing so to
have increased the Maximum Swingline Amount and shall not be
obligated to make any such Swingline Advance thereafter.
Administrative Agent, will not, without the prior consent of
each Lender (which may be written or oral) knowingly make any
Swingline Advance which would cause either (i) the aggregate
amount of the Aggregate Revolving Loan to exceed the Maximum
Available Amount as of such date immediately prior to the
making of any such Swingline Advance or (ii) the Lenders'
Exposure to exceed the Total Aggregate Facility Limit. The
Maximum Swingline Amount on any date for any Swingline Advance
shall be a Dollar amount equal to the lesser of (i)
$25,000,000 or (ii) an amount equal to the Maximum Available
Amount as of such date minus the Aggregate Revolving Loan
immediately prior to the making of such Swingline Advance;
provided, however, at no time shall any Advance be deemed to
be a Swingline Advance, and such Advance shall be deemed to be
a Revolving Advance, if the sum of the Swingline Loan and the
amount of the Revolving Loans made by the Lender which is
Administrative Agent exceeds such Lender's Revolving Loan
Facility as set forth on Exhibit 0. The Swingline Facility is
not a commitment to lend or advance funds but is a
discretionary facility.
Swingline Note. The obligation of Borrower to repay the Swingline Loan shall be
evidenced by a promissory note payable to the order of
Administrative Agent in a maximum principal amount of
$25,000,000 and otherwise satisfactory to Administrative
Agent.
Letter of Credit Facility.
As may be requested from time to time by Borrower hereunder and subject to the
terms and conditions hereof, Administrative Agent, shall
either cause to be issued or the Letter of Credit Issuer will
issue standby letters of credit and commercial (documentary)
letters of credit for the account of Borrower from time to
time from the Effective Date to the date notice of termination
of the Aggregate Revolving Loan Facility is effective or
termination of the Letter of Credit Facility is effective, but
only if the Letter of Credit Exposure will not as a result of
such issuance exceed the lesser of (i) Five Million Dollars
($5,000,000) and (ii) an amount equal to the difference
between (a) the lesser of the Aggregate Revolving Loan
Facility and the Borrowing Base, and (b) the sum of (I) the
Aggregate Revolving Loan, (II) the Swingline Loan, (III) the
Floorplan Shortfall, and (IV) the amount of the Other Creditor
Indebtedness (unless an Intercreditor Agreement has been
executed between Administrative Agent and the holder of such
Other Intercreditor Indebtedness). The Existing Letters of
Credit are deemed to be Letters of Credit and deemed to be
issued under the Letter of Credit Facility.
29
Immediately upon the issuance of a Letter of Credit in accordance with the terms
and conditions hereof, Administrative Agent or Letter of
Credit Issuer, as the case may be, shall be deemed to have
sold and transferred to each other Lender, and such other
Lender shall be deemed to have purchased and received from
Administrative Agent or Letter of Credit Issuer, as the case
may be, a pro rata undivided interest and participation in
such Letter of Credit, the reimbursement obligation of
Borrower with respect thereto, and any guaranty thereof or
collateral therefor. Each Lender's (including the Letter of
Credit Issuer's) pro-rata undivided interest shall be the same
as its pro-rata share of the Aggregate Revolving Loan
Facility.
Subject to the terms and conditions below, the expiration date of any Letter of
Credit will not be later than the earlier of (i) the first
anniversary of the date of issuance, and (ii) a Business Day
that is not later than the date which is 25 days prior to the
earliest to occur of the Termination Date, the date of
termination of the Aggregate Revolving Loan Facility or the
date of termination of the Letter of Credit Facility if any
such notice of termination has been previously given;
provided, however, that the expiration date for a Letter of
Credit may be later than such date if Letter of Credit Issuer
(if applicable) and Administrative Agent each consent to such
issuance and Borrower provides to Administrative Agent or the
Letter of Credit Issuer at the time of issuance cash
collateral satisfactory to Letter of Credit Issuer and
Administrative Agent as security for Borrower's obligation to
reimburse Administrative Agent or the Letter of Credit Issuer,
as the case may be, for 105% of all draws and expenses
thereunder ("Cash Collateral"). The Cash Collateral is a part
of the Collateral. Borrower also agrees that if a Letter of
Credit has been issued and the Aggregate Revolving Loan
Facility is subsequently terminated or the Letter of Credit
Facility is subsequently terminated or a Termination Date will
occur so that the expiry of such Letter of Credit(s) is beyond
the effective date of the termination of the Aggregate
Revolving Loan Facility or beyond the effective date of
termination of the Letter of Credit Facility or beyond the
Termination Date, whichever is earliest, then Borrower shall,
on or before five Business Days prior to the effective date of
such termination or the Termination Date, whichever is
earlier, provide Administrative Agent or Letter of Credit
Issuer, as the case may be, with Cash Collateral.
Administrative Agent and the Lenders shall be entitled to make
one or more Revolving Loans to provide Cash Collateral if
Borrower does not timely provide Cash Collateral and all such
Revolving Loans shall be a part of the Loan Obligations
secured by the Collateral. Administrative Agent or the Letter
of Credit Issuer, as the case may be, shall hold Cash
Collateral for the benefit of the Lenders and Administrative
Agent as security for the Letters of Credit and the other Loan
Obligations in an account in its respective name at the Letter
of Credit Issuer or such other financial institution as
Administrative Agent may select in its reasonable discretion.
Total Aggregate Facility Limit. Notwithstanding the Facilities herein, Borrower,
Administrative Agent and each Lender acknowledge and agree that at no
time shall the Aggregate Revolving Loan Facility, the Swingline Loan
Facility, the Aggregate Floorplan Loan Facility, the Interim Floorplan
Loan Facility, all unfunded Approvals, and the Letter of Credit
Exposure exceed $125,000,000 in the aggregate ("Total Aggregate
Facility Limit").
Termination.
At any time an Event of Default has occurred and is continuing, Administrative
Agent or the Required Lenders may terminate some or all of the
Facilities, accelerate the Loan Obligations or take such other
actions as they may have hereunder (including Section 16.3),
30
the other Loan Documents or at law or at equity. In addition
to any other rights and remedies that the Lenders and
Administrative Agent may have in this Agreement, including, if
an Event of Default has occurred and is continuing and all
rights and remedies set forth in Section 0, Administrative
Agent or the Required Lenders may, at any time, whether or not
an Event of Default exists, elect to terminate the Aggregate
Floorplan Loan Facility, the Interim Floorplan Loan Facility
and the Swingline Facility and demand that Borrower repay in
full, in cash, all of the Loan Obligations related thereto
within 90 days of Borrower's receipt of such demand except
that Floorplan Loan Advances and Interim Floorplan Loan
Advances made with respect to any Approval issued during such
90-day period shall be repaid in accordance with the
applicable Statement of Transaction. Any such notice by the
Required Lenders shall be given in writing to Administrative
Agent who shall then promptly send such notice to Borrower, or
if given by Administrative Agent, Administrative Agent shall
promptly notify the Lenders after notifying Borrower. If
Administrative Agent or the Required Lenders terminate the
Aggregate Floorplan Loan Facility as provided herein and no
Event of Default then exists, then 90 days prior notice of
termination shall be given and shall be deemed reasonable and
sufficient.
If no Event of Default exists, then Administrative Agent or the Letter of Credit
Issuer (with respect to the Letter of Credit Facility),
Administrative Agent (with respect to any Facility) or the
Required Lenders (with respect to the Aggregate Floorplan Loan
Facility) may, at any time, elect to terminate some of the
Interim Floorplan Loan Facility, Floorplan Loan Facility and
Swingline Facility on the terms set forth in Sections 0, 0, 0
and 0 respectively. Notwithstanding a termination,
Administrative Agent and Lenders will retain all of their
rights, interests and remedies hereunder and in all Collateral
until Borrower has indefeasibly paid all of the Loan
Obligations in full in cash, all Letters of Credit have
expired and the Letter of Credit Exposure is irreversibly
zero. Nothing contained in this Section 0 limits or otherwise
modifies the termination provisions set forth in Section 0.
If Borrower advises Administrative Agent of a Material Proceeding as required by
Section 0, and if within forty-five (45) days of the filing or
instigation of such Material Proceeding, Borrower has neither
(i) obtained a dismissal of such Material Proceeding, (ii)
provided evidence reasonably satisfactory to the Required
Lenders that the allegations in such Material Proceeding are
fully insured (except for customary deductibles), (iii)
provided evidence reasonably satisfactory to the Required
Lenders that Borrower has obtained a bond sufficient to cover
Borrower's and all other Covered Person's liability in such
Material Proceeding, nor (iv) obtained an agreement from the
Required Lenders that such Material Proceeding is not in fact
a Material Proceeding for the purposes of this Section 0, then
on or before the ninetieth (90th) day following the filing or
instigation of such Material Proceeding, Borrower shall fully
and indefeasibly repay in cash the Loan Obligations including
all unfunded Approvals.
Borrower may at any time to terminate all of the Facilities by giving written
notice to Administrative Agent (which shall then promptly send
a copy of such notice to each Lender) if and only if Borrower
repays in full and in cash all of the Loan Obligations within
90 days of Administrative Agent's receipt of such notice,
including cash collateral for all Floorplan Loan Advances and
Interim Floorplan Loan Advances that may be made with respect
to any Approval issued during such 90 day period.
Notwithstanding a termination, Administrative Agent and
Lenders will retain all of their rights, interests and
31
remedies hereunder and in all Collateral until Borrower has
indefeasibly paid all of the Loan Obligations in full in cash,
all Letters of Credit have expired and the Letter of Credit
Exposure is irreversibly zero.
Interest; Yield Protection.
---------------------------
Interest on the Swingline Loan. The Swingline Loan shall be a LIBOR Loan, unless
the LIBOR Rate is not available as provided in this Agreement, then it
shall be a Base Rate Loan.
Interest on Draws on Letters of Credit. The unreimbursed amount of each draw on
a Letter of Credit shall bear interest at the rate per annum equal to
the LIBOR Rate.
Interest on the Floorplan Loan and Interim Floorplan Loan --Administrative Agent
and GECDF as a Lender Only.
Notwithstanding the terms of this Agreement, the term "Prime Rate" with respect
to any Statement of Transaction, to the extent such term is
defined in any such Statement of Transaction, shall have the
meaning set forth in any such Statement of Transaction. If
"Prime Rate" is not defined in any Statement of Transaction,
the term "Prime Rate" in such Statement of Transaction shall
have the meaning defined in this Agreement. Indebtedness under
each Statement of Transaction shall bear interest at the rate
specified therein for the period from the end of the
no-interest period stated therein until the thirtieth day
thereafter and thereafter at the Maturity/default rate
specified therein. Upon the occurrence and during the
continuance of an Event of Default, Indebtedness under each
Statement of Transaction shall bear interest at the default or
post-Maturity/default rate described therein. If no default or
post-Maturity rate is specified in any Statement of
Transaction, then after the occurrence and during the
continuance of an Event of Default, the Indebtedness under
such Statement of Transaction shall bear interest, as provided
in Section 0 at the rate which would otherwise apply under
such Statement of Transaction plus 2.0% per annum.
Borrower, Administrative Agent and each Lender agrees that certain financial
terms of any Floorplan Loan Advance or Interim Floorplan Loan
Advance made under this Agreement, whether regarding finance
charges, other fees, maturities, curtailments or other
financial terms, are not set forth herein because such terms
depend, in part, upon the availability of Vendor discounts,
payment terms or other incentives, prevailing economic
conditions, Administrative Agent or GECDF floor planning
volume with Borrower and with Vendors, and other economic
factors which may vary over time. Borrower, Administrative
Agent and each Lender further agree that it is therefore in
their mutual best interest to set forth in this Agreement only
the general terms of the Floorplan Loan Facility and the
Interim Floorplan Loan Facility. Upon agreeing to finance a
particular item of Inventory for Borrower, Administrative
Agent will send Borrower a statement of transaction
identifying such Inventory and the applicable financial terms
(each being a "Statement of Transaction"). Administrative
Agent may, without the consent of the Lenders or the Required
Lenders, change any aspect or portion of any Statement of
Transaction. Absent manifest error and unless Borrower
notifies Administrative Agent in writing of any objection
within fifteen (15) days after a Statement of Transaction is
mailed or sent electronically to Borrower: (i) the amount
shown on such Statement of Transaction will be an account
stated; (ii) Borrower will have agreed to all rates, charges
and other terms shown on such Statement of Transaction; (iii)
Borrower will have agreed that Administrative Agent is
financing the items of Inventory referenced in such Statement
32
of Transaction at Borrower's request; and (iv) such Statement
of Transaction will be incorporated herein by reference, will
be made a part hereof as if originally set forth herein, and
will constitute an addendum hereto. If Borrower objects to the
terms of any Statement of Transaction, Borrower agrees to pay
Administrative Agent for such Inventory in accordance with the
most recent terms for similar Inventory to which Borrower has
not objected (or, if there are no prior terms, at the lesser
of the Base Rate plus two percent (2.0%) per annum or at the
maximum lawful contract rate of interest permitted under
applicable law).
Borrower will pay the interest, fees, and finance charges to Administrative
Agent (on the Interim Floorplan Loan) for its own account and
to GECDF (on the Aggregate Floorplan Loan) for its own account
on the outstanding principal amount of the Interim Floorplan
Loans and the Aggregate Floorplan Loans, respectively, at the
rate(s) and in the amount(s) shown on the applicable Statement
of Transaction, unless Borrower objects thereto as provided in
Section 0. All such amounts (whether interest, fees or late
charges, but excluding principal) due and owing as set forth
in the Statements of Transaction shall be retained by
Administrative Agent for its own account (on the Interim
Floorplan Loans) and by GECDF for its own account (on the
Aggregate Floorplan Loans). Interest on the Aggregate
Floorplan Loans will be paid by Administrative Agent to the
Lenders (other than GECDF) from the proceeds Administrative
Agent receives from Borrower and the Vendors, as provided in
Section 0. All discounts and subsidies from a Vendor in
respect of a Floorplan Loan shall be for the sole account of
Administrative Agent and GECDF. Principal received by
Administrative Agent from Borrower on the Aggregate Floorplan
Loans will be paid to the Lenders as set forth in Section 0.
The finance charges attributable to the rate shown on the
Statement of Transaction will: (i) be computed based on a 360
day year; (ii) be calculated by multiplying the Daily Charge
(as defined below) by the actual number of days in the
applicable billing period; and (iii) accrue from the invoice
date of the Collateral identified on such Statement of
Transaction until Administrative Agent receives full payment
as provided in this Agreement for each item of such
Collateral. The "Daily Charge" is the product of the Daily
Rate (as defined below) multiplied by the Average Daily
Balance (as defined below). The "Daily Rate" is the quotient
of the annual rate shown on each Statement of Transaction
divided by 360, or the monthly rate shown on the Statement of
Transaction divided by 30. The "Average Daily Balance" is the
quotient of (i) the sum of the outstanding principal under the
Aggregate Floor Plan Facility plus the Interim Floorplan Loan
Facility on each day of a billing period for each item of
Collateral identified on a Statement of Transaction, divided
by (ii) the actual number of days in such billing period. With
respect to the Interim Floorplan Loans and the Floorplan
Loans, the annual percentage rate of the finance charges
relating to any item of Collateral financed thereby will be
calculated from the invoice date of such Collateral,
regardless of any period during which any finance charge
subsidy shall be paid or payable by any third party.
Administrative Agent will send Borrower a monthly billing statement identifying
all charges, including any late fees assessed, due to
Administrative Agent on the Interim Floorplan Loans and to
GECDF, as a Lender, on the Floorplan Loan Facility. The
charges specified on each billing statement will be due and
payable in full immediately on receipt.
Interest on Aggregate Loans--Other than Floorplan Loans. Each Revolving Loan
Advance or any part of a Revolving Loan Advance shall be a LIBOR
Advance, unless the LIBOR Rate is not available as provided in this
33
Agreement, then it shall be a Base Rate Advance. Each LIBOR Advance
when made will become a LIBOR Loan, which shall bear interest at the
Adjusted LIBOR Rate. Subject to the provisions of this Agreement, each
Base Rate Advance when made will become a Base Rate Loan, which shall
bear interest at the Base Rate.
Interest on Floorplan Loans; Administrative Agent Deficiency Amount.
Administrative Agent, Borrower and each Lender acknowledges and agrees
that the rate of return paid on any Floorplan Loan or Interim Floorplan
Loan is dependent on numerous factors, including discounts and
subsidies offered by the Vendors. Accordingly, Administrative Agent,
Borrower and each Lender agrees that due to the difficulty in
determining the actual rate of return on any particular Floorplan Loan
for Interim Floorplan Loan or with respect to any particular invoice
underlying any such Loan the Lenders (other than GECDF) will be paid
the interest rate specified in this Agreement. With respect to each
Lender (other than GECDF), interest on each Floorplan Loan Advance for
such Lender shall be paid to such Lender by Administrative Agent based
on the interest rates set forth in Sections 0, 0, and 0, and, if
applicable, 0, and as provided in Section 0 from the date of funding by
such Lender to Administrative Agent of its pro-rata share of such
Floorplan Loan Advance to the date of repayment; provided, however, if
a Floorplan Payment Default occurs, then until such Event of Default
has been cured to the reasonable satisfaction of the Required Lenders
or waived in writing by the Required Lenders, to the extent there
exists an Administrative Agent Deficiency Amount (defined below) which
is greater than zero, Administrative Agent may suspend the making of
payments of principal and interest on the Floorplan Loans to each
Lender (other than GECDF) or reduce the amount of such payments on the
Floorplan Loans to each Lender (other than GECDF) on a pro-rata basis
(based on the principal amount of Floorplan Loans outstanding) and
setoff such amounts against Administrative Agent Deficiency Amount
until Administrative Agent Deficiency Amount is reduced to zero, or to
the extent necessary to prevent Administrative Agent Deficiency Amount
from becoming greater than zero. The "Administrative Agent Deficiency
Amount" at any time is a Dollar amount equal to (i) the cumulative
amount of interest distributed by Administrative Agent to the Lenders
(other than GECDF) solely with respect to each specific Statement of
Transaction for which an Event of Default exists as outlined above in
this Section 0 under the portion of the Aggregate Floorplan Loan
attributable to Lenders (other than GECDF) for the period commencing
with the date interest begins accruing under the Statement of
Transaction (excluding any interest distributed which is attributable
to the period of time during the free floor plan period) and to the
extent such interest has not been paid by Borrower under each such
specific Statement of Transaction relating to such Event of Default
through the date of calculation (provided, however, that in no event
shall any interest paid to the Lenders (other than GECDF) relating to
any specific Statement of Transaction during any period for which no
Event of Default exists or existed be included in the calculation under
this clause (i)), minus (ii) the cumulative amount of interest
collected from Borrower by Administrative Agent solely with respect to
each specific Statement of Transaction for which an Event of Default
exists as outlined above in this Section 0 under the portion of the
Aggregate Floorplan Loan attributable to Lenders (other than GECDF) for
the period commencing with the date interest begins accruing under the
Statement of Transaction (excluding any interest distributed which is
attributable to the period of time during the free floor plan period).
Each Floorplan Loan Advance or any part of a Floorplan Loan Advance
owing to a Lender (other than GECDF) shall be considered a LIBOR
Advance for interest rate calculation purposes under this Section,
unless the LIBOR Rate is not available as provided in this Agreement,
then it shall be a Base Rate Advance for interest rate calculation
purposes.
Adjusted LIBOR Rate. The "Adjusted LIBOR Rate" for any LIBOR Loan is the LIBOR
Rate plus the applicable LIBOR Increment determined from time to time
as provided in Section 0. The LIBOR Rate for each LIBOR Loan shall be
34
determined by Administrative Agent pursuant to this Agreement. For each
LIBOR Loan, the Adjusted LIBOR Rate shall fluctuate as provided for
herein. The "LIBOR Rate" shall be the interest rate per annum equal to
the quotient (rounded to the nearest 0.001%) of
(i) For each calendar week commencing on Tuesday of such
week, the rate per annum, as determined by Administrative
Agent, as adjusted from time to time in Administrative Agent's
reasonable discretion for then applicable reserve
requirements, deposit insurance assessment rates and other
regulatory costs, as reported by The Wall Street Journal and
identified as the "London Interbank Offered Rate" for an
interest period of 30 days, on (a) each Monday immediately
preceding, or (b) if any such Monday is not a Business Day,
then on the Business Day immediately preceding such Monday. If
for any reason such rate is not available, the term "LIBOR
Rate" shall mean, for any LIBOR Loan, the rate per annum
appearing on Reuters Screen LIBOR Page as the London interbank
offered rate for deposits in Dollars at approximately 11:00
a.m. (London time) for an interest period of 30 days, on (a)
each Monday immediately preceding, or (b) if any such Monday
is not a Business Day, then on the Business Day immediately
preceding such Monday; provided, however, if more than one
rate is specified on Reuters Screen LIBOR Page, the applicable
rate shall be the arithmetic mean of all such rates (rounded
upwards, if necessary, to the nearest 1/1000 of 1%),
divided by,
(ii) one minus the maximum rate at which reserves (including
any marginal, special, supplemental, or emergency reserves)
are required to be maintained under regulations issued from
time to time by the FRB or any other Governmental Authority to
which any Lender is subject (or any successor), including, in
the case of LIBOR Loans, "Eurocurrency liabilities" (as such
term is used in Regulation D). Without limiting the effect of
the foregoing, the reserve requirement shall reflect any other
reserves required to be maintained by any Lender with respect
to any category of liabilities which includes deposits by
reference to which the LIBOR Rate is to be determined, or any
category of extensions of credit or other assets which include
LIBOR Loans. The entire amount of a LIBOR Loan shall be deemed
to constitute a Eurocurrency liability and as such shall be
deemed to be subject to such reserve requirements without
benefit of credits for proration, exceptions or set-offs which
may be available from time to time to any Lender under
Regulation D. The LIBOR Rate shall be adjusted automatically
on and as of the effective date of any change in any such
reserve requirements.
Notwithstanding anything herein to the contrary, any adjustment
hereunder to the LIBOR Rate as a result of any reserve requirements,
deposit insurance assessment rates or other regulatory costs shall be
limited to respective Loans made hereunder by the affected one or more
Lenders subject to such regulatory costs.
35
Base Rate. Except as set forth in Section 0, the "Base Rate" for any Base Rate
Advance is the Prime Rate (which will fluctuate as described in Section
0) plus the applicable Prime Increment as provided in Section 0.
Prime Increments and LIBOR Increments. The applicable Prime Increment and
applicable LIBOR Increment shall be as set forth in the following
table:
--------------------------------------------------------------------------------------------
LIBOR Increment LIBOR Increment Prime Increment
(All Facilities, except (Aggregate Floorplan Loan (All Facilities, except
Aggregate Floorplan Loan Facility and Interim Floorplan Aggregate Floorplan Loan
Facility and Interim Loan Facility) Facility and Interim
Floorplan Loan Facility) Floorplan Loan Facility)
--------------------------------------------------------------------------------------------
1.75% per annum [to be determined] [to be determined]
--------------------------------------------------------------------------------------------
For the Floorplan Loan Facility and Interim Floorplan Loan
Facility, the Prime Increments and LIBOR Increments set forth above are
used only for determining that interest rate payable by Administrative
Agent to the Lenders pursuant to Section 4.4. The interest rate payable
by Borrower on the Floorplan Loan Facility and Interim Floorplan Loan
Facility is the interest rate described in each Statement of
Transaction, as provided in Section 4.2.
Time of Accrual. Interest shall accrue on all principal amounts outstanding from
the date when first outstanding to the date when no longer outstanding.
Amounts shall be deemed outstanding until payments are applied thereto
as provided herein.
Conversion or Continuation of Loans. Except as described in Sections 0, 0 and 0,
Base Rate Loans are not available to Borrower. Borrower may not at any
time convert some or all of a Base Rate Loan to a LIBOR Loan, or a
LIBOR Loan to a Base Rate Loan, except in situations described in
Sections 0, 0 and 0 in which cases such conversion shall be mandatory.
Computation. Interest shall be computed for the actual days elapsed over a year
deemed to consist of 360 days for all LIBOR Loans and all Base Rate
Loans. The Base Rate and the LIBOR Rate will be determined by
Administrative Agent before the initial Advance on the Effective Date
and on each Business Day thereafter when the LIBOR Rate changes or the
Base Rate changes, as the case may be. Interest rates that are based on
the LIBOR Rate and the Base Rate shall change simultaneously with any
change in the LIBOR Rate or Base Rate, as the case may be, and shall be
effective for the entire day on which such change becomes effective.
Rate After Maturity and Rate After An Event of Default.
Borrower shall pay interest on the Aggregate Revolving Loans
after their Maturity, and if Administrative Agent or the
Required Lenders so determine in their absolute discretion, on
the Aggregate Revolving Loans and on the other Loan
Obligations (other than the Aggregate Floorplan Loans), (i)
after the occurrence and during the continuance of an Event of
36
Default referenced in Section 0 and (ii) after the 30th day
following Borrower's receipt of a notice from Administrative
Agent with respect to any other Event of Default, at a rate
per annum of 2.0% plus the then applicable rate(s) on each
Loan (the "Default Rate").
Borrower shall pay interest on the Aggregate Floorplan Loans and Interim
Floorplan Loans (i) after a Floorplan Payment Default, and
(ii) if Administrative Agent so determines in its absolute
discretion, after the occurrence and during the continuance of
any other Event of Default, in each case, at a rate per annum
as so determined by Administrative Agent as provided in each
Statement of Transaction and, with each Lender (other than
GECDF) receiving, if a higher rate is imposed by
Administrative Agent than otherwise payable by Borrower and
which is paid by Borrower, 2.0% plus the then applicable
rate(s) on each Floorplan Loan of such Lender (the "Floorplan
Default Rate").
Accrual of the Default Rate shall commence (i) after the occurrence and during
the continuation of an Event of Default referenced in Section
0 and (ii) after the 30th day following Borrower's receipt of
notice from Administrative Agent with respect to any other
Event of Default; provided, however, nothing contained in this
Section 0 shall require Administrative Agent or any Lender to
give any notice of an Event of Default to Borrower or
otherwise modify the terms of Section 0. Accrual of the
Floorplan Default Rate shall commence immediately upon an
Event of Default.
Taxes.
Any and all payments by Borrower to or for the account of any Lender or
Administrative Agent hereunder or under any other Loan
Document shall be made free and clear of and without deduction
for any and all present or future Taxes, excluding, in the
case of each Lender and Administrative Agent, Taxes imposed on
its income, and franchise Taxes imposed on it, by the
jurisdiction (or any political subdivision thereof) under the
laws of which such Lender (or its Applicable Lending Office)
or Administrative Agent (as the case may be) is organized or
any political subdivision thereof. If Borrower shall be
required by Law to deduct any Taxes from or in respect of any
sum payable under this Agreement or any other Loan Document to
any Lender or Administrative Agent, (i) the sum payable shall
be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums
payable under this Section) such Lender or Administrative
Agent receives an amount equal to the sum it would have
received had no such deductions been made, (ii) Borrower shall
make such deductions, (iii) Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority
in accordance with applicable Law, and (iv) Borrower shall
furnish to Administrative Agent, at its address referred to
herein, the original or a certified copy of a receipt
evidencing payment thereof.
In addition, Borrower agrees to pay any and all present or future stamp or
documentary taxes and any other excise or property taxes or
charges or similar levies which arise from any payment made
under this Agreement or any other Loan Document or from the
execution or delivery of, or otherwise with respect to, this
Agreement or any other Loan Document (hereinafter referred to
as "Impositions"), except income and franchise Taxes imposed
by any jurisdiction referred to in Section 0.
Borrower agrees to indemnify each Lender and Administrative Agent for the full
amount of Taxes and Impositions (including, any Taxes or
Impositions imposed or asserted by any jurisdiction on amounts
37
payable under this Section) that are required to be paid by
Borrower hereunder but are paid by such Lender or
Administrative Agent (as the case may be) and any liability
(including penalties, interest and expenses) arising therefrom
or with respect thereto; provided, however, that neither
Administrative Agent nor any Lender shall have any obligation
to pay any such Taxes, Impositions or other liability.
Each Lender organized under the laws of a jurisdiction outside the United
States, on or prior to the date of its execution and delivery
of this Agreement in the case of each Lender listed on the
signature pages hereof and on or prior to the date on which it
becomes a Lender in the case of each other Lender, and from
time to time thereafter if requested in writing by Borrower or
Administrative Agent (but only so long as such Lender remains
lawfully able to do so), shall provide Borrower and
Administrative Agent with (i) IRS Form 1001 or 4224, as
appropriate, or any successor form prescribed by the IRS,
certifying that such Lender is entitled to benefits under an
income tax treaty to which the United States is a party which
reduces the rate of withholding Tax on payments of interest or
certifying that the income receivable pursuant to this
Agreement is effectively connected with the conduct of a trade
or business in the United States, (ii) IRS Form W-8 or W-9, as
appropriate, or any successor form prescribed by the IRS, and
(iii) any other form or certificate required by any
Governmental Authority (including any certificate required by
Code Sections 871(h) and 881(c)), certifying that such Lender
is entitled to an exemption from or a reduced rate of Tax on
payments pursuant to this Agreement or any of the other Loan
Documents.
For any period with respect to which a Lender has failed to provide Borrower and
Administrative Agent with the appropriate form pursuant to
Section 0 (unless such failure is due to a change in treaty,
law, or regulation occurring subsequent to the date on which a
form originally was required to be provided), such Lender
shall not be entitled to indemnification under this Section 0
with respect to Taxes imposed by or within the United States;
provided, however, that should a Lender, which is otherwise
exempt from or subject to a reduced rate of withholding Tax,
become subject to Taxes because of its failure to deliver a
form required hereunder, Borrower shall take such action as
such Lender shall reasonably request to assist such Lender to
recover such Taxes.
If Borrower is required to pay additional amounts to or for the account of any
Lender or Administrative Agent pursuant to this Section, then
such Lender or Administrative Agent will agree to use
reasonable efforts to change the jurisdiction of its
Applicable Lending Office so as to eliminate or reduce any
such additional payment which may thereafter accrue if such
change, in the reasonable judgment of such Lender or
Administrative Agent, as the case may be, is not otherwise
disadvantageous to such Lender or Administrative Agent, as the
case may be. Each Lender agrees, with respect to the
provisions of this Section 0, to treat Borrower in a manner
substantially similar to that of its other similarly situated
customers.
Within thirty (30) days after the date of any payment of Taxes described in this
Section 0, Borrower shall furnish to Administrative Agent the
original or a certified copy of a receipt evidencing such
payment.
38
Without prejudice to the survival of any other agreement of Borrower hereunder,
the agreements and obligations of Borrower contained in this
Section shall survive the termination of the Facilities and
the indefeasible payment in full of the Loan Obligations.
Compensation for Increased Costs and Reduced Returns; Capital Adequacy.
If, after the date hereof, the adoption of any applicable Law or any change in
any applicable Law or any change in the interpretation or
administration thereof by any Governmental Authority charged
with the interpretation or administration thereof, or
compliance by any Lender (or its Applicable Lending Office)
with any request or directive (whether or not having the force
of law) of any such Governmental Authority, central bank, or
comparable agency:
shall subject such Lender (or its Applicable Lending Office) to any Tax with
respect to any LIBOR Loans or its obligation to make LIBOR
Loans, or change the basis of taxation of any amounts payable
to such Lender (or its Applicable Lending Office) under this
Agreement in respect of any LIBOR Loans (other than Taxes
imposed on the net income of such Lender by the jurisdiction
in which such Lender has its principal office or such
Applicable Lending Office);
shall impose, modify, or deem applicable any reserve, special deposit,
assessment, or similar requirement (other than the reserve
requirement utilized in the determination of the LIBOR Rate)
relating to any extensions of credit or other assets of, or
any deposits with or other liabilities or commitments of, such
Lender (or its Applicable Lending Office), including the
Commitment of such Lender hereunder; or
shall impose on such Lender (or its Applicable Lending Office) or on the United
States market for certificates of deposit, treasury bills or
the London interbank market any other condition affecting this
Agreement, its Commitments or its Note or any of such
extensions of credit or liabilities or commitments;
and the result of any of the foregoing is to increase the cost to such Lender
(or its Applicable Lending Office) of making, converting into, continuing, or
maintaining any Loan or to reduce any sum received or receivable by such Lender
(or its Applicable Lending Office) under this Agreement or its Notes with
respect to any Loan, then Borrower shall pay to such Lender on demand such
amount or amounts as will reasonably compensate such Lender for such increased
cost or reduction. If any Lender requests compensation by Borrower under this
Section Borrower may, by notice to such Lender (with a copy to Administrative
Agent), suspend the obligation of such Lender to make or continue Loans of the
type with respect to which such compensation is requested, or to convert Loans
of any other type into Loans of such type, until the event or condition giving
rise to such request ceases to be in effect (in which case the provisions of
Section 0 shall be applicable); provided that such suspension shall not affect
the right of such Lender to receive the compensation so requested.
If, after the date hereof, any Lender shall have reasonably determined that the
adoption of any applicable Law regarding capital adequacy or
any change therein or in the interpretation or administration
thereof by any Governmental Authority, central bank, or
comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding
capital adequacy (whether or not having the force of law) of
any such Governmental Authority, central bank, or comparable
agency, has or would have the effect of reducing the rate of
return on the capital of such Lender or any corporation
controlling such Lender as a consequence of such Lender's
obligations hereunder to a level below that which such Lender
or such corporation could have achieved but for such adoption,
change, request, or directive (taking into consideration its
39
policies with respect to capital adequacy), then from time to
time upon demand Borrower shall pay to such Lender such
additional amount or amounts as will reasonably compensate
such Lender for such reduction.
Each Lender shall promptly notify Borrower and Administrative Agent of any event
of which it has knowledge, occurring after the date hereof,
which will entitle such Lender to compensation pursuant to
this Section and will designate a different Applicable Lending
Office if such designation will avoid the need for, or reduce
the amount of, such compensation and will not, in the
reasonable judgment of such Lender, be otherwise
disadvantageous to it. Any Lender claiming compensation under
this Section shall furnish to Borrower and Administrative
Agent a statement setting forth the additional amount or
amounts to be paid to it hereunder which shall be conclusive
in the absence of manifest error. In determining such amount,
such Lender may use any reasonable averaging and attribution
methods. Each Lender agrees, with respect to the provisions of
this Section, to treat Borrower in a manner substantially
similar to that of its other similarly situated customers.
Limitation on Types of Loans. If on or prior to the making of any LIBOR Loan
Administrative Agent reasonably determines that by reason of
circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the LIBOR Rate,
Administrative Agent shall give Borrower prompt notice
thereof, and so long as such condition remains in effect, the
Lenders shall be under no obligation to make additional LIBOR
Loans, or continue LIBOR Loans and all LIBOR Loans shall
immediately convert to Base Rate Loans in accordance with the
terms and conditions of this Agreement.
Illegality. Notwithstanding any other provision of this Agreement, if it becomes
unlawful for any Lender or its Applicable Lending Office to make,
maintain, or fund LIBOR Loans hereunder, then such Lender shall
promptly notify Borrower thereof and such Lender's obligation to make
or continue LIBOR Loans or convert Base Rate Loans into LIBOR Loans
shall be suspended until such time as such Lender may again make,
maintain, and fund LIBOR Loans (in which case the provisions of Section
0 shall be applicable).
Treatment of Affected Loans. If the obligation of any Lender to make a LIBOR
Loan or to convert any Base Rate Loan into an LIBOR Loan shall be
suspended pursuant to Sections 0 or 0 (such Loans being herein called
"Affected Loans"), such Lender's Affected Loans shall be automatically
and immediately be converted into Base Rate Loans and, unless and until
such Lender gives notice as provided below that the circumstances
specified in Sections 0 or 0 that gave rise to such conversion no
longer exist:
(a) to the extent that such Lender's Affected Loans have
been so converted, all payments and prepayments of principal that would
otherwise be applied to such Lender's Affected Loans shall continue to
be made and applied as provided for herein; and
(b) all Loans that would otherwise be made or continued
by such Lender as LIBOR Loans shall be made or continued instead as
Base Rate Loans, and all Loans of such Lender that would otherwise be
converted into LIBOR Loans shall be converted instead into (or shall
remain as) Base Rate Loans.
If such Lender gives notice to Borrower (with a copy to Administrative Agent)
that the circumstances specified in Sections 0 or 0 that gave rise to the
conversion of such Lender's Affected Loans pursuant to this Section no longer
exist (which such Lender agrees to do promptly upon such circumstances ceasing
to exist) at a time when Loans of the type of the Affected Loans made by other
40
Lenders are outstanding, such Lender's Base Rate Loans shall be automatically
converted, so that, after giving effect thereto, all Loans held by the Lenders
holding Loans of the type of the Affected Loans and by such Lender are held pro
rata in accordance with their respective Commitments.
Usury. Notwithstanding any provisions to the contrary in Section 0 or elsewhere
in any of the Loan Documents, Borrower shall not be obligated to pay
interest at a rate which exceeds the maximum rate permitted by Law. If,
but for this Section 0, Borrower would be deemed obligated to pay
interest at a rate which exceeds the maximum rate permitted by Law, or
if any of the Loan Obligations is paid or becomes payable before its
originally scheduled Maturity or is otherwise accelerated and as a
result Borrower has paid or would be obligated to pay interest at such
an excessive rate, then (i) Borrower shall not be obligated to pay
interest to the extent it exceeds the interest that would be payable at
the maximum rate permitted by Law; (ii) if the outstanding Loan
Obligations have not been accelerated as provided in Section 0, any
such excess interest that has been paid by Borrower shall be refunded;
(iii) if the outstanding Loan Obligations have been accelerated as
provided in Section 0, any such excess that has been paid by Borrower
shall be applied to the Loan Obligations as provided in Section 0; and
(iv) the effective rate of interest shall be deemed automatically
reduced to the maximum rate permitted by Law.
Fees.
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Letter of Credit Fees. Borrower shall pay to Administrative Agent for the
account of each Lender with a Revolving Loan Facility (pro rata based
on each Lender's Revolving Loan Facility), a non-refundable recurring
Letter of Credit Fee for each Letter of Credit issued or caused to be
issued hereunder. The Letter of Credit Fee for any Letter of Credit
shall be an amount equal to the aggregate undrawn amount of such Letter
of Credit multiplied by 1.25% (per annum). The Letter of Credit Fee for
each Letter of Credit shall be payable in advance on the date of
issuance for the remaining portion of the quarter when issued and
quarterly thereafter in advance on the first day of each full calendar
quarter thereafter while such Letter of Credit is outstanding.
Other Letter of Credit Fees. Borrower shall pay to Administrative Agent or the
Letter of Credit Issuer, as the case may be, such Letter of Credit
Issuer's other customary fees for issuance, amendment, or renewal of a
Letter of Credit and, as Letter of Credit Issuer and Borrower may agree
with respect to each Letter of Credit, for each negotiation of a draft
drawn under such Letter of Credit.
Calculation of Fees. All of the foregoing fees shall be calculated by
Administrative Agent and payable by Borrower. All of the foregoing fees
and all other fees payable to Administrative Agent or any Lender that
are based on an annual percentage shall be calculated on the basis of a
year deemed to consist of 360 days and for the actual number of days
elapsed. Once paid, all such fees shall be deemed to be fully earned
and nonrefundable under any circumstances. These fees are a part of the
Loan Obligations and are secured by all of the Collateral.
Administrative Agent is hereby authorized to make an Advance to pay
such fees.
Payments.
---------
Scheduled Payments on Loans; Applications to Loans.
