EXHIBIT 10.61
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SECOND AMENDED AND RESTATED CREDIT AGREEMENT
among
COINMACH LAUNDRY CORPORATION,
COINMACH CORPORATION,
THE LENDING INSTITUTIONS LISTED HEREIN,
and
BANKERS TRUST COMPANY,
as ADMINISTRATIVE AGENT,
and
FIRST UNION NATIONAL BANK,
as SYNDICATION AGENT
__________________________________
Dated as of March 2, 1998
__________________________________
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TABLE OF CONTENTS
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Page
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SECTION 1. Amount and Terms of Credit.................................... 1
1.01 The Commitments................................................. 1
1.02 Minimum Amount of Each Borrowing................................ 4
1.03 Notice of Borrowing............................................. 5
1.04 Disbursement of Funds........................................... 6
1.05 Notes........................................................... 6
1.06 Conversions..................................................... 8
1.07 Pro Rata Borrowings............................................. 9
1.08 Interest........................................................ 9
1.09 Interest Periods................................................ 10
1.10 Increased Costs, Illegality, etc................................ 11
1.11 Compensation.................................................... 13
1.12 Change of Lending Office........................................ 14
1.13 Replacement of Banks............................................ 14
SECTION 2. Letters of Credit.............................................. 15
2.01 Letters of Credit............................................... 15
2.02 Letter of Credit Requests....................................... 16
2.03 Letter of Credit Participations................................. 16
2.04 Agreement to Repay Letter of Credit Payments.................... 19
2.05 Increased Costs................................................. 19
SECTION 3. Commitment Commission; Fees; Reductions of Commitment.......... 20
3.01 Fees............................................................ 20
3.02 Voluntary Termination of Unutilized Commitments................. 21
3.03 Mandatory Reduction of Commitments.............................. 22
SECTION 4. Prepayments; Payments; Taxes................................... 23
4.01 Voluntary Prepayments........................................... 23
4.02 Mandatory Repayments and Commitment Reductions.................. 24
4.03 Method and Place of Payment..................................... 32
4.04 Net Payments.................................................... 32
SECTION 5. Conditions Precedent to Loans.................................. 35
5.01 Execution of Agreement; Notes................................... 35
5.02 Payment of Fees................................................. 35
5.03 Opinions of Counsel............................................. 35
5.04 Corporate Documents; Proceedings; etc........................... 35
(i)
5.05 Acquisition Documents........................................... 36
5.06 Acquisition..................................................... 36
5.07 Officer's Certificate........................................... 36
5.08 Approvals....................................................... 36
5.09 Existing ▇▇▇▇▇ Indebtedness..................................... 36
5.10 Pledge and Security Agreements and Collateral Assignment
of Leases....................................................... 37
5.11 Mortgages; Title Insurance; Surveys; etc........................ 38
5.12 Adverse Change, etc............................................. 39
5.13 Litigation...................................................... 39
SECTION 6. Conditions Precedent to All Credit Events...................... 39
6.01 No Default; Representations and Warranties...................... 40
6.02 Notice of Borrowing; Letter of Credit Request................... 40
SECTION 7. Representations, Warranties and Agreements..................... 40
7.01 Corporate Status................................................ 41
7.02 Corporate Power and Authority................................... 41
7.03 No Violation.................................................... 41
7.04 Governmental Approvals.......................................... 42
7.05 Financial Statements; Financial Condition; Undisclosed
Liabilities; Projections; etc................................... 42
7.06 Litigation...................................................... 44
7.07 True and Complete Disclosure.................................... 44
7.08 Use of Proceeds; Margin Regulations............................. 45
7.09 Tax Returns and Payments........................................ 45
7.10 Compliance with ERISA........................................... 46
7.11 The Security Documents.......................................... 46
7.12 Representations and Warranties in Documents..................... 47
7.13 Properties...................................................... 47
7.14 Capitalization.................................................. 48
7.15 Subsidiaries.................................................... 48
7.16 Compliance with Statutes, etc................................... 48
7.17 Investment Company Act.......................................... 49
7.18 Public Utility Holding Company Act.............................. 49
7.19 Environmental Matters........................................... 49
7.20 Labor Relations................................................. 50
7.21 Patents, Licenses, Franchises and Formulas...................... 50
7.22 Indebtedness.................................................... 50
SECTION 8. Affirmative Covenants......................................... 51
8.01 Information Covenants........................................... 51
(ii)
8.02 Books, Records and Inspections.................................. 55
8.03 Maintenance of Property; Insurance.............................. 56
8.04 Corporate Franchises............................................ 57
8.05 Compliance with Statutes, etc................................... 57
8.06 Compliance with Environmental Laws.............................. 57
8.07 ERISA........................................................... 59
8.08 End of Fiscal Years; Fiscal Quarters............................ 60
8.09 Performance of Obligations...................................... 60
8.10 Payment of Taxes................................................ 60
8.11 Additional Security; Further Assurances......................... 60
SECTION 9. Negative Covenants............................................ 62
9.01 Liens.......................................................... 62
9.02 Consolidation, Merger, Sale or Purchase of Assets, etc......... 65
9.03 Dividends, etc................................................. 68
9.04 Indebtedness................................................... 69
9.05 Advances, Investments and Loans................................ 71
9.06 Transactions with Affiliates................................... 73
9.07 Capital Expenditures........................................... 73
9.08 Leverage Ratio................................................. 74
9.09 Consolidated Interest Coverage Ratio........................... 75
9.10 Minimum Consolidated EBITDA.................................... 76
9.11 Limitation on Voluntary Payments and Modifications of
Indebtedness; Modifications of Certificate of Incorporation,
By-Laws and Certain Other Agreements; etc...................... 77
9.12 Limitation on Certain Restrictions on Subsidiaries............. 77
9.13 Limitation on Issuance of Capital Stock........................ 78
9.14 Business....................................................... 78
9.15 Limitation on the Creation of Subsidiaries..................... 79
9.16 Restriction on Tax Consolidation............................... 80
SECTION 10. Events of Default............................................ 80
10.01 Payments....................................................... 80
10.02 Representations, etc........................................... 80
10.03 Covenants...................................................... 80
10.04 Default Under Other Agreements................................. 80
10.05 Bankruptcy, etc................................................ 81
10.06 ERISA.......................................................... 81
10.07 Security Documents............................................. 82
10.08 Guaranty....................................................... 82
(iii)
10.09 Judgments...................................................... 82
10.10 Change of Control.............................................. 82
SECTION 11. Definitions and Accounting Terms............................. 83
11.01 Defined Terms.................................................. 83
SECTION 12. The Administrative Agent..................................... 115
12.01 Appointment.................................................... 115
12.02 Nature of Duties............................................... 115
12.03 Lack of Reliance on the Administrative Agent................... 115
12.04 Certain Rights of the Administrative Agent..................... 116
12.05 Reliance....................................................... 116
12.06 Indemnification................................................ 116
12.07 The Administrative Agent in Its Individual Capacity............ 117
12.08 Holders........................................................ 117
12.09 Resignation by the Administrative Agent........................ 117
SECTION 13. Miscellaneous................................................ 118
13.01 Payment of Expenses, etc....................................... 118
13.02 Right of Set-off............................................... 119
13.03 Notices........................................................ 119
13.04 Benefit of Agreement........................................... 120
13.05 No Waiver; Remedies Cumulative................................. 122
13.06 Payments Pro Rata.............................................. 122
13.07 Calculations; Computations..................................... 123
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER
OF JURY TRIAL.................................................. 123
13.09 Counterparts................................................... 125
13.10 Effectiveness.................................................. 125
13.11 Headings Descriptive........................................... 125
13.12 Amendment or Waiver; etc....................................... 126
13.13 Survival....................................................... 127
13.14 Domicile of Loans.............................................. 127
13.15 Register....................................................... 128
13.16 Confidentiality................................................ 128
SECTION 14. Guaranty..................................................... 129
14.01 The Guaranty................................................... 129
14.02 Bankruptcy..................................................... 131
14.03 Nature of Liability............................................ 131
14.04 Independent Obligation......................................... 132
(iv)
14.05 Authorization.................................................. 132
14.06 Reliance....................................................... 133
14.07 Subordination.................................................. 133
14.08 Waiver......................................................... 133
ANNEX I Commitments
ANNEX II Bank Addresses
SCHEDULE 2.01 Existing Letters of Credit
SCHEDULE 5.10 Leases
SCHEDULE 5.11 Real Property
SCHEDULE 7.01 Corporate Status
SCHEDULE 7.04 Governmental Approvals
SCHEDULE 7.05 Financials
SCHEDULE 7.06 Litigation
SCHEDULE 7.07 True and Complete Disclosure
SCHEDULE 7.13 Properties
SCHEDULE 7.14 Convertible Securities
SCHEDULE 7.15 Subsidiaries
SCHEDULE 7.16 Compliance with Statutes
SCHEDULE 7.19 Environmental
SCHEDULE 7.20 Labor Relations
SCHEDULE 7.21 Patents, Licenses, Franchises and Formulas
SCHEDULE 7.22 Indebtedness
SCHEDULE 8.03 Insurance
SCHEDULE 9.01 Existing Liens
SCHEDULE 9.05 Investments
SCHEDULE 9.06 Transactions with Affiliates
EXHIBIT A Form of Notice of Borrowing
EXHIBIT B-1 Form of Tranche A Term Note
EXHIBIT B-2 Form of Tranche B Term Note
EXHIBIT B-3 Form of Tranche A Revolving Note
EXHIBIT B-4 Form of Tranche B Revolving Note
EXHIBIT B-5 Form of Swingline Note
EXHIBIT C Form of Letter of Credit Request
EXHIBIT D Form of Opinion of ▇▇▇▇▇▇▇▇, Kill & Olick, P.C.,
Special Counsel to Holdings and the Borrower
EXHIBIT E Form of Intercompany Note
EXHIBIT F Form of Assignment and Assumption Agreement
EXHIBIT G-1 Form of Borrower Pledge Agreement
(v)
EXHIBIT G-2 Form of Holdings Pledge Agreement
EXHIBIT H Form of Security Agreement
EXHIBIT I Form of Mortgage
EXHIBIT J Form of Collateral Assignment of Leases
EXHIBIT K Form of Collateral Assignment of Location Leases
EXHIBIT L Form of Landlord Consent
(vi)
SECOND AMENDED AND RESTATED CREDIT AGREEMENT ("Agreement"), dated as
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of March 2, 1998 among COINMACH LAUNDRY CORPORATION, a Delaware corporation
("Holdings"), COINMACH CORPORATION, a Delaware corporation (the "Borrower"), the
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lending institutions from time to time party hereto (each, a "Bank" and
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collectively, the "Banks"), BANKERS TRUST COMPANY, as Administrative Agent, and
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FIRST UNION NATIONAL BANK, as Syndication Agent. Unless otherwise defined
herein, all capitalized terms used herein and defined in Section 11 are used
herein as therein defined).
W I T N E S S E T H :
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WHEREAS, the parties hereto have previously entered into an amended
and restated Credit Agreement dated as of December 19, 1997 (the "Original
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Agreement");
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WHEREAS, the Borrower has entered into an agreement setting forth the
terms and conditions of the Acquisition;
WHEREAS, the parties hereto wish to amend the Original Agreement to
make mutually satisfactory changes in the terms of the Original Agreement;
WHEREAS, the Borrower will incur additional Loans from the Banks, the
proceeds of which will be used to finance the Acquisition;
WHEREAS, in such connection, the Borrower desires to be entitled to
borrow up to an additional $200,000,000 pursuant to this Agreement;
WHEREAS, contemporaneously with the funding of the additional Loans
hereunder, the Acquisition will take place;
WHEREAS, subject to and upon the terms and conditions set forth
herein, the Original Agreement will be automatically amended and restated to
read in full as set forth herein;
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. Amount and Terms of Credit.