Interest. Borrower shall pay interest accrued on each Aggregate Revolving Loan
and on the Swingline Loan monthly in arrears
beginning on the first day of the first calendar
month beginning after the Effective Date and
continuing on the first day of each calendar month
thereafter, and on the effective date of termination
of the Aggregate Revolving Loan Facility. Borrower
shall pay interest accrued on each Revolving Loan and
41
the Swingline Loan after the effective date of
termination of the Aggregate Revolving Loan Facility
or the Swingline Facility at the Default Rate.
Subject to the terms of this Agreement, interest on
the Revolving Loans shall be distributed by
Administrative Agent to the Lenders monthly in
arrears beginning on the first day of the first
calendar month beginning after the Effective Date and
continuing on the first day of each calendar month
thereafter, and on the effective date of termination
of the Aggregate Revolving Loan Facility.
Borrower shall pay to Administrative Agent for its own account and the account
of GECDF, all interest, fees and charges accrued on
the Aggregate Floorplan Loan and the Interim
Floorplan Loan in accordance with the Statements of
Transaction. Subject to the terms of Sections 0 and 0
and elsewhere in this Agreement, interest on the
Floorplan Loans shall be distributed by
Administrative Agent to the Lenders, other than
GECDF, monthly in arrears (with the right of set off
in favor of Administrative Agent and GECDF as set
forth in Section 0) beginning on the first day of the
first calendar month beginning after the Effective
Date and continuing on the first day of each calendar
month thereafter, and on the effective date of
termination of the Aggregate Floorplan Loan Facility,
and, subject to the terms of this Agreement, monthly
thereafter for Approvals in effect and funded but not
funded on the effective date of termination of the
Aggregate Floorplan Loan Facility.
Principal.
Borrower shall, and shall cause each other Covered Person to, direct all Account
Debtors to remit payments on their Accounts to one or
another lockboxes maintained at financial
institutions acceptable to Administrative Agent, each
under a lockbox agreement with such financial
institutions in form and substance satisfactory to
Administrative Agent (collectively, the "Lockboxes")
with all payments received in any such Lockboxes
being deposited into an account at such financial
institution (all such accounts that may exist from
time to time, are collectively referred to as the
"Blocked Accounts"). Each of the Blocked Accounts and
Lockboxes shall be blocked in favor of Administrative
Agent pursuant to one or more agreements in form and
substance satisfactory to Administrative Agent. All
payments received in the Lockboxes, Blocked Accounts
and other proceeds of Collateral and other funds
Borrower receives directly (other than from Floorplan
Loan Advances, Interim Floorplan Loan Advances,
Revolving Loan Advances, and Swingline Advances),
shall be paid to Administrative Agent, as payment on
the Advances, as provided for herein, and deposited
into Administrative Agent's account at such financial
institutions as Administrative Agent shall direct and
instruct from time to time (any such account of
Administrative Agent being a "Cash Collateral
Account").
Subject to Section 00 and the last sentence of this Section, payments shall be
paid or applied by Administrative Agent (in each case
up to the outstanding principal amount of the
applicable Loan) at the times specified in Section 0
(i) first, to reduce the Swingline Loan to zero, (ii)
second, to the extent of any excess, to the Lender
also acting as Administrative Agent in its capacity
as a Lender and not as Administrative Agent, to
reduce any of the Aggregate Revolving Loan owing to
42
the Lender acting as Administrative Agent that are
not also Swingline Loans, and (iii) third, if no
Event of Default has occurred and is continuing,
distributed to Borrower, but if an Event of Default
has occurred and is continuing then retained by
Administrative Agent in the Cash Collateral Account
(without any obligation to pay Borrower interest on
such funds) until the entire amount of the
outstanding Loan Obligations are irrevocably
satisfied, including payment of cash collateral
satisfactory to Administrative Agent as security for
Borrower's obligation to reimburse Administrative
Agent or the Letter of Credit Issuer, as the case may
be, for 105% of all draws and expenses under all
outstanding Letters of Credit and 100% of any
unfunded Approvals, in which case such Approvals
shall be otherwise paid in accordance with the
applicable Statements of Transaction, where after
such other amounts shall be distributed to Borrower,
or, if an Event of Default has occurred or is
continuing, distributed by Administrative Agent to
the other Lenders after consultation by
Administrative Agent with the other Lenders until the
entire amount of the outstanding Loan Obligations are
irrevocably satisfied, including payment of cash
collateral satisfactory to Administrative Agent as
security for Borrower's obligation to reimburse
Administrative Agent or the Letter of Credit Issuer,
as the case may be, for 105% of all draws and
expenses under all outstanding Letters of Credit and
100% of any unfunded Approvals, in which case such
Approvals shall be otherwise paid in accordance with
the applicable Statements of Transaction, where after
such other amounts shall be distributed to Borrower.
Notwithstanding the foregoing, payments, whether from
a Borrower or a Vendor on the Interim Floorplan Loan
and the Aggregate Floorplan Loan owing to
Administrative Agent and the Lender acting as
Administrative Agent shall be applied to the Interim
Floorplan Loan of Administrative Agent and the
Aggregate Floorplan Loan of such Lender as it deems
appropriate in its sole discretion.
Prior to 3:00 p.m. (Local Time) on the last Business Day of each calendar week
(a "Settlement Date"), based on funds collected
pursuant to Section 0 as of 12:00 noon (Local Time)
on the Business Day immediately preceding such
Settlement Date (under all circumstances, including
during the existence of any Event of Default), each
Lender shall, to the extent it does not hold its
pro-rata share of the outstanding Aggregate Floorplan
Loan (including, any amounts for which an Approval
has been issued, whether or not funding has
occurred), Aggregate Revolving Loan, but excluding
any Swingline Loan or Interim Floorplan Loan (which
will be settled to zero as a part of the settlement),
purchase from or sell to one or more other Lenders,
at par, which may occur by a funding through
Administrative Agent, that portion of its Loans as is
necessary for it to thereafter hold its pro-rata
share of the outstanding Aggregate Floorplan Loan and
Aggregate Revolving Loan. In order that the foregoing
settlement among the Lenders can be effected on each
Settlement Date, Administrative Agent shall, on or
before 12:00 p.m. (Local Time) on such Settlement
Date(1), notify each Lender who shall purchase or
sell a Loan, or fund through Administrative Agent, of
----------------------
(1) If the Settlement Date occurs more than once a week, then the
foregoing time shall be 11:00 a.m. (Local Time)
43
(i) the principal amount of the Loan to be purchased
or sold, (ii) the name of the Lender(s) which will be
purchasing from or selling to such Lender a Loan, and
(iii) if such Lender is to purchase a Loan, the name
of and wire transfer instructions for the Lender(s)
from which the Loan shall be purchased. On or before
3:00 p.m. (Local Time) on such Settlement Date, each
such purchasing Lender shall wire transfer
immediately available funds to the applicable selling
Lender(s) the amount necessary to effect the
settlement.
Administrative Agent may, at any time, in its sole discretion, cause the
Settlement Date to occur more frequently, including,
each Business Day of each week. Administrative Agent
shall notify each Lender that a given Business Day
shall be a Settlement Date by no later than 12:30
p.m. (Local Time) on the Business Day immediately
preceding any such date; provided, however, if the
Settlement Date occurs more frequently than once a
week, then once Administrative Agent gives such
notice, no further notices shall be required.
Maturity. Borrower shall repay the entire amount of the Aggregate Revolving Loan
on February 28, 2005 ("Initial Maturity Date"),
unless the Aggregate Revolving Loan Facility
continues after the Initial Maturity Date as provided
below in this Section 0 and Borrower shall repay the
amount of the Swingline Loans on demand. The
Aggregate Revolving Loan Facility will continue from
year to year on each anniversary of the Initial
Maturity Date unless any party hereto gives each
other party hereto written notice of termination of
not less than 90 days prior to the start of a renewal
period. Each of the Aggregate Floorplan Loan
Facility, the Interim Floorplan Loan Facility and the
Swingline Facility are discretionary and may be
terminated at any time as set forth herein, with or
without notice or demand as set forth herein;
provided, however, if Borrower shall give notice of
termination of the Aggregate Revolving Loan Facility,
then such notice shall be deemed to be notice of
termination for all Facilities in which case Borrower
shall pay the entire amount of the outstanding Loan
Obligations upon the effective date of such notice of
termination, including payment of cash collateral
satisfactory to Administrative Agent as security for
Borrower's obligation to reimburse Administrative
Agent or the Letter of Credit Issuer, as the case may
be, for 105% of all draws and expenses under all
outstanding Letters of Credit and 100% of any
unfunded Approvals, in which case such Approvals
shall be otherwise paid in accordance with the
applicable Statements of Transaction.
Special Requirement for Payments on Floorplan Loans and Interim Floorplan Loans.
Borrower will immediately pay Administrative Agent the principal
Indebtedness owed Administrative Agent and the Lenders on each item of
Collateral financed by the Lenders and Administrative Agent (as shown
on the Statement of Transaction identifying such Collateral) under the
Floorplan Loan Facility or the Interim Floorplan Loan Facility on the
earliest occurrence of any of the following events: (i) when such
Collateral is lost, stolen or damaged; (ii) for Collateral financed
under Pay-As-Sold ("PAS") terms (as shown on the Statement of
Transaction identifying such Collateral), when such Collateral is sold,
transferred, rented, leased, otherwise disposed of or matured; (iii) in
accordance with any curtailment schedule for such Collateral (as shown
on the Statement of Transaction identifying such Collateral); (iv) for
Collateral financed under Scheduled Payment Program ("SPP") terms (as
44
shown on the Statement of Transaction identifying such Collateral), in
accordance with the installment payment schedule; and (v) when
otherwise required under the terms of any financing program agreed to
in writing by Borrower and Administrative Agent. Any third party
discount, rebate, subsidy, bonus or credit granted to Borrower for any
Collateral will not reduce the Loan Obligations until Administrative
Agent has received payment as provided in this Agreement. The Floorplan
Shortfall, if any, will remain in effect, until the next determination
of the Floorplan Shortfall by Administrative Agent. Borrower shall pay
all amounts owing to Administrative Agent and the Lenders under the
Floorplan Loan Facility and the Interim Floorplan Loan Facility as set
forth herein and in the applicable Statement of Transaction.
Prepayments.
Voluntary Prepayments. Subject to the limitations in the following sentences,
except for mandatory prepayments and funds received by
Administrative Agent as contemplated by Section 6.1, Borrower
may wholly prepay any Loan that is included in the Aggregate
Revolving Loan or the Swingline Loan, or prepay any Floorplan
Loan or Interim Floorplan Loan, at any time and may make a
partial prepayment thereon from time to time, without penalty
or premium, if Borrower pays any amount that is due as a
consequence of the prepayment of any Loan and as otherwise
provided for in this Agreement. All such prepayments, unless
otherwise expressly stated in writing by Borrower to
Administrative Agent prior to the making of such prepayment,
will be deemed made on the Swingline Loan until it is reduced
to zero, thereafter to the Interim Floorplan Loan until it is
reduced to zero, thereafter to the Aggregate Floorplan Loan
until it is reduced to zero, and thereafter to the Aggregate
Revolving Loan until it is reduced to zero (with, in each
case, the payment of any and all penalties and premiums due
hereunder in connection therewith), and will be applied by
Lenders to reduce the Floorplan Loans and the Revolving Loans,
as appropriate, in accordance with their respective pro-rata
shares.
Mandatory Prepayments. If at any time the Aggregate Revolving Loan exceeds the
Maximum Available Amount (which can be a negative number),
whether as a result of optional Swingline Advance made by
Administrative Agent as contemplated by Section 3.4.2, or
otherwise, Borrower shall on demand make a payment in the
amount of the difference to Administrative Agent for the
account of Administrative Agent on the Swingline Loan and
Lenders on the Aggregate Revolving Loan. Each such prepayment
will be applied by Administrative Agent and Lenders first to
reduce the Swingline Loan until it is reduced to zero, and
then to reduce the Aggregate Revolving Loan (and consequently
a ratable portion of each Lender's Revolving Loan). In
addition, on any date that Interim Floorplan Loan plus the
Aggregate Floorplan Loan exceeds the Aggregate Floorplan Loan
Facility, then Borrower shall, on such date, pay the such
excess to Administrative Agent for the pro-rata benefit of the
Lenders and failure to pay such excess on such date shall be
an immediate Event of Default.
Other Mandatory Prepayments.
Proceeds from Sales of Assets. If any Covered Person sells any of its assets in
a single transaction or related series of
transactions that are not in the ordinary course of
business or otherwise permitted under this Agreement,
Borrower shall make a payment to Administrative Agent
for the benefit of the Lenders in the amount of the
gross proceeds therefrom less reasonable selling
45
expenses and the increment in federal, state and
local income Taxes, if any, and applicable transfer
Taxes, if any, payable as a consequence of such sale.
Borrower need not make such prepayment, however,
unless the net proceeds from such sale or sales
exceed $250,000 in the aggregate in any calendar
year, in the aggregate for all Covered Persons.
Insurance Proceeds. All Insurance Proceeds shall be deposited in the Cash
Collateral Account and shall be applied by
Administrative Agent to the Loan Obligations. During
the occurrence and continuance of an Event of
Default, Administrative Agent is hereby authorized to
participate in any proceeding for the condemnation or
other taking of any of Borrower's property and
Borrower from time to time will deliver to
Administrative Agent all instruments reasonably
requested by Administrative Agent to permit such
participation.
Every prepayment under this Section that is required to be applied to reduce the
Aggregate Revolving Loan shall be distributed by Administrative Agent to Lenders
in accordance with their pro-rata shares of the Aggregate Revolving Loan
Facility and applied by Lenders to reduce their Revolving Loans in accordance
with their respective pro-rata shares of the Aggregate Revolving Loan Facility.
If application to the Revolving Loans of any prepayment required under this
Section reduces the Revolving Loans (and consequently the Aggregate Revolving
Loan) to zero, then the remaining amount of such prepayment shall be applied by
Lenders to reduce the Floorplan Loans then due and payable under the applicable
Statement of Transactions to zero (and consequently the Aggregate Floorplan
Loan).
Reimbursement Obligations of Borrower. Borrower hereby unconditionally agrees to
pay immediately to Letter of Credit Issuer on demand at the Letter of
Credit Issuer's Applicable Lending Office all amounts required to pay
all drafts drawn under Letters of Credit issued for the account of
Borrower and all reasonable expenses incurred by Letter of Credit
Issuer in connection with such Letters of Credit and in any event and
without demand to remit to Letter of Credit Issuer (which may be
through obtaining Advances if permitted under Section 0) sufficient
funds to pay all debts and liabilities arising under any Letter of
Credit issued for the account of such Borrower.
Manner of Payments and Timing of Application of Payments.
Payment Requirement. Except as provided in Section 0 with respect to payments
from the Cash Collateral Account and unless expressly provided
to the contrary elsewhere herein, Borrower shall make each
payment on the Loan Obligations to Administrative Agent for
the account of Lenders (based on each Lender's pro-rata share)
as required under the Loan Documents at the Applicable Lending
Office of Administrative Agent on the date when due, without
deduction, set-off or counterclaim. All such payments will be
distributed by Administrative Agent to Lenders as provided in
Section 0 for application to the Loan Obligations as provided
herein.
Application of Payments and Proceeds. All funds collected pursuant to Section 0
and reported to Administrative Agent as provided in Section 0,
will be distributed by Administrative Agent as provided in
Section 0 on the next Settlement Date following Administrative
Agent's actual receipt of such funds as provided in Section 0.
For purposes of calculation of the Maximum Available Amount
and Completion of the Borrowing Base Certificate pursuant to
Section 0, such funds will be deemed received on the
immediately following Business Day, and distributed by
Administrative Agent on a Settlement Date as provided in
Section 0. The amount so distributed to a Lender will be
46
applied by such Lender to the relevant Loan Obligation on the
Business Day when received. Borrower will also pay to
Administrative Agent, for its own account, such fees as
Administrative Agent generally charges its customers for each
check returned unpaid for insufficient funds (an "NSF check")
(such payment repays Administrative Agent's estimated
administrative costs; it does not waive any Default or Event
of Default caused by the NSF check).
Interest Calculation. Interest shall begin accruing, and be owing and payable on
an Advance on the day such Advance is made by a Lender to
Administrative Agent (provided, however, that interest on
GECDF's Aggregate Floorplan Loan and the Interim Floorplan
Loan shall begin accruing on the date of the applicable
invoice, as provided in the applicable Statement of
Transaction). Section 0 notwithstanding, for purposes of
interest calculation only, a payment received in the Lockboxes
or otherwise (provided it is immediately paid to
Administrative Agent) shall be deemed to have been applied to
the relevant Loan Obligation on the next Business Day
following the Business Day that Borrower reports the receipt
of such payment pursuant to Section 0. Payments on the
Aggregate Floorplan Loan or Interim Floorplan Loan that are
funded by Revolving Loan Advances shall be deemed to be made
on the Aggregate Floorplan Loan or Interim Floorplan Loan for
interest calculation purposes on the day made.
Returned Instruments. If a payment is made by check, draft or other instrument
and the check, draft or other instrument is returned unpaid, any
application of the payment to the Loan Obligations will be reversed and
will be treated as never having been made.
Compelled Return of Payments or Proceeds. If Administrative Agent or any Lender
is for any reason compelled to surrender any payment or any proceeds of
the Collateral because such payment or the application of such proceeds
is for any reason invalidated, declared fraudulent, set aside, or
determined to be void or voidable as a preference, an impermissible
set-off, or a diversion of trust funds, then this Agreement and the
Loan Obligations to which such payment or proceeds was applied or
intended to be applied shall be revived as if such application was
never made; and Borrower shall be liable to pay to Administrative Agent
or such Lender, and shall indemnify Administrative Agent or such Lender
for and hold Administrative Agent or such Lender harmless from any loss
with respect to, the amount of such payment or proceeds surrendered.
This Section shall be effective notwithstanding any contrary action
that Administrative Agent or such Lender may take in reliance upon its
receipt of any such payment or proceeds. Any such contrary action so
taken by Administrative Agent or such Lender shall be without prejudice
to Administrative Agent or such Lender's rights under this Agreement
and shall be deemed to have been conditioned upon the application of
such payment or proceeds having become final and indefeasible. The
provisions of this Section shall survive termination of the Facilities
and the indefeasible payment and satisfaction of all of the Loan
Obligations.
Due Dates Not on Business Days. If any payment required hereunder becomes due on
a date that is not a Business Day, then such due date shall be deemed
automatically extended to the next Business Day.
Procedure for Obtaining Advances.
---------------------------------
Initial Advances. Provided that all conditions thereto hereunder are satisfied
and subject to the limitations contained herein, Lenders will fund and
Administrative Agent will make the initial Revolving Loan Advance, if
any, on the Effective Date as directed by Borrower in a written
direction delivered to Administrative Agent. The manner of disbursement
47
shall be subject to Administrative Agent's approval. Administrative
Agent will fund the initial Interim Floorplan Loan in accordance with
its policies and procedures.
Subsequent Revolving Loan Advances. Borrower may request subsequent Revolving
Loan Advances at any time, but not more often than once each Business
Day, by submitting a request therefor to Administrative Agent as
provided in Section 0. All requests for a Revolving Loan Advance must
be submitted by Borrowing Agent. Administrative Agent may treat every
request for a Revolving Loan Advance as a request for a Swingline
Advance to the extent the requested amount does not exceed the Maximum
Swingline Amount and as a request for a Revolving Loan Advance in the
amount of the excess. Every request for an Revolving Loan Advance shall
be irrevocable. A request for a Revolving Loan Advance received by
Administrative Agent on a day that is not a Business Day or that is
received by Administrative Agent after 10:00 a.m. (Local Time) on a
Business Day shall be treated as having been received by Administrative
Agent at 10:00 a.m. (Local Time) on the next Business Day; provided,
however, if Settlement Dates occur more than once a week, then a
request for a Revolving Loan Advance received by Administrative Agent
on a day that is not a Business Day or that is received by
Administrative Agent after 11:00 a.m. (Local Time) on a Business Day
shall be treated as having been received by Administrative Agent at
11:00 a.m. (Local Time) on the next Business Day.
Subsequent Floorplan Loan Advances. Administrative Agent may treat every request
for a Floorplan Loan Advance as a request for an Interim Floorplan Loan
Advance to the extent the requested amount does not exceed the
Floorplan Loan Facility (when added to the Aggregate Floorplan Loan and
the Interim Floorplan Loan and all unfunded Approvals) and as a request
for a Floorplan Loan Advance in the amount of the excess.
Repayment of the Swingline Loan and the Interim Floorplan Loan.
Administrative Agent may in its absolute discretion on any Business Day give
notice to Lenders of the amount of the Swingline Loan or
Interim Floorplan Loan after application of all payments to be
applied thereto as provided elsewhere herein. Such notice
shall be given no later than 12:00 p.m. (Local Time) and may
include a demand that the Swingline Loan or the Interim
Floorplan Loan be fully paid. If Administrative Agent demands
that the Swingline Loan or the Interim Floorplan Loan be fully
paid, then prior to 3:00 p.m. (Local Time) on such date,
Lenders shall remit funds to Administrative Agent sufficient
to reduce the Swingline Loan or the Interim Floorplan Loan to
zero. The aggregate of such remittances shall be treated as a
Revolving Loan Advance and the Aggregate Revolving Loan
increased accordingly (in the case of payments on the
Swingline Loan) and as a Floorplan Loan Advance and the
Aggregate Floorplan Loan increased accordingly (in the case of
payments on the Interim Floorplan Loan). Each such remittance
by a Lender shall be made in accordance with its pro-rata
share of the Aggregate Revolving Loan Facility or the
Floorplan Loan Facility shall be made notwithstanding that (i)
the amount of the aggregate of such remittances by Lenders may
not be in the minimum amount for Revolving Loan Advances
otherwise required hereunder, (ii) any conditions to Advances
in Section 10 may not be then satisfied, (iii) an Event of
Default has occurred and is continuing, (iv) the aggregate
amount of such remittances by Lenders would result in the
Aggregate Revolving Loan exceeding the Maximum Available
Amount, or (v) such remittances by Lenders may be made after
the effective date of termination of the Aggregate Revolving
Loan Facility; provided, however, that in no event shall any
Lender be required to make any such remittance that would
result in the sum of (a) the Revolving Loan of such Lender,
plus (b) such Lender's pro-rata share of the Letter of Credit
Exposure exceeding such Lender's Revolving Loan Facility.
48
If for any reason, including the commencement of a proceeding in bankruptcy with
respect to any Borrower, remittances by Lenders as provided
above cannot be made on the date otherwise required above,
then each Lender shall be deemed automatically to have
purchased from Administrative Agent as of such date an
undivided interest and participation in the Swingline Loan and
the Interim Floorplan Loan equal to such Lender's pro-rata
share, so as to cause such Lender to share in the Swingline
Loan and the Interim Floorplan Loan in accordance with its
pro-rata share. Each Lender shall remit its pro-rata share of
the Swingline Loan and the Interim Floorplan Loan to
Administrative Agent promptly on demand. All interest payable
with respect to such Lender's pro-rata share of the Swingline
Loan and the Interim Floorplan Loan shall be for the account
of Administrative Agent to the date such remittance is made,
and shall be for the account of and remitted by Administrative
Agent to such Lender (except in the case of the Floorplan
Loan, at the rate designated in Section 0 with respect to
GECDF and the other Lenders) as a participant from such date.
Further, until such remittance is made, such Lender shall pay
to Administrative Agent, on demand, interest on such Lender's
pro-rata share of the Swingline Loan and the Floorplan Loan at
the Federal Funds Rate, and such Lender shall be subject to
the restrictions contained in Section 0.
Letters of Credit. Borrower may request the issuance of a Letter of Credit by
submitting an issuance request to Letter of Credit Issuer and executing
the reimbursement agreement required under Section 0 no less than five
Business Days prior to the requested issue date for such Letter of
Credit.
Administrative Agent's Right to Make Other Certain Advances.
Payment of Loan Obligations. Administrative Agent shall have the right to make
Revolving Loan Advances at any time and from time to time to
cause timely payment of any of the Loan Obligations, including
to pay interest or principal on the Swingline Loan, the
Interim Floorplan Loan, the Aggregate Floorplan Loan, and the
Aggregate Revolving Loan, and to pay any other fees owing to
the Lenders or Administrative Agent; provided, however, with
respect to third party fees, if no Event of Default has
occurred and is continuing, Administrative Agent shall use its
reasonable efforts to give prior notice to Borrower of the
payment of any such fees from an Advance (but shall have no
liability for its failure to notify Borrower, and any such
failure shall not give rise to a claim or cause of action by
Borrower against Administrative Agent or any Lender). If no
Event Default exists, Administrative Agent shall use
reasonable efforts to notify Borrower (but shall have no
liability for its failure to notify Borrower and such failure
shall not give rise to a claim or cause of action by Borrower
against Administrative Agent or any Lender) on the day it
makes any payment or pays any interest owing hereunder.
Administrative Agent may select the Advance Date for any such
Advance, but such Advance Date may only be a Business Day.
Administrative Agent will use reasonable efforts to promptly
give notice to Borrower after any such Advance is made but
failure to give such notice shall not give rise to any
liability on the part of Administrative Agent or any Lender.
Payments to Other Creditors. If Administrative Agent becomes obligated to
reimburse or pay to any creditor of Borrower any amount in
order to (i) obtain a release of such creditor's Security
Interest in any of the Collateral, other than Permitted
49
Security Interests, or (ii) otherwise satisfy an Obligation of
Borrower to such creditor to the extent not indefeasibly
satisfied by the initial Advances, then Administrative Agent
shall have the right (but shall have no obligation) to make
Advances for that purpose. Administrative Agent may select the
Advance Date for any such Advance, but such Advance Date may
only be a Business Day. Administrative Agent will use
reasonable efforts to give prompt notice to Borrower after any
such Advance is made but failure to give such notice shall not
give rise to any liability on the part of Administrative Agent
or any Lender; provided, however, upon the occurrence and
during the continuance of an Event of Default no such notice
shall be required.
Fundings.
Advances. Other than if a Swingline Advance or Interim Floorplan Loan Advance
will be made by Administrative Agent, not later than 10:00
a.m. (Local Time) on each Advance Date (or 11:00 a.m. if
Settlement Dates occur more than once a week) for a Floorplan
Loan Advance or Revolving Loan Advance, Administrative Agent
shall promptly notify each Lender of the amount of the
Floorplan Loan Advance or the Revolving Loan Advance to be
made on that Advance Date. In each case then, each Lender
shall make immediately available to Administrative Agent by
3:00 p.m. (Local Time) on the Advance Date funds consisting
solely of Dollars in the amount of its pro-rata share of such
Floorplan Loan Advance or Revolving Loan Advance, rounded to
the nearest ▇▇▇▇▇, in accordance with such remittance
instructions as may be given by Administrative Agent to
Lenders from time to time.
Draws on Letters of Credit. If a draw is made on a Letter of Credit and Borrower
does not reimburse the amount of such draw in full to Letter
of Credit Issuer immediately on demand, Letter of Credit
Issuer shall promptly notify Administrative Agent of such
failure. Upon Administrative Agent's receipt of such notice
from Letter of Credit Issuer, Administrative Agent may notify
each Lender thereof and shall have the right to cause a
Revolving Loan Advance to be made, regardless whether such
Revolving Loan Advance would result in the Aggregate Revolving
Loan exceeding the Maximum Available Amount or regardless as
to whether an Event of Default exists, by notifying each
Lender of the draw, the amount of the Revolving Loan Advance
required to fund reimbursement of such draw, and the amount of
such Lender's ratable share of such Revolving Loan Advance.
The Advance Date and time for such Revolving Loan Advance
shall not be later than 3:00 p.m. (Local Time) on the first
Business Day following Administrative Agent's delivery of such
notice to Lenders. By no later than such Advance Date and
time, each Lender shall make immediately available to
Administrative Agent funds consisting solely of Dollars in the
amount of its pro-rata share of such Revolving Loan Advance,
rounded to the nearest ▇▇▇▇▇, in accordance with such
remittance instructions as may be given by Administrative
Agent to each Lender from time to time.
All Fundings Ratable. All fundings of Advances (other than Swingline Advances
and Interim Floorplan Loan Advances) shall be made by Lenders
as provided herein in accordance with their pro-rata shares of
the respective Aggregate Facilities, as applicable. Except as
otherwise expressly provided herein, a Lender shall not be
obligated to fund Revolving Loan Advances that would result in
such Lender's Revolving Loan plus such Lender's pro-rata share
of the Letter of Credit Exposure exceeding its Revolving Loan
Facility, fund Floorplan Loan Advances that would result in
its Floorplan Loan exceeding its Floorplan Loan Facility, or
make available any more than its pro-rata share of any
Advance.
50
Administrative Agent's Availability Assumption.
Unless Administrative Agent has been given written notice by a Lender prior to
an Advance Date that such Lender does not intend to make
immediately available to Administrative Agent such Lender's
pro-rata share of the Advance which Administrative Agent may
be obligated to make on the Advance Date, including any
Advance that may be made based on the issuance of an Approval,
Administrative Agent may assume that such Lender has made the
required amount available to Administrative Agent on the
Advance Date and Administrative Agent may, in reliance upon
such assumption, make available to Borrower a corresponding
amount. Failure of any Lender to pay its pro-rata share of the
Swingline Loan, any Floorplan Loan (whether based on the
issuance of an Approval or otherwise), the Interim Floorplan
Loan (whether based on the issuance of an Approval or
otherwise), or any Revolving Loan or any other amount owing
hereunder by a Lender upon demand shall make such Lender a
"Defaulting Lender." If such corresponding amount is not in
fact made immediately available to Administrative Agent by
such Defaulting Lender on the Advance Date, Administrative
Agent shall be entitled to recover such corresponding amount
on demand from such Defaulting Lender. If such Defaulting
Lender does not pay such corresponding amount immediately upon
Administrative Agent's demand therefor, then Administrative
Agent shall promptly notify Borrower and the other Lenders and
Borrower shall pay such corresponding amount to Administrative
Agent within one (1) Business Day. Administrative Agent shall
also be entitled to recover, either from such Defaulting
Lender or Borrower, interest on such corresponding amount for
each day from the date such corresponding amount was made
available by Administrative Agent to Borrower to the date such
corresponding amount is recovered by Administrative Agent, at
a rate per annum equal to either (i) if paid by such Lender,
the cost to Administrative Agent of funding such amount at the
Federal Funds Rate, or (ii) if paid by Borrower, the
applicable rate for the Advance in question determined from
the request therefor. Each Lender shall be obligated only to
fund its pro-rata share of an Advance subject to the terms and
conditions hereof, regardless of the failure of another Lender
to fund its pro-rata share thereof.
Each remittance or payment or Advance required to be made by a Lender shall be
made in accordance with its pro-rata share and shall be made
notwithstanding that (i) the amount of the aggregate of such
remittances by Lenders may not be in the minimum amount for
Revolving Loan Advances, or Floorplan Loan Advances or
otherwise required hereunder, (ii) any conditions to Advances
in Section 0 may not be then satisfied, (iii) an Event of
Default exists, (iv) the aggregate amount of such remittances
by Lenders would result in the Aggregate Revolving Loan
exceeding the Maximum Available Amount or the aggregate amount
of such remittances by Lenders would result in the Aggregate
Floorplan Loan plus the Interim Floorplan Loan exceeding the
value of the Collateral advanced against thereunder or the
Aggregate Floorplan Loan Facility, or (v) such remittances by
Lenders may be made after the effective date of termination of
the Aggregate Revolving Loan Facility or the Aggregate
Floorplan Loan Facility, as the case may be; provided,
however, that in no event shall any Lender be required to make
any such remittance that would result in the Revolving Loan of
such Lender exceeding such Lender's Revolving Loan Facility or
the Floorplan Loan of such Lender exceeding such Lender's
Floorplan Loan Facility.
In addition, with respect to any Defaulting Lender, until a payment or Advance
is paid to Administrative Agent (with interest as described
above), (i) such Defaulting Lender shall permit Administrative
51
Agent the unconditional and irrevocable right of setoff
against any amounts (including payments of principal,
interest, and fees, as well as indemnity payments) received by
Administrative Agent hereunder for the benefit of any such
Defaulting Lender, and (ii) if such failure to pay shall
continue for a period of three Business Days, result in any
such Defaulting Lender forfeiting any right to vote on any
matter that the Required Lenders or all Lenders are permitted
to vote for hereunder (and the calculation of Required Lenders
shall exclude such Defaulting Lender's interest in the
Lenders' Exposure); provided, however, once such a failure is
cured, then such Lender shall, subsequent thereto, have all
rights hereunder; provided, further, however, if any Lender
shall fail to make such a payment within the three Business
Day period specified in clause (ii) above (other than by
reason of events beyond the reasonable control of such Lender)
three or more times during the term hereof, such Lender shall
permanently forfeit its right to vote hereunder (and the
calculation of Required Lenders shall exclude such Defaulting
Lender's interest in the Lenders' Exposure).
Disbursement. Provided that all conditions precedent herein to a requested
Advance or, if applicable, a Swingline Advance or Interim Floorplan
Loan Advance, have been satisfied, including with respect to any
Floorplan Loan Advance or Interim Floorplan Loan Advance, the
requirements of any agreements with any Vendors, Administrative Agent
will make the amount of such requested Advance available to Borrower or
in the case of an Interim Floorplan Loan Advance or a Floorplan Loan
Advance to the appropriate Vendor, on the applicable Advance Date in
immediately available funds in Dollars at the Applicable Lending
Office.
Restrictions on Advances. No more than one Revolving Loan Advance and no more
than one Swingline Advance will be made on any one day pursuant to a
request for a Revolving Loan Advance. Advances will only be made for
the purposes permitted in Section 0.
Each Advance Request and Request for a Letter of Credit Certification. Each
submittal of a request for an Advance and each submittal of a request
for the issuance of a Letter of Credit by a Borrowing Officer shall
constitute a certification by Borrower that (i) no Event of Default
exists, (ii) all conditions precedent hereunder to the making of the
requested Advance have been satisfied or waived in writing by the
Required Lenders, and (iii) the Representations and Warranties are then
true and correct and will be true and correct on the Advance Date, as
applicable, as if then made.
Requirements for Every Advance Request. Subject to the terms of Section 0 and
the other provisions of this Agreement, with regards to Swingline
Loans, and Revolving Loan Advances, only a request (which shall be in
writing in the form of Exhibit 0 and mailed, personally delivered or
telecopied as provided in Section 0) from a Borrowing Officer to
Administrative Agent that specifies the amount of the Advance to be
made, the Advance Date for the requested Advance shall be treated as a
request for an Advance. No Advance Date for any requested Advance may
be other than a Business Day. With regards to Swingline Loans, a
request for an Advance must be given prior to 11:00 a.m., Local Time,
on the Advance Date for such Advance. With regards to a Revolving Loan,
a request for an Advance must be given prior to 10:00 a.m., Local Time,
on the Advance Date for such Advance, or if the Settlement Date occurs
more often than once a week, then prior to 11:00 a.m. Local Time on the
Advance Date for such Advance. Subject to the terms of Section 0 and
the other provisions of this Agreement, Floorplan Loan Advances and
Interim Floorplan Loan Advances will be funded in accordance with
Administrative Agent's procedures.
52
Requirements for Every Letter of Credit Request. Only a written request (which
may be mailed, personally delivered or telecopied as provided in this
Agreement) from a Borrowing Officer to Administrative Agent or an
electronic initiation over an online service provided by Letter of
Credit Issuer that specifies the amount, requested issue date (which
shall be a Business Day and in no event later than thirty days before
the effective date of termination of the Aggregate Revolving Loan
Facility) and beneficiary of the requested Letter of Credit and other
information necessary for its issuance shall be treated as a request
for issuance of a Letter of Credit together with such Letter of Credit
applications and reimbursement agreements as the Letter of Credit
Issuer may reasonably request.
Exoneration of Administrative Agent and Lenders. Neither Administrative Agent
nor any Lender shall incur any liability to Borrower for treating a
request that meets the express requirements of Section 0 or 0 as a
request for the issuance of a Letter of Credit or an Advance, if
Administrative Agent believes in good faith that the Person making the
request is a Borrowing Officer. Neither Administrative Agent nor any
Lender shall incur any liability to Borrower for failing to treat any
such request as a request for an Advance or the issuance of a Letter of
Credit, if Administrative Agent believes in good faith that the Person
making the request is not a Borrowing Officer.
Security; Guaranties. As security for the payment and performance of the Loan
Obligations, Borrower shall on the Execution Date and from time to time
thereafter execute and deliver, or cause to be executed and delivered, to
Administrative Agent such security agreements, mortgages and other security
documents as they relate to the Collateral as reasonably requested by
Administrative Agent from time to time, including the following documents, each
in form and substance satisfactory to Administrative Agent and the Required
Lenders:
Landlord Consents. With respect to any real property leased by Borrower or any
other Covered Person upon which Inventory or other material amounts of
Collateral are located, whether on, prior to or after the Effective
Date, Borrower shall cause to be delivered to Administrative Agent such
landlord consents and nondisturbance and attornment agreements as
Administrative Agent shall reasonably request.
Security Agreements. Security agreements granting to Administrative Agent for
the benefit of Lenders a first priority Security Interest under the UCC
in all of the Goods, Equipment, Accounts, Inventory, Instruments,
Documents, Chattel Paper, General Intangibles and other personal
property of Borrower and any Covered Person, whether currently owned or
hereafter acquired, and all proceeds thereof, subject only to Permitted
Security Interests affecting such property.
Pledge Agreements.
Stock pledge agreements and membership pledge agreements granting to
Administrative Agent for the benefit of Lenders a first priority
Security Interest in all of the capital stock, membership interests,
and other securities (and all options and warrants therefor) of every
Subsidiary of every Borrower, now or hereafter issued and outstanding,
and all proceeds thereof.
Collateral Assignments. Each of the following collateral assignments from
Borrower or any other Covered Person, each subject to no other Security
Interests except Permitted Security Interests affecting the item
assigned:
53
Account and Lockbox Assignments. Assignments assigning to Administrative Agent
for the benefit of Lenders all of Borrower's or such other
Covered Person's rights and interest in all Blocked Accounts
and Lockboxes.
Intellectual Property Assignments. Assignments assigning to Administrative
Agent for the benefit of Lenders all of Borrower's or such
other Covered Person's rights and interest in all Intellectual
Property.
Acquisition Documents Assignment. Assignments assigning to Administrative Agent
for the benefit of Lenders all of Borrower's or such other
Covered Person's rights and interest in all Acquisition
Documents for any Permitted Acquisition closing on or after
the Effective Date.
Notwithstanding the execution and delivery of the other Loan Documents
set forth above, and in addition thereto, Borrower hereby expressly
assigns and grants to Administrative Agent for the benefit of Lenders,
a first priority Security Interest in any and all rights, title and
interest that it may have in Blocked Accounts, Lockboxes, Intellectual
Property and Acquisition Documents as security for payment and
performance of the Loan Obligations.
Power of Attorney. Borrower hereby authorizes (and shall cause each other
Covered Person to do the same) Administrative Agent and irrevocably appoints
Administrative Agent (acting by any of its officers) as such Borrower's agent
and attorney-in-fact (which appointment is coupled with an interest and is
therefore irrevocable) to do any of the following until all of the Loan
Obligations are fully and indefeasibly paid and satisfied in cash, there are no
Letters of Credit outstanding and the Letter of Credit Exposure is irreversibly
zero, and the Facilities are terminated:
At any time that an Event of Default has occurred and is continuing, (i) demand
payment of any Account; (ii) enforce payment of any Account by legal
proceedings or otherwise; (iii) exercise all of such Borrower's rights
and remedies in proceedings brought to collect any Account; (iv) sell
or assign any Account upon such terms, for such amount and at such time
or times as Administrative Agent deems advisable; (v) settle, adjust,
compromise, extend or renew any Account; (vi) discharge and release any
Account; (vii) prepare, file and sign such Borrower's name on any proof
of claim in bankruptcy or other similar documents against an Account
Debtor; (viii) notify the postal authorities of any change of the
address for delivery of such Borrower's mail to any address designated
by Administrative Agent and open and process all mail addressed to such
Borrower; (ix) endorse such Borrower's name on any verification of
Accounts and notices thereof to Account Debtors; (x) make one or more
Revolving Loan Advances or Floorplan Loan Advances to pay the costs and
expenses of any of the foregoing; and (xi) do anything that
Administrative Agent deems necessary in its reasonable discretion to
assure that the Loan Obligations are fully and indefeasibly paid and
satisfied in cash and that Borrower complies with each covenant and
agreement contained herein and in the other Loan Documents.
At any time, (i) take control in any manner of any item of payment or proceeds
of any Account and deposit the same in the Cash Collateral Account and
apply the proceeds thereof to the Loan Obligations as provided herein;;
(ii) have access to any lockbox or postal box into which such
Borrower's mail is deposited to facilitate collection of Accounts and
application of proceeds consistent herewith; (iii) endorse such
Borrower's name upon any items of payment and deposit the same in the
Cash Collateral Account and apply the proceeds thereof to the Loan
Obligations as provided herein; (iv) endorse such Borrower's name upon
any chattel paper, document, instrument, invoice, or similar document
or agreement relating to any Account or other item of the Collateral
necessary to effectuate collection of any Account related thereto; and
54
(v) execute in such Borrower's name and on such Borrower's behalf or
file any financing statement or amendments thereto, or such mortgages,
deeds of trust or other security documents deemed necessary or
appropriate by Administrative Agent to assure the perfection or
continued perfection of Administrative Agent's Security Interests in
the Collateral for the benefit of Lenders hereunder.
The foregoing power of attorney and authorization shall be deemed irrevocable,
but shall be automatically revoked upon the full and indefeasible payment in
cash of all of the Loan Obligations, the expiration or termination of all
Letters of Credit and reduction of the Letter of Credit Exposure to zero, and
the termination of the Facilities.
Conditions of Lending.
----------------------
Conditions to Initial Advance. Without in any manner limiting the Lenders' and
Administrative Agent's discretion hereunder, Lenders will have no
obligation to fund the initial Revolving Loan Advance or the initial
Floorplan Loan Advance unless:
Listed Documents and Other Items. Administrative Agent shall have received on or
before the Effective Date all of the documents and other items
listed or described in Exhibit 0, with each being satisfactory
to Lenders and (as applicable) duly executed and (also as
applicable) sealed, attested, acknowledged, certified, or
authenticated.
Financial Condition. Lenders shall have determined to their satisfaction that
the financial statements of Borrower for the periods ended
June 30, 2003 (the "Initial Financial Statements"), and the
projections of Borrower's financial condition, results of
operations, and cash flow statements of Borrower for the
period ending as of June 30, 2004 as furnished to
Administrative Agent and other information furnished to
Administrative Agent by Borrower (i) for the periods ended on
or before June 30, 2003, fairly and accurately reflect the
business and financial condition of Borrower, its cash flows
and the results of its operations for such periods in
accordance with GAAP, and (ii) for the periods that will end
after June 30, 2003, fairly and accurately forecast the
business and financial condition of Borrower, its cash flows,
and the results of its operations for such periods in
accordance with GAAP.
Default. No Event of Default Exists and no or Event of Default will occur as a
result of such Advance being requested or made or the
application of the proceeds thereof.
Perfection of Security Interests. Every Security Interest required to be granted
by Borrower to Administrative Agent under Section 0 shall have
been perfected and shall be, except for Permitted Security
Interests, or as otherwise satisfactory to Lenders, a first
priority Security Interest.
Representations and Warranties. The Representations and Warranties shall be true
and correct.
Material Adverse Change. Since June 30, 2003, there shall not have been any
change which has or is reasonably likely to have a Material
Adverse Effect.
Payment of Fees. Borrower shall have paid and reimbursed to Administrative Agent
and the Lenders all fees, costs and expenses that are payable
or reimbursable to Administrative Agent and the Lenders
hereunder on or before the Effective Date.
Other Items. Administrative Agent shall have received such other consents,
approvals, opinions, certificates, documents or information as
it reasonably deems necessary or shall have issued an Approval
as necessary.
55
No Material Proceedings. No Material Proceedings are pending or, to the best
knowledge of Borrower, threatened, against Borrower or any
Covered Person.
Conditions to Subsequent Advances. Without in any manner limiting the Lenders'
and Administrative Agent's discretion hereunder, Lenders will have no
obligation to fund any Advance after the initial Revolving Loan
Advance, and the initial Floorplan Loan Advance, unless:
General Conditions. All of the conditions to the initial Advances in Section 0
(except the condition in Sections 0, 0, 0, 0, and 0 shall have
been and shall remain satisfied).
Representations and Warranties. The Representations and Warranties are then true
and correct, and as of the time of such Advance will be true
and correct.
Approvals. With regards to a Floorplan Loan Advance or Interim Floorplan Loan
Advance, an Approval has been issued by Administrative Agent.
Default. No Event of Default has occurred and is continuing and no Default or
Event of Default will occur as a result of such Advance being
requested or made or the application of the proceeds thereof.
No Material Proceedings. No Material Proceedings are pending or, to the best
knowledge of Borrower, threatened, against Borrower or any
Covered Person.
Material Adverse Change. Since the date of the Financial Statements for the most
recent month end delivered to Administrative Agent in
accordance with Section 0, there shall not have been any
change which at the time of the requested Advance, has or is
reasonably likely to have a Material Adverse Effect.
Conditions to Issuance of Letters of Credit. As conditions precedent to the
issuance of any Letter of Credit:
Letter of Credit Application/Reimbursement Agreement. Borrower shall have
executed and delivered to Letter of Credit Issuer a letter of
credit application/reimbursement agreement satisfactory to
Letter of Credit Issuer and Administrative Agent under which
Borrower further evidences its obligation to reimburse to
Letter of Credit Issuer on demand the amount of each draw on
such Letter of Credit as provided in Section 0, together with
interest from the date of the draw at the rate provided in
Section 0 and (without duplication) all reasonable expenses
incurred by Letter of Credit Issuer in connection with such
Letter of Credit.
No Prohibitions. No order, judgment or decree of any Governmental Authority
shall exist which purports by its terms to enjoin or restrain
Letter of Credit Issuer or any other Lender from issuing such
Letter of Credit, and no Law or request or directive (whether
or not having the force of law) from any Governmental
Authority with jurisdiction over Letter of Credit Issuer or
any other Lender shall exist which prohibits, or requests that
Letter of Credit Issuer or any other Lender refrain from, the
issuance of letters of credit generally or such Letter of
Credit in particular, or imposes upon Letter of Credit Issuer
or any other Lender with respect to such Letter of Credit any
restriction or reserve or capital requirement (for which
Letter of Credit Issuer or any other Lender is not otherwise
compensable by Borrower hereunder).
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Representations and Warranties. The Representations and Warranties are then true
and correct, and as of the time of the issuance of such Letter
of Credit will be true and correct.
No Material Proceedings. No Material Proceedings are pending or, to the best
knowledge of Borrower, threatened, against Borrower or any
Covered Person.
No Default. No Event of Default and no Default has occurred and is continuing or
Event of Default is reasonably likely to occur as a result of
such Letter of Credit being issued or a draw thereon being
made or paid.
Other Conditions. All of the conditions to the initial Advances in Section 0
(except the conditions in Sections 0, 0, 0 and 0 and 0) and
the condition in Section 0 shall have been and shall remain
satisfied.
Representations and Warranties. Except as otherwise described in the Disclosure
Schedule attached hereto as Exhibit 0, Borrower represents and warrants to
Administrative Agent, Lenders and Letter of Credit Issuer, at all times while
any of the Loan Obligations are outstanding and until such time as the
Facilities are terminated, as follows:
Organization and Existence. Each Covered Person is duly organized and existing
in good standing under the Laws of the State of its organization and is
duly qualified to do business and is in good standing in every State
where the nature or extent of its business or properties require it to
be qualified to do business, except where the failure to so qualify
will not have a Material Adverse Effect. Each Covered Person has the
power and authority to own its properties and carry on its business as
now being conducted. With respect to each Covered Person, the following
information is accurately and completely set forth on section 0 of the
Disclosure Schedule: (i) the full and exact legal name of each Covered
Person, (ii) State of organization/ formation of such Covered Person,
(iii) the tax identification number (FEIN) of each Covered Person, and
(iv) the charter number (if available) of each Covered Person.
Authorization. Each Covered Person is duly authorized to execute and perform
every Loan Document to which such Covered Person is a party, and
Borrower is duly authorized to borrow hereunder, and this Agreement and
the other Loan Documents have been duly authorized by all requisite
corporate action (or in the case of Covered Persons which are not
corporations, other organizational action) of each Covered Person. No
consent, approval or authorization of, or declaration or filing with,
any Governmental Authority, and no consent of any other Person, is
required in connection with any Covered Person's execution, delivery or
performance of this Agreement and the other Loan Documents to which it
is a party, except for those already duly obtained.
Due Execution. Every Loan Document to which a Covered Person is a party has been
executed on behalf of such Covered Person by a Person duly authorized
to do so.
Enforceability of Obligations. Each of the Loan Documents to which a Covered
Person is a party constitutes the legal, valid and binding obligation
of such Covered Person, enforceable against such Covered Person in
accordance with its terms, except to the extent that the enforceability
thereof against such Covered Person may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar Laws affecting
creditors' rights generally or by equitable principles of general
application.
Burdensome Obligations. No Covered Person is a party to or bound by any Contract
or is subject to any provision in the Charter Documents of such Covered
Person which would, if performed by such Covered Person, result in a
Default or Event of Default either immediately or upon the elapsing of
time.
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Legal Restraints. The execution and performance of any Loan Document by a
Covered Person does not and will not violate or constitute a default
under the Charter Documents of such Covered Person, any Material
Agreement of such Covered Person, or any Material Law, and does not and
will not, except as expressly contemplated or permitted in this
Agreement, result in any Security Interest being imposed on any of such
Covered Person's property. All Material Agreements in existence as of
the Effective Date are listed on section 0 to the Disclosure Schedule.
Labor Contracts and Disputes. As of the Effective Date, there is no collective
bargaining agreement or other labor contract covering employees of a
Covered Person, and to Borrower's knowledge, no union or other labor
organization is seeking to organize, or to be recognized as, a
collective bargaining unit of employees of a Covered Person. There is
no pending or, to Borrower's knowledge, threatened, strike, work
stoppage or other material labor dispute against or affecting any
Covered Person or its employees, which has or would reasonably likely
to have a Material Adverse Effect.
No Material Proceedings. As of the Effective Date, and except as set forth on
section 0 to the Disclosure Schedule, there is no litigation,
investigation or other proceeding by or before any Governmental
Authority pending or, to the best knowledge of Borrower, threatened (i)
which involves any of the Loan Documents or any of the transactions
contemplated thereby, or involves a Covered Person as a party or any
property of Covered Person, (ii) in which there has been issued an
injunction, writ, temporary restraining order or any other order of any
nature which purports to restrain or enjoin the making of any Advance,
the consummation of any other transaction contemplated by the Loan
Documents, or the enforceability of any provision of any of the Loan
Documents, (iii) which involves the actual or alleged breach or
violation by a Covered Person of, or default by a Covered Person under,
any Contract to which Borrower or any Covered Person is a party or by
which any such Borrower or any other Covered Person is bound, or (iv)
which involves the actual or alleged violation by a Covered Person or
any Guarantor of any separately enforceable provision of a Law.
Material Licenses. All Material Licenses have been obtained or exist for each
Covered Person.
Compliance with Material Laws. Each Covered Person is in compliance with all
Material Laws. Without limiting the generality of the foregoing:
General Compliance with Environmental Laws and Governmental Procurement
Regulations. The operations of every Covered Person comply
with all applicable Environmental Laws and, as of the
Effective Date, Governmental Authority procurement Laws,
except where the failure to be in compliance would not
reasonably be likely to have to a Material Adverse Effect.
Proceedings. None of the operations of any Covered Person are the subject of any
judicial or administrative complaint, order or proceeding
alleging the violation of any applicable Environmental Laws
or, as of the Effective Date, Governmental Authority
procurement Laws, which would reasonably be likely to give
rise to a Material Adverse Effect.
Investigations. None of the operations of any Covered Person are the subject of
investigation by any Governmental Authority regarding the
improper transportation, storage, disposal, generation or
release into the environment of any Hazardous Material or, as
58
of the Effective Date, violation of any applicable
Governmental Authority procurement Law, the results of which
have or are reasonably likely to have a Material Adverse
Effect or reduce materially the value of the Collateral.
Notices and Reports Regarding Hazardous Materials. No notice or report under any
Environmental Law indicating a past or present spill or
release into the environment of any Hazardous Material has
been filed within the four years ending on the Execution Date,
or as of the Effective Date is required to be filed, by any
Covered Person.
Hazardous Materials on Real Property. No Covered Person has at any time, and to
Borrower's knowledge, no other Person has at any time during
any Covered Person's occupancy of such real property,
transported, stored, disposed of, generated or released any
Hazardous Material on the surface, below the surface, or
within the boundaries of any real property owned or operated
by such Covered Person or any improvements thereon in
violation of applicable Law which could reasonably be likely
to have a Material Adverse Effect. No property of any Covered
Person is subject to a Security Interest in favor of any
Governmental Authority for any liability under any
Environmental Law or damages arising from or costs incurred by
such Governmental Authority in response to a spill or release
of Hazardous Material into the environment.
Environmental Property Transfer Acts. No environmental property transfer acts
are applicable to the transactions contemplated by this
Agreement and each Covered Person has provided all notices and
obtained all necessary environmental permit transfers and
consents, if any, required in order to consummate the
transactions contemplated by this Agreement or the Acquisition
Documents, to perfect Administrative Agent's Security
Interests for the benefit of Lenders and to operate such
Covered Person's business as presently or proposed to be
operated.
Other Names. Except for GTSI's former name "Government Technology Services,
Inc." and as otherwise disclosed in writing to Administrative Agent
from time to time with no less than thirty (30) days prior written
notice to Administrative Agent (i) no Covered Person has used any name
other than the full name which identifies such Covered Person in this
Agreement, and (ii) the only trade name or style under which a Covered
Person sells Inventory or creates Accounts, or to which instruments in
payment of Accounts are made payable, is the name which identifies such
Covered Person in this Agreement.
Prior Transactions. From June 30, 1998 to the Effective Date, and thereafter
except as otherwise permitted hereunder, no Covered Person has been a
party to any merger or consolidation, or acquired all or substantially
all of the assets of any Person.
Capitalization. Borrower's authorized capital stock, partnership interests and
membership interests and, as of the Effective Date, issued and
outstanding capital stock, partnership interests and membership
interests is as described in section 0 of the Disclosure Schedule, and
all issued and outstanding shares, partnership interests and membership
interests of each Covered Person are validly issued and outstanding,
fully paid and non-assessable.
Solvency. Borrower and each Covered Person is Solvent prior to and after giving
effect to, the making of each Advance and after giving effect to the
contribution provisions of Section 0.
Projections. As of the Effective Date with respect to the projections of
Borrower's financial condition, results of operations, and cash flow
for the period through June 30, 2004 (a copy of which have been
59
delivered to Administrative Agent), and thereafter with respect to the
annual projections required to be delivered to Administrative Agent by
Borrower pursuant to Section 0, represent when delivered hereunder
Borrower's good faith best estimate of Borrower's future financial
performance for the periods set forth therein, and (ii) such
projections have been prepared on the basis of the assumptions set
forth therein, which Borrower believes are fair and reasonable in light
of current and reasonably foreseeable business conditions.
Financial Statements. The Financial Statements are complete and correct in all
material respects, have been prepared in accordance with GAAP, and
fairly reflect the financial condition, results of operations and cash
flows of the Persons covered thereby as of the dates and for the
periods stated therein subject to, in the case of Interim Financial
Statements, the absence of footnotes and normal year-end adjustments.
No Change in Condition. From June 30, 2003 to the Effective Date there has been
no change which has or is reasonably likely to have a Material Adverse
Effect.
No Defaults. No Covered Person has breached or violated or has defaulted under
any Material Agreement, or has defaulted with respect to any Material
Obligation of such Covered Person which such breach or default has
continued beyond any cure periods set forth in the applicable
underlying agreements.
Investments. No Covered Person has any Investments in other Persons except
existing Permitted Investments.
Indebtedness. No Covered Person has any Indebtedness except existing Permitted
Indebtedness.
Indirect Obligations. No Covered Person has any Indirect Obligations except
existing Permitted Indirect Obligations.
Encumbrances. None of the real property purported to be owned by a Covered
Person is subject to any Encumbrances except Permitted Encumbrances.
Operating Leases. No Covered Person has an interest as lessee under any
Operating Leases other than Operating Leases entered into in the
ordinary course of business and on an arm's-length basis, which in the
aggregate, do not have rental payments in excess of $5,000,000, for the
preceding twelve-month period.
Capital Leases. No Covered Person has an interest as a lessee under any Capital
Leases other than Capital Leases that constitute Permitted
Indebtedness.
Other Creditor Indebtedness; Intercreditor Documents. As of the Effective Date,
there is no breach or default with respect to the Other Creditor
Indebtedness, thereafter there is no breach or default with respect to
the Other Creditor Indebtedness that would be an Event of Default
pursuant to Section 0 and the Other Creditor Indebtedness has been
incurred in accordance with the terms and conditions of this Agreement.
Tax Liabilities; Governmental Charges. Each Covered Person has filed or caused
to be filed all tax reports and returns required to be filed by it with
any Governmental Authority, except where extensions have been properly
obtained. Each Covered Person has paid or made adequate provision for
payment of all Taxes of such Covered Person, except Taxes which are
being diligently contested in good faith by appropriate proceedings and
as to which such Covered Person has established adequate reserves in
conformity with GAAP. No Security Interest for any such Taxes has been
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filed and no claims are being asserted with respect to any such Taxes
which, if adversely determined, has or is reasonably likely to have a
Material Adverse Effect. There are no material unresolved issues
concerning any liability of a Covered Person for any Taxes which, if
adversely determined, has or is reasonably likely to have a Material
Adverse Effect.
Pension Benefit Plans. All Pension Benefit Plans maintained by each Covered
Person or an ERISA Affiliate of such Covered Person qualify under Code
Section 401 and are in compliance with the provisions of ERISA, except
when the failure to comply has not or could not be reasonably likely to
have a Material Adverse Effect. Except with respect to events or
occurrences which do not have and are not reasonably likely to have a
Material Adverse Effect:
Prohibited Transactions. None of such Pension Benefit Plans has participated in,
engaged in or been a party to any non-exempt Prohibited
Transaction as defined in ERISA or the Code, and no officer,
director or employee of such Covered Person or of an ERISA
Affiliate of such Covered Person has committed a breach of any
of the responsibilities or obligations imposed upon
fiduciaries by Title I of ERISA.
Claims. There are no claims, pending or threatened, involving any such Pension
Benefit Plan by a current or former employee (or beneficiary
thereof) of such Covered Person or ERISA Affiliate of such
Covered Person, nor is there any reasonable basis to
anticipate any claims involving any such Pension Benefit Plan
which would likely be successfully maintained against such
Covered Person or such ERISA Affiliate.
Reporting and Disclosure Requirements. There are no violations of any reporting
or disclosure requirements with respect to any such Pension
Benefit Plan and none of such Pension Benefit Plans has
violated any applicable Law, including ERISA and the Code.
Accumulated Funding Deficiency. No such Pension Benefit Plan has (i) incurred an
accumulated funding deficiency (within the meaning of Code
Section 412(a)), whether or not waived; (ii) been a Pension
Benefit Plan with respect to which a Reportable Event (to the
extent that the reporting of such events to the PBGC within
thirty days of the occurrence has not been waived) has
occurred and is continuing; or (iii) been a Pension Benefit
Plan with respect to which there exist conditions or events
which have occurred that present a significant risk of
termination of such Pension Benefit Plan by the PBGC.
Multi-employer Plan. All Multi-employer Plans to which any Covered Person
contributes or is obligated to contribute are listed in
section 0 of the Disclosure Schedule. No Covered Person or
ERISA Affiliate of such Covered Person has received notice
that any such Multi-employer Plan is in reorganization or has
been terminated within the meaning of Title IV of ERISA, and
no such Multi-employer Plan is reasonably expected to be in
reorganization or to be terminated within the meaning of Title
IV of ERISA.
Welfare Benefit Plans. No Covered Person or ERISA Affiliate of any Covered
Person maintains a Welfare Benefit Plan that has a liability which, if
enforced or collected, has or is reasonably likely to have a Material
Adverse Effect. Each Covered Person and each ERISA Affiliate of any
Covered Person has complied in all respects with the applicable
requirements of Code Section 4980B pertaining to continuation coverage
as mandated by COBRA, except any failure that does not have or is
reasonably likely not to have a Material Adverse Effect.
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Retiree Benefits. No Covered Person or ERISA Affiliate of such Covered Person
has an obligation to provide any Person with any medical, life
insurance, or similar benefit following such Person's retirement or
termination of employment (or to such Person's beneficiary subsequent
to such Person's death) other than (i) such benefits provided to
Persons at such Person's sole expense and (ii) obligations under COBRA.
Distributions. Except as permitted hereunder or disclosed in Section 0 of the
Disclosure Schedule, no Distribution (as defined in Section 0) has on
or after June 30, 2003 been declared, paid or made upon or in respect
of any capital stock or other securities of Borrower.
Real Property. Except as otherwise permitted hereunder, including under Section
0, Section 0 of the Disclosure Schedule contains a correct and complete
list of (i) the street addresses and a general description of all real
property owned by each Covered Person, and (ii) a list of all leases,
subleases, and licenses of real property by each Covered Person, with
such Covered Person identified for each as the lessee, sublessee,
licensee, lessor, sublessor, or licensor, as is the case, together with
the street addresses and a general description of the real property
involved and the names and addresses of the other parties to such
leases, subleases, and licenses. Each of such leases, subleases, and
licenses is valid and enforceable in accordance with its terms and is
in full force and effect, and no default by such Covered Person, or to
Borrower's knowledge, any other party to any such lease, sublease, or
license exists which will or is reasonably likely to result in a
Material Adverse Effect.
State of Collateral and other Property. Each Covered Person has good and
marketable or merchantable title to all real and personal property
purported to be owned by it or reflected in the Financial Statements,
except for real or personal property sold or leased after June 30, 2003
as permitted by and in accordance with the terms of the Loan Documents.
There are no Security Interests on any of the property purported to be
owned by any Covered Person, including the Collateral, except Permitted
Security Interests. Without limiting the generality of the foregoing:
Accounts. With respect to each Account scheduled, listed or referred to in
reports submitted by any Covered Person to Administrative
Agent pursuant to the Loan Documents, except as disclosed
therein or with respect to Accounts of not more than $100,000
in the aggregate: (i) the Account arose from a bona fide
transaction completed in accordance with the terms of any
documents governing such transaction; (ii) the Account is not
evidenced by a judgment and there is no material dispute
respecting it; (iii) the amount of the Account as shown on the
applicable Covered Person's books and records and all invoices
and statements which may be delivered to Administrative Agent
with respect thereto are owing to the applicable Covered
Person and are not in any way contingent; (iv) there are no
known set-offs, counterclaims or disputes existing or asserted
with respect to the Account and the applicable Covered Person
has not made any agreement with any Account Debtor for any
deduction therefrom except a discount or allowance allowed by
the applicable Covered Person in the ordinary course of its
business for prompt payment; (v) there are no facts, events or
occurrences which in any way materially impair the validity or
enforcement of the Account or materially reduce the amount
payable thereunder as shown on the applicable Covered Person's
books and records and all invoices and statements delivered to
Administrative Agent with respect thereto; (vi) the Account is
assignable; (vii) the Account arose in the ordinary course of
the applicable Covered Person's business; (viii) to such
Covered Person's knowledge, the Account Debtor with respect to
the Account has the capacity to contract; (ix) the services
furnished, goods sold or goods leased giving rise to the
Account are not subject to any Security Interest except the
62
perfected Security Interest granted to Administrative Agent
hereunder for the benefit of Lenders and Permitted Security
Interests; (x) there are no proceedings or actions which are
pending or, to Borrower's knowledge, threatened against the
Account Debtor with respect to the Account; and (xi) no
payments have been or will be made on the Account except
payments promptly delivered to the Blocked Accounts at the
financial institutions as provided in this Agreement.
Inventory. With respect to Inventory of Borrower: (i) such Inventory (except for
Inventory in transit or in the possession of such Covered
Person's customers) is located at one or another of the
premises listed in section 0 of the Disclosure Schedule as
being a location of such Borrower's Inventory; (ii) the
applicable Covered Person has good and merchantable title to
such Inventory or a good and valid leasehold interest as
lessee to such Inventory, subject to no Security Interest
whatsoever except for the perfected Security Interest granted
to Administrative Agent hereunder for the benefit of Lenders
and Permitted Security Interests; (iii) such Inventory is of
good and merchantable quality, free from any known material
defects; (iv) Borrower now keeps and will keep correct and
accurate records itemizing and describing the kind, type,
quality and quantity of Inventory, Borrower's cost therefor
and the selling price thereof or the rental/lease rate
thereof, the daily withdrawals therefrom and the additions
thereto; (v) except as may be permitted by Section 13.12.2,
Inventory that is not rented or leased will not be stored with
a bailee, repairman, warehouseman or similar party without
Administrative Agent's prior written consent, and if
Administrative Agent consents (which such consent shall not be
unreasonably withheld or delayed), Borrower will, concurrently
with delivery to such party, cause any such party to issue and
deliver to Administrative Agent, in form acceptable to
Administrative Agent, warehouse receipts, in Administrative
Agent's name evidencing the storage of such Inventory, and
waivers of warehouseman's liens in favor of Administrative
Agent; (vi) Borrower will timely pay or cause to be timely
paid all taxes, rents, business taxes, and other charges
relating to the premises where the Inventory is located which
Borrower is contractually or legally obligated to pay except
those amounts which Borrower is diligently contesting in good
faith by appropriate proceedings provided Borrower has
established adequate reserves therefor in accordance with GAAP
and no Event of Default has occurred and is continuing or no
Event of Default would reasonably be likely to occur as a
result thereof; (vii) except as may be permitted in Section
13.12.2, a landlord consent of the type described in Section
8.1, satisfactory to Administrative Agent, has been obtained
for each location in which Borrower keeps Inventory; and
(viii) the sale, lease or other disposition of such Inventory
by Administrative Agent or Lenders following an Event of
Default shall not require the consent of any Person and shall
not constitute a breach or default under any contract or
agreement to which any Covered Person is a party or to which
the Inventory is subject.
Equipment. With respect to each Covered Person's owned equipment: (i) such
Covered Person has good and marketable title thereto; (ii)
none of such equipment is subject to any Security Interests
except for the perfected Security Interest granted to
Administrative Agent for the benefit of Lenders and Permitted
Security Interests; (iii) such equipment (except as otherwise
permitted hereunder and for equipment in transit) is located
at one or another of the premises listed on Section 0 of the
Disclosure Schedule as a location of such Covered Person's
equipment. With respect to such Covered Person's equipment
such equipment is of good and merchantable quality, free from
any material defects, ordinary wear and tear and damage by
acts of God excepted.
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Intellectual Property. With respect to the Intellectual Property of the Covered
Persons: (i) section 0 of the Disclosure Schedule contains a
complete and correct list of all of each Covered Person's
Intellectual Property, (ii) the Covered Person listed on the
Disclosure Schedule as the owner thereof owns all right, title
and interest in, under and to such Intellectual Property,
subject to no licenses or any interest therein or other
agreements relating thereto, except for the Intellectual
Property Assignments; (iii) none of such Intellectual Property
is subject to any pending or, to such Covered Person's
knowledge, threatened challenge; (iv) to the knowledge of such
Covered Person, such Covered Person has not committed any
patent, trademark, trade name, service ▇▇▇▇ or copyright
infringement, and the present conduct of such Covered Person's
business does not infringe any patents, trademarks, trade name
rights, service marks, copyrights, publication rights, trade
secrets or other proprietary rights of any Person; and (v)
there are no claims or demands of any Person pertaining to, or
any proceedings which are pending or, to the knowledge of such
Covered Person, threatened, which challenge such Covered
Person's rights in respect of any proprietary or confidential
information or trade secrets used in the conduct of such
Covered Person's business which are reasonably likely to have
a Material Adverse Effect.
Documents, Instruments and Chattel Paper. All documents, instruments and chattel
paper describing, evidencing or constituting Collateral, and
all signatures and endorsements thereon by a Covered Person
are complete, valid, and genuine, and all goods evidenced by
such documents, instruments and chattel paper are owned by a
Covered Person free and clear of all Security Interests other
than Security Interests granted to Administrative Agent
hereunder for the benefit of Lenders and Permitted Security
Interests.
Chief Place of Business; Locations of Collateral. As of the Execution Date,
the chief executive office and principal place of business of each Covered
Person is identified in section 0 of the Disclosure Schedule
and the location of the books and records of each Covered
Person, and all of such Covered Person's chattel paper and all
records of Accounts, are located only at the places listed and
so identified in section 0 of the Disclosure Schedule;
the States in which any Covered Person is qualified to conduct its business and
the respective counties within such States and the Canadian
Provinces and other foreign jurisdictions in which any Covered
Person conducts its business are listed and so identified in
section 0 of the Disclosure Schedule; and
all of the Inventory is located at the locations listed in section 0 of the
Disclosure Schedule; all office furniture and equipment is
located at the locations listed in section 0 of the Disclosure
Schedule.
[Intentionally Omitted].
No Negative Pledges. Except as set forth in section 0 of the Disclosure Schedule
and for the Loan Documents and Intercreditor Agreements, no Covered
Person is a party to or bound by any Contract which prohibits the
creation or existence of any Security Interest upon or assignment or
conveyance of any of the Collateral (regardless of type or nature) of
any Covered Person.
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Security Documents.
Security Agreements. Each Security Agreement is effective to grant to
Administrative Agent for the pro-rata benefit of Lenders an
enforceable Security Interest in the Personal Property
Collateral described therein. Upon appropriate filing (as to
all Personal Property Collateral in which a Security Interest
may be perfected under the applicable State's UCC by filing a
financing statement or statements) or Administrative Agent's
taking possession (as to items of the Personal Property
Collateral of which a secured party must take possession to
perfect a Security Interest under the applicable State's UCC)
or Administrative Agent's taking control (as to the items of
the Personal Property Collateral of which a secured party must
take control to perfect a Security Interest under the
applicable State's UCC), Administrative Agent will have a
fully perfected Security Interest in the Personal Property
Collateral described in each Security Agreement, subject only
to Permitted Security Interests affecting such Personal
Property Collateral.
Collateral Assignments.
Blocked Account Agreements. The Blocked Account Agreements are effective to
grant to Administrative Agent for the benefit of
Lenders an enforceable first priority Security
Interest in the Blocked Accounts.
Intellectual Property Assignments. Each Intellectual Property Assignment is
effective to grant to Administrative Agent for the
benefit of Lenders an enforceable first priority
Security Interest in all the Intellectual Property
described therein, subject only to Permitted Security
Interests affecting such Intellectual Property.
Acquisition Documents Assignment. Each Acquisition Documents Assignment, if any,
is effective to grant to Administrative Agent for the
benefit of Lenders an enforceable first priority
Security Interest in and lien on all of Borrower's
rights, remedies, claims and interests under the
Acquisition Documents covered thereby.
Pledge Agreement. Each Pledge Agreement is effective to grant to Administrative
Agent for the benefit of Lenders an enforceable first
priority Security Interest in all the stock,
membership interests, and other securities described
therein.
S Corporation. There is no election for any Covered Person in effect under Code
Section 1362(a) to be treated as an S Corporation as defined in Code
Section 1361(a).
Subsidiaries and Affiliates. As of the Effective Date, Borrower has no
Subsidiaries and has no Affiliates who are not individuals, except
those Persons listed in section 0 of the Disclosure Schedule.
Bank Accounts and Lockboxes. No Covered Person has any bank account or lockbox
other than the bank accounts and Lockboxes allowed or required
hereunder. All bank accounts maintained by any Covered Person with any
bank or other financial institution are described in section 0 of the
Disclosure Schedule.
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Margin Stock. No Covered Person is engaged or will engage, principally or as one
of its important activities, in the business of extending credit for
the purpose of purchasing or carrying margin stock (within the meaning
of Regulation U), and no part of the proceeds of any Advance will be
used by any Covered Person to purchase or carry any such margin stock
or to extend credit to others for the purpose of purchasing or carrying
any such margin stock or for any purpose which violates, or which would
be inconsistent with, the provisions of Regulation U. None of the
transactions contemplated by any of the Loan Documents or any of the
Acquisition Documents will violate Regulations T, U or X.
Tax Matters. Borrower does not intend to treat the Loans or Letters of Credit
and related transactions as being a "reportable transaction" (within
the meaning of Treasury Regulation Section 1.6011-4).
Investment Company Act, Etc. No Covered Person is an investment company
registered or required to be registered under the Investment Company
Act of 1940, or a company controlled (within the meaning of such
Investment Company Act) by such an investment company or an affiliated
person of, or promoter or principal underwriter for, an investment
company, as such terms are defined in the Investment Company Act of
1940. No Covered Person is subject to regulation under the Public
Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act or any other Law limiting or regulating its
ability to incur Indebtedness for money borrowed.
No Material Misstatements or Omissions. Neither the Loan Documents, any of the
Financial Statements nor any statement, list, certificate or other
information furnished or to be furnished by Borrower or any other
Covered Person to Administrative Agent or Lenders in connection with
the Loan Documents or any of the transactions contemplated thereby
contains any untrue statement of a material fact, or omits to state a
material fact necessary to make the statements therein not misleading.
Borrower has disclosed to Administrative Agent and Lenders everything
regarding the business, operations, property, financial condition, and
the prospective operations, financial condition or assets of itself and
every Covered Person that has or is reasonably likely to have a
Material Adverse Effect.
Filings. All registration statements, reports, proxy statements and other
documents, if any, required to be filed by Borrower with the Securities
and Exchange Commission pursuant to the Securities Act of 1933, as
amended, and the Securities Exchange Act of 1934, as amended, have been
filed, and such filings, when made, shall be complete and accurate in
all material respects and contain no untrue statements of material fact
or omit to state any material facts required to be stated therein or
necessary in order to make the statements therein not misleading.
Broker's Fees. No broker or finder is entitled to compensation for services
rendered with respect to the transactions contemplated by this
Agreement.
Eligibility of Collateral. Each Account which Borrower, expressly or by
implication, requests Administrative Agent to classify as an Eligible
Account will, as of the time when such request is made, conform in all
respects to the requirements of such classification set forth in the
definition of Eligible Accounts herein.
Loans to Shareholders. As of the Effective Date, there are no outstanding loans,
advances that have been made or commitments to make loans or advances
to any shareholder of any Borrower by any Borrower, nor has any
shareholder of any Borrower incurred any Indebtedness to any Borrower.
66
Lease Transaction Accounting. Section 0 of the Disclosure Schedule contains a
true and correct description of the accounting methodology applied by
Borrower and any other Covered Person in the preparation of their
respective Financial Statements with respect to all transactions in
which Inventory is leased or rented to a Person, including the
treatment of transactions in which Borrower or a Covered Person has
sold or assigned to a third Person any leases between it and any
Governmental Authority or other Person pursuant to which such Borrower
or Covered Person will act as a servicer, collection agent or otherwise
in any manner remit or turn over any amounts to any third Person under
such leases that have been sold or assigned ("Lease Servicing").
Modification and Survival of Representations. Borrower may, at any time, after
the initial Advances are made, propose to Lenders in writing to modify the
Representations and Warranties in Section 0, and any other Representation or
Warranty made in any certificate, report, opinion or other document delivered by
Borrower pursuant to the Loan Documents. If the proposed modifications are
satisfactory to the Required Lenders as evidenced by their written assent
thereto, such Representations and Warranties shall be deemed and treated as so
modified. If such proposed modifications are not satisfactory to the Required
Lenders, such proposed modifications shall not be deemed or treated as modifying
such Representations and Warranties. All Representations and Warranties, as made
or deemed made as of a particular time, shall survive execution of each of the
Loan Documents and the making of every Advance, and until all of the Loan
Obligations are fully and indefeasibly paid in cash, no Letters of Credit are
outstanding and the Letter of Credit Exposure is irreversibly zero and the
Facilities are terminated. All Representations and Warranties may be relied upon
by Administrative Agent and Lenders as being true and correct as of the date
when made or deemed made giving effect to the Exceptions. Notwithstanding
anything in this Agreement or the other Loan Documents to the contrary, for all
purposes of this Agreement and the other Loan Documents, any reference to the
Representations and Warranties shall be deemed to mean such Representations and
Warranties giving effect to (i) such modifications to the Representations and
Warranties assented to in writing by Administrative Agent or the Required
Lenders as contemplated or permitted by this Agreement and (ii) for those
Representations and Warranties that address matters only as of a particular date
they shall be true and correct as of such date.
Affirmative Covenants. Borrower covenants and agrees that, until all of the Loan
Obligations are fully and indefeasibly paid in cash no, Letters of Credit are
outstanding and the Letter of Credit Exposure is irreversibly zero and the
Facilities are terminated, Borrower shall do, and Borrower shall cause each
other Borrower and each other Covered Person to do, the following:
Use of Proceeds. The proceeds of Swingline Advances, Interim Floorplan Loan
Advances, the initial and subsequent Floorplan Loan Advances and the
initial and subsequent Revolving Loan Advances shall be used solely to
repay the existing Indebtedness of GTSI to GECDF and such other
Indebtedness as is listed on Exhibit 0, to fund working capital,
purchase Inventory, and for general corporate purposes.
Corporate Existence. Each Covered Person shall maintain its existence in good
standing and shall maintain in good standing its right to transact
business in those states in which it is now or hereafter doing
business, except where the failure to so qualify will not have and will
not be reasonably likely to have a Material Adverse Effect. Each
Covered Person shall obtain and maintain all Material Licenses for such
Covered Person.
Maintenance of Property and Leases. Each Covered Person shall maintain in good
condition and working order (ordinary wear and tear and damage by acts
of God excepted), and repair and replace as required, all buildings,
equipment, machinery, fixtures, Inventory, and other real and personal
property owned or leased by such Covered Person whose useful economic
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life has not elapsed and which is necessary for the ordinary conduct of
the business of such Covered Person, except where failure to do so does
not have or reasonably will likely not have a Material Adverse Effect.
Each Covered Person shall maintain in good standing and free of
defaults all of its leases of buildings, equipment, machinery,
fixtures, Inventory, and other real and personal property whose useful
economic life has not elapsed and which is necessary for the ordinary
conduct of the business of such Covered Person, except where the
failure to be in good standing or free of default would not reasonably
be likely to give rise to a Material Adverse Effect. No Covered Person
shall permit any of its equipment, Inventory, or other property to
become a fixture to real property or an accession to other personal
property unless Administrative Agent has a valid, perfected and first
priority Security Interest for the benefit of Lenders in such real or
personal property.