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1.01 The Commitments. (a) Subject to and upon the terms and
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conditions set forth herein, each Bank with a Tranche A Term Loan Commitment
("Tranche A Term Loan Banks") severally agrees to make on the Effective Date a
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term loan (each such term loan, a "Tranche A Term Loan" and, collectively, the
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"Tranche A Term Loans") to the Borrower, which Tranche A Term Loans (i) shall be
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made and initially maintained as a single Borrowing of Base Rate Loans (subject
to the option to convert such Tranche A Term Loans pursuant to Section 1.06);
provided that, except as otherwise specifically provided in
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Section 1.10(b), all Tranche A Term Loans comprising the same Borrowing shall at
all times be of the same Type, and (ii) shall equal for each Bank, in initial
aggregate principal amount, an amount which equals the Tranche A Term Loan
Commitment of such Bank on the Effective Date (before giving effect to any
reductions thereto on such date pursuant to Section 3.03(a)). Once repaid,
Tranche A Term Loans incurred hereunder may not be reborrowed.
(b) Subject to and upon the terms and conditions set forth herein,
each Bank with a Tranche B Term Loan Commitment ("Tranche B Term Loan Banks")
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severally agrees to make on the Amendment Effective Date a term loan (each such
term loan, a "Tranche B Term Loan" and, collectively, the "Tranche B Term
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Loans") to the Borrower, which Tranche B Term Loans (i) shall be made and
initially maintained as a single Borrowing of Base Rate Loans (subject to the
option to convert such Tranche B Term Loans pursuant to Section 1.06); provided
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that, except as otherwise specifically provided in Section 1.10(b), all Tranche
B Term Loans comprising the same Borrowing shall at all times be of the same
Type, and (ii) shall equal for each Bank, in initial aggregate principal amount,
an amount which equals the Tranche B Term Loan Commitment of such Bank on the
Amendment Effective Date (before giving effect to any reductions thereto on such
date pursuant to Section 3.03(b)). Once repaid, Tranche B Term Loans incurred
hereunder may not be reborrowed.
(c) Subject to and upon the terms and conditions set forth herein,
each Bank with a Tranche A Revolving Loan Commitment ("Tranche A Revolving Loan
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Banks") severally agrees, at any time and from time to time on and after the
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Effective Date and prior to the Tranche A Revolving Loan Maturity Date, to make
a revolving loan or revolving loans (each, a "Tranche A Revolving Loan" and,
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collectively, the "Tranche A Revolving Loans") to the Borrower, which Tranche A
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Revolving Loans (i) shall, at the option of the Borrower, be Base Rate Loans or
Eurodollar Loans; provided that (A) except as otherwise specifically provided in
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Section 1.10(b), all Tranche A Revolving Loans comprising the same Borrowing
shall at all times be of the same Type and (B) no Tranche A Revolving Loans
maintained as Eurodollar Loans may be incurred prior to the earlier of (1) the
60th day after the Effective Date or (2) the Syndication Date, (ii) may be
repaid and reborrowed in accordance with the provisions hereof, (iii) shall not
exceed for any Bank at any time outstanding that aggregate principal amount
which, when added to the product of (x) such Bank's Adjusted Percentage and (y)
the aggregate amount of all Letter of Credit Outstandings plus all Swingline
Loans then outstanding (exclusive of Unpaid Drawings and Swingline Loans which
are repaid with the proceeds of, and simultaneously with the incurrence of, the
respective incurrence of Tranche A Revolving Loans) at such time, equals the
Tranche A Revolving Loan Commitment of such Bank at such time and (iv) shall not
exceed for all Banks at any time outstanding that aggregate principal amount
which, when added to the amount of all Swingline Loans then outstanding and all
Letter of Credit Outstandings (exclusive of
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Unpaid Drawings which are repaid with the proceeds of, and simultaneously with
the incurrence of, the respective incurrence of Tranche A Revolving Loans) at
such time the Tranche A Total Revolving Loan Commitment then in effect.
(d) Subject to and upon the terms and conditions set forth herein,
each Bank with a Tranche B Revolving Loan Commitment ("Tranche B Revolving Loan
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Banks") severally agrees, at any time and from time to time on and after the
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Effective Date and prior to the Tranche B Revolving Loan Maturity Date, to make
a revolving loan or revolving loans (each, a "Tranche B Revolving Loan" and,
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collectively, the "Tranche B Revolving Loans") to the Borrower, which Tranche B
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Revolving Loans (i) shall, at the option of the Borrower, be Base Rate Loans or
Eurodollar Loans; provided that (A) except as otherwise specifically provided in
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Section 1.10(b), all Tranche B Revolving Loans comprising the same Borrowing
shall at all times be of the same Type and (B) no Tranche B Revolving Loans
maintained as Eurodollar Loans may be incurred prior to the earlier of (1) the
60th day after the Effective Date or (2) the Syndication Date, (ii) may be
repaid and reborrowed in accordance with the provisions hereof, (iii) shall not
exceed for any Bank at any time outstanding that aggregate principal amount
which equals the Tranche B Revolving Loan Commitment of such Bank at such time
and (iv) shall not exceed for all Banks at any time outstanding that aggregate
principal amount which equals at such time the Tranche B Total Revolving Loan
Commitment then in effect.
(e) Subject to and upon the terms and conditions herein set forth,
BTCo agrees to make at any time and from time to time on and after the Effective
Date and prior to the Swingline Expiry Date, a loan or loans to the Borrower
(each, a "Swingline Loan" and, collectively, the "Swingline Loans"), which
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Swingline Loans (i) shall be made and maintained as Base Rate Loans, (ii) may be
repaid and reborrowed in accordance with the provisions hereof, (iii) shall not
exceed in aggregate principal amount at any time outstanding, when combined with
the aggregate principal amount of all Tranche A Revolving Loans then outstanding
and the Letter of Credit Outstandings (exclusive of Unpaid Drawings relating to
Letters of Credit which are repaid with the proceeds of, and simultaneously with
the incurrence of, the respective incurrence of Tranche A Revolving Loans) at
such time, an amount equal to the Tranche A Total Revolving Loan Commitment then
in effect and (iv) shall not exceed in aggregate principal amount at any time
outstanding the Maximum Swingline Amount. BTCo shall not be obligated to make
any Swingline Loans at a time when a Bank Default exists unless BTCo has entered
into arrangements satisfactory to it and the Borrower to eliminate BTCo's risk
with respect to each Bank's (including any Defaulting Bank's) participation in
such Swingline Loans, including by cash collateralizing such Defaulting Bank's
or Banks' Percentage of the outstanding Swingline Loans. BTCo will not make a
Swingline Loan after it has received written notice from the Borrower or the
Required Banks stating that a Default or an Event of Default exists until such
time as BTCo shall have received a written notice of (i) rescission of such
notice from the party or
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parties originally delivering the same or (ii) a waiver of such Default or Event
of Default from the Required Banks.
(f) On any Business Day, BTCo may, in its sole discretion, give
notice to the Tranche A Revolving Loan Banks and the Borrower that all
outstanding Swingline Loans shall be funded with a Borrowing of Tranche A
Revolving Loans (provided that each such notice shall be deemed to have been
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automatically given upon the occurrence of a Default or an Event of Default
under Section 10.05 or upon the exercise of any of the remedies provided in the
last paragraph of Section 10), in which case a Borrowing of Tranche A Revolving
Loans constituting Base Rate Loans (each such Borrowing, a "Mandatory
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Borrowing") shall be made on the immediately succeeding Business Day by all
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Tranche A Revolving Loan Banks pro rata based on each Bank's Percentage, and the
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proceeds thereof shall be applied directly to repay BTCo for such outstanding
Swingline Loans. Each Tranche A Revolving Loan Bank hereby irrevocably agrees
to make Base Rate Loans upon one Business Day's notice pursuant to each
Mandatory Borrowing in the amount and in the manner specified in the preceding
sentence and on the date specified in writing by BTCo notwithstanding (i) that
the amount of the Mandatory Borrowing may not comply with the Minimum Borrowing
Amount otherwise required hereunder, (ii) whether any conditions specified in
Section 6 are then satisfied, (iii) whether a Default or an Event of Default has
occurred and is continuing, (iv) the date of such Mandatory Borrowing and (v)
any reduction in the Tranche A Total Revolving Loan Commitment after any such
Swingline Loans were made. In the event that any Mandatory Borrowing cannot for
any reason be made on the date otherwise required above (including, without
limitation, as a result of the commencement of a proceeding under the Bankruptcy
Code in respect of the Borrower), each Tranche A Revolving Loan Bank (other than
BTCo) hereby agrees that it shall forthwith purchase from BTCo (without recourse
or warranty) such assignment of the outstanding Swingline Loans as shall be
necessary to cause the Tranche A Revolving Loan Banks to share in such Swingline
Loans ratably based upon their respective Percentages; provided that all
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interest payable on the Swingline Loans shall be for the account of BTCo until
the date the respective assignments is purchased and, to the extent attributable
to the purchased assignment, shall be payable to the Bank purchasing same from
and after such date of purchase.
1.02 Minimum Amount of Each Borrowing. The aggregate principal
--------------------------------
amount of each Borrowing of any Tranche of Term Loans shall not be less than
$5,000,000 and, if greater, shall be in an integral multiple of $500,000. The
aggregate principal amount of each Borrowing of any Tranche of Revolving Loans
shall be not less than $1,000,000 and, if greater, shall be in an integral
multiple of $100,000. More than one Borrowing may occur on the same date, but
at no time shall there be outstanding more than nine Borrowings of Eurodollar
Loans. The principal amount of each Borrowing of Swin-
-4-
gline Loans shall not be less than $250,000 and, if greater, shall be in an
integral multiple of $50,000.
1.03 Notice of Borrowing. (a) Whenever the Borrower desires to
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make a Borrowing hereunder (excluding Borrowings of Swingline Loans and Tranche
A Revolving Loans incurred pursuant to a Mandatory Borrowing), it shall give the
Administrative Agent at its Notice Office at least one Business Day's prior
written (or telephonic promptly confirmed in writing) notice of each Base Rate
Loan and at least three Business Days' prior written (or telephonic promptly
confirmed in writing) notice of each Eurodollar Loan to be made hereunder;
provided that any such notice shall be deemed to have been given on a certain
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day only if given before 12:00 Noon (New York time) on such day. Each such
written notice or written confirmation of telephonic notice (each, a "Notice of
---------
Borrowing"), except as otherwise expressly provided in Section 1.10, shall be
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irrevocable and shall be given by the Borrower in the form of Exhibit A,
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appropriately completed to specify the aggregate principal amount of the Loans
to be made pursuant to such Borrowing, the date of such Borrowing (which shall
be a Business Day), whether the Loans being made pursuant to such Borrowing
shall constitute Term Loans or Revolving Loans and whether, subject to the other
terms and provisions hereof, the Loans being made pursuant to such Borrowing are
to be initially maintained as Base Rate Loans or Eurodollar Loans and, if
Eurodollar Loans, the initial Interest Period to be applicable thereto. The
Administrative Agent shall promptly give each Bank which is required to make
Loans of the Tranche specified in the respective Notice of Borrowing, notice of
such proposed Borrowing, of such Bank's proportionate share thereof and of the
other matters required by the immediately preceding sentence to be specified in
the Notice of Borrowing.
(b) (i) Whenever the Borrower desires to incur Swingline Loans
hereunder, it shall give BTCo not later than 12:00 noon (New York time) on the
day such Swingline Loan is to be made, written notice (or telephonic notice
promptly confirmed in writing) of each Swingline Loan to be made hereunder.
Each such notice shall be irrevocable and shall specify in each case (x) the
date of such Borrowing (which shall be a Business Day) and (y) the aggregate
principal amount of the Swingline Loan to be made pursuant to such Borrowing.
(ii) Mandatory Borrowings shall be made upon the notice specified in
Section 1.01(e), with the Borrower hereby irrevocably agreeing, by its
incurrence of any Swingline Loan, to the making of Mandatory Borrowings as set
forth in such Section 1.01(e).
(c) Without in any way limiting the obligation of the Borrower to
confirm in writing any telephonic notice of any Borrowing of Loans, the
Administrative Agent or BTCo (in the case of Swingline Loans), as the case may
be, may act without liability upon the basis of telephonic notice of such
Borrowing, reasonably believed by the Administrative Agent or BTCo, as the case
may be, in good faith to be from an Authorized Officer of the
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Borrower prior to receipt of written confirmation. In each such case, the
Borrower hereby waives the right to dispute the Administrative Agent's or
BTCo's, as the case may be, record of the terms of such telephonic notice of
such Borrowing of Loans.