Inventory. Each Covered Person shall keep its Inventory and Equipment, taken as
a whole, in good and merchantable condition (subject to ordinary wear
and tear) at its own expense and shall hold such Inventory for sale or
lease, or to be furnished in connection with the rendition of services,
in the ordinary course of such Covered Person's business, on terms
which do not include ▇▇▇▇-and-hold, guarantied sale, sale and return,
sale on approval, consignment or similar repurchase or return terms,
except for sales to Governmental Authorities involving, in the Covered
Person's ordinary course of business, ▇▇▇▇-and-hold terms and return
terms described in Section 0, or as otherwise permitted herein.
Insurance. Each Covered Person shall at all times keep insured or cause to be
kept insured, in insurance companies having a rating of at least "A-"
by Best's Rating Service, all property owned by it of a character
usually insured by others carrying on businesses similar to that of
such Covered Person in such manner and to such extent and covering such
risks as such properties are usually insured. Except for Inventory that
is in-transit (which Inventory shall be insured adequately, consistent
with past practices of Borrower, against Borrower's risk-of-loss while
such Inventory is in-transit) and Inventory that has been drop-shipped
at a customer location, at all times, all Inventory shall be insured
for full replacement value. Each Covered Person shall timely pay all
premiums for such insurance. Each Covered Person shall at all times
carry insurance, in insurance companies having a rating of at least
"A-" by Best's Rating Service, against liability on account of damage
to persons or property (including product liability insurance and
insurance required under all Laws pertaining to workers' compensation)
and covering all other liabilities common to such Covered Person's
business, in such manner and to such extent as such coverage is usually
carried by others conducting businesses similar to that of such Covered
Person. At all times, Borrower shall maintain replacement value
insurance for all Collateral on any ocean, waterway, interstate,
highway, or other public way. All policies of liability insurance
maintained hereunder shall name Administrative Agent as an additional
insured for the benefit of Lenders; all policies of property insurance
maintained hereunder with respect to the Collateral shall reflect
Administrative Agent's interest therein as a loss payee on an ▇▇▇▇▇ #27
form for the benefit of Lenders. Administrative Agent is authorized,
but not obligated, as the attorney-in-fact for Borrower, and every
other Covered Person and for the benefit of Lenders, (i) prior to the
occurrence and during the continuance of an Event of Default, with
Borrower's consent (which consent shall not be unreasonably withheld),
and during the continuance of an Event of Default, without Borrower's
or any other Covered Person's consent, to adjust and compromise
proceeds payable under such policies of insurance, (ii) to collect,
receive and give receipts for such proceeds in the name of Borrower or
any other Covered Person, Administrative Agent and Lenders, and (iii)
to endorse Borrower or any other Covered Person's name upon any
instrument in payment thereof. Such power granted to Administrative
Agent shall be deemed coupled with an interest and shall be irrevocable
(until all of the Loan Obligations are fully and indefeasibly paid in
cash and the Facilities have terminated) as set forth in Section 0. All
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policies of insurance maintained hereunder shall contain a clause
providing that such policies may not be canceled, reduced in coverage
or otherwise modified without 30 days' prior written notice to
Administrative Agent. Borrower and Administrative Agent acknowledge
that the intent of this provision is to provide continuous and adequate
insurance coverage against loss of the Collateral while any Loan
Obligations are outstanding and to obtain such insurance company's
agreement to notify Administrative Agent of any actions which threaten
such coverage. Provided that Administrative Agent receives evidence
that its interests in the Collateral are adequately protected as
required herein, Administrative Agent shall use commercially reasonable
efforts to review and respond promptly to the reasonable requests of
Borrower with respect to modifications it desires to make in its
insurance coverage. Borrower shall or shall cause any other Covered
Person upon request of Administrative Agent at any time to furnish to
Administrative Agent updated evidence of insurance (in the form
required as a condition to Administrative Agent's lending hereunder)
for such insurance.
Payment of Taxes and Other Obligations. Each Covered Person shall promptly pay
and discharge or cause to be paid and discharged, as and when due, any
and all income taxes, federal or otherwise, lawfully assessed and
imposed upon it, and any and all lawful taxes, rates, levies, and
assessments whatsoever upon its properties and every part thereof, or
upon the income or profits therefrom and all claims of materialmen,
mechanics, carriers, warehousemen, landlords and other like Persons for
labor, materials, supplies, storage or other items or services which if
unpaid might be or become a Security Interest or charge upon any of its
property; provided, however, that a Covered Person may diligently
contest in good faith by appropriate proceedings the validity of any
such taxes, rates, levies, or assessments and claims, provided such
Covered Person has established adequate reserves therefor in conformity
with GAAP on the books of such Covered Person, and no Security
Interest, other than a Permitted Security Interest, results from such
non-payment.
Compliance With Laws. Each Covered Person shall comply with all Material Laws.
Without limiting the generality of the foregoing:
Environmental Laws. Each Covered Person shall comply and shall use commercially
reasonable efforts to ensure compliance by all of its tenants,
subtenants and other occupants, if any, with all Environmental
Laws, any of which if not so complied with will or is
reasonably likely to have a Material Adverse Effect.
Pension Benefit Plans. Each Covered Person and each ERISA Affiliate of such
Covered Person shall at all times make prompt payments or
contributions to meet the minimum funding standards under
ERISA and the Code with respect to any Pension Benefit Plan
maintained by such Covered Person or such ERISA Affiliate, and
shall comply with all reporting and disclosure requirements
and all provisions of the Code and ERISA applicable to any
Pension Benefit Plan maintained by such Covered Person or such
ERISA Affiliate.
Governmental Authority Procurement Regulations. Borrower shall at all times
comply and shall use commercially reasonable efforts to ensure
compliance by each Covered Person with all Laws relating to
Governmental Authority procurement, any of which if not so
complied with will or is reasonably likely to have a Material
Adverse Effect.
Discovery and Clean-up of Hazardous Material. Upon any Covered Person receiving
notice of any violation of Environmental Laws or any similar notice
described in Section 0, or upon any Covered Person otherwise
discovering Hazardous Material on any property owned or leased by such
Covered Person which is in violation of, or which would result in
69
liability under, any Environmental Law, the violation of which or which
liability will or is reasonably likely to have a Material Adverse
Effect, Borrower shall: (i) promptly take such acts as may be necessary
to prevent danger or harm to the property or any Person therein as a
result of such Hazardous Material; (ii) at the reasonable request of
Administrative Agent, and at Borrower's sole cost and expense, obtain
and deliver to Administrative Agent promptly, but in no event later
than 90 days after such request, a then currently dated environmental
assessment of the property certified to Administrative Agent and any
future holder of the Loan Obligations, a proposed plan for responding
to any environmental problems described in such assessment, and an
estimate of the costs thereof; and (iii) take all necessary steps to
initiate and expeditiously complete all removal, remedial, response,
corrective and other action to eliminate any such environmental
problems, and keep Administrative Agent informed of such actions and
the results thereof.
Termination of Pension Benefit Plan. No Covered Person or ERISA Affiliate of
such Covered Person shall terminate or amend any Pension Benefit Plan
maintained by such Covered Person or such ERISA Affiliate if such
termination or amendment would result in any liability to such Covered
Person or such ERISA Affiliate under ERISA or any increase in current
liability for the plan year for which such Covered Person or such ERISA
Affiliate is required to provide security to such Pension Benefit Plan
under the Code.
Notice to Administrative Agent and Lenders of Material Events. Borrower shall,
promptly upon any Responsible Officer of Borrower obtaining knowledge
or notice thereof, give notice to Administrative Agent and each Lender
of (i) any breach of any of the covenants in Sections 0, 0, or 0; (ii)
any Default or Event of Default; (iii) the commencement of any Material
Proceeding; and (iv) any loss of or damage to any assets of a Covered
Person or the commencement of any proceeding for the condemnation or
other taking of any of the assets of a Covered Person, if such loss,
damage or proceeding has or is reasonably likely to have a Material
Adverse Effect, whether or not Insurance Proceeds are likely to be
payable as a consequence of such loss, damage or proceeding. In
addition,
Borrower shall furnish to Administrative Agent from time to time all information
which Administrative Agent reasonably requests with respect to
the status of any Material Proceeding.
Borrower shall furnish to Administrative Agent from time to time all information
which Administrative Agent reasonably requests with respect to
any Pension Benefit Plan established by a Covered Person or an
ERISA Affiliate of any Covered Person.
Borrower shall deliver notice to Administrative Agent of the establishment of
any Pension Benefit Plan by a Covered Person or an ERISA
Affiliate of such Covered Person.
Borrower shall promptly inform Administrative Agent of its receipt of, and
deliver to Administrative Agent a copy of, any (i) notice that
any violation of any Environmental Law or Employment Law may
have been committed or is about to be committed by any Covered
Person that has or which would reasonably be likely to have a
Material Adverse Effect, (ii) notice that any administrative
or judicial complaint or order has been filed or is about to
be filed against any Covered Person alleging violations of any
Environmental Law or Employment Law or requiring such Covered
Person to take any action in connection with the release of
any Hazardous Material into the environment, which has or
would reasonably be likely to have a Material Adverse Effect,
(iii) notice from a Governmental Authority or private party
alleging that a Covered Person may be liable or responsible
for costs associated with a response to or cleanup of a
release of Hazardous Material into the environment or any
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damages caused thereby, which has or would reasonably be
likely to have a Material Adverse Effect, (iv) notice that a
Covered Person is subject to federal, state or local
investigation regarding the improper transportation, storage,
disposal, generation or release into the environment of any
Hazardous Material which has or would reasonably be expected
to have a Material Adverse Effect, or (v) notice that any
properties or assets of a Covered Person are subject to a
Security Interest in favor of any Governmental Authority for
any liability under any Environmental Law or damages arising
from or costs incurred by such Governmental Authority in
response to a release of Hazardous Material into the
environment.
Borrower shall deliver to Administrative Agent notice of each of the following
events promptly after they occur: (i) the failure of any
Covered Person or ERISA Affiliate of such Covered Person to
make any required installment or any other required payment to
any Pension Benefit Plan in sufficient amount to comply with
ERISA and the Code on or before the due date for such
installment or payment; (ii) the occurrence of any Reportable
Event, or a prohibited transaction or accumulated funding
deficiency (as those terms are defined in ERISA), with respect
to any Pension Benefit Plan maintained or contributed to by a
Covered Person or an ERISA Affiliate of such Covered Person;
(iii) receipt by a Covered Person or ERISA Affiliate of such
Covered Person of any notice from a Multi-employer Plan
regarding the imposition of withdrawal liability; and (iv)
receipt by a Covered Person or ERISA Affiliate of such Covered
Person of any notice of the institution, or a Covered Person's
expectancy of the institution, of any proceeding or receipt by
such Covered Person or such ERISA Affiliate of any notice of
the taking, or such Covered Person's or such ERISA Affiliate's
expectancy of the taking, of any other action which may result
in the termination of any Pension Benefit Plan maintained or
contributed to by such Covered Person or such ERISA Affiliate,
or the withdrawal or partial withdrawal by a Covered Person or
ERISA Affiliate of such Covered Person from any Pension
Benefit Plan, and the filing or receipt by a Covered Person or
ERISA Affiliate of such Covered Person of any such notice and
filing or receipt of all subsequent reports or notices under
ERISA with or from the IRS, the PBGC, or the DOL relating to
the same; and, in addition to such notice, deliver to
Administrative Agent a certificate of a Responsible Officer of
Borrower, setting forth details as to such events and the
action that the affected Covered Person or ERISA Affiliate of
such Covered Person proposes to take with respect thereto. For
purposes of this Section, each Covered Person and any ERISA
Affiliate of such Covered Person shall be deemed to know all
facts known by the administrator of any Plan of which such
Covered Person or such ERISA Affiliate is the plan sponsor.
Borrower shall promptly deliver to Administrative Agent notice of any default or
event of default, or the occurrence of any event which would
with the passage of time, giving of notice or otherwise,
constitute a default or event of default with respect to any
of the Permitted Indebtedness in excess of $500,000.
Borrower shall promptly deliver notice to Administrative Agent of the assertion
by the holder of any Indebtedness of a Covered Person in the
outstanding principal amount in the aggregate in excess of
$500,000 that a default exists with respect thereto or that
such Covered Person is not in compliance with the terms
thereof, or of the threat or commencement by such holder of
any enforcement action because of such asserted default or
noncompliance.
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Borrower shall, promptly after becoming aware thereof, deliver notice to
Administrative Agent of any pending or threatened strike, work
stoppage, or other material labor dispute affecting a Covered
Person which would reasonably be likely to have a Material
Adverse Effect.
Borrower shall promptly deliver notice to Administrative Agent of any change in
the name, State of incorporation or organization or form of
any Covered Person, or the trade names or styles under which a
Covered Person will sell Inventory or create Accounts, or to
which instruments in payment of Accounts may be made payable,
at least 30 days prior to such change.
Borrower shall, promptly after becoming aware thereof, deliver notice to
Administrative Agent of any event that has or is reasonably
likely to have a Material Adverse Effect.
Borrower shall, promptly after becoming aware thereof, deliver notice to
Administrative Agent of an actual or alleged violation of any
Material Law applicable to a Covered Person or the property of
a Covered Person.
Borrower shall notify Administrative Agent promptly in writing of any fact or
condition of which Borrower is aware which adversely affects
the value of the Collateral taken as a whole, including
disclosing the amount of such loss or depreciation in value
and disclosing any adverse fact or condition or the occurrence
of any event which causes loss or depreciation in the value of
the Collateral of more than $500,000 taken as a whole.
Borrower shall provide such additional information to
Administrative Agent regarding the amount of any loss or
depreciation in value of the Collateral as Administrative
Agent may request from time to time.
Borrower shall notify Administrative Agent promptly in writing of the
acquisition or lease of any improved real estate upon which
Inventory or material amounts of other Collateral will be
located.
Borrower shall notify Administrative Agent promptly in writing of any pending
unsatisfied request (oral or written) of a third Person that
the Borrower repurchase Inventory under a repurchase agreement
or similar arrangement, including the Textron Agreement.
Borrower shall keep on file with Administrative Agent at all times an
appropriate instrument naming each Borrowing Officer.
Maintenance of Security Interests of Security Documents.
Preservation and Perfection of Security Interests. Borrower shall promptly, upon
the reasonable request of Administrative Agent and at
Borrower's expense, execute, acknowledge and deliver, or cause
the execution, acknowledgment and delivery of, and thereafter
file or record in the appropriate governmental office, any
document or instrument supplementing or confirming the
Security Documents or otherwise reasonably deemed necessary by
Administrative Agent to create, preserve or perfect any
Security Interest purported to be created by the Security
Documents or to consummate fully the transactions contemplated
by the Loan Documents. The foregoing actions by Borrower shall
include, (i) filing financing or continuation statements, and
amendments thereof, and executing such mortgages, deeds of
trust, assignments or security agreements, in form and
substance satisfactory to Administrative Agent; (ii)
delivering to Administrative Agent the original certificates
of title for motor vehicles, or applications therefor duly
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executed, with Administrative Agent's Security Interest for
the benefit of Lenders properly shown thereon; (iii)
delivering to Administrative Agent the originals of all
instruments, documents and chattel paper, and all other
Collateral of which Administrative Agent determines it should
have physical possession in order to perfect and protect
Administrative Agent's Security Interest for the benefit of
Lenders therein, duly endorsed or assigned to Administrative
Agent without restriction; (iv) delivering to Administrative
Agent warehouse receipts covering any portion of the
Collateral located in warehouses and for which warehouse
receipts are issued; (v) upon the occurrence and during the
continuance of an Event of Default, transferring Inventory to
warehouses designated by Administrative Agent; (vi) delivering
to Administrative Agent all letters of credit on which
Borrower is named beneficiary; (vii) placing a durable notice
of the existence of Administrative Agent's Security Interest
for the benefit of Lenders, acceptable to Administrative
Agent, upon such items of the Collateral as are designated by
Administrative Agent; and (viii) placing a notice of the
existence of Administrative Agent's Security Interest for the
benefit of Lenders, acceptable to Administrative Agent, upon
those writings evidencing the Collateral and the books and
records of Borrower pertaining to the Collateral, as
designated by Administrative Agent.
Collateral Held by Warehouseman, Bailee, etc. If any Inventory which is
purchased by Borrower pursuant to the Aggregate Floorplan Loan
Facility or Interim Floorplan Loan Facility with a value in
excess of $500,000 per location, or $1,500,000 in the
aggregate, is at any time in the possession or control of a
warehouseman, bailee or any of Borrower's agents or processors
(not including any lessee or other Person to whom Inventory is
leased or rented in the ordinary course of such Covered
Person's business), then Borrower shall notify Administrative
Agent thereof and shall notify such Person of Administrative
Agent's Security Interest for the benefit of Lenders in such
Collateral and, upon Administrative Agent's request, instruct
such Person to hold all such Collateral for Administrative
Agent's account subject to Administrative Agent's
instructions. Except with respect to Inventory held be
Ichiban, Inc. as otherwise provided herein, if at any time any
Inventory which is purchased by Borrower pursuant to the
Aggregate Floorplan Loan Facility or Interim Floorplan Loan
Facility with a value in excess of $500,000 for each location
or $1,500,000 in the aggregate, is located on any premises
that are not owned by Borrower (not including any lessee or
other person to whom Inventory is leased or rented in the
ordinary course of such Covered Person's business, or other
locations where Borrower is not obligated to pay rent for up
to 30 consecutive days) then Borrower shall obtain or cause to
be obtained written waivers or consents, in form and substance
satisfactory to Administrative Agent, of all present and
future Security Interests to which the owner or lessor or any
mortgagee of such premises may be entitled to assert against
the Collateral.
Compliance With Terms of Security Documents. Each Covered Person shall comply
with all of the terms, conditions and covenants in the
Security Documents to which such Covered Person is a party.
Accounting System. Each Covered Person shall maintain a system of accounting
established and administered in accordance with GAAP. Without limiting
the generality of the foregoing:
Account Records. Each Covered Person shall maintain a record of Accounts at its
principal place of business that itemizes each Account of such
Covered Person and describe the names and addresses of the
Account Debtors on such Accounts, all relevant invoice
73
numbers, invoice dates, and shipping dates, and the due dates,
collection histories, and aging of such Accounts.
Inventory Records. Each Covered Person shall maintain an inventory system
satisfactory to Administrative Agent.
Tracing of Proceeds. Borrower shall maintain detailed and accurate accounting
and records of proceeds of the Loans and transfers of proceeds
of the Loans (i) received by it from the Lenders or
Administrative Agent, (ii) transferred from it to any other
Covered Person, and (iii) received by it from another
Borrower. Borrower acknowledges that its ability to obtain the
Loans hereunder is made possible by the fact that Borrowers
are co-borrowers under this Agreement and the other Loan
Documents, and are operated as one enterprise. Borrower agrees
that (i) the business operations of Borrower and each other
Covered Person are interrelated and complement one another,
and such entities have a common business purpose and common
management, and (ii) the proceeds of Advances hereunder will
benefit Borrower, severally and jointly, regardless of which
Borrower requests or receives part or all of any Advance. Not
in any way in limitation of any other provisions set forth
herein, such books and records may be reviewed and copied by
Administrative Agent at Borrower's expense at reasonable
intervals and upon reasonable notice given by Administrative
Agent to Borrower.
Financial Statements. Borrower shall deliver to Administrative Agent and each
Lender:
Annual Financial Statements. Within 100 days after the close of each fiscal year
of Borrower, year-end audited consolidated and consolidating
financial statements of Borrower and its Subsidiaries,
containing a balance sheet, income statement, statement of
cash flows and an unqualified report by an independent
certified public accounting firm selected by Borrower
accompanied by (i) a Compliance Certificate of Borrower, (ii)
the Management Letter and report on internal controls, if any,
delivered by such independent certified public accounting firm
in connection with their audit, and (iii) if requested by
Administrative Agent, any summary prepared by such independent
certified public accounting firm of the adjustments proposed
by the members of its audit team.
Annual Projections. No later than the 30th day of each fiscal year of all
Borrowers, projected balance sheets and statements of income
and expense for such fiscal year, on a consolidated basis, and
with such other detail as Administrative Agent may reasonably
require.
Monthly Financial Statements.
Within 30 days after the end of each fiscal month of Borrower,
management-prepared unaudited financial statements of Borrower
and every Subsidiary of a Borrower for the fiscal months not
covered by the latest year-end financial statements, in each
case containing a balance sheet, income statement, and
unaudited consolidated financial statements of Borrower and
its Subsidiaries, accompanied by a Compliance Certificate of
Borrower.
Each Compliance Certificate shall be in the form of Exhibit 0, shall
contain detailed calculations of the financial measurements referred to in
Section 0 for the relevant periods, and shall contain statements by the signing
authorized officer (either the president, any vice president or the chief
financial officer) to the effect that, except as explained in reasonable detail
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in such Compliance Certificate, (i) the attached Financial Statements are
complete and correct in all material respects (subject, in the case of Financial
Statements other than annual, to normal year-end audit adjustments and with
respect to Financial Statements other than annual, without footnote disclosures)
and have been prepared in accordance with GAAP applied consistently throughout
the periods covered thereby and with prior periods (except as disclosed
therein), (ii) all of the Representations and Warranties are true and correct as
of the date such certification is given as if made on such date, and (iii) no
Event of Default has occurred and is continuing. If any Compliance Certificate
delivered to Lenders discloses that a representation or warranty is not true and
correct, or that an Event of Default has occurred and is continuing that has not
been waived in writing by Required Lenders, such Compliance Certificate shall
state what action Borrower has taken or proposes to take with respect thereto.
Other Financial Information. Borrower shall also deliver the following to
Administrative Agent and to each Lender each in a form satisfactory to
Administrative Agent:
Periodic Borrowing Base Certificates. On the Effective Date, the date of any
Advance and periodically thereafter, but not less often than
seven (7) days from the date of the last Borrowing Base
Certificate, each Business Day, a Borrowing Base Certificate
completed and signed by the Chief Financial Officer or other
Borrowing Officer. If an Event of Default exists, Borrower
shall provide a Borrowing Base Certificate more often if so
requested by Administrative Agent in its sole and absolute
discretion. Each Borrowing Base Certificate shall
substantially be in the form of Exhibit 0. With each Borrowing
Base Certificate, Borrower shall notify Administrative Agent
of any pending unsatisfied request of a third Person that
Borrower repurchase Inventory under a repurchase agreement or
similar arrangement, including the Textron Agreement, unless
such notice was previously provided by Borrower to
Administrative Agent pursuant to Section 0.
Daily Schedule of Deposits. On each Business Day, a schedule of all receipts and
deposits received by Borrower (including all Lockbox receipts)
on the preceding Business Day.
Weekly Summary Accounts Aging. Within two (2) Business Days following the end of
each week, a Schedule of Accounts as of the end of the most
recent week.
Semimonthly Sales Journal Report. Within three (3) days after the 15th of each
month and the end of each month, a report listing each item of
Inventory sold or leased by Borrower for such period.
Monthly Detailed Accounts Aging and Inventory Reports. Within ten (10) days
after the end of each month, a Schedule of Accounts (including
lease receivables, each presented on a summary and detailed
basis), a Schedule of Inventory, and accounts payable aging as
of month end.
Monthly Locations of Inventory Report. Within ten (10) days after the end of
each fiscal month, a listing, by address of the locations of
Inventory.
Monthly Cash Receipts Journal and Credit Memo Entries. Within ten (10) days
after the end of each month, a report showing cash receipts on
Accounts, cash receipts not on Accounts and summary of credit
memo entries.
Semiannual Customer Address Listing. Within ten (10) days after the end of each
June and December, a listing, by customer, of such customer's
address.
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Other Reports or Information Concerning Accounts or Inventory. Such other
reports and information, in form and detail reasonably satisfactory to
Administrative Agent, and documents as Administrative Agent may
reasonably request from time to time concerning Accounts or Inventory
including, to the extent requested by Administrative Agent, copies of
all invoices, leases, bills of lading, shipping receipts, purchase
orders, and warehouse receipts.
Tax Notifications. If Borrower determines to take any action inconsistent with
its intention set forth in Section 0, it will promptly notify
Administrative Agent thereof. If Borrower so notifies Administrative
Agent, Borrower acknowledges that one or more of Administrative Agent
and the Lenders may treat its Loans or its interest in Swingline Loans
or Letters of Credit as part of a transaction that is subject to
Treasury Regulation Section 301.6112-1, and Administrative Agent and
such Lender or Lenders, as applicable, will maintain the lists and
other records required by such Treasury Regulation. Promptly after
Borrower has notified Administrative Agent of any intention by Borrower
to treat Loans or Letters of Credit and related transactions as being a
"reportable transaction" (within the meaning of Treasury Regulation
Section 1.6011-4), Borrower will promptly provide a duly completed copy
of IRS Form 8886 or any successor form.
Stockholder and SEC Reports. Promptly after their filing by or on behalf of
Borrower or any other Covered Person, mail or otherwise deliver to
Administrative Agent copies of any (i) proxy statements, financial
statements and reports which Borrower makes available to its
stockholders, and (ii) reports, registration statements and
prospectuses with any securities exchange or the Securities and
Exchange Commission or any Governmental Authority succeeding to any of
its functions.
Pension Benefit Plan Reports. Promptly upon the request of Administrative Agent
at any time or from time to time, a copy of each annual report or other
filing or notice filed with respect to each Pension Benefit Plan of a
Covered Person or an ERISA Affiliate of a Covered Person.
Other Information. Promptly upon the request of Administrative Agent at any time
or from time to time, such other information concerning Borrower, its
business or financial condition as Administrative Agent may reasonably
request.
Review of Accounts. Not less often than annually, and promptly at Administrative
Agent's reasonable request if an Event of Default has occurred and is
continuing, Borrower shall conduct a review of its Accounts, bad debt
reserves, and collection histories of Account Debtors and promptly
following such review provide Administrative Agent with a report of
such review in form and detail satisfactory to Administrative Agent.
Inventory. Not less often than annually, and promptly at Administrative Agent's
reasonable request if an Event of Default has occurred and is
continuing, Borrower shall conduct a physical count of its and each
other Covered Person's Inventory and promptly following the completion
of such count provide Administrative Agent with a report thereof in
form and detail satisfactory to Administrative Agent, including the
value of such Inventory in accordance with GAAP.
Lease Servicing. Funds received by Borrower in its capacity as a servicer,
collection agent or otherwise which must be remitted or turned over to
any third Person pursuant to agreements with respect to leases of
Inventory that have been sold or assigned ("Servicing Funds") by
Borrower to another Person, shall be segregated from all other funds
received by Borrower and kept separate at all times from the Lockboxes,
Cash Collateral Accounts and operating bank accounts of Borrower.
Borrower shall direct that all Servicing Funds be deposited to one or
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more other lockboxes or other bank accounts whose sole purpose shall be
to collect such Servicing Funds and distribute them as required under
the relevant lease assignments, servicing agreements and related
documents.
Examinations and Site Visits by Administrative Agent. Administrative Agent or
Persons authorized by and acting on behalf of Administrative Agent or
any Lender may at any time (upon reasonable prior notice, except if an
Event of Default has occurred and is continuing, no prior notice shall
be required) during normal business hours examine the books, records,
and assets of, and inspect any of the property, locations or operations
of, each Covered Person from time to time, and in the course thereof
may make copies or abstracts of such books and records and discuss the
affairs, finances and books and records of such Covered Person with its
accountants, officers and employees, and make such inspections as it
deems necessary. Each Covered Person shall cooperate with
Administrative Agent, Lenders and such Persons in the conduct of such
exams, site visits and inspections and shall deliver to Administrative
Agent any instrument necessary for Administrative Agent to obtain
records from any service bureau maintaining records for such Covered
Person. Administrative Agent may, while an Event of Default has
occurred and is continuing, perform as many as examinations as it may
choose, and Borrower is required to reimburse Administrative Agent for
all fees, costs and expenses incurred in connection therewith. Borrower
shall not be obliged to reimburse Administrative Agent for examination
costs and expenses; provided, however, any examinations conducted
during the existence of an Event of Default shall not be subject to any
limitation regarding reimbursement, and Borrower shall pay all costs of
such examinations.
Verification of Accounts and Notices to Account Debtors. Administrative Agent
shall have the right at any time and from time to time, to verify the
validity and amount of any Account and any other matter relating to an
Account, by communicating in writing or orally directly with the
Account Debtor or any Person who represents or Administrative Agent
believes represents the Account Debtor.
Appraisals of Collateral. So long as an Event of Default has occurred and is
continuing, Administrative Agent or Persons authorized by and acting on
behalf of Administrative Agent may, at Borrower's sole cost and
expense, as often as Administrative Agent deems desirable, perform or
have performed on its behalf an appraisal of Borrower's Inventory,
equipment, and other assets by an appraiser reasonably acceptable to
Administrative Agent and prepared on a basis reasonably satisfactory to
Administrative Agent. Each Covered Person shall cooperate with
Administrative Agent and such Persons in the conduct of such appraisals
and shall deliver to Administrative Agent or such Persons any documents
or instruments necessary for Administrative Agent or such Person's to
perform such appraisals. Borrower shall reimburse Administrative Agent
for all reasonable costs and reasonable expenses actually incurred by
it in conducting or having conducted each such appraisal plus
Administrative Agent's other actual out-of-pocket costs and expenses.
Access to Officers and Auditors. Each Covered Person shall permit Administrative
Agent, any Lender and Persons authorized by Administrative Agent or any
Lender to discuss the business, operations, revenues, financial
condition, property, or business prospects of such Covered Person with
its officers, employees, accountants and independent auditors as often
as Administrative Agent or any Lender may request in its reasonable
discretion, and such Covered Person shall direct such officers,
employees, accountants and independent auditors to cooperate with
Administrative Agent.
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Movement of Inventory. Borrower shall notify Administrative Agent in writing if
Borrower has knowledge that any Inventory will be located for more than
thirty (30) consecutive days outside any of the locations listed in
section 0 of the Disclosure Schedule.
Titled Assets. Upon the occurrence and continuance of an Event of Default,
Borrower shall, at Administrative Agent's request, cause the respective
titles of all Collateral which are titled in the name of any Covered
Person to reflect thereon that Administrative Agent, as agent for
itself and the other Lenders, as the first and only lienholder thereon,
and shall deliver originals of all such titles to Administrative Agent.
Acquisition Documents. Borrower shall in all material respects perform all of
its obligations under all Acquisition Documents, and shall enforce all
of its rights and remedies thereunder, in each case as it deems
appropriate in its reasonable business judgment; provided, however,
that Borrower shall not take any action or fail to take any action
which would result in a waiver or other loss of any material right or
remedy of Borrower thereunder. Without limiting the generality of the
foregoing, Borrower shall take all action necessary or appropriate to
permit, and shall not take any action which would have any material
adverse effect upon, the full enforcement of all of Borrower's
indemnification rights under all the Acquisition Documents. Borrower
shall notify Administrative Agent in writing promptly after Borrower
becomes aware thereof, of any event or fact which could give rise to a
claim by Borrower for indemnification under any of the Acquisition
Documents for an amount in excess of $500,000, and shall diligently
pursue such right and promptly report to Administrative Agent on all
further developments with respect thereto. Borrower shall remit
directly to Administrative Agent, for application to the Loan
Obligations in such order as Administrative Agent determines, all
amounts received by Borrower as indemnification or otherwise pursuant
to the Acquisition Documents. If Borrower fails after Administrative
Agent's demand to pursue diligently any material right under any of the
Acquisition Documents, or if there is an Event of Default has occurred
and is continuing, then Administrative Agent may directly enforce such
right in its own or Borrower's name and may enter into such settlements
or other agreements with respect thereto as Administrative Agent
determines in its reasonable judgment. Notwithstanding the foregoing,
Borrower shall at all times remain liable to observe and perform all of
its duties and obligations under all the Acquisition Documents, and
Administrative Agent's exercise of any of its rights with respect to
the Collateral shall not release Borrower from any of such duties or
obligations. Administrative Agent shall not be obligated to perform or
fulfill any of Borrower's duties or obligations under any of the
Acquisition Documents or to make any payment thereunder, or to make any
inquiry as to the sufficiency of any payment or property received by it
thereunder or the sufficiency of performance by any party thereunder,
or to present or file any claim, or to take any action to collect or
enforce any performance or payment of any amounts, or any delivery of
any property.
Other Information. Administrative Agent may provide to any Vendor, Lender,
potential Lender, credit rating agency or as required by Law any
credit, financial or other information on Borrower that Administrative
Agent may from time to time possess; provided, however, that with
respect to a Vendor, such information shall be limited to information
with respect to Borrower's accounts and activity with such Vendor only.
Administrative Agent may obtain from any Vendor any credit, financial
or other information regarding Borrower that such Vendor may from time
to time possess.
Further Assurances. Borrower shall execute and deliver, or cause to be executed
and delivered, to Administrative Agent such documents and agreements,
and shall take or cause to be taken such actions, as Administrative
Agent may from time to time reasonably request to carry out the terms
and conditions of this Agreement and the other Loan Documents.
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Negative Covenants. Borrower covenants and agrees that until all of the Loan
Obligations are fully and indefeasibly paid in cash no Letters of Credit are
outstanding and the Letters of Credit Exposure is irreversibly zero and the
Facilities are terminated, Borrower shall not, directly or indirectly, do any of
the following, or permit any other Borrower or any other Covered Person to do
any of the following, without the prior written consent of Required Lenders:
Investments. Make any Investments in any other Person except the following:
Investments in (i) interest-bearing United States government obligations; (ii)
certificates of deposit issued by any Lender; (iii) prime
commercial paper rated A1 or better by Standard and Poor's
Corporation or Prime P1 or better by ▇▇▇▇▇'▇ Investor Service,
Inc.; (iv) agreements involving the sale to Borrower of United
States government securities and their guarantied repurchase
the next Business Day by a commercial bank chartered under the
Laws of the United States or any state thereof which has
capital and surplus of not less than $250,000,000, (v) banking
acceptances certificates of deposit issued by and time
deposits with any commercial bank chartered under the Laws of
the United States or any state thereof which has combined
capital and surplus of not less than $250,000,000, (vi) money
market deposit accounts issued or offered by any domestic
office of any commercial bank chartered under the Laws of the
United States or any state thereof combined capital and
surplus of not less than $250,000,000 or (vii) any security
that constitutes an "Eligible Security" under Rule 2a-7(a)(10)
under the Investment Company Act of 1940, as amended..
Accounts arising in the ordinary course of business and payable in accordance
with Borrower's customary trade terms.
Any Investments that are Permitted Acquisitions.
Investments existing on the Execution Date and disclosed in Section 0 of the
Disclosure Schedule.
Notes or securities received by a Covered Person in settlement of Indebtedness
of other Persons to such Covered Person that was incurred in
the ordinary course of such Covered Person's business.
Investments by any Covered Person in any other Covered Person.
Investments not described above which do not exceed $1,000,000 in the aggregate
annually, provided that when made there exists at least
$7,500,000 of Excess Eligible Accounts.
Indebtedness. Create, incur, assume, or allow to exist any Indebtedness of any
kind or description, except the following:
Excluding Other Creditor Indebtedness, Indebtedness to trade creditors incurred
in the ordinary course of business.
The Loan Obligations.
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The Other Creditor Indebtedness if an Intercreditor Agreement remains in effect
with respect thereto.
Indebtedness secured by Permitted Security Interests.
Indebtedness constituting Liabilities (as defined by GAAP) under any Capital
Lease under which a Covered Person is a lessee existing on the
Execution Date and disclosed in Section 0 of the Disclosure
Schedule and is subject to an Intercreditor Agreement unless
Administrative Agent, in its sole and absolute discretion,
waives the requirement for an Intercreditor Agreement with
respect to any particular Other Creditor Indebtedness, and any
Capital Leases under which a Covered Person is a lessee
entered into by any Covered Person after the Execution Date
for capital assets which are subject to Intercreditor
Agreements unless Administrative Agent, in its sole and
absolute discretion, waives the requirement for an
Intercreditor Agreement with respect to any particular Other
Creditor Indebtedness in all cases, up to $5,000,000 in the
aggregate outstanding at any one time (such amount to be
calculated as the amount which would have been the aggregate
cost of the property leased if it had been purchased rather
than leased).
Indebtedness of one Covered Person owed to any other Covered Person; provided,
however, that such Indebtedness is (i) unsecured, (ii)
evidenced by a book-entry on the accounting records of the
Covered Persons involved, but not evidenced by a promissory
note or other instrument of any kind, unless such original
promissory note(s) are promptly delivered to Administrative
Agent together with a pledge or assignment document
satisfactory to Administrative Agent granting Administrative
Agent a Security Interest therein, and (iii) does not exceed
in the aggregate, among all Covered Persons, $2,000,000.
Unsecured Indebtedness not described above in this Section 0 which does not
exceed $1,000,000 in the aggregate at any time.
Payments on Other Creditor Indebtedness. Make any nonscheduled prepayment of
principal or interest on any Other Credit Indebtedness unless both
immediately before and after giving effect to any such prepayment,
there shall be no Default or Event of Default and no Default or Event
of Default is reasonably likely to have occurred.
Prepayments. Voluntarily prepay any Indebtedness other than (i) the Loan
Obligations in accordance with the terms of the Loan Documents, (ii)
trade payables in the ordinary course of business consistent with past
practices, and (iii) as permitted by Section 0.
Indirect Obligations. Create, incur, assume or allow to exist any Indirect
Obligations except Indirect Obligations disclosed on section 0 of the
Disclosure Schedule or, provided that there exists, when created,
incurred or assumed at least $7,500,000 of Excess Eligible Accounts,
subsequent Indirect Obligations which do not exceed $1,000,000, in the
aggregate.
Security Interests. Create, incur, assume or allow to exist any Security
Interest upon all or any part of its property, real or personal
(including intangible property), now owned, leased or hereafter
acquired or leased, except the following:
Security Interests for taxes, assessments or governmental charges not delinquent
or which are being diligently contested in good faith and by
appropriate proceedings and for which adequate book reserves
in accordance with GAAP are maintained.
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Security Interests arising out of deposits in connection with workers'
compensation insurance, unemployment insurance, old age
pensions, or other social security or retirement benefits
legislation.
Deposits or pledges to secure bids, tenders, contracts (other than contracts for
the payment of money), leases, statutory obligations, surety
and appeal bonds, and other obligations of like nature arising
in the ordinary course of business.
Security Interests imposed by any Law, such as mechanics', workmen's,
materialmen's, landlords', carriers', or other like Security
Interests arising in the ordinary course of business which
secure payment of obligations which are not past due or which
are being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with
GAAP are maintained on such Covered Person's books.
Security Interests on Inventory in favor of IBM Credit, LLC, Hewlett-Packard
Company or Affiliates thereof and the holders of any Other
Creditor Indebtedness approved in writing, in advance by
Administrative Agent, all of which such Security Interests are
subject to Intercreditor Agreements satisfactory to
Administrative Agent as of the date of such agreements, unless
Administrative Agent, in its sole and absolute discretion,
waives the requirement for an Intercreditor Agreement with
respect to any particular Other Creditor Indebtedness.
Security Interests resulting from a judgment or order entered against a Covered
Person which is not final and non-appealable, provided the
loss of the property subject to such Security Interest would
not reasonably be expected to have a Material Adverse Effect.
Purchase money Security Interests securing payment of the purchase price of
assets (other than Inventory which is subject to an
Intercreditor Agreement) acquired by Borrower or other Covered
Person after the Execution Date in an aggregate principal
amount outstanding at any one time that does not exceed
$1,000,000.
Security Interests securing the Loan Obligations in favor of Administrative
Agent for the benefit of Lenders.
Security Interests that are disclosed in section 0 of the Disclosure Schedule.