1.04 Disbursement of Funds. No later than 12:00 Noon (New York
---------------------
time) on the date specified in each Notice of Borrowing, each Bank with a
Commitment of the respective Tranche will make available its pro rata portion of
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each such Borrowing requested to be made on such date (or in the case of
Swingline Loans, BTCo shall make available the full amount thereof). All such
amounts shall be made available in Dollars and in immediately available funds at
the Payment Office of the Administrative Agent, and the Administrative Agent
will make available to the Borrower at the Payment Office the aggregate of the
amounts so made available by the Banks. Unless the Administrative Agent shall
have been notified by any Bank prior to the date of Borrowing that such Bank
does not intend to make available to the Administrative Agent such Bank's
portion of any Borrowing to be made on such date, the Administrative Agent may
assume that such Bank has made such amount available to the Administrative Agent
on such date of Borrowing and the Administrative Agent, in reliance upon such
assumption, may (in its sole discretion and without obligation to do so) make
available to the Borrower a corresponding amount. If such corresponding amount
is not in fact made available to the Administrative Agent by such Bank, the
Administrative Agent shall be entitled to recover such corresponding amount on
demand from such Bank. If such Bank does not pay such corresponding amount
forthwith upon the Agent's demand therefor, the Administrative Agent shall
promptly notify the Borrower and the Borrower shall immediately pay such
corresponding amount to the Administrative Agent. The Administrative Agent
shall also be entitled to recover on demand from such Bank or the Borrower, as
the case may be, interest on such corresponding amount in respect of each day
from the date such corresponding amount was made available by the Administrative
Agent to the Borrower until the date such corresponding amount is recovered by
the Administrative Agent, at a rate per annum equal to (i) if recovered from
such Bank, at the overnight Federal Funds Rate and (ii) if recovered from the
Borrower, the rate of interest applicable to the respective Borrowing, as
determined pursuant to Section 1.08. Nothing in this Section 1.04 shall be
deemed to relieve any Bank from its obligation to make Loans hereunder or to
prejudice any rights which the Borrower may have against any Bank as a result of
any failure by such Bank to make Loans hereunder.
1.05 Notes. (a) Upon the written request of a Bank, the
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Borrower's obligation to pay the principal of, and interest on, the Loans made
by each Bank shall be evidenced (i) if Tranche A Term Loans, by a promissory
note duly executed and delivered by the Borrower substantially in the form of
Exhibit B-1 with blanks appropriately completed in conformity herewith (each, a
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"Tranche A Term Note" and, collectively, the "Tranche A Term Notes"), (ii) if
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Tranche B Term Loans, by a promissory note duly executed and delivered by the
Borrower substantially in the form of Exhibit B-2 with blanks appropriately
-6-
completed in conformity herewith (each, a "Tranche B Term Note" and,
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collectively, the "Tranche B Term Notes"), (iii) if Tranche A Revolving Loans,
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by a promissory note duly executed and delivered by the Borrower substantially
in the form of Exhibit B-3 with blanks appropriately completed in conformity
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herewith (each, a "Tranche A Revolving Note" and, collectively, the "Tranche A
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Revolving Notes"), (iv) if Tranche B Revolving Loans, by a promissory note duly
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executed and delivered by the Borrower substantially in the form of Exhibit B-4,
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with blanks appropriately completed in conformity herewith (each, a "Tranche B
---------
Revolving Note" and, collectively, the "Tranche B Revolving Notes") and (v) if
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Swingline Loans, by a promissory note duly executed and delivered by the
Borrower substantially in the form of Exhibit B-5, with blanks appropriately
completed in conformity herewith (the "Swingline Note").
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(b) The Tranche A Term Note issued to each Bank shall (i) be executed
by the Borrower, (ii) be payable to the order of such Bank and be dated the
Effective Date, (iii) be in a stated principal amount equal to the Tranche A
Term Loan made by such Bank on the Effective Date and be payable in the
principal amount of Tranche A Term Loans evidenced thereby, (iv) mature on the
Tranche A Term Loan Maturity Date, (v) bear interest as provided in the
appropriate clause of Section 1.08 in respect of the Base Rate Loans and
Eurodollar Loans, as the case may be, evidenced thereby, (vi) be subject to
voluntary prepayments as provided in Section 4.01 and mandatory repayment as
provided in Section 4.02 and (vii) be entitled to the benefits of this Agreement
and the other Credit Documents.
(c) The Tranche B Term Note issued to each Bank shall (i) be executed
by the Borrower, (ii) be payable to the order of such Bank and be dated the
Amendment Effective Date, (iii) be in a stated principal amount equal to the
Tranche B Term Loans made by such Bank on the Amendment Effective Date and be
payable in the principal amount of Tranche B Term Loans evidenced thereby, (iv)
mature on the Tranche B Term Loan Maturity Date, (v) bear interest as provided
in the appropriate clause of Section 1.08 in respect of the Base Rate Loans and
Eurodollar Loans, as the case may be, evidenced thereby, (vi) be subject to
voluntary prepayments as provided in Section 4.01 and mandatory repayment as
provided in Section 4.02 and (vii) be entitled to the benefits of this Agreement
and the other Credit Documents.
(d) The Tranche A Revolving Note issued to each Bank shall (i) be
executed by the Borrower, (ii) be payable to the order of such Bank and be dated
the Effective Date, (iii) be in a stated principal amount equal to the Tranche A
Revolving Loan Commitment of such Bank on the Effective Date and be payable in
the principal amount of Tranche A Revolving Loans evidenced thereby, (iv) mature
on the Tranche A Revolving Loan Maturity Date, (v) bear interest as provided in
the appropriate clause of Section 1.08 in respect of the Base Rate Loans and
Eurodollar Loans, as the case may be, evidenced thereby, (vi) be subject to
voluntary prepayments as
-7-
provided in Section 4.01 and mandatory repayment as provided in Section 4.02 and
(vii) be entitled to the benefits of this Agreement and the other Credit
Documents.
(e) The Tranche B Revolving Note issued to each Bank shall (i) be
executed by the Borrower, (ii) be payable to the order of such Bank and be dated
the Effective Date, (iii) be in a stated principal amount equal to the Tranche B
Revolving Loan Commitment of such Bank and be payable in the principal amount of
the Tranche B Revolving Loans evidenced thereby, (iv) mature on the Tranche B
Revolving Loan Maturity Date, (v) bear interest as provided in the appropriate
clause of Section 1.08 in respect of the Base Rate Loans and Eurodollar Loans,
as the case may be, evidenced thereby, (vi) be subject to voluntary prepayments
as provided in Section 4.01 and mandatory repayment as provided in Section 4.02
and (vii) be entitled to the benefits of this Agreement and the other Credit
Documents.
(f) The Swingline Note issued to BTCo shall (i) be executed by the
Borrower, (ii) be payable to the order of BTCo and be dated the Effective Date,
(iii) be in a stated principal amount equal to the Maximum Swingline Amount and
be payable in the principal amount of the outstanding Swingline Loans evidenced
thereby, (iv) mature on the Swingline Expiry Date, (v) bear interest as provided
in Section 1.08 in respect of the Base Rate Loans evidenced thereby, (vi) be
subject to voluntary prepayments as provided in Section 4.01 and mandatory
repayment as provided in Section 4.02, and (vii) be entitled to the benefits of
this Agreement and the other Credit Documents.
(g) Each Bank will note on its internal records the amount of each
Loan made by it and each payment in respect thereof and will prior to any
transfer of any of its Notes endorse on the reverse side thereof the outstanding
principal amount of Loans evidenced thereby. Failure to make any such notation
shall not affect the Borrower's obligations in respect of such Loans.
1.06 Conversions. The Borrower shall have the option to convert,
-----------
on any Business Day occurring on or after the earlier of (1) the 60th day after
the Effective Date or (2) the Syndication Date, all or a portion equal to at
least (x) in the case of a conversion of Term Loans, $5,000,000 (and, if
greater, in an integral multiple of $500,000) and (y) in the case of a
conversion of Revolving Loans, $1,000,000 (and, if greater, in an integral
multiple of $100,000), of the outstanding principal amount of Loans made
pursuant to one or more Borrowings (so long as of the same Tranche) of one or
more Types of Loans into a Borrowing (of the same Tranche) of another Type of
Loan; provided that (i) except as otherwise provided in Section 1.10(b),
--------
Eurodollar Loans may be converted into Base Rate Loans only on the last day of
an Interest Period applicable to the Loans being converted and no such partial
conversion of Eurodollar Loans shall reduce the outstanding principal amount of
such Eurodollar Loans made pursuant to a single Borrowing to less than (x) in
the case of Term Loans, $5,000,000 and (y) in the case of Revolving Loans,
$1,000,000,
-8-
(ii) Base Rate Loans may only be converted into Eurodollar Loans if no
Default or Event of Default is in existence on the date of the conversion,
and (iii) no conversion pursuant to this Section 1.06 shall result in a greater
number of Eurodollar Borrowings than is permitted under Section 1.02. Each such
conversion shall be effected by the Borrower by giving the Administrative Agent
at its Notice Office prior to 12:00 Noon (New York time) at least three Business
Days' prior notice (each, a "Notice of Conversion") specifying the Loans to be
--------------------
so converted, the Borrowing(s) pursuant to which such Loans were made and, if to
be converted into Eurodollar Loans, the Interest Period to be initially
applicable thereto. The Administrative Agent shall give each Bank prompt notice
of any such proposed conversion affecting any of its Loans; provided that the
--------
failure of the Administrative Agent to give any such notice shall not affect the
rights or obligations of the Borrower hereunder.
1.07 Pro Rata Borrowings. All Borrowings of Tranche A Term Loans,
-------------------
Tranche B Term Loans, Tranche A Revolving Loans and Tranche B Revolving Loans
under this Agreement shall be incurred from the Banks pro rata on the basis of
--- ----
their respective Tranche A Term Loan Commitments, Tranche B Term Loan
Commitments, Tranche A Revolving Loan Commitments or Tranche B Revolving Loan
Commitments, as the case may be. It is understood that no Bank shall be
responsible for any default by any other Bank of its obligation to make Loans
hereunder and that each Bank shall be obligated to make the Loans provided to be
made by it hereunder, regardless of the failure of any other Bank to make its
Loans hereunder.
1.08 Interest. (a) The Borrower agrees to pay interest in respect
--------
of the unpaid principal amount of each Base Rate Loan from the date the proceeds
thereof are made available to the Borrower until the earlier of (i) the maturity
(whether by acceleration or otherwise) of such Base Rate Loan and (ii) the
conversion of such Base Rate Loan to a Eurodollar Loan pursuant to Section 1.06,
at a rate per annum which shall be equal to the sum of the Applicable Base Rate
Margin plus the Base Rate in effect from time to time.
(b) The Borrower agrees to pay interest in respect of the unpaid
principal amount of each Eurodollar Loan from the date the proceeds thereof are
made available to the Borrower until the earlier of (i) the maturity (whether by
acceleration or otherwise) of such Eurodollar Loan and (ii) the conversion of
such Eurodollar Loan to a Base Rate Loan pursuant to Section 1.06, 1.09 or
1.10(b), as applicable, at a rate per annum which shall, during each Interest
Period applicable thereto, be equal to the sum of the Applicable Eurodollar
Margin plus the Eurodollar Rate for such Interest Period.
(c) Overdue principal and, to the extent permitted by law, overdue
interest in respect of each Loan and any other overdue amount payable hereunder
shall, in each case, bear interest until paid in full at a rate per annum equal
to the greater of (x) 2% per annum in excess of the rate otherwise applicable to
Base Rate Loans of the respective
-9-
Tranche of Loans from time to time and (y) the rate which is 2% in excess of the
rate then borne by such Loans, in each case with such interest to be payable on
demand.
(d) Accrued (and theretofore unpaid) interest shall be payable (i) in
respect of each Base Rate Loan, quarterly in arrears on each Quarterly Payment
Date, (ii) in respect of each Eurodollar Loan, on the last day of each Interest
Period applicable thereto and, in the case of an Interest Period in excess of
three months, on each date occurring at three month intervals after the first
day of such Interest Period and (iii) in respect of each Loan, on any repayment
or prepayment (on the amount repaid or prepaid), upon conversion, at maturity
(whether by acceleration or otherwise) and, after such maturity, on demand.
(e) Upon each Interest Determination Date, the Administrative Agent
shall determine the Eurodollar Rate for each Interest Period applicable to
Eurodollar Loans and shall promptly notify the Borrower and the applicable Banks
thereof. Each such determination shall, absent manifest error, be final and
conclusive and binding on all parties hereto.
(f) All computations of interest hereunder shall be made in
accordance with Section 13.07(b).
1.09 Interest Periods. At the time it gives any Notice of
----------------
Borrowing or Notice of Conversion in respect of the making of, or conversion
into, any Eurodollar Loan (in the case of the initial Interest Period applicable
thereto) or on the third Business Day prior to the expiration of an Interest
Period applicable to such Eurodollar Loan (in the case of any subsequent
Interest Period), the Borrower shall have the right to elect, by giving the
Administrative Agent notice thereof, the interest period (each, an "Interest
--------
Period") applicable to such Eurodollar Loan, which Interest Period shall, at the
------
option of the Borrower, be a one, two, three or six-month period; provided that:
--------
(i) all Eurodollar Loans comprising a Borrowing shall at all times
have the same Interest Period;
(ii) the initial Interest Period for any Eurodollar Loan shall
commence on the date of Borrowing of such Eurodollar Loan (including the
date of any conversion thereto from a Loan of a different Type) and each
Interest Period occurring thereafter in respect of such Eurodollar Loan
shall commence on the day on which the next preceding Interest Period
applicable thereto expires;
(iii) if any Interest Period relating to a Eurodollar Loan begins
on a day for which there is no numerically corresponding day in the
calendar month at the
-10-
end of such Interest Period, such Interest Period shall end on the last
Business Day of such calendar month;
(iv) if any Interest Period would otherwise expire on a day which
is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day; provided, however, that if any Interest Period for
-------- -------
a Eurodollar Loan would otherwise expire on a day which is not a Business
Day but is a day of the month after which no further Business Day occurs in
such month, such Interest Period shall expire on the next preceding
Business Day;
(v) no Interest Period may be selected at any time when a Default
or Event of Default is then in existence;
(vi) no Interest Period in respect of any Borrowing of any Tranche
of Loans shall be selected which extends beyond the respective Maturity
Date for such Tranche of Loans; and
(vii) no Interest Period in respect of any Borrowing of Term Loans
shall be selected which extends beyond any date upon which a mandatory
repayment of such Term Loans will be required to be made under Section
4.02(c) or (d), as the case may be, if the aggregate principal amount of
Term Loans which have Interest Periods which will expire after such date
will be in excess of the aggregate principal amount of Term Loans then
outstanding less the aggregate amount of such required prepayment.
If upon the expiration of any Interest Period applicable to a
Borrowing of Eurodollar Loans, the Borrower has failed to elect, or is not
permitted to elect, a new Interest Period to be applicable to such Eurodollar
Loans as provided above, the Borrower shall be deemed to have elected to convert
such Eurodollar Loans into Base Rate Loans effective as of the expiration date
of such current Interest Period.
1.10 Increased Costs, Illegality, etc. (a) In the event that any
--------------------------------
Bank shall have determined (which determination shall, absent manifest error, be
final and conclusive and binding upon all parties hereto but, with respect to
clause (i) below, may be made only by the Administrative Agent):
(i) on any Interest Determination Date that, by reason of any
changes arising after the date of this Agreement affecting the interbank
Eurodollar market, adequate and fair means do not exist for ascertaining
the applicable interest rate on the basis provided for in the definition of
Eurodollar Rate; or
-11-
(ii) at any time, that such Bank shall incur increased costs or
reductions in the amounts received or receivable hereunder with respect to
any Eurodollar Loan because of (x) any Change in Law since the date of this
Agreement, such as, for example, but not limited to: (A) a change in
Covered Taxes resulting from the payment to any Bank of the principal of or
interest such Eurodollar Loan or any other amounts payable hereunder, but
without duplication of any amounts payable in respect of Taxes pursuant to
Section 4.04(a), or (B) a change in official reserve requirements, but, in
all events, excluding reserves required under Regulation D to the extent
included in the computation of the Eurodollar Rate and/or (y) other
circumstances since the date of this Agreement affecting such Bank or the
interbank Eurodollar market or the position of such Bank in such market; or
(iii) at any time, that the making or continuance of any
Eurodollar Loan has been made (x) unlawful by any law or governmental rule,
regulation or order, (y) impossible by compliance by any Bank in good faith
with any governmental request (whether or not having force of law) or (z)
impracticable as a result of a contingency occurring after the date of this
Agreement which materially and adversely affects the interbank Eurodollar
market;
then, and in any such event, such Bank (or the Administrative Agent, in the case
of clause (i) above) shall promptly give notice (by telephone confirmed in
writing) to the Borrower and, except in the case of clause (i) above, to the
Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the other Banks). Thereafter (x) in
the case of clause (i) above, Eurodollar Loans shall no longer be available
until such time as the Administrative Agent notifies the Borrower and the Banks
that the circumstances giving rise to such notice by the Administrative Agent no
longer exist, and any Notice of Borrowing or Notice of Conversion given by the
Borrower with respect to Eurodollar Loans which have not yet been incurred
(including by way of conversion) shall be deemed rescinded by the Borrower, (y)
in the case of clause (ii) above, the Borrower shall pay to such Bank, upon
written demand therefor, such additional amounts (in the form of an increased
rate of, or a different method of calculating, interest or otherwise as such
Bank in its sole discretion shall determine) as shall be required to compensate
such Bank for such increased costs or reductions in amounts received or
receivable hereunder (a written notice as to the additional amounts owed to such
Bank, showing the basis for the calculation thereof, submitted to the Borrower
by such Bank in good faith shall, absent manifest error, be final and conclusive
and binding on all the parties hereto) and (z) in the case of clause (iii)
above, the Borrower shall take one of the actions specified in Section 1.10(b)
as promptly as possible and, in any event, within the time period required by
law. Each of the Administrative Agent and each Bank agrees that if it gives
notice to the Borrower of any of the events described in clause (i) or (iii)
above, it shall promptly notify the Borrower and, in the case of any such Bank,
the Agent, if such event ceases to exist. If
-12-
any such event described in clause (iii) above ceases to exist as to a Bank, the
obligations of such Bank to make Eurodollar Loans and to convert Base Rate Loans
into Eurodollar Loans on the terms and conditions contained herein shall be
reinstated.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected by the circumstances described in
Section 1.10(a)(iii) shall) either (x) if the affected Eurodollar Loan is then
being made initially or pursuant to a conversion, cancel the respective
Borrowing by giving the Administrative Agent telephonic notice (confirmed in
writing) on the same date that the Borrower was notified by the affected Bank
pursuant to Section 1.10(a)(ii) or (iii) or (y) if the affected Eurodollar Loan
is then outstanding, upon at least three Business Days' written notice to the
Administrative Agent, require the affected Bank to convert such Eurodollar Loan
into a Base Rate Loan; provided that, if more than one Bank is affected at any
--------
time, then all affected Banks must be treated the same pursuant to this Section
1.10(b).
(c) If at any time after the Effective Date, any Bank determines that
the introduction of or any change in any applicable law or governmental rule,
regulation, order, guideline, directive or request (whether or not having the
force of law) concerning capital adequacy, or any change in interpretation or
administration thereof by any governmental authority, central bank or comparable
agency, will have the effect of increasing the amount of capital required or
expected to be maintained by such Bank or any corporation controlling such Bank
based on the existence of such Bank's Commitments hereunder or its obligations
hereunder, then the Borrower shall pay to such Bank, upon its written demand
therefor, such additional amounts as shall be required to compensate such Bank
or such other corporation for the increased cost to such Bank or such other
corporation or the reduction in the rate of return to such Bank or such other
corporation as a result of such increase of capital. Such Bank's reasonable
good faith determination of compensation owing under this Section 1.10(c) shall,
absent manifest error, be final and conclusive and binding on all the parties
hereto. Each Bank, upon determining that any additional amounts will be payable
pursuant to this Section 1.10(c), will give prompt written notice thereof to the
Borrower, which notice shall set forth the basis of the calculation of such
additional amounts, although the failure to give any such notice shall not
release or diminish the Borrower's obligations to pay additional amounts
pursuant to this Section 1.10(c) upon the subsequent receipt of such notice.
1.11 Compensation. The Borrower shall compensate each Bank, upon
------------
its written request (which request shall set forth the reason for requesting
such compensation), for all reasonable losses, expenses and liabilities
(including, without limitation, any loss, expense or liability incurred by
reason of the liquidation or reemployment of deposits or other funds required by
such Bank to fund its Eurodollar Loans but excluding any loss of
-13-
anticipated profit) which such Bank may sustain: (i) if for any reason (other
than a default by such Bank) a Borrowing of, or conversion from or into,
Eurodollar Loans does not occur on a date specified therefor in a Notice of
Borrowing or Notice of Conversion (whether or not withdrawn by the Borrower or
deemed withdrawn pursuant to Section 1.10(a)); (ii) if any repayment (including
any repayment made pursuant to Section 4.02 or as a result of an acceleration of
the Loans pursuant to Section 10) or conversion of any of its Eurodollar Loans
occurs on a date which is not the last day of an Interest Period with respect
thereto; (iii) if any prepayment of any of its Eurodollar Loans is not made on
any date specified in a notice of prepayment given by the Borrower; or (iv) as a
consequence of (x) any other default by the Borrower to repay its Loans when
required by the terms of this Agreement or any Note held by such Bank or (y) any
election made pursuant to Sections 1.10(b) or 1.13. Calculation of all amounts
payable to a Bank under this Section 1.11 shall be made as though that Bank had
actually funded its relevant Eurodollar Loan through the purchase of a
Eurodollar deposit bearing interest at the Eurodollar Rate in an amount equal to
the amount of that Loan, having maturity comparable to the relevant Interest
Period and through the transfer of such Eurodollar deposit from an offshore
office of that Bank to a domestic office of that Bank in the United States of
America; provided, however, that each Bank may fund each of its Eurodollar Loans
-------- -------
in any manner it sees fit and the foregoing assumption shall be utilized only
for the calculation of amounts payable under this Section 1.11.
1.12 Change of Lending Office. Each Bank agrees that on the
------------------------
occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or
(iii), Section 1.10(c), Section 2.05 or Section 4.04 with respect to such Bank,
it will, if requested by the Borrower, use reasonable good faith efforts
(subject to overall policy considerations of such Bank) to designate another
lending office for any Loans or Letters of Credit affected by such event;
provided that such designation is made on such terms that such Bank and its
--------
lending office suffer no significant economic, legal or regulatory disadvantage,
with the object of avoiding the consequence of the event giving rise to the
operation of such Section. Nothing in this Section 1.12 shall affect or
postpone any of the obligations of the Borrower or the right of any Bank
provided in Sections 1.10, 2.05 and 4.04.