Acquisitions. Except for Permitted Acquisitions, Permitted Investments or other
transactions permitted pursuant to Sections 0 and 0. for Permitted
Acquisitions, and Permitted Investments acquire stock, membership
interests, partnership interests or any other equity interest in a
Person, or acquire all or substantially all of the assets of a Person
(including assets comprising all or substantially all of an
unincorporated business unit or division of any Person). "Permitted
Acquisition" means an acquisition of the stock, membership interests,
partnership interests, or any other equity interest in a Person, or the
acquisition of all or substantially all of the assets of a Person
(including assets comprising all or substantially all of an
unincorporated business unit or division of any Person), which
satisfies each of the following conditions: (i) a Borrower or a wholly
owned Subsidiary thereof is the Acquiring Company, (ii) if the
acquisition is structured as a merger, a Borrower or a wholly owned
Subsidiary thereof is the Surviving Company, (iii) the Target Company
is in a substantially similar line of business as a Borrower, (iv) no
Event of Default exists, and giving effect to such acquisition, no
Default or Event of Default will occur or is reasonably likely to
occur, (v) there is at least $20,000,000 of Excess Eligible Accounts
both immediately before and immediately after giving effect to the
Acquisition, (vi) simultaneously with the closing of such acquisition,
the Target Company (if such Permitted Acquisition is structured as a
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purchase of equity) or the Surviving Company (if such Permitted
Acquisition is structured as a purchase of assets or a merger) executes
and delivers to Administrative Agent (a) such documents necessary to
grant to Administrative Agent for the benefit of the Lenders a first
priority Security Interest in all of the assets of such Target Company
or Surviving Company (including the execution of an Acquisition
Documents Assignment), each in form and substance satisfactory to
Administrative Agent and (b) an unlimited Guaranty of the Loan
Obligations, or at the option of Administrative Agent in Administrative
Agent's absolute discretion, a joinder agreement satisfactory to
Administrative Agent in which such Target Company or Surviving Company
becomes a Borrower under this Agreement and assumes primary, joint and
several liability for the Loan Obligations, (vii) prior to the closing
of such acquisition, a Responsible Officer of Borrower delivers to
Administrative Agent a certificate certifying that such acquisition is
a Permitted Acquisition, (viii) such acquisition is not conducted
pursuant to an unsolicited tender offer, proxy contest or other
mechanism which does not have or require the consent of Target's board
of directors, (ix) Borrower has provided Administrative Agent with pro
forma financial statements of the Target Company for the trailing
twelve month period which, if combined with Borrower and giving effect
to the terms and conditions of the Acquisition, would not have resulted
in a Default, and (x) Borrower has, no less than 15 days prior to
making such acquisition, prepared and furnished to Administrative Agent
the proforma financial statements described below for the Target
Company (if such acquisition is structured as a purchase of equity) or
the Surviving Company (if such acquisition is structured as a purchase
of assets or a merger), demonstrating to the reasonable satisfaction of
Administrative Agent that the Target Company, all Surviving Companies,
and each Borrower, as the case may be, will be Solvent upon
consummation of such acquisition and is reasonably likely to be Solvent
within 12 months of such acquisition, and that none of the covenants in
Section 15 will be violated as a consequence of such acquisition or are
reasonably likely to be within 12 months of such acquisition, and, if
applicable, a certificate demonstrating that the Maximum Available
Amount will be great enough to allow a Revolving Loan Advance to be
made in the amount Borrower will request in connection with the closing
of such Permitted Acquisition, and Borrower has also provided to
Administrative Agent, no less than 15 days prior to making such
acquisition, copies of the audited financial statements (if available,
or unaudited financial statements if no audited financial statements
exist) for the Target Company for the two fiscal years most recently
ended and, to the extent available, for each of the completed fiscal
quarters in the then current fiscal year. The proforma financial
statements referred to in clause (ix) shall contain consolidated and
consolidating balance sheets, income statements, statements of cash
flows and such other reports and disclosures of each Borrower as well
as the Target Company (if such Permitted Acquisition is structured as a
purchase of equity) or the Surviving Company (if such Permitted
Acquisition is structured as a purchase of assets or a merger) and
shall cover such forecast periods (up to 12 months from the proposed
effective date of such Permitted Acquisition), as Administrative Agent
may in its discretion require.
Bailments; Consignments; Warehousing. Except to the extent expressly permitted
in this Agreement, store any Inventory with a bailee, warehouseman,
consignee or pursuant to an express or implied agreement establishing a
bailment or consignment of Inventory or similar arrangement, unless
Administrative Agent has received a written acknowledgment reasonably
satisfactory to Administrative Agent from the third party involved
which acknowledges the prior perfected Security Interest of
Administrative Agent for the benefit of Lenders in such Inventory.
Notwithstanding the foregoing or Section 0, the failure to obtain a
bailee letter from Ichiban, Inc. with respect to the Inventory or other
Collateral presently held by Ichiban, Inc. shall not constitute a
Default or Event of Default under this Agreement while litigation is
pending between Borrower and Ichiban, Inc.
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Disposal of Property. Sell, transfer, exchange, or otherwise dispose of any of
its assets. Notwithstanding the foregoing unless an Event of Default
has occurred and is continuing (in which case all of the following
shall be prohibited unless Administrative Agent otherwise consents
except that sales and leases of Inventory in the ordinary course shall
be permitted until such time as Administrative Agent otherwise notifies
Borrower in writing to cease such activities), a Covered Person may
sell, transfer, exchange or otherwise dispose of Inventory in the
ordinary course or equipment or other similar assets no longer
reasonably necessary for the operation of its business in the ordinary
course of business consistent with past practice, provided that all
proceeds of such sales, transfers or other dispositions shall be
deposited into the Lockboxes, except as permitted by Section 0.
Distributions. If there is no Existing Default and no Default or Event of
Default is reasonably likely to occur as a result of such payment,
directly or indirectly declare or make, or incur any liability to make,
any Distribution to any Person in excess of $2,500,000, in the
aggregate, annually. For purposes of this Section, a "Distribution"
means and includes (i) any cash dividend or payment, (ii) any
acquisition or redemption of any outstanding stock or other equity
interest of Borrower or a Covered Person, (iii) any retirement or
prepayment of debt securities before their regularly scheduled Maturity
dates, other than as expressly permitted by this Agreement, and (iv)
any loan or advance to a shareholder, partner, or member other than
split-dollar life insurance policies and advances for travel or similar
expenses made in the ordinary course of business. Notwithstanding the
foregoing, if (i) no Default exists and no Default or Event of Default
will occur or is reasonably likely to occur as a result of such payment
and (ii) there is at least $7,500,000 of Excess Eligible Accounts after
giving effect to the contemplated Distribution, the Borrower or any
other Covered Person may purchase or otherwise acquire any outstanding
capital stock or other equity securities of Borrower.
[Intentionally Omitted.]
Capital Structure; Equity Securities. Except pursuant to Section 0, make any
change in the capital structure of any Covered Person; change any
Charter Documents of any Covered Person which has or is reasonably
likely to have a Material Adverse Effect on any Covered Person or which
will or is reasonably likely to cause a Default or Event of Default; or
issue or create any stock or other equity interest (or class or series
thereof), or non-equity interest that is convertible into stock or
other equity interest (or class or series thereof), in any Covered
Person, except stock, membership interests, partnership interests or
other equity interests (or class or series thereof) that are
subordinated in right of payment to all the Loan Obligations in a
manner satisfactory to Administrative Agent.
Change of State of Formation; Change of Name. Make any change in the state of
incorporation or formation of organization of any Covered Person,
change its type of legal entity, or change its legal name as it appears
on any certificates or articles of organization or formation. Make any
change in the trade names or styles under which a Covered Person will
sell Inventory or create Accounts, or to which instruments in payment
of Accounts may be made payable, except in accordance with the terms of
Section 0 with at least 30 days prior written notice to Administrative
Agent of such change.
Change of Business. Engage in any business other than substantially as conducted
by a Covered Person on the Effective Date.
Transactions With Affiliates. Enter into or be a party to any transaction or
arrangement, including the purchase, sale or exchange of property of
any kind or the rendering of any service, with any Affiliate other than
a Covered Person, or make any loans or advances to any Affiliate other
than a Covered Person. If, however, there is no Event of Default
exists, each Covered Person may engage in such transactions with an
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Affiliate in the ordinary course of business and pursuant to the
reasonable requirements of its business and on fair and reasonable
terms substantially as favorable to it as those which it could obtain
in a comparable arm's-length transaction with a non-Affiliate;
provided, however, during an Event of Default exists, Borrower may
continue to make normal salary payments and provide customary health
benefits to the owners of Borrower for services actually rendered. No
Borrower shall make any loan or advance to any shareholder, member or
partner of any Borrower, other than split-dollar life insurance
policies and advances for travel or similar expenses made in the
ordinary course of business, or permit any shareholder, member or
partner of any Borrower to incur any Indebtedness to any Borrower
(other than travel and similar advances in the ordinary course of
business).
Operating Leases. Incur rental payments under all Operating Leases in excess of
$5,000,000, in the aggregate, based on the preceding twelve-month
period.
Conflicting Agreements. Enter into any agreement, that would, if fully complied
with by it, result in a Default or Event of Default either immediately
or upon the elapsing of time.
Investment Banking and Finder's Fees. Pay or agree to pay, or reimburse any
other party with respect to, any investment banking or similar or
related fee, underwriter's fee, finder's fee, or broker's fee to any
Person in connection with this Agreement.
Sale and Leaseback Transactions. Enter into any agreement or arrangement with
any Person providing for any Covered Person to lease or rent property
that Borrower has or will sell or otherwise transfer to such Person.
New Subsidiaries and Holding Company Reorganization.
New Subsidiaries. Organize, create or acquire any Subsidiary unless it is part
of a Permitted Acquisition or Borrower has obtained the prior written
consent of Administrative Agent thereto (which consent shall not be
unreasonably withheld) and contemporaneously with the organization,
creation or acquisition of such Subsidiary, if permitted hereunder or
otherwise consented to by Administrative Agent, the applicable Covered
Person and such Subsidiary executes and delivers to Administrative
Agent for the benefit of Lenders an unlimited Guaranty of the Loan
Obligations by such Subsidiary, a pledge of the capital stock,
partnership interests, or membership interests of such Covered Person
in such Subsidiary, and other Security Documents requested by
Administrative Agent so as to grant Administrative Agent, for the
benefit of the Lenders, a perfected, first priority security interest
in all real and personal property of such Subsidiary.
Holding Company Reorganization. Notwithstanding anything herein to the contrary,
GTSI shall be permitted to organize and create a holding company ("GTSI
Holding") in a transaction or series of related transactions ("Holding
Company Reorganization") which satisfy each of the following
conditions: (i) there is no Existing Default, and no Default or Event
of Default will occur or is reasonably likely to occur as a result of
or due to the Holding Company Reorganization; (ii) simultaneously with
the closing of the Holding Company Reorganization each of GTSI and GTSI
Holding executes and delivers to Administrative Agent (a) such
documents necessary to grant Administrative Agent for benefit of the
Lenders a first priority Security Interest in all of the assets of GTSI
Holding, including all of GTSI's outstanding capital stock upon closing
of the Holding Company Reorganization, and (b) an unlimited Guaranty of
the Loan Obligations executed by GTSI Holding, each in form and
substance satisfactory to Administrative Agent; (iii) prior to the
closing of the Holding Company Reorganization, a Responsible Officer of
Borrower delivers to Administrative Agent a certificate certifying that
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such Holding Company Reorganization satisfies the conditions set forth
in this Section 14.18.2; (iv) the Holding Company is organized under
the Delaware General Corporation Law ("DGCL") within 60 days prior to
the closing, as a direct wholly owned Subsidiary of GTSI, solely for
the purpose of consummating the Holding Company Reorganization, with no
material assets and only such liabilities that are immaterial and
incidental to its organization and purpose; (v) the Holding Company
Reorganization is consummated pursuant to and in accordance with
Section 251(g) of the DGCL, whereby GTSI will merge with and into a
special purpose Delaware corporation that is a direct wholly owned
Subsidiary of GTSI Holding and an indirect wholly owned Subsidiary of
GTSI, and GTSI will survive such merger as the successor corporation
and a direct wholly owned Subsidiary of GTSI Holding, and each
outstanding share of GTSI's common stock shall be converted into one
share of GTSI Holding's common stock with the same voting powers,
designations, preferences and rights, and the qualifications,
restrictions and limitations thereof, with respect to GTSI Holding as
such stock had with respect to GTSI; and (vi) the reorganization must
be tax free for federal income tax purposes to GTSI stockholders.
Fiscal Year. Change its fiscal year from December 31.
Leases. Enter into any Capital Leases except as permitted by Section 0.
S Corporation Status. Any Covered Person elects under Section 1362(a) of the
Code to be treated as an S corporation.
Tax Consolidation. File or consent to the filing of any consolidated income tax
return with any Person except for one or more other Covered Persons.
Transactions Having a Material Adverse Effect. Enter into any transaction which
has or is reasonably likely to have a Material Adverse Effect; or enter
into any transaction, which shall cause a Default or Event of Default
hereunder.
Storage; Chief Executive Officer; State of Incorporation. Store any Inventory or
equipment at any location other than as set forth on section 0 of the
Disclosure Schedule or as otherwise permitted hereunder; maintain its
chief executive office at any location other than as set forth on
section 0 of the Disclosure Schedule; change its state of incorporation
or formation from that disclosed in section 0 of the Disclosure
Schedule.
Like-Kind Exchange. Borrower shall not complete or attempt to complete any
"like-kind exchange" (as such term is defined in the Code or applicable
regulations) with respect to any Collateral on which Administrative
Agent has a first priority Security Interest.
Financial Covenants.
--------------------
Special Definitions. As used in this Section 0 and elsewhere herein, the
following capitalized terms have the following meanings:
"Capital Expenditure"-- an expenditure for an asset that must be
depreciated or amortized under GAAP, for goodwill, or for any asset that under
GAAP must be treated as a capital asset. An expenditure for purposes of this
definition includes any deferred or seller financed portion of the purchase
price of an asset and includes the Capital Expenditure Equivalent of a Capital
Lease. Capital Expenditures do not include the amount expended in connection
with any Permitted Acquisition or any expenditure made with insurance proceeds
to the extent used to replace or repair damaged fixed assets and plant
equipment.
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"Capital Expenditure Equivalent"-- of a Capital Lease is the amount
which would have been the aggregate cost of the property leased if it had been
purchased rather than leased.
"EBITDA" means, for any period of calculation, an amount equal to (i)
the sum of (a) Net Income (which shall include interest income but shall not
give effect to any asset impairment or accounting policy or practice change that
results in a noncash adjustment during the respective period), (b) Interest
Expense, (c) income tax expense, (d) depreciation expense, and (e) amortization
expense, plus (ii) to the extent considered extraordinary loss under GAAP, such
extraordinary losses, minus (iii) to the extent considered extraordinary gain
under GAAP, such extraordinary gains.
"Intangibles" means and includes, at any date, general intangibles;
software (purchased or developed in-house); accounts receivable and advances due
from officers, directors, employees, stockholders, members, owners and
Affiliates; leasehold improvements net of depreciation; licenses; good will;
prepaid expenses; escrow deposits; covenants not to compete; the excess of cost
over book value of acquired assets; franchise fees; organizational costs;
finance reserves held for recourse obligations; capitalized research and
development costs; the capitalized cost of patents, trademarks, service marks
and copyrights net of amortization; and such other similar items as
Administrative Agent may from time to time determine in Administrative Agent's
sole discretion.
"Tangible Net Worth" means, at any date, (a) Total Assets, minus (b)
the sum of (i) Intangibles plus (ii) Total Liabilities.
"Total Assets" means the sum of all assets as presented in the balance
sheet in Borrower's most recent combined Financial Statements delivered to
Administrative Agent and each of the Lenders as required hereunder.
"Total Funded Indebtedness" means the sum of the following, without
duplication, (i) outstanding principal and interest of the Loans (including any
fees payable to Administrative Agent or any Lender in connection with the
execution and delivery of this Agreement), but excluding the Aggregate Floorplan
Loan and Interim Floorplan Loan, and (ii) the face amount of any letters of
credit issued on the account of any Borrower.
"Total Liabilities" means the sum of all liabilities as presented in
the balance sheet in Borrower's most recent combined Financial Statements
delivered to Administrative Agent and each of the Lenders as required hereunder
(including as liabilities, all reserves required under GAAP for contingencies
and other potential liabilities) plus all Indebtedness or Borrower not otherwise
reported thereon.
All other capitalized terms used in this Section 0 shall have their meanings and
shall be determined under GAAP. All calculations shall be for Borrowers and
their respective Subsidiaries on a consolidated basis. For the purposes of
calculating the amount of Total Indebtedness in this Section 0, each scheduled
payment of interest and principal on any of the Loans made on the first of a
month shall be deemed to have been made on the immediately preceding day. Upon
completion of a Permitted Acquisition, the Target Company shall be included in
each of these covenants contained in this Section on a pro-forma basis,
including for periods prior to the completion of any such Permitted Acquisition.
Minimum Tangible Net Worth. Borrower covenants that Tangible Net Worth on the
last day of each fiscal month shall be no less than Forty Five Million
Dollars ($45,000,000).
Maximum Total Liabilities to Tangible Net Worth. Borrower covenants that the
ratio of Total Liabilities minus Subordinated Indebtedness to Tangible
Net Worth plus Subordinated Indebtedness calculated as of the last day
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of each fiscal month specified in the table below, shall not be less
than the ratio specified in such table opposite said fiscal month
-------------------------------------------------------------------
Fiscal Month Ended Maximum Ratio
-------------------------------------------------------------------
Each July 31, August 31, and September 30 6.00:1.00
-------------------------------------------------------------------
Each January 31, February 28/29, March 31, 4.00:1.00
April 30, May 31, June 30, October 31,
November 30 and December 31
-------------------------------------------------------------------
Maximum Total Funded Indebtedness to EBITDA. Borrower covenants that the ratio
of Total Funded Indebtedness to EBITDA, calculated as of the last day
of each fiscal month for twelve month period then ended: (i) shall be
no more than 4.00:1.00 for any fiscal month ending January 31, February
28/29, March 31, April 30, May 31, June 30, October 31, November 30, or
December 31, and (ii) shall be no more than 6.00:1.00 for any fiscal
month ending on July 31, August 31, or September 30.
Minimum EBIT to Net Sales. Borrower covenants that its EBITDA less depreciation
and amortization expense as a percentage of net sales as set forth in
Borrower's income statement, calculated as of the last day of each
fiscal month for the twelve month period then ended, shall be no less
than 0.50%.
Default.
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Events of Default. The occurrence of any one or more of the following events
shall constitute an event of default (an "Event of Default"):
Failure to Pay Principal or Interest. Failure of Borrower to pay (i) any
interest accrued on any of the Loans when due, or (ii) any
principal of the Loans when due; provided, however, it shall
not be an Event of Default with respect to the payment of any
principal or interest on any Floorplan Loan or Interim
Floorplan Loan until the occurrence of a Floorplan Payment
Default. "Floorplan Payment Default" means any failure by
Borrower to make any payment, under a Statement of Transaction
by the thirtieth (30th) day following the last day of the no
interest period set forth in a Statement of Transaction.
"Floorplan Payment Default" shall not mean or include, and
shall exclude, any deductions, offsets or other disputes made
or asserted by Borrower which are accepted by or under
negotiation with Administrative Agent.
Failure to Pay Certain Other Amounts Owed to Lenders. Failure of Borrower to pay
any of the Loan Obligations (other than principal of the Loans
or interest accrued thereon and other than Administrative
Agent's costs and expenses Borrower is required to pay
pursuant Sections 0 and 0) within five Business Days after the
date when due.
Failure to Pay Examination and Appraisal Costs. Failure of Borrower to pay any
of Administrative Agent's costs and expenses required to be
paid by Borrower pursuant Sections 0 and 0 within 10 days
after the date when due.
Failure to Pay Amounts Owed to Other Persons. Failure of any Covered Person to
make any payment due on Indebtedness of such Covered Person
which such Indebtedness is over $500,000 in the aggregate to
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Persons (other than Indebtedness owed to Lenders under the
Loan Documents and other than Indebtedness owed to any Covered
Person's trade creditors in connection with the purchase of
such Covered Person's Inventory from such trade creditors) and
which failure continues unwaived beyond any applicable grace
period specified in the documents evidencing such
Indebtedness.
Representations or Warranties. Any of the Representations and Warranties is
discovered to have been false in any material respect when
made and is not cured within five Business Days of the date
such Representation and Warranty was made (provided such
breach can be cured within such period and provided that
Borrower works diligently and in good faith to cure any such
breach during such period).
Certain Covenants with Cure Periods. Failure of any Covered Person to comply
with any covenant in Section 0 (other than the covenants in
Section 0 referenced in Section 0 below) which is not cured
within 30 days after the initial occurrence of such failure,
provided noncompliance with such covenant can be cured within
such 30 day period and provided that Borrower works diligently
and in good faith to cure any such noncompliance during such
period.
Certain Covenants Without Cure Periods. Failure of any Covered Person to comply
with the covenants in Section 0, Section 0, Section 0, Section
0, Section 0, Section 0, and Section 0), Section 0, or Section
0.
Other Covenants. Failure of any Covered Person to comply with of any of the
terms or provisions of any of the Loan Documents applicable to
it (other than a failure which constitutes an Event of Default
under any of Sections 0 through 0).
Acceleration of Other Indebtedness. Any Obligation (other than a Loan
Obligation) of a Covered Person for the repayment of $500,000
in the aggregate or more of borrowed money is accelerated, or
becomes or is declared to be due and payable or required to be
prepaid (other than by an originally scheduled prepayment)
prior to the original Maturity thereof.
Default Under Other Agreements. The occurrence of any default or event of
default under any agreement to which a Covered Person is a
party (other than the Loan Documents), which default or event
of default continues unwaived beyond any applicable grace
period provided therein and has or is reasonably likely to
have a Material Adverse Effect or involves Indebtedness of
more than $500,000 in the aggregate.
Other Creditor Indebtedness. The occurrence of (i) any breach, default or event
of default by any Covered Person with respect to any of the
Other Creditor Indebtedness in excess of $500,000 in the
aggregate which is not cured or waived within any applicable
grace period, or (ii) the termination of any Intercreditor
Agreement by any party thereto, other than Administrative
Agent, prior to the payment in full of all of the Other
Creditor Indebtedness covered thereby.
Bankruptcy; Insolvency; Etc. A Covered Person (i) fails to pay, or admits in
writing its inability to pay, its debts generally as they
become due, or otherwise is not Solvent; (ii) makes an
assignment for the benefit of creditors; (iii) files a
petition in bankruptcy, is adjudicated insolvent or bankrupt,
petitions or applies to any tribunal for any receiver or any
trustee of such Covered Person or any substantial part of its
property; (iv) commences any proceeding relating to such
Covered Person under any reorganization, arrangement,
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readjustment of debt, dissolution or liquidation Law of any
jurisdiction, whether now or hereafter in effect; (v) has
commenced against it any such proceeding which remains
undismissed for a period of 60 days, or by any act indicates
its consent to, approval of, or acquiescence in any such
proceeding or the appointment of any receiver of or any
trustee for it or of any substantial part of its property, or
allows any such receivership or trusteeship to continue
undischarged for a period of 60 days but, except with regards
to Approvals issued on or prior to such commencement date
referred to in this clause (vi), no additional Loans shall be
made, no additional Letters of Credit shall be issued, and no
new Approvals shall be given during such period without all
Lenders' and Administrative Agent's prior written approval and
the prior written approval of any court of proper jurisdiction
deemed necessary by Administrative Agent; or (vii) takes any
action to authorize any of the foregoing; or (vii) takes any
action to authorize any of the foregoing.
Judgments; Attachment; Settlement; Etc. Any one or more judgments or orders is
entered against a Covered Person or any attachment or other
levy is made against the property of a Covered Person with
respect to a claim or claims involving in the aggregate
liabilities (not paid or fully covered by insurance, less the
amount of reasonable deductibles in effect on the Execution
Date) in an aggregate amount in excess of $500,000 and such
judgment becomes final and non-appealable or if timely
appealed is not fully bonded and collection thereof stayed
pending the appeal; or any Covered Person agrees to a
settlement obligating any Covered Person to make a payment
with respect to a claim or claims involving in the aggregate
liabilities (not paid or fully covered by insurance, less the
amount of reasonable deductibles in effect on the Execution
Date) in an aggregate amount in excess of $500,000.
Pension Benefit Plan Termination, Etc. Any Pension Benefit Plan termination by
the PBGC or the appointment by the appropriate United States
District Court of a trustee to administer any Pension Benefit
Plan or to liquidate any Pension Benefit Plan, which has or
reasonably could be likely to have a Material Adverse Effect;
or any event which constitutes grounds either for the
voluntary termination of any Pension Benefit Plan by the PBGC
or for the appointment by the appropriate United States
District Court of a trustee to administer or liquidate any
Pension Benefit Plan shall have occurred and be continuing for
thirty (30) days after Borrower has notice of any such event,
which has or reasonably could be likely to have a Material
Adverse Effect; or any voluntary termination of any Pension
Benefit Plan which is a defined benefit pension plan as
defined in Section 3(35) of ERISA while such defined benefit
pension plan has an accumulated funding deficiency in an
amount exceeding $500,000 in the aggregate unless
Administrative Agent has been notified of such intent to
voluntarily terminate such plan and Required Lenders have
given their consent and agreed that such event shall not
constitute an Event of Default; or the plan administrator of
any Pension Benefit Plan applies under Code Section 412(d) for
a waiver of the minimum funding standards of Code Section
412(1) and Required Lenders determine that the substantial
business hardship upon which the application for such waiver
is based could subject any Covered Person or ERISA Affiliate
of any Covered Person to a liability in excess of $500,000 in
the aggregate.
Liquidation or Dissolution. A Covered Person files a certificate of dissolution
under applicable state Law or is liquidated or dissolved or
suspends or terminates the operation of its business, or has
commenced against it any action or proceeding for its
liquidation or dissolution or the winding up of its business,
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or takes any action in furtherance thereof, except in
connection with the consolidation of such a Covered Person and
its assets with another Covered Person and its assets.
Seizure of Assets. All or any material part of the property of all Covered
Persons is nationalized, expropriated, seized or otherwise
appropriated, or custody or control of such property or of all
Covered Persons is assumed by any Governmental Authority or
any court of competent jurisdiction at the instance of any
Governmental Authority, unless the same is being contested in
good faith by proper proceedings diligently pursued and a stay
of enforcement is in effect.
Loan Documents; Security Interests. For any reason other than the failure of
Administrative Agent to take any action available to it to
maintain perfection of the Security Interests created in favor
of Administrative Agent for the benefit of Lenders pursuant to
the Loan Documents, any Loan Document ceases to be in full
force and effect or any Security Interest with respect to any
portion of the Collateral intended to be secured thereby
ceases to be, or is not, valid, perfected and prior to all
other Security Interests (other than the Permitted Security
Interests, and other than sales of Inventory and Equipment
expressly permitted hereunder made in the ordinary course of
business, to a bona fide purchaser, for fair market value, if
all of the proceeds thereof are delivered to Administrative
Agent as set forth herein) or is terminated, revoked or
declared void or invalid, or Borrower or any Covered Person
contests the Security Interests of Administrative Agent or
contests or denies that it has any liability or obligation
under any agreement, term, or condition contained in any Loan
Document to which Borrower or such Covered Person is a party.
Loss to Collateral. Any abandonment, loss, theft, damage or destruction of any
item or items of Collateral occurs which is not covered by
insurance as required herein and has or is reasonably likely
to have a Material Adverse Effect.
Guaranty; Guarantor. Any Guaranty ceases to be in full force and effect or any
action is taken to discontinue or assert the invalidity or
unenforceability of any Guaranty or any Guarantor fails to
comply with any of the terms or provisions of any Guaranty, or
any representation or warranty of Guarantor therein is false,
or any Guarantor denies that it has any further liability
under any Guaranty or gives notice to Lender to such effect,
or any Guarantor fails to furnish the financial statements
required under any Guaranty or otherwise breaches or is in
default of any obligation or covenant contained in any
Guaranty or any Guarantor, who is an individual dies.
Governmental Authority Bar. Borrower or any Covered Person is barred or
suspended from doing business with any Account Debtor that is
a Governmental Authority which suspension or bar has or is
reasonably likely to have a Material Adverse Effect.
Change of Control. Except pursuant to Section 14.20.2, in the case of GTSI, GTSI
merges or consolidates with or into another Person, or permits
any Person or Group, to become the record or beneficial owner,
directly or indirectly, on a fully diluted basis, of
securities representing 35% or more of the voting power of
GTSI's then outstanding securities having the power to vote or
35% or more of GTSI's then outstanding capital stock, or to
acquire the power to elect a majority of the Board of
Directors of GTSI. In the case of any Covered Person other
than GTSI, such Covered Person merges or consolidates with or
into another Person, other than a Covered Person, or otherwise
permits any Person or Group, other than one or more other
Borrowers, to become the record or beneficial owner, directly
or indirectly, on a fully diluted basis, of any securities
representing any of the voting power of such Covered Person or
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any of such Covered Person's then outstanding capital stock or
other equity interests, or to acquire the power to elect any
Person to the board of directors (or other management position
in the case of Covered Persons which are not corporation) of
such Covered Person.
Cross-Default. An Event of Default under this Agreement will automatically and
immediately constitute a default under every other Loan Document
without regard to any requirement therein for the giving of notice or
the passing of time.
Rights and Remedies.
Termination of Facilities. Upon an Event of Default described in Section 0, all
of the Facilities shall be deemed canceled without any action
or notice by the Lenders or Administrative Agent, and Lenders
shall have no obligation to make any further or subsequent
Advances or fund Approvals issued in accordance with this
Agreement. Upon the occurrence and during the continuance of
any other Event of Default, the Required Lenders in their sole
and absolute discretion may cancel the Facilities. Such
cancellation may be, in any case, without presentment, demand
or notice of any kind, which Borrower expressly waives.
Borrower hereby waives any requirement for notice of
acceleration.
Acceleration; Funding. Upon an Event of Default described in Section 0, all of
the outstanding Loan Obligations shall automatically become
immediately due and payable and Administrative Agent shall
cease making Advances. Upon the occurrence and during the
continuance of any other Event of Default, and at any time
thereafter, (i) Administrative Agent may or, at the direction
of the Required Lenders shall, cease making Advances (except
Advances to fund Approvals previously issued shall be made),
and (ii) the Required Lenders in their sole and absolute
discretion may declare all of the outstanding Loan Obligations
immediately due and payable. Any such acceleration may be, in
either case, without presentment, demand or notice of any
kind, which Borrower expressly waives.
Right of Set-off. During an Existing Default, each Lender is hereby authorized,
without notice to Borrower (any such notice being expressly
waived by Borrower), to the fullest extent permitted by law,
to set off and apply against the Loan Obligations any and all
deposits (general or special, time or demand, provisional or
final) or any other assets at any time held by or at such
Lender or under the control of or otherwise pledged to such
Lender, or any other Indebtedness at any time owing by such
Lender (or its Affiliate) to or for the credit or the account
of Borrower, irrespective of whether or not such Lender shall
have made any demand under this Agreement or the Notes or any
Guaranty and although such Loan Obligations may be unmatured.
The rights of each Lender under this Section are in addition
to other rights and remedies (including other rights of
set-off) which such Lender may otherwise have. Any such
amounts, deposits, property or assets shall be promptly
turned-over to Administrative Agent in the form received for
application to the Loan Obligations as set forth in this
Agreement, and until turned over to Administrative Agent such
amounts, deposits, property and assets shall be held by such
Lender in trust for the benefit of Administrative Agent and
the other Lenders. During an Existing Default, Administrative
Agent is hereby authorized, without notice to Borrower (any
such notice being expressly waived by Borrower), to set off
and apply against the Loan Obligations any and all deposits
(general or special, time or demand, provisional or final) or
other assets at any time held by or at Administrative Agent,
or under the control of or otherwise pledged to Administrative
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Agent, or any other Indebtedness at any time owing by
Administrative Agent or any Affiliate thereof to or for the
credit or the account of Borrower, irrespective of whether or
not Administrative Agent or any Affiliate thereof shall have
made any demand under this Agreement or the Loan Obligations
and although such Loan Obligations may be unmatured.
Notice to Account Debtors. Upon the occurrence and during the continuance of an
Event of Default, Administrative Agent may (if Required
Lenders concur or direct), without prior notice to Borrower,
notify any or all Account Debtors that the Accounts have been
assigned to Administrative Agent for the benefit of Lenders
and that Administrative Agent has a Security Interest therein
for the benefit of Lenders, and Administrative Agent may
direct, or Borrower, at Administrative Agent's request, shall
direct, any or all Account Debtors to make all payments upon
the Accounts directly to Administrative Agent for the benefit
of Lenders.
Entry Upon Premises and Access to Information. Upon the occurrence and during
the continuance of an Event of Default, Administrative Agent
may (or shall at the direction of the Required Lenders) (i)
enter upon the premises leased or owned by Borrower where
Collateral is located (or is believed to be located) without
any obligation to pay rent to Borrower, or any other place or
places where Collateral is believed to be located, (ii) render
Collateral usable or saleable, (iii) remove Collateral
therefrom to the premises of Administrative Agent or any agent
of Administrative Agent for such time as Administrative Agent
may desire in order effectively to collect or liquidate
Collateral; (iv) take possession of, and make copies and
abstracts of, Borrower's original books and records, obtain
access to Borrower's data processing equipment, computer
hardware and software relating to any of the Collateral and
use all of the foregoing and the information contained therein
in any manner Administrative Agent deems appropriate in
connection with the exercise of Administrative Agent's rights;
and (v) notify postal authorities to change the address for
delivery of Borrower's mail to an address designated by
Administrative Agent and to receive, open and process all mail
addressed to Borrower.
Completion of Uncompleted Inventory Items. Upon the occurrence and during the
continuance of an Event of Default, Administrative Agent may
(or shall at the direction of the Required Lenders) request
that Borrower, and Borrower shall upon such request, use
Borrower's reasonable efforts to obtain the consent of its and
any other Covered Person's customers to the completion (before
or after foreclosure by Administrative Agent of its security
interest therein) of the manufacture of all uncompleted
Inventory items that Borrower or any other Covered Person was
manufacturing for such customers pursuant to contracts or
accepted purchase orders, and the commitment by such customers
to purchase such items upon their completion as provided in
the relevant contracts or accepted purchase orders. Borrower
shall, as an uncompensated agent for Lenders, complete or
cause to be completed the manufacture and shipment of all such
items as provided in the relevant contracts or accepted
purchase orders if Administrative Agent so directs.
Borrower's Obligations. Upon the occurrence and during the continuance of an
Event of Default, Borrower shall, if Administrative Agent so
requests, assemble all the movable tangible Collateral and
make it available to Administrative Agent at a place or places
to be designated by Administrative Agent in its discretion.
Secured Party Rights. Upon the occurrence and during the continuance of an Event
of Default:
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Administrative Agent may (and at the direction of the Required Lenders shall)
exercise any or all of its rights under the Security Documents
as a secured party under the UCC and any other applicable Law;
and
Administrative Agent may sell or otherwise dispose of any or all of the
Collateral at public or private sale in a commercially
reasonable manner, which sale Administrative Agent may
postpone from time to time by announcement at the time and
place of sale stated in the notice of sale or by announcement
at any adjourned sale without being required to give a new
notice of sale, all as Administrative Agent deems advisable,
for cash or credit. A Lender may become the purchaser at any
such sale if permissible under applicable Law, and Borrower
agrees that such Lender has no obligation to preserve rights
to Collateral against prior parties or to marshal any
Collateral for the benefit of any Person. Borrower agrees that
if Administrative Agent conducts a private sale of any
Collateral by requesting bids from five or more dealers,
distributors, or lessors in that type of Collateral, any sale
by Administrative Agent of such Collateral, in bulk or in
parcels, to the bidder submitting the highest cash bid
therefor, which occurs within 120 days of the later to occur
of (a) Administrative Agent taking possession and control of
such Collateral, or (b) Administrative Agent being otherwise
authorized or permitted to sell such Collateral, is a
commercially reasonable sale of such Collateral under the UCC.
Borrower further agrees that 10 (ten) or more days prior
written notice will be commercially reasonable notice of any
public or private sale. Borrower agrees that the purchase of
any Collateral by a Vendor, as provided in any agreement
between Administrative Agent and the Vendor or GECDF and
Vender, is a commercially reasonable disposition and private
sale of such Collateral under the UCC, and no request for bids
shall be required. Borrower irrevocably waives any requirement
that Administrative Agent retain possession and not dispose of
any Collateral until after an arbitration hearing, arbitration
award, confirmation, trial or final judgment. If
Administrative Agent disposes of any such Collateral other
than as herein contemplated, the commercial reasonableness of
such disposition will be determined in accordance with the
Laws of the State governing this Agreement.
Joint and Several.
Each Obligation and liability of Borrower to Administrative
Agent, Letter of Credit Issuer, and each Lender, including the
Loan Obligations, are the joint and several obligations of
Borrower, and Administrative Agent, Letter of Credit Issuer,
and any Lender may proceed directly against any Borrower, or
all Borrowers, or any Guarantor, or any Collateral, or all of
the foregoing, or any one of the foregoing or any combination
of the foregoing, without first proceeding against Borrower or
any Collateral, or without joining all Persons liable or
potentially liable for any portion of the Loan Obligations in
one action. Borrower shall be jointly and severally liable as
primary obligor and not merely as surety for repayment of all
Loan Obligations arising under the Loan Documents. Such joint
and several liability shall apply to Borrower regardless of
whether any Advance was only requested by or on behalf of or
made to any other Borrower or the proceeds of any Advance were
used only by or on behalf of any other Borrower or any
indemnification Obligation or any other Obligation arose only
as a result of the action of any other Borrower. If any
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Borrower makes a payment in respect of the Loan Obligations
hereunder and under the other Loan Documents, it shall have
the rights of contribution described in this Section below
against the other Borrower or Borrowers; provided that such
Borrower shall not exercise its right of contribution until
all of the Loan Obligations are fully and indefeasibly paid
and satisfied, and the Facilities are terminated, no Letters
of Credit are outstanding and the Letter of Credit Exposure is
zero and Lenders have no further obligation to extend credit
to or for the account of any Borrower; provided, however, that
Administrative Agent is hereby granted, for the benefit of the
Lenders, a Security Interest in such right of contribution and
may enforce such right during an Existing Default. It is the
intent of Borrower, Administrative Agent, Letter of Credit
Issuer and the Lenders that Borrower's maximum obligation to
repay the Loan Obligations hereunder and under the other Loan
Documents (the Loan Obligation Limit) shall not exceed the
greater of (i) the amount actually borrowed or received
directly or indirectly by such Borrower with respect thereto
and (ii) the amount which is $1.00 less than the amount which,
if recorded by such Borrower as a liability, would render such
Borrower not Solvent. To the extent that any Borrower makes a
payment on any of the Loan Obligations (a "Loan Obligation
Payment"), such Borrower (the "Entitled Borrower") is entitled
to contribution and indemnification from, and reimbursement
by, each other Borrower (a "Contributing Borrower") in the
amount of the Contribution Obligation of such Contributing
Borrower hereunder. The "Contribution Obligation" of a
Contributing Borrower with respect to the Loan Obligation
Payment of an Entitled Borrower is an amount equal to the
greater of (1) the lesser of (x) such Contributing Borrower's
Loan Obligation Limit at the time the Loan Obligation Payment
is made and (y) such Contributing Borrower's Allocable Share
of the Loan Obligation Payment, and (2) the amount of all
proceeds from the Loan Obligations actually received by such
Contributing Borrower or applied by the recipient thereof
directly or indirectly for the benefit of such Contributing
Borrower, less the sum of any repayments thereof and any Loan
Obligation Payments made by such Contributing Borrower prior
to the time the applicable Loan Obligation Payment is made.
The "Allocable Share" of a Contributing Borrower is a
fraction, the numerator of which is such Contributing
Borrower's Loan Obligation Limit at the time the applicable
Loan Obligation Payment is made and the denominator of which
is the sum of the Loan Obligation Limits of all of the
Contributing Borrowers (plus a similarly computed amount for
any Guarantor which has a similar obligation to make a
contribution) as of such time.
Miscellaneous. During an Existing Default, Administrative Agent or Lenders may
(and Administrative Agent shall at the direction of the
Required Lenders) exercise any other rights and remedies
available to Administrative Agent or Lenders under the Loan
Documents or otherwise available to Administrative Agent or
Lenders at law or in equity.
Application of Funds. Any funds received by Lenders or Administrative Agent for
the benefit of Lenders with respect to any Loan Obligation after its
Maturity or acceleration thereof, including proceeds of Collateral,
shall be applied as follows: (i) first, to reimburse Lenders based on
their respective pro-rata shares for any amounts due to Lenders under
Section 0; (ii) second, to reimburse to Administrative Agent all
unreimbursed costs and expenses paid or incurred by Administrative
Agent that are payable or reimbursable by Borrower hereunder; (iii)
third, to reimburse to Lenders based on their respective pro-rata
shares for unreimbursed costs and expenses paid or incurred by Lenders
(including costs and expenses incurred by Administrative Agent as a
Lender that are not reimbursable as provided in the preceding clause)
that are payable or reimbursable by Borrower hereunder; (iv) fourth, to
the payment of interest accrued on the Loans to each of Lenders based
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on their respective pro-rata shares; (v) fifth, pari passu to (a) the
payment of the Loans of each of Lenders, in such order as each Lender
determines in its absolute discretion (b) to the payment of
Interest/Currency Hedge Obligations; and (c) to Letter of Credit Issuer
as cash collateral for the Letter of Credit Exposure; and (vi) sixth,
to the payment of the other Loan Obligations based on each Lender's
respective pro-rata shares. Any remaining amounts shall be applied to
payment of all the Obligations to Administrative Agent. Any further
remaining amounts shall be paid to Borrower or such other Persons as
shall be legally entitled thereto. Except as expressly provided
otherwise herein, Lenders may apply, and reverse and reapply, payments
and proceeds of the Collateral to the Loan Obligations in such order
and manner as Lenders determine in their absolute discretion. Borrower
hereby irrevocably waives the right to direct the application of
payments and proceeds of the Collateral. Notwithstanding the foregoing,
Administrative Agent and the Lenders may, with respect to the Aggregate
Floorplan Loan Facility apply: (i) at any time, payments to reduce
finance charges first and then principal, regardless of Borrower's
instructions; and (ii) principal payments to the oldest (earliest)
invoice for Collateral financed by Administrative Agent and Lenders
under the Aggregate Floorplan Loan Facility (including the Interim
Floorplan Loan Facility), but, in any event, all principal payments
will first be applied to such Collateral financed by Administrative
Agent and Lenders under the Aggregate Floorplan Loan Facility
(including the Interim Floorplan Loan Facility) which is sold, lost,
stolen, damaged, rented, leased, or otherwise disposed of or
unaccounted for.
Limitation of Liability; Waiver. Administrative Agent and Lenders shall not be
liable to Borrower as a result of any commercially reasonable
possession, repossession, collection or sale by Administrative Agent of
Collateral; and Borrower hereby waives all rights of redemption from
any such sale and the benefit of all valuation, appraisal and exemption
Laws. If Administrative Agent seeks to take possession of any of the
Collateral by replevin or other court process, Borrower hereby
irrevocably waives (i) the posting of any bonds, surety and security
relating thereto required by any statute, court rule or otherwise as an
incident to such possession, (ii) any demand for possession of the
Collateral prior to the commencement of any suit or action to recover
possession thereof, (iii) any requirement that Administrative Agent
retain possession and not dispose of any Collateral until after trial
or final judgment, and (iv) to the extent permitted by applicable Law,
all rights to notice and hearing prior to the exercise by
Administrative Agent of Administrative Agent's right to repossess the
Collateral without judicial process or to replevy, attach or levy upon
the Collateral without notice or hearing. Administrative Agent shall
have no obligation to preserve rights to the Collateral or to marshal
any Collateral for the benefit of any Person.
Notice. Any notice of intended action required to be given by Administrative
Agent (including notice of a public or private sale of Collateral), if
given as provided in Section 0 at least 10 days prior to such proposed
action, shall be effective and constitute reasonable and fair notice to
Borrower.
Administrative Agent and Lenders.
---------------------------------
Appointment, Powers, and Immunities. GECDF is hereby appointed Administrative
Agent hereunder and under each of the other Loan Documents. Each Lender
hereby irrevocably appoints and authorizes Administrative Agent to act
as its agent under this Agreement and the other Loan Documents with
such powers and discretion as are specifically delegated to
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental
thereto. Administrative Agent (which term as used in this sentence and
in Section 0 and the first sentence of Section 0 hereof shall include
its Affiliates and its own and its Affiliates' officers, directors,
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employees, representatives, and agents): (i) shall not have any duties
or responsibilities except those expressly set forth in this Agreement
and shall not be a trustee or fiduciary for any Lender; (ii) shall not
be responsible to the Lenders for any recital, statement,
representation, or warranty (whether written or oral) made in or in
connection with any Loan Document or any certificate or other document
referred to or provided for in, or received by any of them under, any
Loan Document, or for the value, validity, effectiveness, genuineness,
enforceability, or sufficiency of any Loan Document, or any other
document referred to or provided for therein or for any failure by any
Covered Person or any other Person to perform any of its obligations
thereunder; (iii) shall not be responsible for or have any duty to
ascertain, inquire into, or verify the performance or observance of any
covenants or agreements by any Covered Person or the satisfaction of
any condition or to inspect the property (including the books and
records) of any Covered Person or any of its Subsidiaries or
Affiliates; (iv) unless directed in writing by the Required Lenders,
shall not be required to initiate or conduct any litigation or
collection proceedings under any Loan Document (other than normal
collection procedures from the Lockboxes); and (v) shall not be
responsible for any action taken or omitted to be taken by it under or
in connection with any Loan Document, except for its own gross
negligence or willful misconduct. Administrative 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.
Reliance by Administrative Agent. Administrative Agent shall be entitled to rely
upon any certification, notice, instrument, writing, or other
communication (including any thereof by telephone or telecopy) believed
by it to be genuine and correct and to have been signed, sent or made
by or on behalf of the proper Person or Persons, and upon advice and
statements of legal counsel (including counsel for any Covered Person),
independent accountants, and other experts selected by Administrative
Agent. Administrative Agent may deem and treat the payee of any Note as
the holder thereof for all purposes hereof unless and until
Administrative Agent receives and accepts an Assignment and Acceptance
executed in accordance with this Agreement. As to any matters not
expressly provided for by this Agreement, Administrative Agent shall
not be required to exercise any discretion or take any action, but
shall be required to act or to refrain from acting (and shall be fully
protected in so acting or refraining from acting) upon the instructions
of the Required Lenders, and such instructions shall be binding on all
of the Lenders; provided, however, that Administrative Agent shall not
be required to take any action that exposes Administrative Agent to
personal liability or that is contrary to any Loan Document or
applicable Law or unless it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense
which may be incurred by it by reason of taking any such action.
Employment of Administrative Agents and Counsel. Administrative Agent may
execute any of its duties hereunder by or through employees, agents,
and attorneys-in-fact and shall not be liable to any Lender, except
with respect to money or securities received by it or such agents or
attorneys-in-fact, for the default or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. Administrative
Agent shall be entitled to advice of counsel concerning all matters
pertaining to the agency hereby created and its duties hereunder and
shall not be liable to any Lender for acting or failing to act as
advised by such counsel, except where doing so violates an express
obligation of Administrative Agent under the Loan Documents.
Defaults. Administrative Agent shall not be deemed to have knowledge or notice
of the occurrence of a Default or Event of Default unless
Administrative Agent has received written notice from a Lender or
Borrower specifying such Default or Event of Default and stating that
such notice is a "Notice of Default". If Administrative Agent receives
such a written notice of the occurrence of a Default or Event of
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Default, Administrative Agent shall promptly give notice thereof to the
Lenders. Administrative Agent shall (subject to Section 0 hereof) take
such action with respect to such Default or Event of Default as shall
be directed by the Required Lenders, provided that, unless and until
Administrative Agent shall have received such directions,
Administrative Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable in the best
interest of the Lenders.
Rights as Lender. With respect to its Facilities and the Loans made by it, GECDF
(and any successor acting as Administrative Agent) in its capacity as a
Lender hereunder shall have the same rights and powers hereunder as any
other Lender and may exercise the same as though it were not acting as
Administrative Agent, and the term "Lender" or "Lenders" shall, unless
the context otherwise indicates, include Administrative Agent in its
individual capacity as a Lender. GECDF (and any successor acting as
Administrative Agent) and its Affiliates may (without having to account
therefor to any Lender) accept deposits from, lend money to, make
investments in, provide services to, and generally engage in any kind
of lending, trust, or other business with any Covered Person or any of
its Subsidiaries or Affiliates or any Guarantor as if it were not
acting as Administrative Agent, and GECDF (and any successor acting as
Administrative Agent) and its Affiliates may accept fees and other
consideration from any Covered Person or any of its Subsidiaries or
Affiliates or any Guarantor for services in connection with this
Agreement or otherwise without having to account for the same to
Lenders.
Indemnification. The Lenders agree to reimburse and indemnify Administrative
Agent (to the extent not reimbursed under the terms of Section 0, but
without limiting the obligations of Borrower under such Section) in
accordance with their respective pro-rata shares, for any and all
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses (including reasonable attorneys'
fees), or disbursements of any kind and nature whatsoever that may be
imposed on, incurred by or asserted against Administrative Agent
(including by any Lender) in any way relating to or arising out of any
Loan Document or the transactions contemplated thereby or any action
taken or omitted by Administrative Agent under any Loan Document;
provided that no Lender shall be liable for any of the foregoing to the
extent they arise from the gross negligence or willful misconduct of
the Person to be indemnified. Without limitation of the foregoing, each
Lender agrees to reimburse Administrative Agent promptly upon demand
for its pro-rata share of any costs or expenses payable by Borrower to
Administrative Agent under this Agreement or the other Loan Documents,
to the extent that Administrative Agent is not promptly reimbursed for
such costs and expenses by Borrower. If Lenders reimburse
Administrative Agent and Administrative Agent subsequently receives
reimbursement from Borrower, Administrative Agent shall promptly remit
to the Lenders (without interest) their pro-rata share of such
reimbursement received from Borrower. The agreements contained in this
Section shall survive payment in full of the Loans and all other
amounts payable under this Agreement and the termination of the
Facilities. If Administrative Agent is for any reason compelled to
surrender any payment or any proceeds of the Collateral because such
payment or the application of such proceeds is for any reason
invalidated, declared fraudulent, set aside, or determined to be void
or voidable as a preference, an impermissible set-off, or a diversion
of trust funds, then this Agreement and the Loan Obligations to which
such payment or proceeds was applied or intended to be applied shall be
revived as if such application was never made, and to the extent
Administrative Agent has been compelled to surrender any such payment
or proceeds which have been distributed by Administrative Agent to a
Lender and Borrower has not repaid such amounts immediately upon demand
by Administrative Agent, such Lender shall be liable to pay to
Administrative Agent the amount of any such payments or proceeds so
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received by Lender and surrendered by Administrative Agent, and shall
indemnify Administrative Agent for and hold Administrative Agent
harmless from any loss with respect to payments or proceeds received by
such Lender and surrendered by Administrative Agent.
Notification of Lenders. Each Lender agrees to use commercially reasonable
efforts (but no Lender shall have liability to any other Lender or
Administrative Agent for failure to use such commercially reasonable
efforts, unless such failure is due to a Lender's willful misconduct in
not using such commercially reasonable efforts), upon becoming actually
aware of anything which has or is reasonably likely to have a Material
Adverse Effect on any Covered Person, including any Guarantor, to
promptly notify Administrative Agent thereof. Administrative Agent
shall promptly deliver to each Lender copies of every written notice,
demand, report (including any financial report), or other writing which
Administrative Agent gives to or receives from Borrower or any Lender,
or of which Administrative Agent, in its capacity as a Lender otherwise
becomes actually aware, and which itself (a) constitutes, or which
contains information about, something that has or is reasonably likely
to have a Material Adverse Effect on any Covered Person, including any
Guarantor, or (b) is otherwise delivered to Administrative Agent by
Borrower pursuant to the Loan Documents and is deemed material
information by Administrative Agent in its sole discretion. Any Lender
may specifically request certain information regarding any Covered
Person which it reasonably believes is in the possession of
Administrative Agent. Administrative Agent and its directors, officers,
agents, and employees shall have no liability to any Lender for failure
to deliver any such item to such Lender unless the failure constitutes
gross negligence or willful misconduct.
Non-Reliance on Agent and Other Lenders. Each Lender agrees that it has,
independently and without reliance on Administrative Agent or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Covered Persons and
their Subsidiaries and the Guarantors and its own decision to enter
into this Agreement and that it will, independently and without
reliance upon Administrative Agent or any other Lender, and based on
such documents and information as it shall deem appropriate at the
time, continue to make its own analysis and decisions in taking or not
taking action under the Loan Documents. Except for notices, reports,
and other documents and information expressly required to be furnished
to the Lenders by Administrative Agent hereunder, Administrative Agent
shall not have any duty or responsibility to provide any Lender with
any credit or other information concerning the affairs, financial
condition, or business of any Covered Person or any of its Subsidiaries
or Affiliates or any of the Guarantors that may come into the
possession of Administrative Agent or any of its Affiliates.
Resignation. Administrative Agent may resign at any time by giving notice
thereof to the Lenders and Borrower. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor
Administrative Agent. Effective with such resignation, the resigning
Administrative Agent shall assign (at Borrower's sole cost and expense)
all Security Interests in the Collateral, security documents and UCC
filings, and do all other things reasonably necessary so as to assign
and transfer the Security Interests in the Collateral (including, all
documents effectuating or evidencing such Security Interests) to any
successor Administrative Agent. The successor Administrative Agent
appointed by the Required Lenders shall be a Lender. If no successor
Administrative Agent shall have been so appointed by the Required
Lenders and shall have accepted such appointment within thirty (30)
days after the retiring Administrative Agent's giving of notice of
resignation, then the retiring Administrative Agent may, on behalf of
the Lenders, appoint a successor Administrative Agent which shall be a
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commercial bank or other financial institution organized under the laws
of the United States or any state thereof having combined capital and
surplus of at least $300,000,000. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor, such
successor shall thereupon succeed to and become vested with all the
rights, powers, discretion, privileges, and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder. After any
retiring Administrative Agent's resignation hereunder as Administrative
Agent, the provisions of this Section 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 Administrative Agent.
Collections and Distributions to Lenders by Administrative Agent. Except as
otherwise provided in this Agreement, including the other provisions of
this Agreement pertaining to interest in the Floorplan Loans and the
Interim Floorplan Loans and the provisions of Section 0 pertaining to
the suspension or reduction of payments of principal and interest to
the Lenders under certain circumstances, all payments of interest,
fees, principal and other amounts received by Administrative Agent for
the account of Lenders shall be distributed by Administrative Agent to
Lenders in accordance with their pro-rata shares of the outstanding
Loan Obligations at the time of such distribution by wire transfer of
same day funds to Lenders as provided in this Agreement (or entirely to
Administrative Agent in the case of payments of interest, fees or
principal with respect to the Swingline Loan) on the Settlement Date
following the date when received, unless received after 12:00 noon
(Local Time) on a Settlement Date, in which case they shall be so
distributed by 12:00 noon (Local Time) on the next Settlement Date. All
amounts received by any Lender on account of the Loan Obligations,
including amounts received by way of setoff, shall be paid over
promptly to Administrative Agent for distribution to Lenders as
provided above in this Section. Such distributions shall be made
according to instructions that each Lender may give to Administrative
Agent from time to time.
Provision Regarding Payments. Lenders agree that the Lenders shall be obligated
to make any required purchase and or sale from another Lender on a
Settlement Date or required reimbursement to Administrative Agent
following the termination of the Lenders obligations to make Advances
under Sections 0 (A) and (B) of this Agreement. The parties acknowledge
and agree that the provisions of this Section 0 are solely for the
benefit of Administrative Agent and the Lenders and not for Borrower or
any other Person.
General.
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Lenders' Right to Cure. Administrative Agent or any Lender may (but shall not be
obligated to), from time to time, in its absolute discretion, for
Borrower's account and at Borrower's expense, pay (or, with the consent
of Required Lenders, make a Revolving Loan Advance, or Floorplan Loan
Advance to pay) any amount or do any act required of Borrower hereunder
or requested by Administrative Agent or Required Lenders to preserve,
protect, maintain or enforce the Loan Obligations, the Collateral or
Administrative Agent's Security Interests therein for the benefit of
Lenders, and which Borrower fails to pay or do, including payment of
any judgment against Borrower, insurance premium, Taxes, warehouse
charge, finishing or processing charge, landlord's claim, and any other
Security Interest upon or with respect to the Collateral. All payments
that Lenders make pursuant to this Section and all out-of-pocket costs
and expenses that Lenders pay or incur in connection with any action
taken by them hereunder shall be a part of the Loan Obligations, the
repayment of which shall be secured by the Collateral. Any payment made
or other action taken by Lenders pursuant to this Section shall be
without prejudice to any right to assert an Event of Default hereunder
and to pursue Lender's other rights and remedies with respect thereto.
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Rights Not Exclusive. Every right granted to Administrative Agent and Lenders
hereunder or under any other Loan Document or allowed to it at law or
in equity shall be deemed cumulative and may be exercised from time to
time.
Survival of Agreements. All covenants and agreements made herein and in the
other Loan Documents shall survive the execution and delivery of this
Agreement, the Notes and other Loan Documents and the making of every
Advance. All agreements, obligations and liabilities of Borrower under
this Agreement concerning the payment of money to Administrative Agent
and Lenders, including Borrower's obligations under Sections 0 and 0,
but excluding the obligation to repay the Loans and interest accrued
thereon, shall survive the repayment in full of the Loans and interest
accrued thereon, whether or not indefeasible, the return of the Notes
to Borrower and the termination of the Facilities.
Assignments.
Permitted Assignments. At any time after the Execution Date, any Lender may
assign to one or more Eligible Assignees all or a portion of
its rights and obligations under this Agreement (including all
or a portion of the Notes payable to it, its Facilities and
its Loans), provided that the terms of assignment satisfy the
following requirements:
Administrative Agent shall have accepted the assignment, which acceptance
shall not be unreasonably withheld; provided,
however, that if the Facilities have been terminated
and the Loan Obligations accelerated by the Required
Lenders, then Administrative Agent's consent shall
not be required; and provided further, however an
assignment from a Lender to an Affiliate of such
Lender shall not require the prior written acceptance
of Administrative Agent, but such Lender shall give
prior written notice of such assignment to
Administrative Agent and such assignment shall
otherwise be subject to all of the terms and
provisions of this Section and this Agreement.
Each such assignment shall be of a constant, and not a varying, percentage of
all of the assigning Lender's rights and obligations
under this Agreement.
For each assignment involving the issuance and transfer of Notes, the
assigning Lender shall execute an Assignment and
Acceptance in the form of Exhibit 0 together with any
Note subject to such assignment and a processing fee
of $4,000.
The minimum Facility which shall be assigned (which shall include the
applicable portion of the assigning Lender's
Revolving Loan Facility, and Floorplan Loan Facility
and the Letter of Credit Facility, (and in the case
of Administrative Agent, the Swingline Facility and
the Interim Floorplan Loan Facility)) is Five Million
Dollars ($5,000,000) or such lesser amount which
constitutes such Lender's entire Facility; provided,
however, that no such minimum shall apply between a
Lender and its Affiliates, or between one Lender and
another Lender or to an assignment of all of a
Lender's rights and obligations under this Agreement.
The assignee shall have an office located in the United States and is otherwise
an Eligible Assignee.
Upon execution, delivery, and acceptance of such Assignment
and Acceptance, the assignee thereunder shall be a party
hereto and, to the extent of such assignment, have the
obligations, rights, and benefits of a Lender hereunder and
the assigning Lender shall, to the extent of such assignment,
relinquish its rights and be released from its obligations
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under this Agreement. Upon the consummation of any assignment
pursuant to this Section, the assignor, Administrative Agent
and Borrower shall make appropriate arrangements so that, if
required, new Notes are issued to the assignor and the
assignee. If the assignee is not incorporated under the Laws
of the United States or a State thereof, it shall deliver to
Borrower and Administrative Agent certification as to the
exemption from deduction or withholding of Taxes in accordance
with Section 0.
Register; Consequences and Effect of Assignments.
From and after the effective date specified in any Assignment and Acceptance,
the assignee shall be deemed and treated as a party
to this Agreement and, to the extent that rights and
obligations hereunder and under the Notes held by the
assignor have been assigned or negotiated to the
assignee pursuant to such Assignment and Acceptance,
to have the rights and obligations of a Lender
hereunder as fully as if such assignee had been named
as a Lender in this Agreement and of a holder of such
Notes, and the assignor shall, to the extent that
rights and obligations hereunder or under such Notes
have been assigned or negotiated by it pursuant to
such Assignment and Acceptance, relinquish its rights
and be released from its future obligations under
this Agreement.
By executing and delivering an Assignment and Acceptance, the assignor
thereunder and the assignee confirm to and agree with
each other and the other parties hereto substantially
as follows: (i) the assignment made under such
Assignment and Acceptance is made without recourse;
(ii) such assignor makes no representation or
warranty and assumes no responsibility with respect
to the financial condition of any Covered Person or
Guarantor or the performance or observance by any
Covered Person or Guarantor of any of its Loan
Obligations; (iii) such assignee confirms that it has
received a copy of this Agreement, together with
copies of the Financial Statements and such other
Loan Documents and other documents and information as
it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment
and Acceptance; (iv) such assignee will,
independently and without reliance upon
Administrative Agent, such assignor, or any other
Lender, and based on such documents and information
as it deems appropriate at the time, continue to make
its own credit decisions in taking or not taking
action under this Agreement; (v) such assignee
appoints and authorizes Administrative Agent to take
such action as agent on its behalf and to exercise
such powers under this Agreement and the other Loan
Documents as are delegated to Administrative Agent by
the terms hereof and thereof, together with such
powers as are reasonably incidental thereto; and (vi)
such assignee agrees that it will perform in
accordance with their terms all of the obligations
which by the terms of this Agreement are required to
be performed by it as a Lender and a holder of a
Note.
Administrative Agent shall maintain at its address referred to herein a copy
of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of
the names and addresses of the Lenders and the
Facility of, and principal amount of Loans owing to,
each Lender from time to time (the "Register"). The
entries in the Register shall be conclusive and
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binding for all purposes, absent manifest error, and
Borrower, Administrative Agent and the Lenders may
treat each Person whose name is recorded in the
Register as a Lender hereunder for all purposes of
this Agreement. The Register shall be available for
inspection by Borrower or any Lender at any
reasonable time and from time to time upon reasonable
prior notice. Upon its receipt of an Assignment and
Acceptance executed by the parties thereto, together
with any Note subject to such assignment and payment
of the processing fee, Administrative Agent shall, if
such Assignment and Acceptance has been completed and
is in substantially the form of Exhibit 0 hereto, (i)
accept such Assignment and Acceptance, (ii) record
the information contained therein in the Register and
(iii) give prompt notice thereof to the parties
thereto and to Borrower.
Administrative Agent to Retain Copies of Assignments and Acceptances.
Administrative Agent shall maintain a copy of each Assignment
and Acceptance delivered to and accepted by it.
Notice to Borrower of Assignment. Upon its receipt of an Assignment and
Acceptance executed by an assigning Lender, if Administrative
Agent accepts the assignment contemplated thereby,
Administrative Agent shall give prompt notice thereof to
Borrower. Borrower shall execute and deliver replacement Notes
to the assignor and assignee as requested by Administrative
Agent and necessary to give effect to the assignment. If
Borrower fails or refuses to execute and deliver such
replacement Notes, Administrative Agent may, as agent and
attorney-in-fact for Borrower, execute and deliver such
replacement Notes on behalf of Borrower. Borrower hereby
appoints Administrative Agent as its agent and
attorney-in-fact for such purpose and acknowledges that such
power is coupled with an interest and therefore irrevocable
until the Loan Obligations have been indefeasibly paid in full
in cash and the Facilities have terminated. Administrative
Agent shall not have any liability to Borrower or anyone else,
including any Lender, as a consequence of exercising the power
granted to Administrative Agent in the foregoing sentence in
any instance.
Assignment to Federal Reserve Bank. Notwithstanding any other provision set
forth in this Agreement, any Lender may at any time assign and
pledge all or any portion of its Loans and its Notes to any
Federal Reserve Bank as collateral security pursuant to
Regulation A and any Operating Circular issued by such Federal
Reserve Bank. No such assignment shall release the assigning
Lender from its obligations hereunder.
Information. Subject to the terms and conditions of Section 0, any Lender or
Administrative Agent may furnish any information concerning
Borrower or any of its Subsidiaries in the possession of such
Lender or Administrative Agent, as the case may be, from time
to time to assignees, Affiliates or participants (including
prospective assignees and participants).
Sale of Participations. Each Lender may sell participations to one or more
Persons (other than Borrower or an Affiliate of Borrower) in
all or a portion of its rights and obligations under this
Agreement; provided, however, that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii)
such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, (iii)
the participant shall be entitled to the benefit of the right
of setoff contained in this Agreement, (iv) the amount of the
participation shall be in a minimum amount of $5,000,000 or
such lesser amount which constitutes such Lender's entire
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Facility, and (v) Borrower, the other Lenders and
Administrative Agent shall continue to deal solely and
directly with such Lender in connection with such Lender's
rights and obligations under this Agreement, and such Lender
shall retain the sole right to enforce the obligations of
Borrower relating to its Loans, its Notes and its funding of
Advances and to approve any amendment, modification, or waiver
of any provision of this Agreement (other than amendments,
modifications, or waivers that forgives the amount of
principal of the Loans). Notwithstanding the foregoing, the
sale of any such participations which would require Borrower
to file a registration statement with the Securities and
Exchange Commission or under the securities Laws of any State
shall not be permitted; provided that any Lender may sell such
participations as it may be required to do under any
applicable Law or as otherwise instructed to do so by any
Governmental Authority.
Payment of Expenses. Borrower agrees to pay or reimburse to Administrative Agent
all of Administrative Agent's reasonable out-of-pocket costs incurred
in connection with Administrative Agent's due diligence review before
execution of the Loan Documents; the negotiation and preparation of
proposals, any proposal letter, term sheet and the Loan Documents; the
syndication of the Loans; the administration of this Agreement, the
Loan Documents and the Loans; the perfection of Administrative Agent's
Security Interests in the Collateral; the interpretation of any of the
Loan Documents; the enforcement of Administrative Agent's rights and
remedies under the Loan Documents after a Default or Event of Default;
any amendment of or supplementation to any of the Loan Documents; and
any waiver, consent or forbearance with respect to any Default or Event
of Default. Administrative Agent's reasonable out-of-pocket costs may
include to the extent they are actually paid or incurred by
Administrative Agent: title insurance fees and premiums; the cost of
searches for Security Interests existing against Covered Persons or
Guarantors; recording and filing fees and taxes; appraisal fees;
examination and audit fees; environmental consultant fees; litigation
costs; and all attorneys' and paralegals' expenses and reasonable fees.
Attorneys' and paralegals' expenses may include filing charges;
telephone, data transmission, facsimile and other communication costs;
courier and other delivery charges; and photocopying charges.
Litigation costs may include filing fees, deposition costs, expert
witness fees, expenses of service of process, and other such costs paid
or incurred in any administrative, arbitration, or court proceedings
involving a Lender and any Covered Person, including proceedings under
the Bankruptcy Code. In addition, Borrower shall pay to Administrative
Agent, upon receipt of notification from Administrative Agent,
Administrative Agent's customary fees to send or receive electronic
transfers of funds. All costs and fees which Borrower is obligated to
pay or reimburse Administrative Agent are Loan Obligations payable to
Administrative Agent and are payable on demand by Administrative Agent.
General Indemnity.
Borrower agrees to indemnify and hold harmless Administrative Agent, each
Lender, the Letter of Credit Issuer and each of their
Affiliates and their respective officers, directors,
employees, attorneys, representatives, agents, and advisors
(each, an "Indemnified Party") from and against any and all
claims, damages, losses, liabilities, costs, and expenses
(including reasonable attorneys' fees) that may be incurred by
or asserted or awarded against any Indemnified Party, in each
case arising out of or in connection with or by reason of
(including in connection with any investigation, litigation,
or proceeding or preparation of defense in connection
therewith) the Loan Documents, the Acquisition Documents, any
of the transactions contemplated herein or the actual or
proposed use of the proceeds of the Loans (including any
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payments made by Administrative Agent to any Person (other
than Borrower) who is a party to any blocked account, lockbox
agreement, bailee letter, landlord waiver or other similar
agreement, including any indemnity payments by Administrative
Agent thereunder), or the manufacture, storage,
transportation, release or disposal of any Hazardous Material
on, from, over or affecting any of the Collateral or any of
the assets, properties, or operations of any Covered Person or
any predecessor in interest, directly or indirectly, except to
the extent such claim, damage, loss, liability, cost, or
expense is found in a final, non-appealable judgment by a
court of competent jurisdiction to have resulted from such
Indemnified Party's gross negligence or willful misconduct. In
the case of an investigation, litigation or other proceeding
to which the indemnity in this Section applies, such indemnity
shall be effective whether or not such investigation,
litigation or proceeding is brought by Borrower, its
directors, shareholders or creditors or an Indemnified Party
or any other Person or any Indemnified Party is otherwise a
party thereto and whether or not the transactions contemplated
hereby are consummated. Borrower agrees not to assert and
agrees that it will not direct any other Covered Person to
assert any claim against any Indemnified Party, on any theory
of liability, for special, indirect, consequential, or
punitive damages arising out of or otherwise relating to the
Loan Documents, the Acquisition Documents any of the
transactions contemplated herein or the actual or proposed use
of the proceeds of the Loans. Borrower also agrees to pay,
indemnify and hold harmless the Indemnified Parties for, from
and against, and shall promptly reimburse the Indemnified
Parties for, any and all claims, damages, liabilities, losses,
costs and expenses (including reasonable attorneys' fees and
expenses and amounts paid in settlement) incurred, paid or
sustained by the Indemnified Parties, or enforcement by
Administrative Agent of any of its rights with respect
thereto, except to the extent such claim, damage, loss,
liability, cost, or expense is found in a final,
non-appealable judgment by a court of competent jurisdiction
to have resulted from such Indemnified Party's gross
negligence or willful misconduct. Borrower shall pay,
indemnify and hold harmless the Indemnified Parties for, from
and against, and shall promptly reimburse the Indemnified
Parties for, any and all claims, damages, liabilities, losses,
costs and expenses (including reasonable attorneys' fees and
expenses and amounts paid in settlement) incurred, paid or
sustained by the Indemnified Parties, arising out of or
relating to the Acquisition Documents or enforcement by
Administrative Agent of any of its rights with respect
thereto. Borrower covenants and agrees to assume liability for
and to protect, indemnify and hold harmless Administrative
Agent, the Letter of Credit Issuer and each of the Lenders
from any and all liabilities, obligations, damages, penalties,
claims, causes of action, costs, charges and expenses
(including attorneys' fees), which may be incurred by, imposed
or asserted against Administrative Agent, the Letter of Credit
Issuer or any Lender, howsoever arising or incurred because
of. out of or in connection with the disbursements of
Revolving Loans, Swingline Loans, Interim Floorplan Loans, or
Floorplan Loans in accordance with Section 0; provided,
however, the liability of Borrowers pursuant to this indemnity
shall not extend to any liability, obligation, damage,
penalty, claim, cause of action, cost, charge or expense
caused by or arising out of the gross negligence or willful
misconduct of Administrative Agent, the Letter of Credit
Issuer or the Lenders. Borrower: (i) is obligated to pay any
Loan Obligation even if any Collateral is defective or fails
to conform to any warranties extended by any third party; (ii)
shall not assert against Administrative Agent, the Letter of
Credit Issuer, any Lender or any other Indemnified Party any
claim or defense Borrower has against any third party; and
(iii) indemnify and hold Administrative Agent, the Letter of
Credit Issuer, any Lender and any other Indemnified Party
harmless against all claims and defenses asserted by any buyer
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of the Collateral relating to the condition of, or any
representations regarding, any of the Collateral. Borrower
irrevocably waives all rights of offset and counterclaims
Borrower may have against Administrative Agent, the Letter of
Credit Issuer or any Lender except counterclaims arising in
the case of Administrative Agent's, the Letter of Credit
Issuer's or any Lender's willful misconduct.
The obligations of Borrower under this Section 0 shall survive the termination
of the Facilities, the indefeasible full payment and
satisfaction of all of the Loan Obligations, and the release
of the Collateral. All amounts, obligations and liabilities
referred to in Section 0 shall be deemed to be a part of the
Loan Obligations and shall be paid to Administrative Agent on
demand.
To the extent that any of the indemnities required from Borrower under this
Section are unenforceable because they violate any Law or
public policy, Borrower shall pay the maximum amount which it
is permitted to pay under applicable Law.
The foregoing indemnification shall not apply to the extent such liabilities
and costs are determined to have resulted or been caused, in
whole or in part, by the gross negligence or willful
misconduct on the part of such Indemnified Party. THE
FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH
LIABILITIES AND COSTS ARE IN ANY WAY OR TO ANY EXTENT CAUSED,
IN WHOLE OR IN PART, BY ANY NEGLIGENT ACT OR OMISSION OF ANY
KIND EXCEPT AS PROVIDED BY THE IMMEDIATELY PRECEDING SENTENCE.
In exchange for, among other things, Administrative Agent's agreement to make
any payments to any Person (other than Borrower or a Covered
Person) who is a party to any blocked account, lockbox
agreement, bailee letter, landlord waiver or other similar
agreement entered into in connection herewith (including any
indemnity payments by Administrative Agent thereunder,
collectively, "Third Person Reimbursement Agreements"),
Borrower hereby releases, discharges and acquits forever
Administrative Agent and each Lender and any of their
respective officers, directors, servants, agents, employees
and attorneys, past, present and future, from any and all
claims, demands and causes of action, of whatever nature,
whether in contract or tort, accrued or to accrue, contingent
or vested, known or unknown, running in favor of Borrower or
any Covered Person arising out of or relating to such Third
Person Reimbursement Agreements.
Letters of Credit. Borrower assumes all risks of the acts or omissions of any
beneficiary of any of the Letters of Credit. Neither Letter of Credit
Issuer, Administrative Agent, any Lender nor any of their respective
directors, officers, employees, agents, or representatives shall be
liable or responsible for: (a) the use which may be made of any of the
Letters of Credit or for any acts or omissions of beneficiary in
connection therewith; (b) the validity, sufficiency or genuineness of
documents, or of any endorsement(s) thereon, even if such documents
should in fact prove to be in any or all respects invalid,
insufficient, fraudulent or forged; (c) payment by the Letter of Credit
Issuer against presentation of documents which, on their face, appear
to comply with the terms of any Letter of Credit, even though such
documents may fail to bear any reference or adequate reference to any
such Letter of Credit; or (d) any other circumstances whatsoever in
making or failing to make payment under any Letter of Credit in
connection with which Letter of Credit Issuer would, pursuant to the
Uniform Customs and Practices for Documentary Credits (1993 Revision),
International Chamber of Commerce Publication No. 500 (as amended from
time to time), be absolved from liability. In furtherance and not in
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limitation of the foregoing, Letter of Credit Issuer may accept
documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary.
Changes in Accounting Principles. If any Covered Person, at the end of its
fiscal year and with the concurrence of its independent certified
public accountants, changes the method of valuing the Inventory of such
Covered Person, or if any other changes in accounting principles from
those used in the preparation of any of the Financial Statements are
required by or result from the promulgation of principles, rules,
regulations, guidelines, pronouncements or opinions by the Financial
Accounting Standards Board or the American Institute of Certified
Public Accountants (or successors thereto or bodies with similar
functions), and any of such changes result in a change in the method of
calculation of, or affect the results of such calculation of, any of
the financial covenants, standards or terms found herein, then the
parties hereto agree to enter into and diligently pursue negotiations
in order to amend such financial covenants, standards or terms so as to
equitably reflect such changes, with the desired result that the
criteria for evaluating the financial condition and results of
operations of such Covered Person shall be the same after such changes
as if such changes had not been made; provided, however, that until
such amendments are made, (i) all financial covenants herein and all
the provisions hereof which contemplate financial calculation hereunder
shall remain in full force and effect and (ii) in connection therewith,
no effect shall be given hereunder to the one or more changes in
accounting principles .
Loan Records. The date and amount of all Advances to Borrower and payments of
amounts due from Borrower under the Loan Documents will be recorded in
the records that Administrative Agent normally maintains for such types
of transactions. The failure to record, or any error in recording, any
of the foregoing shall not, however, affect the obligation of Borrower
to repay the Loans and other amounts payable under the Loan Documents.
Borrower shall have the burden of proving that such records are not
correct. Borrower agrees that Administrative Agent's and any Lender's
books and records showing the Loan Obligations and the transactions
pursuant to this Agreement shall be admissible in any action or
proceeding arising therefrom, and shall constitute prima facie proof
thereof, irrespective of whether any Loan Obligation is also evidenced
by a promissory note or other instrument. Absent manifest error, any
statement sent by Administrative Agent or a Lender to a Covered Person
shall be deemed correct, accurate and binding on Borrower and an
account stated (except for reversals and reapplications of payments as
provided in Section 0 and corrections of errors discovered by
Administrative Agent or a Lender), unless Borrower notifies
Administrative Agent in writing to the contrary within 60 days after
such statement is rendered. In the event a timely written notice of
objections is given by Borrower, only the items to which exception is
expressly made will be considered to be disputed by Borrower.
Other Security and Guaranties. Administrative Agent or any Lender may, without
notice or demand and without affecting Borrower's obligations
hereunder, from time to time, for the benefit of the other Lenders and
Administrative Agent (based upon each Lender's pro-rata share): (a)
take from any Person and hold collateral (other than the Collateral)
for the payment of all or any part of the Loan Obligations and
exchange, enforce and release such collateral or any part thereof; and
(b) accept and hold any endorsement or Guaranty of payment of all or
any part of the Loan Obligations and release or substitute any such
endorser or Guarantor, or any Person who has given any Security
Interest in any other collateral as security for the payment of all or
any part of the Loan Obligations, or any other Person in any way
obligated to pay all or any part of the Loan Obligations.
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Loan Obligations Payable in Dollars. All Loan Obligations shall be payable only
in Dollars. If, however, to obtain a judgment in any court it is
necessary to convert a Loan Obligation payable in Dollars into another
currency, the rate of exchange used shall be that at which
Administrative Agent, using its customary procedures, could purchase
Dollars with such other currency in New York, New York on the Business
Day immediately preceding the day on which such judgment is rendered.
If any sum in another currency is paid to a Lender or received by a
Lender and applied to a Loan Obligation payable in Dollars, such Loan
Obligation shall be deemed paid and discharged only to the extent of
the amount of Dollars that Administrative Agent, using its customary
procedures, is able to purchase in New York, New York with such sum on
the Business Day immediately following receipt thereof. Borrower agrees
to indemnify each Lender against any loss in Dollars that it may incur
on such Loan Obligation as a result of such payment or receipt and
application to such Loan Obligation.