1.13 Replacement of Banks. (x) If any Bank becomes a Defaulting
--------------------
Bank, (y) upon the occurrence of any event giving rise to the operation of
Section 1.10(a)(ii) or (iii), Section 1.10(c), Section 2.05 or Section 4.04 with
respect to any Bank which results in such Bank charging to the Borrower
increased costs in excess of those being generally charged by the other Banks or
becoming incapable of making Eurodollar Loans, or (z) as provided in Section
13.12(b) in the case of certain refusals by a Bank to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks, the Borrower shall
have the right, if no Default or Event of Default will exist immediately after
giving effect to the respective replacement, to replace such Bank (the "Replaced
--------
Bank") with one or more other Eligible
----
-14-
Transferee or Transferees, none of whom shall constitute a Defaulting Bank at
the time of such replacement reasonably acceptable to the Administrative Agent
(collectively, the "Replacement Bank"); provided that (i) at the time of any
---------------- --------
replacement pursuant to this Section 1.13, the Replacement Bank shall enter into
one or more Assignment and Assumption Agreements pursuant to Section 13.04(b)
(and with all fees payable pursuant to said Section 13.04(b) to be paid by the
Replacement Bank) pursuant to which the Replacement Bank shall acquire all of
the Commitments and outstanding Loans of, and in each case participations in
Letters of Credit and Swingline Loans by, the Replaced Bank and, in connection
therewith, shall pay to (x) the Replaced Bank in respect thereof an amount equal
to the sum of (A) an amount equal to the principal of, and all accrued interest
on, all outstanding Loans of the Replaced Bank, (B) an amount equal to all
Unpaid Drawings and Swingline Loans that have been funded by (and not reimbursed
to) such Replaced Bank, together with all then unpaid interest with respect
thereto at such time and (C) an amount equal to all accrued, but theretofore
unpaid, Fees owing to the Replaced Bank pursuant to Section 3.01 and (y) BTCo an
amount equal to such Replaced Bank's Adjusted Percentage (for this purpose,
determined as if the adjustment described in clause (y) of the immediately
succeeding sentence had been made with respect to such Replaced Bank) of any
Unpaid Drawing (which at such time remains an Unpaid Drawing) or Swingline Loans
to the extent such amount was not theretofore funded by such Replaced Bank, and
(ii) all obligations of the Borrower owing to the Replaced Bank (other than
those specifically described in clause (i) above in respect of which the
assignment purchase price has been, or is concurrently being, paid, but
including all amounts, if any, owing under Section 1.11) shall be paid in full
to such Replaced Bank concurrently with such replacement. Upon the execution of
the respective Assignment and Assumption Agreements, the payment of amounts
referred to in clauses (i) and (ii) above and, if so requested by the
Replacement Bank, delivery to the Replacement Bank of the appropriate Note or
Notes executed by the Borrower, (x) the Replacement Bank shall become a Bank
hereunder and, unless the respective Replaced Bank continues to have outstanding
Term Loans hereunder, the Replaced Bank shall cease to constitute a Bank
hereunder, except with respect to indemnification provisions under this
Agreement (including, without limitation, Sections 1.10, 1.11, 2.05, 4.04, 13.01
and 13.06) and the other Credit Documents, which shall survive as to such
Replaced Bank and (y) the Adjusted Percentages of the Banks shall be
automatically adjusted at such time to give effect to such replacement (and to
give effect to the replacement of a Defaulting Bank with one or more Non-
Defaulting Banks).
SECTION 2. Letters of Credit.
-----------------
2.01 Letters of Credit. (a) Subject to and upon the terms and
-----------------
conditions herein set forth, the Borrower may request that any Issuing Bank
issue, at any time and from time to time on and after the Effective Date and
prior to the Tranche A Revolving Loan Maturity Date, for the account of the
Borrower and for the benefit of any holder (or
-15-
any trustee, agent or other similar representative for any such holders) of L/C
Supportable Indebtedness of the Borrower or any of its Subsidiaries that are
Guarantors, an irrevocable standby letter of credit, in a form customarily used
by such Issuing Bank or in such other form as has been approved by such Issuing
Bank (each such standby letter of credit, a "Letter of Credit") in support of
----------------
such L/C Supportable Indebtedness.
(b) Notwithstanding the foregoing, (i) no Letter of Credit shall be
issued the Stated Amount of which, when added to the Letter of Credit
Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and
prior to the issuance of, the respective Letter of Credit) at such time would
exceed either (x) $10,000,000 or (y) when added to the aggregate principal
amount of all Tranche A Revolving Loans and Swingline Loans made by Non-
Defaulting Banks and then outstanding, an amount equal to the Adjusted Total
Tranche A Revolving Loan Commitment at such time, (ii) each Letter of Credit
shall by its terms terminate on or before, the date which occurs 12 months after
the date of the issuance thereof but not beyond the 30th day prior to Revolving
Loan Maturity Date (although any such Standby Letter of Credit may be extendible
for successive periods of up to 12 months, but not beyond the 30th day prior to
Revolving Loan Maturity Date), on terms acceptable to the Issuing Bank thereof)
and (iii) each Letter of Credit shall be denominated in Dollars and shall be
issued on a sight basis.
2.02 Letter of Credit Requests. (a) Whenever the Borrower desires
-------------------------
that a Letter of Credit be issued for its account, the Borrower shall give the
Administrative Agent and the respective Issuing Bank at least two Business Days'
(or such shorter period as is acceptable to the respective Issuing Bank) written
notice thereof. Each notice shall be in the form of Exhibit C (each, a "Letter
------
of Credit Request").
-----------------
(b) The making of each Letter of Credit Request shall be deemed to be
a representation and warranty by the Borrower that such Letter of Credit may be
issued in accordance with, and will not violate the requirements of, Section
2.01(b). Unless the respective Issuing Bank has received notice from any Bank
before it issues a Letter of Credit that one or more of the conditions specified
in Sections 5 or 6 are not then satisfied, or that the issuance of such Letter
of Credit would violate Section 2.01(b), then such Issuing Bank shall issue the
requested Letter of Credit for the account of the Borrower in accordance with
such Issuing Bank's usual and customary practices. Upon its issuance of any
Letter of Credit or any amendment thereto, such Issuing Bank shall promptly
notify each Bank of such issuance or amendment, which notice, shall be
accompanied by a copy of the amendment or Letter of Credit actually issued.
2.03 Letter of Credit Participations. (a) Immediately upon the
-------------------------------
issuance by any Issuing Bank of any Letter of Credit, such Issuing Bank shall be
deemed to have sold and transferred to each Bank with a Tranche A Revolving Loan
Commitment, other than a Defaulting Bank or such Issuing Bank (each such Bank,
in its capacity under this Section
-16-
2.03, a "Participant"), and each such Participant shall be deemed irrevocably
-----------
and unconditionally to have purchased and received from such Issuing Bank,
without recourse or warranty, an undivided interest and participation, to the
extent of such Participant's Adjusted Percentage-Tranche A, in such Letter of
Credit, each drawing made thereunder and the obligations of the Borrower under
this Agreement with respect thereto, and any security therefor or guaranty
pertaining thereto. Upon any change in the Tranche A Revolving Loan Commitments
or Adjusted Percentages-Tranche A of the Banks pursuant to Section 1.13 or 13.04
or as a result of a Bank Default, it is hereby agreed that, with respect to all
outstanding Letters of Credit and Unpaid Drawings, there shall be an automatic
adjustment to the participations pursuant to this Section 2.03 to reflect the
new Adjusted Percentages-Tranche A of the assignor and assignee Bank or of all
Banks with Tranche A Revolving Loan Commitments (other than Defaulting Banks),
as the case may be.
(b) In determining whether to pay under any Letter of Credit, such
Issuing Bank shall have no obligation relative to the other Banks other than to
confirm that any documents required to be delivered under such Letter of Credit
appear to have been delivered and that they appear to comply on their face with
the requirements of such Letter of Credit. Any action taken or omitted to be
taken by any Issuing Bank under or in connection with any Letter of Credit if
taken or omitted in the absence of gross negligence or willful misconduct, as
determined by a court of competent jurisdiction, shall not create for such
Issuing Bank any resulting liability to the Borrower or any Bank.
(c) In the event that any Issuing Bank makes any payment under any
Letter of Credit and the Borrower shall not have reimbursed such amount in full
to such Issuing Bank pursuant to Section 2.04(a), such Issuing Bank shall
promptly notify the Agent, which shall promptly notify each Participant, of such
failure, and each Participant shall promptly and unconditionally pay to such
Issuing Bank the amount of such Participant's Adjusted Percentage-Tranche A of
such unreimbursed payment in Dollars and in same day funds. If the
Administrative Agent so notifies, prior to 11:00 A.M. (New York time) on any
Business Day, any Participant required to fund a payment under a Letter of
Credit, such Participant shall make available to such Issuing Bank in Dollars
such Participant's Adjusted Percentage-Tranche A of the amount of such payment
on such Business Day in same day funds. If and to the extent such Participant
shall not have so made its Adjusted Percentage-Tranche A of the amount of such
payment available to such Issuing Bank, such Participant agrees to pay to such
Issuing Bank, forthwith on demand such amount, together with interest thereon,
for each day from such date until the date such amount is paid to such Issuing
Bank at the overnight Federal Funds Rate. The failure of any Participant to
make available to such Issuing Bank its Adjusted Percentage-Tranche A of any
payment under any Letter of Credit shall not relieve any other Participant of
its obligation hereunder to make available to such Issuing Bank its Adjusted
Percentage-Tranche A of any Letter of Credit on the date required, as specified
above, but no Participant shall be responsible for the failure of
-17-
any other Participant to make available to such Issuing Bank such other
Participant's Adjusted Percentage-Tranche A of any such payment.
(d) Whenever any Issuing Bank receives a payment of a
reimbursement obligation as to which it has received any payments from the
Participants pursuant to clause (c) above, such Issuing Bank shall pay to each
Participant which has paid its Adjusted Percentage-Tranche A thereof, an amount
equal to such Participant's share (based upon the proportionate aggregate amount
originally funded by such Participant to the aggregate amount funded by all
Participants) of the principal amount of such reimbursement obligation and
interest thereon accruing after the purchase of the respective participations.
(e) Upon the request of any Participant, each Issuing Bank shall
furnish to such Participant copies of any Letter of Credit issued by it.
(f) The obligations of the Participants to make payments to each
Issuing Bank with respect to Letters of Credit issued by it shall be irrevocable
and not subject to any qualification or exception whatsoever and shall be made
in accordance with the terms and conditions of this Agreement under all
circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement or any
of the other Credit Documents;
(ii) the existence of any claim, set-off, defense or other right
which the Borrower or any of its Subsidiaries may have at any time against
a beneficiary named in a Letter of Credit, any transferee of any Letter of
Credit (or any Person for whom any such transferee may be acting), the
Agent, any Participant, or any other Person, whether in connection with
this Agreement, any Letter of Credit, the transactions contemplated herein
or any unrelated transactions (including any underlying transaction between
the Borrower and the beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or any other document presented under
any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents; or
(v) the occurrence of any Default or Event of Default unless the
Issuing Bank has received written notice from the Borrower or the Required
Banks stating
-18-
that a Default or an Event of Default exists prior to the issuance of a
Letter of Credit.
2.04 Agreement to Repay Letter of Credit Payments. (a) The
--------------------------------------------
Borrower hereby agrees to reimburse the respective Issuing Bank, by making
payment to the Administrative Agent in immediately available funds at the
Payment Office, for any payment or disbursement made by it under any Letter of
Credit (each such amount, so paid until reimbursed, an "Unpaid Drawing"), no
--------------
later than one Business Day after the date of such payment or disbursement, with
interest on the amount so paid or disbursed by such Issuing Bank, to the extent
not reimbursed prior to 12:00 Noon (New York time) on the date of such payment
or disbursement, from and including the date paid or disbursed to but excluding
the date such Issuing Bank was reimbursed by the Borrower therefor at a rate per
annum which shall be the Base Rate in effect from time to time plus the
Applicable Margin for Base Rate Loans; provided, however, to the extent such
-------- -------
amounts are not reimbursed prior to 12:00 Noon (New York time) on the third
Business Day following such payment or disbursement, interest shall thereafter
accrue on the amounts so paid or disbursed by such Issuing Bank (and until
reimbursed by the Borrower) at a rate per annum which shall be the Base Rate in
effect from time to time plus the Applicable Base Rate Margin plus 2%, in each
such case, with interest to be payable on demand. The respective Issuing Bank
shall give the Borrower prompt notice of each Drawing under any Letter of
Credit; provided that the failure to give any such notice shall in no way
--------
affect, impair or diminish the Borrower's obligations hereunder.
(b) The obligations of the Borrower under this Section 2.04 to
reimburse the respective Issuing Bank with respect to drawings on Letters of
Credit (each, a "Drawing") (including, in each case, interest thereon) shall be
-------
absolute and unconditional under any and all circumstances and irrespective of
any set-off, counterclaim or defense to payment which the Borrower may have or
have had against any Bank (including in its capacity as issuer of the Letter of
Credit or as Participant), or any nonapplication or misapplication by the
beneficiary of the proceeds of such Drawing, the respective Issuing Bank's only
obligation to the Borrower being to confirm that any documents required to be
delivered under such Letter of Credit appear to have been delivered and that
they appear to comply on their face with the requirements of such Letter of
Credit. Any action taken or omitted to be taken by any Issuing Bank under or in
connection with any Letter of Credit if taken or omitted in the absence of gross
negligence or willful misconduct, as determined by a court of competent
jurisdiction, shall not create for such Issuing Bank any resulting liability to
the Borrower.
2.05 Increased Costs. If at any time after the Effective Date, any
---------------
Change in Law by any Governmental Authority charged with the interpretation or
administration thereof, or compliance by any Issuing Bank or any Participant
with any request or directive by any such authority (whether or not having the
force of law), or any change in generally
-19-
acceptable accounting principles, shall either (i) impose, modify or make
applicable any reserve, deposit, capital adequacy or similar requirement against
letters of credit issued by any Issuing Bank or participated in by any
Participant, or (ii) impose on any Issuing Bank or any Participant any other
conditions relating, directly or indirectly, to this Agreement or any Letter of
Credit; and the result of any of the foregoing is to increase the cost to any
Issuing Bank or any Participant of issuing, maintaining or participating in any
Letter of Credit, or reduce the amount of any sum received or receivable by any
Issuing Bank or any Participant hereunder or reduce the rate of return on its
capital with respect to Letters of Credit, but without duplication of any
amounts payable in respect of taxes pursuant to Section 4.04(a), then, upon
demand to the Borrower by such Issuing Bank or any Participant (a copy of which
demand shall be sent by such Issuing Bank or such Participant to the
Administrative Agent), the Borrower shall pay to such Issuing Bank or such
Participant such additional amount or amounts as will compensate such Bank for
such increased cost or reduction in the amount receivable or reduction on the
rate of return on its capital. Any Issuing Bank or any Participant, upon
determining that any additional amounts will be payable pursuant to this Section
2.05, will give prompt written notice thereof to the Borrower, which notice
shall include a certificate submitted to the Borrower by such Issuing Bank or
such Participant (a copy of which certificate shall be sent by such Issuing Bank
or such Participant to the Administrative Agent), setting forth in reasonable
detail the basis for the calculation of such additional amount or amounts
necessary to compensate such Issuing Bank or such Participant. The certificate
required to be delivered pursuant to this Section 2.05 shall, if delivered in
good faith and absent manifest error, be final and conclusive and binding on the
Borrower.
SECTION 3. Commitment Commission; Fees; Reductions of Commitment.
-----------------------------------------------------
3.01 Fees. (a) The Borrower agrees to pay the Administrative
----
Agent for distribution to each Non-Defaulting Bank with a Tranche A Revolving
Loan Commitment and/or a Tranche B Revolving Loan Commitment a commitment
commission (the "Commitment Commission") for the period from the Effective Date
---------------------
to and including the Revolving Loan Maturity Date (or such earlier date as
either the Total Tranche A Revolving Loan Commitment or Total Tranche B
Revolving Loan Commitment, as the case may be, shall have been terminated),
computed at a rate equal to 3/8 of 1% per annum on the daily Unutilized Tranche
A Revolving Loan Commitment and/or Unutilized Tranche B Revolving Loan
Commitment of such Non-Defaulting Bank; provided that the Commitment Commission
--------
shall be computed at a rate equal to 1/2 of 1% per annum for each day on which
the Pro Forma Leverage Ratio of Holdings is greater than 4.25 to 1.0. Accrued
Commitment Commission shall be due and payable quarterly in arrears on each
Quarterly Payment Date and on the Revolving Loan Maturity Date or such earlier
date upon which either the Total Tranche A Revolving Loan Commitment or the
Total Tranche B Revolving Loan Commitment, as the case may be, is terminated.
-20-
(b) The Borrower agrees to pay to the Administrative Agent for
distribution to each Non-Defaulting Bank with a Tranche A Revolving Loan
Commitment (based on their respective Adjusted Percentages) a fee in respect of
each Letter of Credit issued hereunder (the "Letter of Credit Fee"), for the
--------------------
period from and including the date of issuance of such Letter of Credit to and
including the termination of such Letter of Credit, computed at a rate per annum
equal to the Applicable Margin for Eurodollar Loans as in effect from time to
time on the daily Stated Amount of such Letters of Credit. Accrued Letter of
Credit Fees shall be due and payable quarterly in arrears on each Quarterly
Payment Date and upon the first day on or after the termination of the Total
Revolving Loan Commitment upon which no Letters of Credit remain outstanding.
(c) The Borrower agrees to pay to the respective Issuing Bank, for
its own account, a facing fee in respect of each Letter of Credit issued for its
account hereunder (the "Facing Fee") for the period from and including the date
----------
of issuance of such Letter of Credit to and including the termination of such
Letter of Credit, computed at a rate equal to 1/4 of 1% per annum of the daily
Stated Amount of such Letter of Credit; provided that in no event shall the
--------
annual Facing Fee with respect to each Letter of Credit be less than $500.
Accrued Facing Fees shall be due and payable quarterly in arrears on each
Quarterly Payment Date and on the date upon which the Tranche A Total Revolving
Loan Commitment has been terminated and such Letter of Credit has been
terminated in accordance with its terms.
(d) The Borrower shall pay, upon each drawing under, issuance of, or
amendment to, any Letter of Credit, such amounts as shall at the time of such
event be the administrative charge and the reasonable expenses which the
respective Issuing Bank is generally imposing in connection with such occurrence
with respect to letters of credit.
(e) The Borrower shall pay to each of the Agents, for their own
respective accounts, such other fees as have been agreed to in writing by the
Borrower and such Agent, in each case, when and as due.
(f) All computations of fees hereunder shall be made in accordance
with Section 13.07(b).
3.02 Voluntary Termination of Unutilized Commitments. (a) Upon at
-----------------------------------------------
least two Business Days' prior notice to the Administrative Agent at its Notice
Office (which notice the Administrative Agent shall promptly transmit to each of
the Banks), the Borrower shall have the right, at any time or from time to time,
without premium or penalty, to terminate the Total Unutilized Tranche A
Revolving Loan Commitments and Total Unutilized Tranche B Revolving Loan
Commitments, in whole or in part, in integral multiples of $1,000,000 in the
case of partial reductions to the Total Unutilized Tranche A Revolving Loan
Commitments and Total Unutilized Tranche B Revolving Loan Commitments;
-21-
provided that (i) each such reduction shall apply proportionately to permanently
--------
reduce pro rata the Tranche A Revolving Loan Commitment and the Tranche B
--- ----
Revolving Loan Commitment of each Bank with such a Commitment and (ii) the
reduction to the Total Unutilized Tranche A Revolving Loan Commitments and Total
Unutilized Tranche B Revolving Loan Commitments shall in no case be in an amount
which would cause the applicable Revolving Loan Commitment of any Bank to be
reduced (as required by preceding clause (i)) by an amount which exceeds the
applicable Total Unutilized Revolving Tranche A Loan Commitments and Total
Unutilized Tranche B Revolving Loan Commitments of such Bank as in effect
immediately before giving effect to such reduction.
(b) In the event of certain refusals by a Bank as provided in Section
13.12(b) to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Banks, and subject to obtaining the consents required by Section
13.12(b), the Borrower may, upon five Business Days' written notice to the
Administrative Agent at its Notice Office (which notice the Administrative Agent
shall promptly transmit to each of the Banks) terminate all of the Revolving
Loan Commitment of such Bank so long as all Loans, together with accrued and
unpaid interest, Fees and all other amounts, owing to such Bank (other than
amounts owing in respect of the Term Loans maintained by such Bank, if such
Loans are not being repaid pursuant to Section 13.12(b)) are repaid concurrently
with the effectiveness of such termination (at which time Schedule I shall be
deemed modified to reflect such changed amounts), and at such time, unless the
respective Bank continues to have outstanding Loans and/or commitments
hereunder, such Bank shall no longer constitute a "Bank" for purposes of this
Agreement, except with respect to indemnification provisions under this
Agreement (including, without limitation, Sections 1.10, 1.11, 2.05, 4.04, 13.01
and 13.06) and the other Credit Documents, which shall survive as to such repaid
Bank.
3.03 Mandatory Reduction of Commitments. (a) In addition to any
----------------------------------
other mandatory commitment reductions pursuant to this Section 3.03, the Total
Tranche A Term Loan Commitment (and the Tranche A Term Loan Commitment of each
Bank) shall (i) terminate in its entirety on the Effective Date (after giving
effect to the making of the Tranche A Term Loans on such date) and (ii) prior to
the termination of the Total Tranche A Term Loan Commitment as prov ided in
clause (i) above, be reduced from time to time to the extent required by Section
4.02.
(b) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Tranche B Term Loan Commitment (and the Tranche
B Term Loan Commitment of each Bank) shall (i) terminate in its entirety on the
Amendment Effective Date (after giving effect to the making of the Tranche B
Term Loans on such date) and (ii) prior to the termination of the Total Tranche
B Term Loan Commitment as pro-
-22-
vided in clause (i) above, be reduced from time to time to the extent required
by Section 4.02.
(c) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Tranche A Revolving Loan Commitment and the Tranche B
Revolving Loan Commitment (and the applicable Revolving Loan Commitment of each
Bank) shall terminate in its entirety on the Revolving Loan Maturity Date.
(d) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, on each date after the Effective Date upon which a
mandatory prepayment of Term Loans pursuant to Section 4.02(g) is required (and
exceeds in amount the aggregate principal amount of Term Loans then outstanding)
or would be required if Term Loans were then outstanding, the Total Revolving
Loan Commitments shall be permanently reduced by the amount, if any, by which
the amount required to be applied pursuant to said Section (determined as if an
unlimited amount of Term Loans were actually outstanding) exceeds the aggregate
principal amount of Term Loans then outstanding.
(e) Each reduction to the Total Tranche A Term Loan Commitment, the
Total Tranche B Term Loan Commitment and the Total Revolving Loan Commitments
pursuant to this Section 3.03 (or pursuant to Section 4.02) shall be applied
proportionately to reduce the Term Loan Commitment or the Revolving Loan
Commitments, as the case may be, of each Bank with such a Commitment.
(f) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Swingline Commitment shall terminate in its entirety
on the Swingline Expiry Date.
SECTION 4. Prepayments; Payments; Taxes.