Confidentiality. Administrative Agent may obtain from any Vendor any credit,
financial or other information regarding Borrower that such Vendor may
from time to time possess. Administrative Agent and each Lender agrees
that it will use its commercially reasonable efforts not to disclose to
third Persons any information that it obtains about Borrower or its
operations or finances that are designated by Borrower in writing as
confidential or that Borrower has advised Lenders in writing
constitutes non-public information. Administrative Agent and any Lender
may, however, disclose such information to their Affiliates, to each
other, to each other's Affiliates, and to all of the officers,
attorneys, auditors, accountants, bank examiners, agents and
representatives of the foregoing who have a need to know such
information in connection with the administration, interpretation or
enforcement of the Loan Documents or the lending and collection
activity contemplated therein or to the extent required by Law or a
Governmental Authority. Administrative Agent or such Lender shall use
their reasonable efforts to advise such Persons that such information
is to be treated as confidential, but shall have no liability for
failure to do so, unless such failure is grossly negligent or willful.
Administrative Agent or any Lender may also disclose such information
in any documents that it files in any legal proceeding or otherwise to
pursue, enforce or preserve its rights under the Loan Documents.
Administrative Agent may also disclose credit, financial, or other
information on Borrower in Administrative Agent's possession to the
Lenders, Vendors and potential Vendors, or any Persons liable for the
Loan Obligations; provided, however, Administrative Agent will use its
commercially reasonably efforts not to provide copies of Borrower's
Financial Statements to any such Vendors or potential Vendors without
Borrower's prior written consent, although if Administrative Agent does
provide copies of Borrower's Financial Statements to any such Vendors
or potential Vendors, it shall have no liability for such disclosure.
Administrative Agent's and Lenders' non-disclosure obligation shall not
apply to any information that (i) is disclosed to Administrative Agent
or any Lender by a third Person not affiliated with or employed by
Borrower who does not, to Administrative Agent's or such Lender's
knowledge, have a commensurate duty of non-disclosure, or (ii) is or
becomes publicly known other than as a result of disclosure by
Administrative Agent or a Lender.
Notwithstanding anything herein to the contrary, "information" shall
not include, and Administrative Agent and each Lender may disclose to
any and all Persons, without limitation of any kind, any information
with respect to the "tax treatment" and "tax structure" (in each case,
within the meaning of Treasury Regulation Section 1.6011-4) of the
transactions contemplated hereby and all materials of any kind
(including opinions or other tax analyses) that are provided to
Administrative Agent or such Lender relating to such tax treatment and
tax structure; provided that with respect to any document or similar
item that in either case contains information concerning the tax
treatment or tax structure of the transaction as well as other
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information, this sentence shall only apply to such portions of the
document or similar item that relate to the tax treatment or tax
structure of the Loans, Letters of Credit and transactions contemplated
hereby.
Binding Arbitration.
--------------------
Arbitrable Claims. Except as otherwise specified below, all actions, disputes,
claims and controversies under common law, statutory law or in equity
of any type or nature whatsoever, whether arising before or after the
date of this Agreement and the Loan Documents, and whether directly or
indirectly relating to: (a) this Agreement or any amendments,
modifications, restatements, waivers, and addenda hereto, or the
breach, invalidity or termination hereof; (b) any previous or
subsequent agreement between or among Administrative Agent, Lenders,
Borrower and any other Covered Person; (c) any act committed by
Administrative Agent, Lenders or by any parent company, subsidiary or
affiliated company of Administrative Agent or the Lenders (the "Lender
Companies"), or by any employee, agent, officer or director of a Lender
Company whether or not arising within the scope and course of
employment or other contractual representation of the Lender Companies
provided that such act arises under a relationship, transaction or
dealing between Administrative Agent, any Lender, Borrower and any
other Covered Person; or (d) any other relationship, transaction or
dealing between or among, Administrative Agent, Lenders, Borrower and
any Covered Person (collectively, for clauses (a) through and including
(d), the "Disputes"), will be subject to and resolved by binding
arbitration. Notwithstanding the foregoing, the parties agree that
either party may pursue claims against the other that do not exceed
Fifteen Thousand Dollars ($15,000) in the aggregate in a court of
competent jurisdiction. Service of arbitration claims shall be
acceptable if made by U.S. mail or overnight delivery to the address
for the party described herein.
Administrative Body. All arbitration hereunder will be conducted in accordance
with the Commercial Arbitration Rules of either: (a) The American
Arbitration Association ("AAA"); or (b) United States Arbitration &
Mediation ("USA&M"). The party first filing an arbitration claim shall
designate which arbitration forum and rules are to be applied for all
Disputes between the parties. The arbitration rules are found at
▇▇▇.▇▇▇.▇▇▇ for AAA, and at www.usam-midwest.com.for USA&M. AAA claims
may be filed in any AAA office. Claims filed with USA&M shall be filed
in their Midwest office located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇.
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇. All arbitrator(s) selected will be attorneys
with at least five (5) years secured transactions experience. A panel
of three arbitrators shall hear all claims exceeding One Million
Dollars ($1,000,000), exclusive of interest, costs and attorneys' fees.
The arbitrator(s) will decide if any inconsistency exists between the
rules of the applicable arbitral forum and the arbitration provisions
contained herein. If such inconsistency exists, the arbitration
provisions contained herein will control and supersede such rules. The
arbitrator shall follow the terms of this agreement and the applicable
law, including the attorney-client privilege and the attorney work
product doctrine.
Hearings. Each party hereby consents to a documentary hearing for all
arbitration claims, by submitting the Dispute to the arbitrator(s) by
written briefs and affidavits, along with relevant documents. However,
arbitration claims will be submitted by way of an oral hearing if any
party requests an oral hearing within thirty (30) days after service of
the claim, and that party remits the appropriate amount for AAA's or
USA&M's (as applicable) fees and arbitrator compensation within ten
(10) days of the designated arbitration association's statement for
payment of all fees and arbitrator compensation relating to the oral
hearing. Each party agrees that failure to timely pay all fees and
arbitrator compensation billed to the party requesting the oral hearing
will be deemed such party's consent to submitting the Dispute to the
arbitrator on documents and such party's waiver of its request for an
oral hearing. The site of all oral arbitration hearings will be in the
108
Division of the Federal Judicial District in which the designated
arbitration association maintains a regional office that is closest to
Borrower.
Discovery. Discovery permitted in any arbitration proceeding commenced hereunder
is limited as follows. No later than forty (40) days after the filing
and service of a claim for arbitration, the parties in contested cases
will exchange detailed statements setting forth the facts supporting
the claim(s) and all defenses to be raised during the arbitration, and
a list of all exhibits and witnesses. No later than twenty-one (21)
days prior to the oral arbitration hearing, the parties will exchange a
final list of all exhibits and all witnesses, including any designation
of any expert witness(es) together with a summary of their testimony; a
copy of all documents and a detailed description of any property to be
introduced at the hearing. Under no circumstances will the use of
interrogatories, requests for admission, requests for the production of
documents or the taking of depositions be permitted. However, if of the
designation of any expert witness(es), the following will occur: (i)
all information and documents relied upon by the expert witness(es)
will be delivered to the opposing party; (ii) the opposing party will
be permitted to depose the expert witness(es); (iii) the opposing party
will be permitted to designate rebuttal expert witness(es); and (iv)
the arbitration hearing will be continued to the earliest possible date
that enables the foregoing limited discovery to be accomplished.
Exemplary or Punitive Damages. The Arbitrator(s) will not have the authority to
award exemplary or punitive damages.
Confidentiality of Awards. All arbitration proceedings, including testimony or
evidence at hearings, will be kept confidential, although any award or
order rendered by the arbitrator(s) pursuant to the terms of this
Agreement may be confirmed as a judgment or order in any state or
federal court of competent jurisdiction within the federal judicial
district which includes the residence of the party against whom such
award or order was entered. This Agreement concerns transactions
involving commerce among the several states. The Federal Arbitration
Act, Title 9 U.S.C. Sections 1 et seq., as amended ("FAA") will govern
all arbitration(s) and confirmation proceedings hereunder.
Prejudgment and Provisional Remedies. Nothing herein will be construed to
prevent Administrative Agent's, any Lender's, Borrower's or any Covered
Person's use of bankruptcy, receivership, injunction, repossession,
replevin, claim and delivery, sequestration, seizure, attachment,
foreclosure, or any other prejudgment or provisional action or remedy
relating to any Collateral for any current or future debt owed by
either party to the other. Any such action or remedy will not waive
Administrative Agent's, any Lender's, Borrower's or any Covered
Person's right to compel arbitration of any Dispute.
Attorneys' Fees. If Administrative Agent, any Lender, Borrower or any Covered
Person brings any other action for judicial relief with respect to any
Dispute (other than those set forth in Sections 0 or 0), the party
bringing such action will be liable for and immediately pay all of the
other party's costs and expenses (including attorneys' fees) incurred
to stay or dismiss such action and remove or refer such Dispute to
arbitration. If Administrative Agent, any Lender, Borrower or any
Covered Person brings or appeals an action to vacate or modify an
arbitration award and such party does not prevail, such party will pay
all costs and expenses, including attorneys' fees, incurred by the
other party in defending such action. Additionally, if Borrower or any
Covered Person sues Administrative Agent or any Lender or institutes
any arbitration claim or counterclaim against Administrative Agent or
any Lender in which Administrative Agent or any Lender is the
prevailing party, Borrower or any such Covered Person will pay all
109
costs and expenses (including attorneys' fees) incurred by
Administrative Agent or any Lender in the course of defending such
action or proceeding.
Limitations. Any arbitration proceeding must be instituted: (i) with respect to
any Dispute for the collection of any debt owed by either party to the
other, before the second anniversary of the date the last payment by or
on behalf of the payor was received and applied in respect of such debt
by the payee; and (ii) with respect to any other Dispute, before the
second anniversary of the date the incident giving rise thereto
occurred, whether or not any damage was sustained or capable of
ascertainment or either party knew of such incident. Failure to
institute an arbitration proceeding within such period will constitute
an absolute bar and waiver to the institution of any proceeding,
whether arbitration or a court proceeding, with respect to such
Dispute. Notwithstanding the foregoing, this limitations provision will
be suspended temporarily, as of the date any of the following events
occur, and will not resume until the date following the date either
party is no longer subject to, (a) bankruptcy; (b) receivership; (c)
any proceeding regarding an assignment for the benefit of creditors; or
(d) any legal proceeding, civil or criminal, which prohibits either
party from foreclosing any interest it might have in the collateral of
the other party.
Survival After Termination. The agreement to arbitrate will survive the
termination of this Agreement.
Invalidity/Unenforceability of Binding Arbitration; Jury Trial Waiver; Service
of Process; Forum. IF THIS AGREEMENT IS FOUND TO BE NOT SUBJECT TO ARBITRATION,
THEN:
Jury Trial Waiver. ANY LEGAL PROCEEDING WITH RESPECT TO ANY DISPUTE (1) ARISING
UNDER THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR (2) IN ANY
WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF
THE PARTIES HERETO OR ANY OF THEM IN RESPECT OF THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT, OR THE TRANSACTIONS RELATED HERETO
OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER OR NOT SOUNDING IN CONTRACT OR TORT OR
OTHERWISE, WILL BE TRIED IN A COURT OF COMPETENT JURISDICTION
BY A JUDGE WITHOUT A JURY. EACH BORROWER, ADMINISTRATIVE AGENT
AND EACH LENDER WAIVE ANY RIGHT TO A JURY TRIAL IN ANY SUCH
PROCEEDING. Each Borrower, Administrative Agent, and each
Lender further agrees and consents that any such claim,
demand, action or cause of action shall be decided by court
trial without a jury and that either may file an original
counterpart or a copy of this Agreement with any court as
written evidence of the consent of the parties hereto to the
waiver of their right to trial by jury.
Choice of Forum. Subject only to the exception in the next sentence, Borrower,
Administrative Agent, and each Lender hereby agrees to the
exclusive jurisdiction of the federal court of the Eastern
District of Missouri and the state courts of Missouri located
in St. Louis County, Missouri and waives any objection based
on venue or forum non conveniens with respect to any action
instituted therein, and agrees that any dispute concerning the
relationship between Administrative Agent, Lenders, and
Borrower or the conduct of any of them in connection with this
Agreement or otherwise shall be heard only in the courts
described above. Notwithstanding the foregoing: (1)
Administrative Agent or any Lender shall have the right to
bring any action or proceeding against any Borrower or its
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property in any courts of any other jurisdiction
Administrative Agent or any Lender deem necessary or
appropriate in order to realize on the Collateral, real estate
or other security for the Loan Obligations, and (2) each party
hereto acknowledges that any appeals from the courts described
in the immediately preceding sentence may have to be heard by
a court located outside those jurisdictions.
Service of Process. Borrower, Administrative Agent and each Lender hereby waives
personal service of any and all process upon it and consents
that all such service of process may be made by registered
mail (return receipt requested) directed to such party at its
address set forth on the signature pages hereof, and service
so made shall be deemed to be completed five (5) days after
the same shall have been so deposited in the U.S. mails.
Nothing in this Section shall affect the right of
Administrative Agent or any Lender to serve legal process in
any other manner permitted by Law.
Miscellaneous.
--------------
Notices. All notices, consents, requests and demands to or upon the respective
parties hereto shall be in writing, and shall be deemed to have been
given or made when delivered in person to those Persons listed on the
signature pages hereof or four (4) Business Days after the date when
deposited in the United States mail, postage prepaid, or, in the case
of the overnight courier services, when delivered to the overnight
courier service, or in the case of telecopy notice, when sent,
verification received, in each case addressed as set forth on the
signature pages hereof, or to such other address as either party may
designate by notice to the other in accordance with the terms of this
Section. No notice given to or demand made on Borrower by
Administrative Agent or any Lender in any instance shall entitle
Borrower to notice or demand in any other instance.
Amendments and Modifications; Waivers and Consents; All Lenders. Unless
otherwise provided herein, no amendment to or modification of any
provision of this Agreement, or of any of the other Loan Documents
shall be effective unless it is in writing and signed by authorized
officers of Borrower and Required Lenders. Unless otherwise provided
herein, no waiver of, or consent to any departure by Borrower from, the
requirements of any provision of this Agreement or any of the other
Loan Documents shall be effective unless it is in writing and signed by
authorized officers or representatives of Required Lenders. Any such
amendment, modification, waiver or consent shall be effective only in
the specific instance and for the purpose for which given. The
foregoing notwithstanding, no such amendment, modification or consent
shall, unless signed by authorized officers of Borrower and authorized
officers or representatives of all Lenders or the affected Lender as
needed: (i) reduce or forgive the repayment of principal of any Advance
or the reimbursement of any draw on a Letter of Credit or interest on
the Aggregate Revolving Loan, (ii) change the regularly scheduled dates
for payments of interest of any Revolving Loan Advance payable to any
Lender or the fees payable hereunder or change the Initial Maturity
Date (except as set forth herein), (iii) change the provisions of
Section 0 to the detriment of any Lender, (iv) change the definition of
Required Lenders herein, (vi) change the provisions of this Section,
(v) release any Covered Person from its obligations under the Loan
Documents, (vi) increase the percentage in Section 0, (vii) change any
provisions of this Agreement requiring ratable distributions to
Lenders, (x) reduce the applicable LIBOR Increment or Prime Increment,
or (xi) exchange, waive, or release the Security Interests in any of
the Collateral (except as expressly permitted by Section 0); provided,
however, that to the extent not permitted by Section 0, Administrative
Agent may, in its absolute discretion and without the consent of any
Lender or any Covered Person or Guarantor, may permit Borrower or such
other applicable Person to exchange, waive or release the Security
Interests in any of the Collateral so long as the fair market value of
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the Collateral which is exchanged or for which the Security Interest is
waived or released does not exceed $2,000,000 in each instance and
$4,000,000 in the aggregate per calendar year. In addition, the Dollar
amount of the Revolving Loan Facility or Floorplan Loan Facility of any
Lender may not be increased without the consent of such Lender and
Administrative Agent, and if the aggregate amount of any Facility is
increased, then only the consent of the Lenders participating in any
such increase, Administrative Agent and Borrower shall be required. No
notice to or demand on Borrower in any instance shall entitle Borrower
to any other or further notice or demand in another similar or
different instance. No failure by Administrative Agent or any Lender to
exercise, and no delay by Administrative Agent or any Lender in
exercising, any right, remedy, power or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise
by Administrative Agent or any Lender of any right, remedy, power or
privilege hereunder preclude any other exercise thereof, or the
exercise of any other right, remedy, power or privilege existing under
any Law or otherwise.
Course of Dealing. Acceptance of or acquiescence in a course of performance or
course of dealing rendered or taken under or with respect to this
Agreement or the other Loan Documents will not be relevant in any
respect to determine the meaning of this Agreement or the other Loan
Documents, or the obligations or liabilities of the parties hereto
under this Agreement or the other Loan Documents, even though the
accepting or acquiescing party had knowledge of the nature of the
performance and opportunity for objection.
Rights Cumulative. Each of the rights and remedies of Administrative Agent and
Lenders under this Agreement shall be in addition to all of its other
rights and remedies under applicable Law, and nothing in this Agreement
shall be construed as limiting any such rights or remedies.
Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and all future holders of the Notes and
their respective successors and assigns, except that Borrower may not
assign, delegate or transfer any of its rights or obligations under
this Agreement without the prior written consent of Administrative
Agent and Required Lenders. With respect to Borrower's successors and
assigns, such successors and assigns shall include any receiver,
trustee or debtor-in-possession of or for Borrower.
Severability. Any provision of this Agreement which is prohibited, unenforceable
or not authorized in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition, unenforceability or
lack of authorization without invalidating the remaining provisions
hereof or affecting the validity, enforceability or legality of such
provision in any other jurisdiction unless the ineffectiveness of such
provision would result in such a material change as to cause completion
of the transactions contemplated hereby to be unreasonable.
Counterparts. This Agreement may be executed by the parties hereto on any number
of separate counterparts, and all such counterparts taken together
shall constitute one and the same instrument. It shall not be necessary
in making proof of this Agreement to produce or account for more than
one counterpart signed by the party to be charged.
Governing Law; No Third Party Rights. This Agreement, the Notes and the other
Loan Documents and the rights and obligations of the parties hereunder
and thereunder shall be governed by and construed and interpreted in
accordance with the internal Laws of the State of Missouri applicable
to contracts made and to be performed wholly within such state, without
regard to choice or conflicts of law principles; except that the
provisions of the Loan Documents pertaining to the creation or
perfection of Security Interests or the enforcement of rights of
Administrative Agent and Lenders in Collateral located in a State other
that the State of Missouri shall be governed by the Laws of such State.
112
This Agreement is solely for the benefit of the parties hereto and
their respective successors and assigns, and no other Person shall have
any right, benefit, priority or interest under, or because of the
existence of, this Agreement.
Counterpart Facsimile Execution. For purposes of this Agreement, a document (or
signature page thereto) signed and transmitted by facsimile machine or
telecopier is to be treated as an original document. The signature of
any Person thereon, for purposes hereof, is to be considered as an
original signature, and the document transmitted is to be considered to
have the same binding effect as an original signature on an original
document. At the request of any party hereto, any facsimile or telecopy
document is to be re-executed in original form by the Persons who
executed the facsimile or telecopy document. No party hereto may raise
the use of a facsimile machine or telecopier or the fact that any
signature was transmitted through the use of a facsimile or telecopier
machine as a defense to the enforcement of this Agreement or any
amendment or other document executed in compliance with this Section.
No Other Agreements. There are no other agreements between Administrative Agent,
Lenders, and Borrower, oral or written, concerning the subject matter
of the Loan Documents, and all prior agreements concerning the same
subject matter, including any proposal or commitment letter, are merged
into the Loan Documents and thereby extinguished.
Waiver of Right to Seek Punitive and Exemplary Damages. Borrower, Administrative
Agent and each Lender each hereby irrevocably waives forever any right
to obtain or claim for punitive or exemplary damages from any other
party to this Agreement.
Negotiated Transaction. Borrower, Administrative Agent and each Lender represent
each to the others that in the negotiation and drafting of this
Agreement and the other Loan Documents they have been represented by
and have relied upon the advice of counsel of their choice. Borrower
and Administrative Agent affirm that their counsel have both had
substantial roles in the drafting and negotiation of this Agreement and
each Lender affirms that its counsel has participated in the drafting
and negotiation of this Agreement; therefore, this Agreement will be
deemed drafted by all of Borrower, Agent and Lenders, and the rule of
construction to the effect that any ambiguities are to be resolved
against the drafter will not be employed in the interpretation of this
Agreement.
Incorporation By Reference. All of the terms of the other Loan Documents are
incorporated in and made a part of this Agreement by this reference.
Statutory Notice-Insurance. The following notice is given pursuant to Section
427.120 of the Missouri Revised Statutes; nothing contained in such
notice shall be deemed to limit or modify the terms of the Loan
Documents:
UNLESS YOU PROVIDE EVIDENCE OF THE INSURANCE COVERAGE REQUIRED BY YOUR
AGREEMENT WITH US, WE MAY PURCHASE INSURANCE AT YOUR EXPENSE TO PROTECT
OUR INTERESTS IN YOUR COLLATERAL. THIS INSURANCE MAY, BUT NEED NOT,
PROTECT YOUR INTERESTS. THE COVERAGE THAT WE PURCHASE MAY NOT PAY ANY
CLAIM THAT YOU MAKE OR ANY CLAIM THAT IS MADE AGAINST YOU IN CONNECTION
WITH THE COLLATERAL. YOU MAY LATER CANCEL ANY INSURANCE PURCHASED BY
US, BUT ONLY AFTER PROVIDING EVIDENCE THAT YOU HAVE OBTAINED INSURANCE
AS REQUIRED BY OUR AGREEMENT. IF WE PURCHASE INSURANCE FOR THE
COLLATERAL, YOU WILL BE RESPONSIBLE FOR THE COSTS OF THAT INSURANCE,
113
INCLUDING THE INSURANCE PREMIUM, INTEREST AND ANY OTHER CHARGES WE MAY
IMPOSE IN CONNECTION WITH THE PLACEMENT OF THE INSURANCE, UNTIL THE
EFFECTIVE DATE OF THE CANCELLATION OR EXPIRATION OF THE INSURANCE. THE
COSTS OF THE INSURANCE MAY BE ADDED TO YOUR TOTAL OUTSTANDING BALANCE
OR OBLIGATION. THE COSTS OF THE INSURANCE MAY BE MORE THAN THE COST OF
INSURANCE YOU MAY BE ABLE TO OBTAIN ON YOUR OWN.
Statutory Notice--Oral Commitments. The following notice is given pursuant to
Section 432.045 of the Missouri Revised Statutes; nothing contained in
such notice shall be deemed to limit or modify the terms of the Loan
Documents:
ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO
FORBEAR FROM ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND
OR RENEW SUCH DEBT ARE NOT ENFORCEABLE. TO PROTECT YOU (BORROWER) AND
US (CREDITOR) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS
WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING, WHICH IS
THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US,
EXCEPT AS WE MAY LATER AGREE IN WRITING TO MODIFY IT.
{remainder of page intentionally left blank;
signature pages follow}
114
THIS CONTRACT CONTAINS A BINDING ARBITRATION CLAUSE WHICH MAY BE
ENFORCED BY THE PARTIES.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by appropriate duly authorized officers as of the Effective Date.
GTSI CORP., as Borrower
By:____________________________
Name:__________________________
Title:_________________________
Notice Address for all Borrowers:
GTSI Corp.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Chief Financial Officer
FAX# (▇▇▇) ▇▇▇-▇▇▇▇
TEL# (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to
Arent Fox ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇, PLLC
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇-▇▇▇▇
Attn: Carter Strong, Esq.
FAX# (▇▇▇) ▇▇▇-▇▇▇▇
TEL# (▇▇▇) ▇▇▇-▇▇▇▇
GE COMMERCIAL DISTRIBUTION FINANCE CORPORATION,
as Administrative Agent and a Lender
By:__________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Director
Notice Address:
GE Commercial Distribution Finance Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
FAX # (▇▇▇) ▇▇▇-▇▇▇▇
TEL # (▇▇▇) ▇▇▇-▇▇▇▇
115
with a copy to
GE Commercial Distribution Finance Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: General Counsel
FAX # (▇▇▇) ▇▇▇-▇▇▇▇
TEL # (▇▇▇) ▇▇▇-▇▇▇▇
116
EXHIBIT 0
GLOSSARY AND INDEX OF DEFINED TERMS
AAA -- is defined in Section 0.
ACCOUNT -- as to any Person, the right of such Person to payment for goods sold
or leased or for services rendered by such Person.
ACCOUNT DEBTOR -- the obligor on any Account.
ACQUISITION DOCUMENTS -- in the case of any Permitted Acquisition, the documents
to which Borrower or any other Covered Person is a party and under which such
Permitted Acquisition is contemplated, and all of the foregoing at any time
after a Permitted Acquisition has occurred.
ACQUISITION DOCUMENTS ASSIGNMENT -- the assignment of the Acquisition Documents
that is executed and delivered to Administrative Agent for the benefit of
Lenders as provided herein, and consented to by the applicable Seller.
ADMINISTRATIVE AGENT -- GECDF in its capacity as Administrative Agent under this
Agreement, and its successors and assigns in such capacity.
ADVANCE -- a Revolving Loan Advance, a Swingline Advance, an Interim Floorplan
Loan Advance or Floorplan Loan Advance.
ADVANCE DATE -- the date on which an Advance is requested by Borrower to be
made, or is otherwise contemplated or intended to be made, as provided herein.
AFFILIATE -- with respect to any Person, (a) any other Person who is a partner,
director, officer or stockholder of such Person; and (b) any other Person which,
directly or indirectly, is in control of, is controlled by or is under common
control with such Person, and any partner, director, officer or stockholder of
such other Person described. For purposes of this Agreement, control of a Person
by another Person shall be deemed to exist if such other Person has the power,
directly or indirectly, either to (i) vote thirty-five percent (35%) or more of
the securities having the power to vote in an election of directors of such
Person, or (ii) direct the management of such Person, whether by contract or
otherwise and whether alone or in combination with others.
AGGREGATE FACILITY -- either the Aggregate Revolving Loan Facility, the
Aggregate Floorplan Loan Facility or the Letter of Credit Facility.
AGGREGATE FACILITIES -- the Aggregate Revolving Loan Facility, the Aggregate
Floorplan Loan Facility and the Letter of Credit Facility.
AGGREGATE LOAN -- any of the Aggregate Revolving Loan, the Swingline Loan, the
Interim Floorplan Loan, or the Aggregate Floorplan Loan Facility as the case may
be.
AGGREGATE FLOORPLAN LOAN -- the from time to time outstanding principal balance
of all Floorplan Loan Advances.
AGGREGATE FLOORPLAN LOAN FACILITY -- the aggregate discretionary line of Lenders
as stated in Section 0 to fund Floorplan Loan Advances, as it may be changed as
provided herein.
117
AGGREGATE REVOLVING LOAN -- the from time to time outstanding principal balance
of all Revolving Loan Advances.
AGGREGATE REVOLVING LOAN FACILITY -- the aggregate facilities of Lenders as
stated in Section 0 to fund Revolving Loan Advances, as it may be changed as
provided herein.
APPLICABLE LENDING OFFICE -- means, for Administrative Agent and each Lender and
for each Loan, the "Applicable Lending Office" of Administrative Agent or such
Lender (or of an affiliate of such Lender) designated for such Loan on the
signature pages hereof or such other office of such Lender (or an affiliate of
Administrative Agent or such Lender) as Administrative Agent or such Lender may
from time to time specify to Administrative Agent (in the case of another
Lender) and Borrower by written notice in accordance with the terms hereof as
the office by which its Loans are to be made and maintained.
APPROVAL -- means Administrative Agent's approval to finance particular
Inventory for Borrower which is evidenced by Administrative Agent issuing a
financing approval number to the Vendor of such Inventory. "Approval" also means
(i) any open-to-buy authorization given by Administrative Agent to a Vendor,
pursuant to which Administrative Agent may authorize such Vendor to assume
Administrative Agent's approval to finance inventory until Administrative Agent
affirmatively withdraws such authorization, and (ii) any Approval for which
Administrative Agent has not made an Interim Floorplan Loan Advance or the
Lenders have not made a Floorplan Loan Advance as a result of Administrative
Agent not receiving the invoice from the Vendor for the Inventory which is
subject to the Approval.
ASBESTOS MATERIAL -- either asbestos or asbestos-containing materials.
ASSIGNED COLLATERAL -- any tangible or intangible property of Borrower or any
other Person, now owned or hereafter acquired, other than the Personal Property
Collateral, in which Administrative Agent holds or will hold a Security Interest
under a Collateral Assignment to secure payment or performance of any of the
Loan Obligations, and all proceeds thereof.
ASSIGNMENT AND ACCEPTANCE -- means an Assignment and Acceptance in the form of
Exhibit 0
AVERAGE DAILY BALANCE -- is defined in Section 0.
BANKRUPTCY CODE -- means Title 11 of the United States Code, as amended or
replaced from time to time.
BASE RATE -- for any day, the rate per annum equal to the Prime Rate (as such
rate may fluctuate from time to time as provided for herein) for such day plus
the Prime Increment. Any change in the Base Rate due to a change in the Prime
Rate shall be effective on the effective date of such change in the Prime Rate.
The interest rate so designated from time to time as the Base Rate by
Administrative Agent is a reference rate and does not necessarily represent the
lowest or best rate charged to any customer of Administrative Agent or any other
Lender or JPMorgan Chase Bank.
BASE RATE ADVANCE -- an Advance that will become a Base Rate Loan.
BASE RATE LOAN -- any portion of a Loan on which interest accrues at the Base
Rate.
BLOCKED ACCOUNTS -- is defined in Section 0.
BLOCKED ACCOUNT ASSIGNMENTS -- the assignments of the Blocked Accounts that are
executed and delivered to Administrative Agent for the benefit of Lenders as
provided herein.
118
BORROWING BASE -- is defined in Section 0.
BORROWING BASE CERTIFICATE -- the certificate required to be delivered to
Administrative Agent and each Lender from time to time as provided in Section 0.
BORROWING AGENT -- is defined in Section 0.
BORROWING OFFICER -- each officer of the Borrowing Agent who is authorized to
submit a request for an Advance or the issuance of a Letter of Credit on behalf
of Borrower or to take such other action as described in Section 0 on behalf of
Borrower as designated by the Borrowing Agent in a writing delivered to
Administrative Agent.
BUSINESS DAY -- a day other than a Saturday, Sunday, or other day on which
commercial banks are authorized or required to close under the Laws of either
the United States or the State of Missouri.
CAPITAL LEASE -- any lease that has been or should be capitalized under GAAP.
CASH COLLATERAL ACCOUNT -- is defined in Section 0.
CHARTER DOCUMENTS -- the articles or certificate of incorporation and bylaws of
a corporation; the certificate of limited partnership and partnership agreement
of a limited partnership; the partnership agreement of a general partnership;
the articles of organization and operating agreement of a limited liability
company; or the indenture of a trust.
COBRA -- the Consolidated Omnibus Budget Reconciliation Act.
CODE -- the Internal Revenue Code of 1986, as amended and all regulations
thereunder of the IRS.
COLLATERAL -- all assets and property of Borrower or any Covered Person,
including all of the Personal Property Collateral, the Assigned Collateral, and
any other property or asset in which Administrative Agent or a Lender has a
Security Interest to secure payment or performance of the Loan Obligations and
all proceeds thereof.
COLLATERAL ASSIGNMENT -- any of the Collateral assignments required or
contemplated under Section 0 to be executed and delivered to Administrative
Agent for the benefit of the Lenders.
COMMONLY CONTROLLED ENTITY -- a Person which is under common control with
another Person within the meaning of Code Section 414(b) or (c).
COMPLIANCE CERTIFICATE-- the certificate required to be delivered to
Administrative Agent pursuant to Section 0.
CONTRACT -- any contract, capital lease, operating lease, note, bond, indenture,
deed, mortgage, deed of trust, security agreement, pledge, hypothecation
agreement, assignment, or other agreement or undertaking, or any security.
COVERED PERSON -- is defined in Section 0.
CREDIT FACILITIES AGREEMENT -- this Agreement.
DAILY CHARGE -- is defined in Section 0.
DAILY RATE -- is defined in Section 0.
119
DEFAULT -- any of the events listed in Section 0 of this Agreement, without
giving effect to any requirement for the giving of notice, for the lapse of
time, or both, or for the happening of any other condition, event or act.
DEFAULT RATE -- the rate of interest payable on each Revolving Loan and each
Swingline Loan and the other Loan Obligations (other than the Aggregate
Floorplan Loans and Interim Floorplan Loans) after its Maturity and in certain
other circumstances as provided in Section 0.
DEFAULTING LENDER -- is defined in Section 0.
DGCL -- is defined in Section 0.
DISCLOSURE SCHEDULE -- the disclosure schedule of Borrower attached hereto as
Exhibit 0.
DISPUTES -- is defined in Section 0.
DISTRIBUTION -- is defined in Section 0.
DOL -- the United States Department of Labor.
DOLLARS and the sign $ -- lawful money of the United States.
EFFECTIVE DATE -- the date when this Agreement is effective as provided in
Section 0.
ELIGIBLE ACCOUNTS -- is defined in Section 0.
ELIGIBLE ASSIGNEE -- means (i) a Lender (including any successor by merger);
(ii) an Affiliate of a Lender; and (iii) subject to Section 0, any other Person
approved by Administrative Agent; provided, however, that neither Borrower, nor
an Affiliate of Borrower shall qualify as an "Eligible Assignee."
EMPLOYMENT LAW -- ERISA, the Occupational Safety and Health Act, the Fair Labor
Standards Act, or any other Law pertaining to the terms or conditions of labor
or safety in the workplace or discrimination or sexual harassment in the
workplace.
ENCUMBRANCE -- as to any item of real or personal property, any easement,
right-of-way, license, condition, or restrictive covenant, or zoning or similar
restriction, that is not a Security Interest but is enforceable by any Person
other than the record owner of such property.
ENVIRONMENTAL LAW -- the Resource Conservation and Recovery Act, the
Comprehensive Environmental Response, Compensation and Liability Act, the Clean
Water Act, the Clean Air Act, or any other Law pertaining to environmental
quality or remediation of Hazardous Material.
EPA -- the United States Environmental Protection Agency.
ERISA -- the Employee Retirement Income Security Act of 1974.
ERISA AFFILIATE -- as to any Person, any trade or business (irrespective of
whether incorporated) which is a member of a group of which such Person is a
member and thereafter treated as a single employer under Code 414(b), (c), (m)
or (o) or applicable Treasury Regulations.
EVENT OF DEFAULT -- any of the events listed in Section 0 as to which any
requirement for the giving of notice, for the lapse of time, or both, or for the
happening of any further condition, event or act has been satisfied.
120
EXCESS ELIGIBLE ACCOUNTS -- on any date of determination, the amount, if any, by
which the Borrowing Base exceeds the sum of (i) the Aggregate Revolving Loan,
(ii) the Swingline Loan, (iii) the Letter of Credit Exposure, and (iv) that
amount of Other Creditor Indebtedness owing to Persons for which an
Intercreditor Agreement has not been executed between Administrative Agent and
the holders of such Other Creditor Indebtedness.
EXECUTION DATE -- the date when this Agreement has been executed.
EVENT OF DEFAULT EXISTS -- a Default which has occurred and is continuing, or an
Event of Default which has occurred, and which has not been waived in writing by
the Required Lenders.
EXISTING LETTERS OF CREDIT -- No. SM2001143W $1,200,000 issued By Wachovia Bank
for the benefit of AG/ARG Avion, LLC.
FAA -- is defined in Section 0.
FACILITY-- the Revolving Loan Facility of a Lender, the Swingline Facility of
Administrative Agent, the Letter of Credit Facility, the Interim Floor plan Loan
Facility of Administrative Agent, or the Floor plan Loan Facility of a Lender.
FEDERAL AUTHORITY -- the federal government of the United States; any
department, agency, division, or instrumentality of any of the foregoing; and
any court, arbitrator, or board of arbitrators whose orders or judgments are
enforceable by or within the territory of any of the foregoing.
FEDERAL FUNDS RATE -- for any day, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided that (a) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (b) if no
such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate charged to Administrative
Agent (in its individual capacity) on such day on such transactions as
determined by Administrative Agent.
FINANCIAL STATEMENTS -- the most recent of the Initial Financial Statements and
the financial statements of Borrower required to be furnished to Administrative
Agent under this Agreement.
FLOORPLAN DEFAULT RATE-- the rate of interest payable on each Floor plan Loan
and Interim Floor plan Loan after its Maturity and in certain other
circumstances as provided in Section 0.
121
FLOORPLAN INVENTORY VALUE -- means, based on the date of respective invoice, but
excluding in all circumstances Inventory (a) manufactured or sold by or on
behalf of IBM Corporation, Hewlett-Packard Company (including Compaq Inventory),
Lexmark International and each of their respective Subsidiaries and Affiliates,
and (b) held by Ichiban, Inc. without a bailee letter satisfactory to
Administrative Agent (i) one hundred percent (100%) of the total aggregate
wholesale invoice price of all of Borrower's Inventory aged 90 days or less,
(ii) fifty percent (50%) of the total aggregate wholesale invoice price of all
of Borrower's Inventory aged between 91 and 180 days, and zero percent (0%) of
the total aggregate wholesale invoice price of all of Borrower's Inventory aged
more than 180 days, in each case, with respect to clauses (i) and (ii) of this
sentence, financed under the Floorplan Loan Facility and the Interim Floorplan
Loan Facility in which Administrative Agent has a first priority, perfected
Security Interest (subject to no other Security Interest other than Permitted
Security Interests) that is unsold and not leased by Borrower and is in
Borrower's possession and control as of the date of determination, less the
amount of any such Inventory reported by Borrower (if Borrower is required by
Administrative Agent or the Required Lenders to report) as demonstration items
or Inventory that is obsolete or otherwise unmerchantable. If any Inventory
financed under the Aggregate Floorplan Loan Facility or in the Interim Floorplan
Loan Facility with a value in excess of $200,000 for each location is located on
any premises that are not owned by Borrower (not including any lessee or other
Person to whom Inventory is leased or rented in the ordinary course of such
Covered Person's business, or other locations where Borrower is not obligated to
pay rent for up to 30 consecutive days) and Borrower has not obtained or caused
to be obtained written waivers or consents, in form and substance satisfactory
to Administrative Agent, then such Inventory shall be deemed to have a
"Floorplan Inventory Value" of Zero Dollars ($0.00).
FLOORPLAN LOAN -- any Lender's pro-rata share of the Aggregate Floorplan Loan.
FLOORPLAN LOAN ADVANCE -- an Advance by Administrative Agent that is to be
funded by Lenders under the Aggregate Floorplan Loan Facility.
FLOORPLAN LOAN FACILITY -- the discretionary line of credit of each Lender as
stated in Section 0 to fund Floorplan Loan Advances.
FLOORPLAN SHORTFALL -- means the amount, if any, by which (a) the sum of the
Aggregate Floorplan Loans and Interim Floorplan Loans outstanding on any date of
determination, exceeds (b) the Floorplan Inventory Value as determined by
Administrative Agent as of such date of determination.
FRB -- the Board of Governors of the Federal Reserve System and any successor
thereto or to the functions thereof.
GAAP -- those generally accepted accounting principles set forth in Statements
of the Financial Accounting Standards Board and in Opinions of the Accounting
Principles Board of the American Institute of Certified Public Accountants or
which have other substantial authoritative support in the United States and are
applicable in the circumstances, as applied on a consistent basis.