----------------------------
4.01 Voluntary Prepayments. The Borrower shall have the right to
---------------------
prepay the Loans, without premium or penalty, in whole or in part at any time
and from time to time on the following terms and conditions: (i) the Borrower
shall give the Administrative Agent prior to 12:00 Noon (New York time) at its
Notice Office (x) at least one Business Day prior to the date that a prepayment
of Base Rate Loans or Swingline Loans is to be made prior written notice (or
telephonic notice promptly confirmed in writing) of its intent to prepay Base
Rate Loans and (y) at least three Business Days' prior written notice (or
telephonic notice promptly confirmed in writing) of its intent to prepay
Eurodollar Loans, whether Term Loans, Revolving Loans or Swingline Loans shall
be prepaid, the amount of such prepayment and the Types of Loans to be prepaid
and, in the case of Eurodollar Loans, the specific Borrowing or Borrowings
pursuant to which made, which notice, except in the case of Swingline Loans, the
Administrative Agent shall promptly transmit to each of the Banks; (ii) each
prepayment shall be in an aggregate principal amount of at least (x)
-23-
$1,000,000 (or, if less, the full amount of such outstanding Loans) in the case
of Term Loans, (y) $500,000 (or, if less, the full amount of such outstanding
Loans) in the case of Revolving Loans or (z) $100,000 (or, if less, the full
amount of Swingline Loans then outstanding) in the case of Swingline Loans;
provided that if any partial prepayment of Eurodollar Loans made pursuant to any
Borrowing shall reduce the outstanding Eurodollar Loans made pursuant to such
Borrowing to an amount less than (1) in the case of Term Loans, $5,000,000 and
(2) in the case of Revolving Loans, $1,000,000, then such Borrowing may not be
continued as a Borrowing of Eurodollar Loans and any election of an Interest
Period with respect thereto given by the Borrower shall have no force or effect;
(iii) prepayments of Eurodollar Loans made pursuant to this Section 4.01 on any
day other than the last day of an Interest Period applicable thereto shall be
accompanied by the amounts required under Section 1.11; (iv) each prepayment in
respect of any Loans made pursuant to a Borrowing shall, except as set forth
below, be applied pro rata among such Loans; and (v) in the event of certain
--- ----
refusals by a Bank as provided in Section 13.12(b) to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks, the Borrower may, upon
five (5) Business Days' written notice to the Administrative Agent at its Notice
Office (which notice, except in the case of Swingline Loans, the Administrative
Agent shall promptly transmit to each of the Banks) repay all Loans, together
with accrued and unpaid interest, Fees, and other amounts owing to such Bank (or
owing to such Bank with respect to each Tranche which gave rise to the need to
obtain such Bank's individual consent) in accordance with said Section 13.12(b)
so long as (A) in the case of the repayment of Revolving Loans for any Bank
pursuant to this clause (v) the Revolving Loan Commitment of such Bank is
terminated concurrently with such repayment, and (B) the consents required by
Section 13.12(b) in connection with the repayment pursuant to this clause (v)
have been obtained; provided that at the Borrower's election (and with the
--------
consent of the Administrative Agent, unless the Administrative Agent is the
Defaulting Bank) in connection with any prepayment of Revolving Loans pursuant
to this Section 4.01, such prepayment shall not be applied to any Revolving Loan
of a Defaulting Bank. Each prepayment of principal of Term Loans pursuant to
this Section 4.01 shall be applied to reduce, in order of maturity for Scheduled
Repayments, the next succeeding four remaining Scheduled Repayments of such Term
Loans and thereafter, to the then remaining Scheduled Repayments of such Term
Loans pro rata based upon the then remaining principal amount of each
--- ----
Scheduled Repayment.
4.02 Mandatory Repayments and Commitment Reductions. (a) On any
----------------------------------------------
day on which the sum of (i) the aggregate outstanding principal amount of
Tranche A Revolving Loans and Swingline Loans (after giving effect to all other
repayments thereof on such date) made by Non-Defaulting Banks plus (ii) the
Letter of Credit Outstanding as then in effect exceeds the Adjusted Total
Tranche A Revolving Loan Commitment as then in effect, the Borrower shall prepay
on such date the principal of Swingline Loans, and if no
-24-
Swingline Loans are or remain outstanding, Tranche A Revolving Loans of Non-
Defaulting Banks in an amount equal to such excess. If, after giving effect to
the prepayment of all outstanding Swingline Loans and Tranche A Revolving Loans
of Non-Defaulting Banks, the aggregate amount of the Letter of Credit
Outstandings exceeds the Adjusted Total Tranche A Revolving Loan Commitment as
then in effect, the Borrower shall pay to the Administrative Agent at the
Payment Office on such date an amount of cash or Cash Equivalents equal to the
amount of such excess (up to a maximum amount equal to the Letter of Credit
Outstandings at such time), such cash or Cash Equivalents to be held as security
for all obligations of the Borrower to Non-Defaulting Banks hereunder in a cash
collateral account to be established by the Administrative Agent.
(b) On any day on which the aggregate outstanding principal amount of
the Tranche A Revolving Loans made by any Defaulting Bank exceeds the Tranche A
Revolving Loan Commitment of such Defaulting Bank, the Borrower shall upon prior
written notice from such Defaulting Bank prepay principal of Tranche A Revolving
Loans of such Defaulting Bank in an amount equal to such excess. On any day on
which the aggregate outstanding principal amount of the Tranche B Revolving
Loans made by any Defaulting Bank exceeds the Tranche B Revolving Loan
Commitment of such Defaulting Bank, the Borrower shall upon prior written notice
from such Defaulting Bank prepay principal of Tranche B Revolving Loans of such
Defaulting Bank in an amount equal to such excess.
(c) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, on each date set forth below, the
Borrower shall be required to repay that principal amount of Tranche A Term
Loans, to the extent then outstanding, as is set forth opposite such date (each
such repayment, as the same may be reduced as provided in Sections 4.01 and
4.02(i), a "Tranche A Term Loan Scheduled Repayment," and each such date, a
---------------------------------------
"Tranche A Term Loan Scheduled Repayment Date"):
---------------------------------------------
Tranche A Term Loan Scheduled Repayment Date Amount
-------------------------------------------- ------
Quarterly Payment Date in March, 1998 $ 250,000
Quarterly Payment Date in June, 1998 250,000
Quarterly Payment Date in Sept., 1998 250,000
Quarterly Payment Date in Dec., 1998 250,000
Quarterly Payment Date in March, 1999 250,000
Quarterly Payment Date in June, 1999 250,000
Quarterly Payment Date in Sept., 1999 250,000
Quarterly Payment Date in Dec., 1999 250,000
Quarterly Payment Date in March, 2000 250,000
Quarterly Payment Date in June, 2000 250,000
-25-
Tranche A Term Loan Scheduled Repayment Date Amount
-------------------------------------------- ------
Quarterly Payment Date in Sept., 2000 250,000
Quarterly Payment Date in Dec., 2000 250,000
Quarterly Payment Date in March, 2001 250,000
Quarterly Payment Date in June, 2001 250,000
Quarterly Payment Date in Sept., 2001 250,000
Quarterly Payment Date in Dec., 2001 250,000
Quarterly Payment Date in March, 2002 250,000
Quarterly Payment Date in June, 2002 250,000
Quarterly Payment Date in Sept., 2002 250,000
Quarterly Payment Date in Dec., 2002 250,000
Quarterly Payment Date in March, 2003 5,000,000
Quarterly Payment Date in June, 2003 5,000,000
Quarterly Payment Date in Sept., 2003 5,000,000
Quarterly Payment Date in Dec., 2003 5,000,000
Quarterly Payment Date in March, 2004 12,500,000
Quarterly Payment Date in June, 2004 12,500,000
Quarterly Payment Date in Sept., 2004 12,500,000
Quarterly Payment Date in Dec., 2004 12,500,000
(d) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, on each date set forth below, the
Borrower shall be required to repay that principal amount of Tranche B Term
Loans, to the extent then outstanding, as is set forth opposite such date (each
such repayment, as the same may be reduced as provided in Sections 4.01 and
4.02(i), a "Tranche B Term Loan Scheduled Repayment," and each such date, a
---------------------------------------
"Tranche B Term Loan Scheduled Repayment Date"):
---------------------------------------------
Tranche B Term Loan Scheduled Repayment Date Amount
-------------------------------------------- -------
Quarterly Payment Date in June, 1998 500,000
Quarterly Payment Date in Sept., 1998 500,000
Quarterly Payment Date in Dec., 1998 500,000
Quarterly Payment Date in March, 1999 500,000
Quarterly Payment Date in June, 1999 500,000
Quarterly Payment Date in Sept., 1999 500,000
-26-
Tranche B Term Loan Scheduled Repayment Date Amount
-------------------------------------------- ------
Quarterly Payment Date in Dec., 1999 500,000
Quarterly Payment Date in March, 2000 500,000
Quarterly Payment Date in June, 2000 500,000
Quarterly Payment Date in Sept., 2000 500,000
Quarterly Payment Date in Dec., 2000 500,000
Quarterly Payment Date in March, 2001 500,000
Quarterly Payment Date in June, 2001 500,000
Quarterly Payment Date in Sept., 2001 500,000
Quarterly Payment Date in Dec., 2001 500,000
Quarterly Payment Date in March, 2002 500,000
Quarterly Payment Date in June, 2002 500,000
Quarterly Payment Date in Sept., 2002 500,000
Quarterly Payment Date in Dec., 2002 500,000
Quarterly Payment Date in March, 2003 500,000
Quarterly Payment Date in June, 2003 500,000
Quarterly Payment Date in Sept., 2003 500,000
Quarterly Payment Date in Dec., 2003 500,000
Quarterly Payment Date in March, 2004 500,000
Quarterly Payment Date in June, 2004 500,000
Quarterly Payment Date in Sept., 2004 500,000
Quarterly Payment Date in Dec., 2004 500,000
Quarterly Payment Date in March, 2005 500,000
Quarterly Payment Date in June, 2005 186,000,000
(e) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, on each date after the Amendment
Effective Date upon which Holdings or any of its Subsidiaries receives any
proceeds from any incurrence by Holdings or any of its Subsidiaries of Senior
Indebtedness, an amount equal to 70% of the cash proceeds (net of underwriting
discounts and commissions and other costs associated therewith including,
without limitation, legal and other professional fees and expenses) of the
respective incurrence of Senior Indebtedness shall be applied as a mandatory
repayment of principal of outstanding Term Loans in accordance with the
requirements of Sections 4.02(i) and (j).
-27-
(f) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, on each date after the Effective Date
upon which Holdings or any of its Subsidiaries receives proceeds from any sale
of assets (including capital stock and securities held thereby, but excluding
(i) sales or transfers of inventory or equipment in the ordinary course of
business (including, without limitation, sales or transfers of inventory or
equipment to Subsidiaries), (ii) the sale or other disposition of obsolete
equipment or inventory, (iii) the sale of overdue receivables in the ordinary
course of business, and (iv) sales of assets between the Borrower and its
Subsidiaries that are Guarantors and/or sales of assets between Subsidiaries of
the Borrower that are Guarantors, in each case to the extent permitted by
Section 9.02) an amount equal to 100% of the Net Sale Proceeds therefrom shall
be applied as a mandatory repayment of principal of outstanding Term Loans in
accordance with the requirements of Sections 4.02(i) and (j); provided that, in
--------
addition to the exceptions set forth above, so long as no Default or Event of
Default then exists, up to an aggregate of $7,500,000 of Net Sale Proceeds in
any fiscal year shall not be required to be so applied on the date of receipt
thereof to the extent that the Borrower has delivered a certificate to the
Administrative Agent within 15 days following such date stating that such Net
Sale Proceeds shall be reinvested or shall be committed to be reinvested in the
Business within 180 days following such date (and to the extent the asset sold
constituted Collateral, the assets in which such Net Sales Proceeds are
reinvested shall be pledged as Collateral pursuant to the appropriate Security
Documents); provided further, that if all or any portion of such Net Sale
-------- -------
Proceeds not required to be applied to the repayment of Term Loans pursuant to
the preceding proviso are either (a) not so used or committed to be so used
within 180 days after the date of receipt of such Net Sale Proceeds or (b) if
committed to be so used within 180 days after the date of receipt of such Net
Sale Proceeds and not so used within 270 days after the date of receipt of such
Net Sale Proceeds, then, in either such case, such remaining portion not used or
committed to be used in the case of preceding clause (a) and not used in the
case of preceding clause (b) shall be applied on the date which is 180 days
after the date of receipt of such Net Sale Proceeds in the case of clause (a)
above or the date occurring 270 days after the date of receipt of such Net Sale
Proceeds in the case of clause (b) above as a mandatory repayment of principal
of outstanding Term Loans in accordance with the requirements of Sections
4.02(i) and (j); provided further, that, in addition to the exceptions set forth
-------- -------
above, so long as no Default or Event of Default then exists, up to an aggregate
of 50% of Net Sale Proceeds of the non-route laundry business shall not be
required to be so applied on the date of receipt thereof to the extent that the
Borrower has delivered a certificate to the Administrative Agent within 15 days
following such date stating that such Net Sale Proceeds shall be reinvested or
shall be committed to be reinvested in the Business within 180 days following
such date (and to the extent the assets sold constituted Collateral, the assets
in which such Net Sales Proceeds are reinvested shall be pledged as Collateral
pursuant to the appropriate Security Documents); provided further, that if all
-------- -------
or any portion of such Net Sale Proceeds not required to be applied to the
repayment of Term Loans pursuant to the preceding proviso are either (a) not
-28-
so used or committed to be so used within 180 days after the date of receipt of
such Net Sale Proceeds or (b) if committed to be so used within 180 days after
the date of receipt of such Net Sale Proceeds and not so used within 270 days
after the date of receipt of such Net Sale Proceeds, then, in either such case,
such remaining portion not used or committed to be used in the case of preceding
clause (a) and not used in the case of preceding clause (b) shall be applied on
the date which is 180 days after the date of receipt of such Net Sale Proceeds
in the case of clause (a) above or the date occurring 270 days after the date of
receipt of such Net Sale Proceeds in the case of clause (b) above as a mandatory
repayment of principal of outstanding Term Loans in accordance with the
requirements of Sections 4.02(i) and (j).