GOVERNMENTAL AUTHORITY -- the federal government of the United States; the
government of any foreign country that is recognized by the United States or is
a member of the United Nations; any state of the United States; any local
government or municipality within the territory or under the jurisdiction of any
of the foregoing including any school district or similar authority; any
department, agency, division, or instrumentality of any of the foregoing; and
any court, arbitrator, or board of arbitrators whose orders or judgments are
enforceable by or within the territory of any of the foregoing.
GROUP -- as used in Regulation 13-D-G issued by the Securities and Exchange
Commission.
122
HAZARDOUS MATERIAL -- any hazardous, radioactive, toxic, solid or special waste,
material, substance or constituent thereof, or any other such substance (as
defined under any applicable Law or regulation), including Asbestos Material.
HOLDING COMPANY REORGANIZATION -- is defined in Section 0.
IMPOSITIONS -- is defined in Section 0.
INDEBTEDNESS -- as to any Person at any particular date, any contractual
obligation enforceable against such Person (i) to repay borrowed money; (ii) to
pay the deferred purchase price of property or services; (iii) to make payments
or reimbursements with respect to bank acceptances or to a factor; (iv) to make
payments or reimbursements with respect to letters of credit whether or not
there have been drawings thereunder; (v) with respect to which there is any
Security Interest in any property of such Person; (vi) to make any payment or
contribution to a Multi-Employer Plan; (vii) that is evidenced by a note, bond,
debenture or similar instrument; (viii) under any conditional sale agreement or
title retention agreement; (ix) all Liabilities (as defined by GAAP) under any
Capital Lease or (x) to pay interest or fees with respect to any of the
foregoing. INDEBTEDNESS also includes any other Obligation that either (i) is
non-contingent and liquidated in amount or (ii) should under GAAP be included in
liabilities and not just as a footnote on a balance sheet.
INDIRECT OBLIGATION -- as to any Person, (a) any guaranty by such Person of any
Obligation of another Person; (b) any Security Interest in any property of such
Person that secures any Obligation of another Person; (c) any enforceable
contractual requirement that such Person (i) purchase an Obligation of another
Person or any property that is security for such Obligation, (ii) advance or
contribute funds to another Person for the payment of an Obligation of such
other Person or to maintain the working capital, net worth or solvency of such
other Person as required in any documents evidencing an Obligation of such other
Person, (iii) purchase property, securities or services from another Person for
the purpose of assuring the beneficiary of any Obligation of such other Person
that such other Person has the ability to timely pay or discharge such
Obligation, (iv) grant a Security Interest in any property of such Person to
secure any Obligation of another Person, (v) otherwise assure or hold harmless
the beneficiary of any Obligation of another Person against loss in respect
thereof; (d) any Obligation arising from the endorsement by such Person of an
instrument (e) any Obligation of such Person as a surety; and (f) any other
contractual requirement enforceable against such Person that has the same
substantive effect as any of the foregoing. The term INDIRECT OBLIGATION does
not, however, include the endorsement by a Person of instruments for deposit or
collection in the ordinary course of business or the liability of a general
partner of a partnership for Obligations of such partnership. The amount of any
Indirect Obligation of a Person shall be deemed to be the stated or determinable
amount of the Obligation in respect of which such Indirect Obligation is made
or, if not stated or determinable, the maximum reasonably anticipated liability
in respect thereof as determined by such Person in good faith.
INITIAL FINANCIAL STATEMENTS -- the financial statements (not including the
projections) of Borrower referred to in Section 0.
INITIAL MATURITY DATE -- is defined in Section 0.
INSURANCE PROCEEDS -- insurance or condemnation proceeds payable as a
consequence of damage to or destruction of any of the Collateral.
INTANGIBLES -- is defined in Section 0.
INTELLECTUAL PROPERTY -- as to any Person, any domestic or foreign patents or
patent applications of such Person, any inventions made or owned by such Person
upon which either domestic or foreign patent applications have not yet been
123
filed, any domestic or foreign trade names or trademarks of such Person, any
domestic or foreign trademark registrations or applications filed by such
Person, any domestic or foreign service marks of such Person, any domestic or
foreign service ▇▇▇▇ registrations and applications by such Person, any domestic
or foreign copyrights of such Person, and any domestic or foreign copyright
registrations or applications by such Person.
INTELLECTUAL PROPERTY ASSIGNMENT -- each assignment of Intellectual Property
that Borrower or any other Person executes and delivers to Administrative Agent
for the benefit of Lenders, either on or after the Execution Date.
INTERCREDITOR AGREEMENT -- individually and collectively, any Intercreditor
Agreement by and between Administrative Agent on behalf of the Lenders, and each
holder of the Other Creditor Indebtedness, each in form and substance
satisfactory to Administrative Agent.
INTEREST/CURRENCY HEDGE OBLIGATION -- any obligations of Borrower to
Administrative Agent, any Lender or any of their respective Affiliates or
Subsidiaries under an agreement or agreements between Borrower and
Administrative Agent, any Lender or any of their respective Affiliates or
Subsidiaries under which the exposure of Borrower to fluctuations in interest
rates or currencies is effectively limited, including, without limitation,
whether in the form of one or more interest rate cap, collar, corridor
agreements, interest rate swaps, currency swaps, or the like, or options
therefor.
INTERIM FLOORPLAN LOAN -- Administrative Agent's aggregate Interim Floorplan
Loan Advances.
INTERIM FLOORPLAN LOAN ADVANCE -- an Advance by Administrative Agent under the
Interim Floorplan Loan Facility.
INTERIM FLOORPLAN LOAN FACILITY -- the discretionary line of credit of
Administrative Agent as stated in Section 0 to fund Interim Floorplan Loan
Advances.
INVENTORY -- goods owned, leased or held by a Person for sale, lease, sublease
or resale or furnished or to be furnished under contracts for services, and raw
materials, goods/work in process, materials, component parts and supplies used
or consumed, or held for use or consumption in such Person's business.
INVESTMENT -- (a) a loan or advance of money or property to a Person, (b) stock
or other equity interest in a Person, (c) a debt instrument issued by a Person,
whether or not convertible to stock or other equity interest in such Person, or
(d) any other interest in or rights with respect to a Person which include, in
whole or in part, a right to share, with or without conditions or restrictions,
some or all of the revenues or net income of such Person.
IRS -- the Internal Revenue Service.
LAW -- any statute, rule, regulation, order, judgment, award or decree of any
Governmental Authority.
LEASE SERVICING -- is defined in Section
LENDER -- any one of the Persons who are signatories to this Agreement and
obligated as lenders or any Person who takes an assignment from any of such
signatories of all or a portion of its rights and obligations as a lender under
this Agreement pursuant to Section 0 and an Assignment and Acceptance as
provided therein.
LENDER COMPANIES -- is defined in Section 00.
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LENDERS' EXPOSURE -- the sum of all Advances under the Aggregate Revolving Loan
Facility, the Swingline Loan, the Interim Floorplan Loan, the Letter of Credit
Exposure and the Aggregate Floorplan Loan Facility (including unfunded
Approvals).
LETTER OF CREDIT -- any standby or commercial (documentary) letter of credit
issued by Letter of Credit Issuer pursuant to the Letter of Credit Facility,
including, without limitation, the Existing Letters of Credit.
LETTER OF CREDIT FACILITY -- the discretionary agreement of the Letter of Credit
Issuer to issue Letters of Credit as provided in Section 3.4.
LETTER OF Credit EXPOSURE -- the undrawn amount of all outstanding letters of
credit issued under the Letter of Credit Facility plus all amounts drawn on such
letters of credit and not yet reimbursed by Borrower.
LETTER OF CREDIT FEE -- the fee payable to Administrative Agent and Lenders as
required in Section 5.3.
LETTER OF CREDIT ISSUER - Wachovia Bank, N.A., or any other Lender succeeding to
Administrative Agents discretionary agreement to issue Letters of Credit
pursuant to Section 3.4; provided, however, in the event that Administrative
Agent shall cause a Letter of Credit to be issued for the account of Borrower by
another financial institution, then Administrative Agent shall be deemed to be
the Letter of Credit Issuer for all purposes including the pass through of fees
and expenses related thereto.
LIBOR ADVANCE -- an Advance that will become a LIBOR Loan.
LIBOR INCREMENT -- is defined in Section 0.
LIBOR LOAN -- any portion of a Loan on which interest accrues at the Adjusted
LIBOR Rate.
LIBOR RATE -- is defined in Section 0.
LOAN -- a Revolving Loan, the Swingline Loan, the Interim Floorplan Loan or a
Floorplan Loan.
LOAN DOCUMENTS -- this Agreement, the Notes, the Security Documents, any
reimbursement agreement between Borrower and Letter of Credit Issuer, any
documents between Administrative Agent and Borrower or Administrative Agent and
any Vendor relating to the Aggregate Floorplan Loan Facility or the Interim
Floorplan Loan Facility, and all other agreements, certificates, documents,
instruments and other writings executed in connection herewith or therewith from
time to time.
LOAN OBLIGATIONS -- all of Borrower's Indebtedness owing to Letter of Credit
Issuer, Administrative Agent (including, without limitation, the Obligations to
Administrative Agent) or Lenders under any of the Loan Documents, whether as
principal, interest, fees or otherwise (including, without limitation, any
amounts set forth in Section 0), any reimbursement agreement between Borrower
and Administrative Agent (or their Affiliates in connection with the issuance of
any letter of credit) and all reimbursement obligations of Borrower to Letter of
Credit Issuer or Lenders with respect to the Letter of Credit Exposure, and all
other agreements, any and all amounts Administrative Agent or any Lender is
obligated to pay or reimburse or pays or reimburses to any Lockbox bank or
Blocked Account bank, certificates, documents, instruments and other writings
executed in connection therewith, and all other Obligations and liabilities of
Borrower to Administrative Agent or Lenders under the Loan Documents and all
Interest/Currency Hedge Obligations (in each case including all extensions,
renewals, modifications, rearrangements, restructures, replacements and
125
refinancings of the foregoing, whether or not the same involve modifications to
interest rates or other payment terms), whether now existing or hereafter
created, absolute or contingent, direct or indirect, joint or several, secured
or unsecured, due or not due, contractual or tortious, liquidated or
unliquidated, arising by operation of law or otherwise, including but not
limited to the obligation of Borrower to repay future advances by Administrative
Agent or Lenders hereunder, whether or not made pursuant to commitment and
whether or not presently contemplated by Borrower, Administrative Agent or
Lenders in the Loan Documents.
LOCAL TIME -- the local time in the city in which Administrative Agent's address
is located, as set forth on the signature page hereto (as changed from time to
time in accordance with the terms hereof), provided, however, such city shall be
located in the continental United States.
LOCKBOXES -- the lockboxes maintained as required in Section 0.
MATERIAL ADVERSE EFFECT -- as to Borrower or any other Covered Person, taken as
a whole, and with respect to any event or occurrence of whatever nature
(including any adverse determination in any litigation, arbitration,
investigation or proceeding), a material adverse effect on (i) the business,
revenues, financial condition, assets, or the prospective business, revenues,
financial condition, or assets of Borrower and all other Covered Persons, taken
as a whole, (ii) the ability of Borrower and all other Covered Persons taken as
a whole to timely pay or perform Borrower's, and each Covered Person's
Obligations generally, taken as a whole, or (iii) in the case of Borrower, and
each Covered Person specifically, the ability of Borrower to pay or perform any
of Borrower's Obligations to Administrative Agent or to any Lender.
MATERIAL AGREEMENT -- as to Borrower or any other Covered Person, any Contract
to which Borrower or any Covered Person is a party or by which any such Borrower
or any other Covered Person is bound which, if violated or breached, has or is
reasonably likely to have a Material Adverse Effect.
MATERIAL LAW -- any separately enforceable provision of a Law (including
Governmental Authority procurement Laws) whose violation by a Borrower or any
other Covered Person has or is reasonably likely to have a Material Adverse
Effect.
MATERIAL LICENSE -- (i) as to any Covered Person, any license, permit or consent
from a Governmental Authority or other Person and any registration and filing
with a Governmental Authority or other Person which if not obtained, held or
made by such Covered Person has or is reasonably likely to have a Material
Adverse Effect, and (ii) as to any Person who is a party to this Agreement or
any of the other Loan Documents, any license, permit or consent from a
Governmental Authority or other Person and any registration or filing with a
Governmental Authority or other Person that is necessary for the execution or
performance by such party, or the validity or enforceability against such party,
of this Agreement or such other Loan Document.
MATERIAL OBLIGATION -- as to Borrower or any Covered Person, an Obligation of
such Person which if not fully and timely paid or performed has or is reasonably
likely to have a Material Adverse Effect.
MATERIAL PROCEEDING -- any litigation, investigation or other proceeding by or
before any Governmental Authority (i) which involves any of the Loan Documents
or any of the transactions contemplated thereby, or involves a Covered Person as
a party or any property of Covered Person and has or is reasonably likely to
have a Material Adverse Effect, (ii) in which there has been issued an
injunction, writ, temporary restraining order or any other order of any nature
which purports to restrain or enjoin the making of any Advance, the consummation
of any other transaction contemplated by the Loan Documents, or the
enforceability of any provision of any of the Loan Documents, (iii) which
126
involves the actual or alleged breach or violation by a Covered Person of, or
default by a Covered Person under, any Material Agreement, or (iv) which
involves the actual or alleged violation by a Covered Person or any Guarantor of
any Material Law. Notwithstanding the foregoing, allegations of breach,
violation or default under clause (iii) or (iv) above shall only constitute a
Material Proceeding hereunder if the making of such allegations or the impact of
such allegations against Borrower or any Covered Person has or is reasonably
likely to have a Material Adverse Effect.
MATURITY -- as to any Indebtedness, the time when it becomes payable in full,
whether at a regularly scheduled time, because of acceleration or otherwise.
MAXIMUM AVAILABLE AMOUNT -- is defined in Section 0.
MULTI-EMPLOYER PLAN -- a Pension Benefit Plan which is a multi-employer plan as
defined in Section 4001(a)(3) of ERISA.
NOTE -- any Revolving Note or the Swingline Note.
OBLIGATION -- as to any Person, any Indebtedness of such Person, any guaranty by
such Person of any Indebtedness of another Person, and any contractual
requirement enforceable against such Person that does not constitute
Indebtedness of such Person or a guaranty by such Person but which would involve
the expenditure of money by such Person if complied with or enforced.
OBLIGATIONS TO ADMINISTRATIVE AGENT -- exclusive of all the Loan Obligations,
all of Borrower's Indebtedness owing to Administrative Agent (whether as
principal, interest, fees or otherwise), all obligations of Borrower under
agreements between Borrower and Administrative Agent under which the exposure of
Borrower to fluctuations in interest rates is effectively limited, whether in
the form of interest rate cap agreements, interest rate swaps, or the like, or
options therefor, all Indirect Obligations of Borrower owing to Administrative
Agent, all reimbursement obligations of Borrower to Administrative Agent with
respect to letters of credit, and all other obligations and liabilities of
Borrower to Administrative Agent (including all extensions, renewals,
modifications, rearrangements, restructures, replacements and refinancings of
the foregoing, whether or not the same involve modifications to interest rates
or other payment terms), whether now existing or hereafter created, absolute or
contingent, direct or indirect, joint or several, secured or unsecured, due or
not due, contractual or tortious, liquidated or unliquidated, arising by
operation of law or otherwise, or acquired by Administrative Agent outright,
conditionally or as collateral security from another, including the obligation
of Borrower to repay future advances by Administrative Agent, whether or not
made pursuant to commitment and whether or not presently contemplated by
Borrower and Administrative Agent.
OPERATING LEASE -- any lease that is not a Capital Lease.
OTHER CREDITOR INDEBTEDNESS -- individually and collectively, except for the
Indebtedness owing to Administrative Agent and the Lenders, all of the
Indebtedness of Borrower which is secured by Inventory and proceeds thereof
(excluding Accounts) of a Covered Person, and includes, Indebtedness
constituting Liabilities (as defined by GAAP) under any Capital Lease, and
Indebtedness secured by purchase money Security Interests.
OTHER CREDITOR INDEBTEDNESS DOCUMENTS -- each document, instrument and agreement
evidencing all or any portion of the Other Creditor Indebtedness.
PBGC -- the Pension Benefit Guaranty Corporation.
127
PENSION BENEFIT PLAN -- any pension or profit-sharing plan which is covered by
Title I of ERISA and all other benefit plans, in each case in respect of which a
Covered Person or a Commonly Controlled Entity of such Covered Person is an
"employer" as defined in Section 3(5) of ERISA.
PERMITTED ACQUISITIONS -- is defined in Section 0.
PERMITTED DISTRIBUTIONS -- any Distributions permitted under Section 0.
PERMITTED ENCUMBRANCE -- any easement, license or similar encumbrance on any
Covered Person's real property, excluding any mortgage, assignment of rents or
lease, deed of trust, or financing statement.
PERMITTED INDEBTEDNESS -- Indebtedness that Borrower is permitted under Section
0 to incur, assume, or allow to exist.
PERMITTED INDIRECT OBLIGATIONS -- Indirect Obligations that Borrower is
permitted under Section 0 to create, incur, assume, or allow to exist.
PERMITTED INVESTMENTS -- Investments that Borrower is permitted under Section 0
to make in other Persons.
PERMITTED SECURITY INTERESTS -- Security Interests that Borrower is permitted
under Section 0 to create, incur, assume, or allow to exist.
PERSON -- any individual, partnership, corporation, trust, unincorporated
association, joint venture, limited liability company, Governmental Authority,
or other organization in any form that has the legal capacity to ▇▇▇ or be sued.
If the context so implies or requires, the term Person includes Borrower.
PERSONAL PROPERTY COLLATERAL -- all of the Goods, Equipment, Accounts,
Inventory, Instruments, Documents, Chattel Paper, General Intangibles, tort
claims, healthcare receivables and other personal property of any kind or
nature, and all accessions and additions thereto of Borrower, any other Covered
Person, or any other Person, whether now owned or hereafter acquired and
wherever located, and all proceeds thereof, in which Administrative Agent at any
time holds or purports to hold a Security Interest for the benefit of Lenders to
secure payment and performance of any of the Loan Obligations.
PLEDGE AGREEMENT -- any pledge agreement required or contemplated under Section
0 to be executed and delivered to Administrative Agent for the benefit of the
Lenders from time to time.
PRIME INCREMENT -- is defined in Section 0.
PRIME RATE -- shall mean the higher of (a) the Federal Funds Rate (as such rate
may fluctuate from time to time as provided for herein) for such day plus .50%,
and (b) a fluctuating interest rate per annum equal to the highest of the prime,
base or reference rates of interest announced publicly from time to time
(whether or not charged in each instance) by ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Bank or any
successor thereof (or any other financial institution chosen by Administrative
Agent, including Administrative Agent) as such bank's prime, base, or reference
rate, which rate may not be the lowest rate of interest charged by such
institution, Administrative Agent, or any Lender to its respective customers or
a favored rate and may not correspond with future increases or decreases in
interest rates charged by other lenders or market interest rates in general.
128
REGULATION A, REGULATION D, REGULATION T, REGULATION U, and REGULATION X --
respectively, Regulation A issued by the FRB, Regulation D issued by the FRB,
Regulation T issued by the FRB, Regulation U issued by the FRB, and Regulation X
issued by the FRB.
REGISTER -- is defined in Section 0.
REPORTABLE EVENT -- a reportable event as defined in Title IV of ERISA or the
regulations thereunder.
REPRESENTATIONS AND WARRANTIES -- The representations and warranties made by
Borrower with respect to itself and other Covered Persons in Section 0, and the
representations and warranties made in any certificate, report, opinion or other
document delivered by Borrower pursuant to the Loan Documents, as such
representations and warranties are modified from time to time as provided in
Section 0.
REQUIRED LENDERS -- defined in Section 0.
RESPONSIBLE OFFICER -- as to any Person that is not an individual, partnership
or trust, the Chairman of the Board of Directors, the President, the chief
executive officer, the chief operating officer, the chief financial officer, the
Treasurer, any Assistant to the Treasurer, or any Vice President in charge of a
principal business unit; as to any partnership, any individual who is a general
partner thereof or any individual who has general management or administrative
authority over all or any principal unit of the partnership's business; and as
to any trust, any individual who is a trustee.
REVOLVING LOAN -- any Lender's pro-rata share of the Aggregate Revolving Loan.
REVOLVING LOAN ADVANCE -- an Advance by Administrative Agent that is to be
funded by Lenders under the Aggregate Revolving Loan Facility.
REVOLVING LOAN FACILITY -- the discretionary facility of each Lender as stated
in Section 0. to fund Revolving Loan Advances.
REVOLVING NOTE -- any note delivered to a Lender as required by Section 0 to
evidence Borrower's obligation to repay such Lender's Revolving Loan.
SCHEDULE OF ACCOUNTS -- a listing of each Account, including the aging of each
Account of Borrower, in such reasonable detail as Administrative Agent may
require.
SCHEDULE OF INVENTORY -- with regards to all Inventory (whether not financed by
Administrative Agent and the Lenders), a listing of each item of existing
Inventory, new Inventory purchases and items of Inventory sold or assigned
within the past ninety (90) days from the date of the last such schedule,
containing the following: initial date of purchase or lease by Borrower of each
item of Inventory, description of each item of Inventory, actual unit cost of
each item of Inventory, number of units of each type of item of Inventory, total
cost by type of Inventory, an aging of each item of Inventory and such other
information as requested by Administrative Agent, all in such detail as
Administrative Agent may reasonably require.
SECURITY AGREEMENT -- any security agreement required or contemplated under
Section 0 to be executed and delivered to Administrative Agent for the benefit
of Lenders.
SECURITY DOCUMENTS -- all of the documents required or contemplated to be
executed and delivered to Administrative Agent for the benefit of Lenders under
Section 0, all other documents granting a Security Interest in any asset of
Borrower or any other Person to secure the payment or performance of any of the
Loan Obligations from time to time, including any such documents listed on
129
Exhibit 0 and any similar documents at any time executed and delivered to
Administrative Agent for the benefit of Lenders from time to time, by Borrower
or any other Person to secure payment or performance of any of the Loan
Obligations.
SECURITY INTEREST -- as to any item of tangible or intangible property, any
interest therein or right with respect thereto or assignment thereof that
secures an Obligation or Indirect Obligation, whether such interest or right is
created under a Contract, or by operation of law or statute (such as but not
limited to a statutory lien for work or materials), or as a result of a
judgment, or which arises under any form of preferential or title retention
agreement or arrangement (including a conditional sale agreement or a lease)
that has substantially the same economic effect as any of the foregoing.
SELLER - any Person who is a party to any Permitted Acquisition other than
Borrower or a Covered Person.
SERVICING FUNDS --is defined in Section 0.
SOLVENT -- as to any Person, (i) such Person not being "insolvent" within the
meaning of Section 101(32) of the Bankruptcy Code, Section 2 of the Uniform
Fraudulent Transfer Act (the "UFTA") or Section 428.014 of the Missouri Revised
Statutes, or any other applicable Law, (ii) such Person not having unreasonably
small capital, within the meaning of Section 548 of the Bankruptcy Code, Section
4 of the UFTA or Section 428.024 of the Missouri Revised Statutes, or any other
applicable Law, and (iii) such Person not being unable to pay such Person's
debts as they become due within the meaning of Section 548 of the Bankruptcy
Code, Section 4 of the UFTA or Section 428.024 of the Missouri Revised Statutes,
or any other applicable Law.
STATE - any state of the United States and the District of Columbia.
STATEMENT OF TRANSACTION -- is defined in Section 0.
SUBSIDIARY -- as to any Person, another Person with respect to which 50% the
outstanding shares of stock or other equity interests (including membership
interests or partnership interests) of each class having ordinary voting power
(other than stock having such power only by reason of the happening of a
contingency) is at the time owned by such Person or by one or more Subsidiaries
of such Person.
SUBORDINATED INDEBTEDNESS -- means the Indebtedness subordinated to the Loan
Obligations incurred on terms and conditions satisfactory to Administrative
Agent and permitted herein.
SURVIVING COMPANY - as applicable, either (i) the Person that will own the
assets to be acquired from a Target Company in a Permitted Acquisition upon the
consummation thereof, or (ii) the survivor of the merger of an Acquiring Company
with the Target Company in a Permitted Acquisition upon the consummation
thereof.
SWINGLINE ADVANCE -- an advance by Administrative Agent to Borrower under the
Swingline Facility.
SWINGLINE FACILITY -- the discretionary facility of Administrative Agent as
stated in Section 0 to make Swingline Advances.
SWINGLINE LOAN -- the from time to time outstanding principal balance of all
Swingline Advances.
TANGIBLE NET WORTH -- is defined in Section 0.
130
TARGET COMPANY-- the Person whose assets or stock, membership interests, or
other equity interests will be acquired in a Permitted Acquisition upon the
consummation thereof, or if applicable, with which an Acquiring Company will
merge in a Permitted Acquisition upon the consummation thereof.
TAX -- as to any Person, any tax, duty, impost, deduction, charges,
withholdings, assessment, fee, or other charge levied by a Governmental
Authority (and all liabilities associated therewith) on the income or property
of such Person, including any interest or penalties thereon, and which is
payable by such Person.
TEXTRON AGREEMENT -- that certain Repurchase Agreement for GTSI Corp., dated
August 29, 2003, and that certain Program Letter, dated August 29, 2003, each by
and between GTSI and Textron Financial Corporation, together with all amendments
thereto (so long as such amendments thereto do not otherwise constitute a
Default or Event of Default under any Loan Document), documents, agreements,
notes, certificates and other documents executed in connection therewith from
time to time.
THIS AGREEMENT -- this document (including every document that is stated herein
to be an appendix, exhibit or schedule hereto, whether or not physically
attached to this document).
TOTAL AGGREGATE FACILITY LIMIT -- is defined in Section 0.
TOTAL ASSETS -- is defined in Section 0.
TOTAL INDEBTEDNESS -- with respect to any Person, the aggregate Indebtedness of
such Person.
TOTAL LIABILITIES -- is defined in Section 0.
UCC -- the Uniform Commercial Code as in effect from time to time in the State
of Missouri or such other similar statute as in effect from time to time in
Missouri or any other appropriate jurisdiction.
UNITED STATES -- when used in a geographical sense, all the states of the United
States of America and the District of Columbia; and when used in a legal
jurisdictional sense, the government of the country that is the United States of
America.
VENDOR -- is defined in Section 0.
VENDOR AGREEMENT -- is defined in Section 0.
WELFARE BENEFIT PLAN -- any plan described by Section 3(1) of ERISA.
131
EXHIBIT 0
---------
LENDERS' FACILITIES AND PRO-RATA SHARES
-------------------------------------------------------------------------------------------------
REVOLVING FLOORPLAN
LENDER TOTALS(2) LOAN LOAN PRO-RATA
FACILITY FACILITY SHARES
-------------------------------------------------------------------------------------------------
GE Commercial
Distribution Finance $125,000,000.00 $90,000,000.00 $75,000,000.00 100.00000%
-------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------
AGGREGATES $125,000,000.00 $90,000,000.00 $75,000,000.00 100.00000%
-------------------------------------------------------------------------------------------------
--------------------
(2) Subject to the Total Aggregate Credit Facility Limit of
$125,000,000 - which can be composed in any combination of Aggregate Revolving
Loans (subject to the $90,000,000 Aggregate Revolving Loan Facility) and
Aggregate Floor plan Loans (subject to the $75,000,000 Aggregate Floor plan Loan
Facility).
132
EXHIBIT 0
---------
FORM OF REQUEST FOR REVOLVING LOAN ADVANCE
GE Commercial Distribution Finance Corporation, as Administrative Agent
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ______________
Re: Credit Facilities Agreement effective October __, 2003, among
GTSI Corp. ("Borrower"), and GE Commercial Distribution
Finance Corporation, as Administrative Agent, and for itself
as a Lender and the other Lenders party thereto, as it may be
amended, modified, restated or replaced from time to time (the
"Credit Agreement")
Ladies and Gentlemen:
The undersigned is a Borrowing Officer of GTSI Corp. and, as such is
authorized to make and deliver this Advance Request on behalf of Borrower
pursuant to Section 0 and Section 0 of the Credit Agreement. All capitalized
words used herein that are defined in the Credit Agreement have the meanings
defined in the Credit Agreement.
Borrower hereby requests that Administrative Agent make a Revolving
Loan Advance of $______________________ to Borrower under the terms of the
Credit Agreement on _______________.
The undersigned hereby certifies that:
(i) No Event of Default exists.
(ii) The Representations and Warranties including those of each
Guarantor in its Guaranty are true and correct and will be
true and correct as of the time of the requested Revolving
Loan Advance.
(iii) The amount of the requested Revolving Loan Advance will not,
when added to the current amount of the Aggregate Revolving
Loan, exceed the Maximum Available Amount, nor will the
Lenders' Exposure exceed the Total Aggregate Facility Limit.
(iv) All conditions precedent to funding of the requested Revolving
Loan Advance under Sections 0 and 0 of the Credit Agreement
have been satisfied.
133
Executed this ____ day of _______________, _____.
GTSI Corp. on behalf of itself and the
other Borrowers
By:______________________________________
Its______________________________________
Typed Name:______________________________
134
EXHIBIT 0
---------
DOCUMENTS AND REQUIREMENTS LIST
TO BE INSERTED
135
EXHIBIT 0
---------
DISCLOSURE SCHEDULE OF BORROWER
136
EXHIBIT 0
---------
INDEBTEDNESS TO BE REPAID WITH INITIAL ADVANCE
137
EXHIBIT 0
---------
FORM OF COMPLIANCE CERTIFICATE
TO: GE Commercial Distribution Finance Corporation, as Administrative Agent
This Compliance Certificate is furnished pursuant to that certain Credit
Facilities Agreement effective October __, 2002 (as the same may be amended,
modified, restated or replaced from time to time, the "Credit Agreement"), among
GTSI Corp., ("Borrower"), GE Commercial Distribution Finance Corporation
("GECDF"), as Administrative Agent, and GECDF and the Lenders as defined in the
Credit Agreement. Unless otherwise defined herein, capitalized terms used in
this Compliance Certificate have the meanings ascribed to them in the Credit
Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the _______________ of GTSI Corp.
2. I have reviewed the terms of the Credit Agreement and the Loan
Documents and I have made, or have caused to be made under my
supervision, a review of the transactions and conditions of
Borrower and each other Covered Person during the accounting
period covered by the attached Financial Statements.
3. The examinations described in paragraph 2 did not disclose,
and I have no knowledge of, the existence of any condition or
event which constitutes an Event of Default as of the date of
this Compliance Certificate; and to my knowledge all of the
Representations and Warranties (including those of each
Guarantor in its Guaranty) are true and correct.
4. [Use for annual financial statements: Schedule I attached
hereto contains the Financial Statements for Borrower for the
fiscal year ended , which are complete and correct in all
material respects and have been prepared in accordance with
GAAP applied consistently throughout the period and with prior
periods (except as disclosed therein).]
[Use for monthly financial statements: Schedule I attached
hereto contains the Financial Statements for Borrower for the
fiscal month ended , which are complete and correct in all
material respects (subject to normal year-end audit
adjustments) and have been prepared in accordance with GAAP
applied consistently throughout the period and with prior
periods (except as disclosed therein).]
5. Borrower and every other Covered Person is in compliance with
all of the covenants in the Credit Agreement, including the
financial covenants in Section 0, and Schedule II attached
hereto contains calculations based on Borrower's consolidated
financial statements and other financial records that show
Borrower's compliance with such financial covenants. The
calculations and the data upon which they are based are
believed by me to be complete and correct.
This Compliance Certificate, together with the Schedules hereto, is executed and
delivered this ______day of _____________________. The undersigned is a duly
authorized Borrowing Officer of Borrower.
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GTSI Corp.
on behalf of itself and the other Borrowers
______________________________________________
Print Name: __________________________________
Title:________________________________________
Schedules I and II are Attached
139
SCHEDULE I TO COMPLIANCE CERTIFICATE
------------------------------------
See current Financial Statements attached.
140
SCHEDULE II TO COMPLIANCE CERTIFICATE
-------------------------------------
Note: the text of Section 0 of the Loan Agreement controls over any difference
between this certificate and Section 0 of the Loan Agreement. Reference should
be made to the Loan Agreement for more specific instructions regarding the
calculation periods and how the components of the financial covenants should be
calculated.
All calculations done in accordance with GAAP on a consolidated basis, in
accordance with the provisions of the Credit Facilities Agreement and are based
on the period ended __________________.
I. Minimum Tangible Net Worth
--------------------------
A. Tangible Net Worth required as of the end of
the fiscal month $45,000,000
B. Actual Tangible Net Worth calculated as of
the end of the fiscal month $__________
II. Maximum Total Liabilities to Tangible Net Worth
-----------------------------------------------
A. Total Liabilities (see definition in
Section 0) $__________
B. Subordinated Indebtedness $__________
C. Total of IIA Less IIB $__________
D. Tangible Net Worth (see definition in
Section 0) $__________
E. Total of IID and IIB $__________
F. Ratio of Item IIA to Item IIB __________
G. Maximum ratio permitted by Section 0 ___.00 to 1.00
III. Minimum EBIT to Net Sales
-------------------------
A. EBITDA (see definition in Section 0) for
preceding fiscal month for the twelve month
period then ended $__________
B. Depreciation and amortization expense for
preceding fiscal month for the twelve month
period then ended $__________
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C. IIIA less IIIB $__________
D. Net Sales for the twelve month period then
ended $__________
E. Ratio of IIIC to IIID as a percentage __________%
F. Minimum Net Income as a percentage of net
sales required by Section 0 0.50%
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IV. Funded Debt to EBITDA
---------------------
A. Total Funded Indebtedness (see definition in
Section 15.1) $__________
B. EBITDA (for preceding twelve month period)
(see definition of EBITDA in Section 15.1)
(i) Net Income $__________
(ii) Interest Expense $__________
(iii) income tax expense $__________
(iv) depreciation expense $__________
(v) amortization expense $__________
(vi) extraordinary losses $__________
(vii) extraordinary gains $__________
(viii) Sum of items (i) through
(vi) less item (vii)
is EBITDA $__________
C. Ratio of VIA to VIB(viii) __________
D. Maximum ratio permitted by Section 0 ____ to 1.00
143
EXHIBIT 0
---------
BORROWING BASE CERTIFICATE
SEE FORM ATTACHED
Attachments:
Schedule of Accounts and Schedule of Inventory
144
EXHIBIT 0
---------
FORM OF ASSIGNMENT AND ACCEPTANCE
DATED _________________, _____
Reference is made to the Credit Facilities Agreement dated as of
October __, 2003 (as amended, modified, restated or replaced from time to time,
the "Credit Agreement") among GTSI Corp. and GE Commercial Distribution Finance
Corporation ("GECDF"), as Administrative Agent, and GECDF and the Lenders as
defined in the Credit Agreement. Terms defined in the Credit Agreement are used
herein with the same meaning.
The "Assignor" and the "Assignee" referred to on Schedule 1 agree as
follows:
1. The Assignor hereby sells and assigns to the Assignee, without
recourse and without representation or warranty except as expressly set forth
herein, and the Assignee hereby purchases and assumes from the Assignor, an
interest in and to the Assignor's rights and obligations under the Credit
Agreement and the other Loan Documents as of the date hereof equal to the
percentage interest specified on Schedule 1 of all outstanding rights and
obligations under the Credit Agreement and the other Loan Documents. After
giving effect to such sale and assignment, the Assignee's Facility and the
amount of the Loans owing to the Assignee will be as set forth on Schedule 1.
Such purchase and assumption shall include that portion of Assignor's
obligations to fund unfunded Approvals equal to the percentage of the Floorplan
Loans being assigned by Assignor to Assignee.
2. The Assignor (i) represents and warrants that it is the legal
and beneficial owner of the interest being assigned by it hereunder and that
such interest is free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with the Loan
Documents or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Loan Documents or any other instrument or document
furnished pursuant thereto; (iii) makes no representation or warranty and
assumes no responsibility with respect to the financial condition of any Covered
Person or any Guarantor, or the performance or observance by any Covered Person
or any Guarantor of any of its obligations under the Loan Documents or any other
instrument or document furnished pursuant thereto; and (iv) attaches the Notes
held by the Assignor and requests that Administrative Agent exchange such Notes
for new Notes payable to the order of the Assignee in an amount equal to the
Facility assumed by the Assignee pursuant hereto and to the Assignor in an
amount equal to the Facility retained by the Assignor, if any, as specified on
Schedule 1.
3. The Assignee (i) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial statements referred to
in Section 0 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will, independently and without
reliance upon Administrative Agent, the Assignor or any other Lender and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
145
the Credit Agreement; (iii) confirms that it is an Eligible Assignee; (iv)
appoints and authorizes Administrative Agent to take such action as agent on its
behalf and to exercise such powers and discretion under the Credit Agreement as
are delegated to Administrative Agent by the terms thereof, together with such
powers and discretion as are reasonably incidental thereto; (v) agrees that it
will perform in accordance with their terms all of the obligations that by the
terms of the Credit Agreement are required to be performed by it as a Lender;
and (vi) attaches any U.S. Internal Revenue Service or other forms required
under the Credit Agreement.
4. Following the execution of this Assignment and Acceptance, it
will be delivered to Administrative Agent for acceptance and recording by
Administrative Agent. The effective date for this Assignment and Acceptance (the
"Effective Date") shall be the date of acceptance hereof by Administrative
Agent, unless otherwise specified on Schedule 1.
5. Upon such acceptance and recording by Administrative Agent, as
of the Effective Date, (i) the Assignee shall be a party to the Credit Agreement
and, to the extent provided in this Assignment and Acceptance, have the rights
and obligations of a Lender thereunder and (ii) the Assignor shall, to the
extent provided in this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.
6. Upon such acceptance and recording by Administrative Agent,
from and after the Effective Date, Administrative Agent shall make all payments
under the Credit Agreement and the Notes in respect of the interest assigned
hereby (including, without limitation, all payments of principal, interest and
fees with respect thereto) to the Assignee. The Assignor and Assignee shall make
all appropriate adjustments in payments under the Credit Agreement and the Notes
for periods prior to the Effective Date directly between themselves.
7. Assignor represents and warrants that is has paid an
assignment and a processing fee of $4,000 to Administrative Agent.
8. This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of the State of Missouri.
9. This Assignment and Acceptance may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of Schedule 1 to this Assignment and Acceptance by
telecopier shall be effective as delivery of a manually executed counterpart of
this Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused Schedule
1 to this Assignment and Acceptance to be executed by their officers thereunto
duly authorized as of the date specified thereon.
146
SCHEDULE 1
to
ASSIGNMENT AND ACCEPTANCE
Percentage of Assignor's interest assigned: __________%
Assignee's Facility: $__________
Aggregate outstanding principal
amount of Loans assigned: $__________
Principal amount of Revolving Note payable to
Assignee: $__________
Principal amount of Floor plan Loans payable to
Assignee: $__________
Amount of unfunded Approvals payable by Assignee: $__________
Principal amount of Revolving Note payable to
Assignor: $__________
Principal amount of Floor plan Loans payable to
Assignor: $__________
Amount of unfunded Approvals payable by Assignor: $__________
Effective Date (if other than date of
acceptance by Administrative Agent): *___________, ____
[NAME OF ASSIGNOR], as Assignor
By: ___________________________________
Title:_____________________________
Dated:____________, 20__
[NAME OF ASSIGNEE], as Assignee
By: ___________________________________
Title:_____________________________
147
Domestic Lending Office:
*This date should be no earlier than five Business Days after the delivery of
this Assignment and Acceptance to Administrative Agent.
Accepted and Approved
this _____ day of ____________, ____
ADMINISTRATIVE AGENT:
By: ___________________________________
Title:_____________________________
148