(g) In addition to any other mandatory repayments pursuant to this
Section 4.02, on each Excess Cash Payment Date, an amount, if positive, equal to
the applicable Excess Cash Flow Percentage of Excess Cash Flow for the relevant
Excess Cash Payment Period shall be applied as a mandatory repayment of
principal of outstanding Term Loans in accordance with the requirements of
Sections 4.02(i) and (j).
(h) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, within 10 days following each date
after the Effective Date on which Holdings or any of its Subsidiaries receives
any proceeds from any Recovery Event, an amount equal to 100% of the net
proceeds of such Recovery Event (net of reasonable costs and taxes incurred in
connection with such Recovery Event including any amounts paid by the Borrower
in connection with self-insurance payments or obligations) shall be applied as a
mandatory repayment of principal of outstanding Term Loans in accordance with
the requirements of Sections 4.02(i) and (j); provided that (x) so long as no
--------
Default or Event of Default then exists and such proceeds do not exceed
$5,000,000, such proceeds shall not be required to be so applied on such date to
the extent that the Borrower has delivered a certificate to the Administrative
Agent on or prior to such date stating that such proceeds shall be used to
replace or restore any properties or assets in respect of which such proceeds
were paid within 180 days following the date of such Recovery Event (which
certificate shall set forth the estimates of the proceeds to be so expended) and
(y) so long as no Default or Event of Default then exists and to the extent that
(a) the amount of such proceeds exceeds $5,000,000, (b) the amount of such
proceeds is at least equal to 90% of the cost of replacement or restoration of
the properties or assets in respect of which such proceeds were paid as
determined by the Borrower and as supported by such estimates or bids from
contractors or subcontractors or such other supporting information as the
Administrative Agent may reasonably request, and (c) the Borrower has delivered
to the Administrative Agent a certificate on or prior to the date the
application would otherwise be required pursuant to this Section 4.02(h) in the
form described in clause (x) above and also certifying its determination as
required by preceding clause (b), then the entire amount and not just the
portion in excess of $5,000,000 shall be deposited with the Administrative
-29-
Agent pursuant to a cash collateral arrangement satisfactory to the
Administrative Agent whereby such proceeds shall be disbursed to the Borrower
from time to time as needed to pay actual costs incurred by it in connection
with the replacement or restoration of the respective properties or assets
(pursuant to such certification requirements as may be established by the
Administrative Agent); provided further, that at any time while an Event of
-------- -------
Default has occurred and is continuing (other than an Event of Default existing
solely as a result of the violation of any or all of Sections 9.08, 9.09 and
9.10, but in each case only if, and to the extent, that the violation of said
covenant has occurred as a result of the underlying event giving rise to the
Recovery Event), the Required Banks may direct the Administrative Agent (in
which case the Administrative Agent shall, and is hereby authorized by the
Borrower to, follow said directions) to apply any or all proceeds then on
deposit in such collateral account to the repayment of Obligations hereunder in
the same manner as proceeds would be applied pursuant to the Borrower Pledge
Agreement; and provided further, that if all or any portion of such proceeds
-------- -------
not required to be applied to the repayment of Term Loans pursuant to the second
preceding proviso (whether pursuant to clause (x) or (y) thereof) are either (A)
not so used or committed to be so used within 180 days after the date of the
respective Recovery Event or (B) if committed to be used within 180 days after
the date of receipt of such proceeds and not so used within 270 days after the
date of the respective Recovery Event, then, in either such case, such remaining
portion not used or committed to be used in the case of preceding clause (A) and
not used in the case of preceding clause (B) shall be applied on the date which
is 270 days after the date of the receipt of proceeds from the respective
Recovery Event in the case of clause (A) above or the date occurring 270 days
after the date of the receipt of proceeds from the respective Recovery Event in
the case of clause (B) above as a mandatory repayment of principal of
outstanding Term Loans in accordance with the requirements of Sections 4.02(i)
and (j) .
(i) Each amount required to be applied to Term Loans (or to the Total
Term Loan Commitment) pursuant to Sections 4.02(e), (f), (g), and (h) shall be
applied pro rata to each Tranche of Term Loans (with each Tranche of Term Loans
--- ----
to be allocated that percentage of the amount to be applied as is equal to a
fraction (expressed as a percentage) the numerator of which is the then
outstanding principal amount of such Tranche of Term Loans and the denominator
of which is equal to the then outstanding principal amount of all Term Loans).
Any amount required to be applied to either Tranche of Term Loans pursuant to
Sections 4.02(e), (f), (g), and (h) shall be applied to repay the outstanding
principal amount of Term Loans of the respective Tranche then outstanding and,
if no Term Loans remain outstanding, all such amounts shall be applied to repay
outstanding borrowings under the Revolving Loans. The amount of each principal
repayment of Term Loans (and the amount of each reduction to the Term Loan
Commitments) made as required by Section 4.02(e), (f), (g), and (h) shall be
applied to reduce the then remaining Scheduled Repayments of the respective
Tranche pro rata based upon the then remaining principal amount of each
--- ----
Scheduled Repayment.
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(j) With respect to each repayment of Loans required by this Section
4.02, the Borrower may designate the Types of Loans of the respective Tranche
which are to be repaid and, in the case of Eurodollar Loans, the specific
Borrowing or Borrowings of the respective Tranche pursuant to which made;
provided that: (i) repayments of Eurodollar Loans pursuant to this Section 4.02
--------
may only be made on the last day of an Interest Period applicable thereto unless
all Eurodollar Loans of the respective Tranche with Interest Periods ending on
such date of required repayment and all Base Rate Loans of the respective
Tranche have been paid in full; (ii) if any repayment of Eurodollar Loans made
pursuant to a single Borrowing shall reduce the outstanding Eurodollar Loans
made pursuant to such Borrowing to an amount less than (x) in the case of Term
Loans, $5,000,000 and (y) in the case of Revolving Loans, $1,000,000, such
Borrowing shall be converted at the end of the then current Interest Period into
a Borrowing of Base Rate Loans; and (iii) each repayment of any Loans made
pursuant to a Borrowing shall be applied pro rata among such Loans. In the
--- ----
absence of a designation by the Borrower as described in the preceding sentence,
the Administrative Agent shall, subject to the above, make such designation in
its sole discretion.
(k) Notwithstanding anything to the contrary contained above in this
Section 4.02, with respect to any mandatory repayments of Tranche B Term Loans
(excluding Tranche B Term Loan Scheduled Repayments) otherwise required above
pursuant to this Section 4.02, if on or prior to the date the respective
mandatory repayment is otherwise required to be made pursuant to this Section
4.02, the Borrower has given the Administrative Agent written notification that
the Borrower has elected to give each Bank with a Tranche B Term Loan the right
to waive such Bank's rights to receive such repayment (the "Waivable Mandatory
------------------
Repayment"), the Administrative Agent shall notify such Banks of such receipt
---------
and the amount of the repayment to be applied to each such Bank's Tranche B Term
Loan. In the event any such Bank with a Tranche B Term Loan desires to waive
such Bank's right to receive any such Waivable Mandatory Repayment in whole or
in part, such Bank shall so advise the Administrative Agent no later than 5:00
P.M. (New York time) five Business Days after the date of such notice from the
Administrative Agent which notice shall also include the amount the Bank desires
to receive. If the Bank does not reply to the Administrative Agent within such
five Business Day period, it will be deemed acceptance of the total payment. If
the Bank does not specify an amount it wishes to receive, it will be deemed
acceptance of 100% of the total payment. In the event that any such Bank waives
such Bank's right to any such Waivable Mandatory Repayment, the Administrative
Agent shall apply 100% of the amount so waived by such Banks to (x) prepay the
Tranche A Term Loans in accordance with Sections 4.02(i) and (j). If the
Borrower elects to give the notice described above in this Section 4.02(k) with
respect to any mandatory repayment, the amount of the respective Waivable
Mandatory Repayment shall be deposited with the Administrative Agent on the date
the mandatory repayment would otherwise be required pursuant to the relevant
provisions of this Section 4.02 (and held by the Administrative Agent
-31-
as cash collateral for the Tranche B Term Loans and, but only to the extent
Banks with Tranche B Term Loans waive their right to receive their share of the
Waivable Mandatory Repayment, for the benefit of the Tranche A Term Loans in a
cash collateral account which shall permit the investment thereof in Cash
Equivalents reasonably satisfactory to the Administrative Agent until the
proceeds are applied to the secured obligations) and the respective mandatory
repayment shall not be required to be made until the seventh Business Day
occurring after the date the respective mandatory repayment would otherwise have
been required to be made. Notwithstanding anything to the contrary contained
above, if one or more Banks waives its right to receive all or any part of any
Waivable Mandatory Repayment, but less than all the Banks holding Tranche B Term
Loans waive in full their right to receive 100% of the total payment otherwise
required with respect to the Tranche B Term Loans, then of the amount actually
applied to the repayment of Tranche B Term Loans of Banks which have waived in
part, but not in full, their right to receive 100% of such repayment, such
amount shall be applied to each then outstanding Borrowing of Tranche B Term
Loans on a pro rata basis (so that each Bank holding Tranche B Term Loans shall,
after giving effect to the application of the respective repayment, maintain the
same percentage (as determined for such Bank, but not the same percentage as the
other Banks hold and not the same percentage held by such Bank prior to
repayment) of each Borrowing of Tranche B Term Loans, which remains outstanding
after giving effect to such application).
(l) Notwithstanding anything to the contrary contained elsewhere in
this Agreement, all other then outstanding Loans shall be repaid in full on the
respective Maturity Date for such Loans.
4.03 Method and Place of Payment. Except as otherwise specifically
---------------------------
provided herein, all payments under this Agreement or any Note shall be made to
the Administrative Agent for the account of the Bank or Banks entitled thereto
not later than 1:00 P.M. (New York time) on the date when due and shall be made
in Dollars in immediately available funds at the Payment Office of the
Administrative Agent. Whenever any payment to be made hereunder or under any
Note shall be stated to be due on a day which is not a Business Day, the due
date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest shall be payable at the applicable
rate during such extension.
4.04 Net Payments. (a) Except as provided in this Section 4.04,
------------
all payments by the Borrower to each Bank or any Agent under this Agreement and
any Note shall be made free and clear of, and without deduction or withholding
for, any Covered Taxes levied or imposed by any Governmental Authority with
respect to such payments. In addition, the Borrower agrees to pay any current
or future stamp, intangible or documentary taxes or any other excise or property
taxes, charges or similar levies (including mortgage recording taxes and similar
fees but not including any Excluded Taxes) that arise from the
-32-
execution, delivery or registration of or otherwise with respect to (other than
as to any payments, Taxes on which shall be governed by the preceding sentence)
this Agreement, or any other document in connection with this Agreement or any
Note (all such taxes, charges and levies are hereinafter referred to as,
collectively, "Other Taxes").
-----------
(b) If the Borrower shall be required by law to deduct or withhold
any Covered Taxes from or in respect of any sum payable hereunder to any Bank or
any Agent, then except as provided in this Section 4.04: (i) the sum payable
shall be increased as necessary so that after making all such required
deductions and withholdings (including deductions and withholdings applicable to
additional sums payable under this Section 4.04) such Bank or such Agent, as the
case may be, receives an amount equal to the sum it would have received had no
such deductions or withholdings been made; (ii) the Borrower shall make such
deductions and withholdings; and (iii) the Borrower shall pay the full amount
deducted or withheld to the relevant taxing authority or other authority in
accordance with applicable law. Within 30 days after the date of any payment by
the Borrower of Covered Taxes or Other Taxes, the Borrower shall furnish to the
Administrative Agent the original or a certified copy of a receipt evidencing
payment thereof, or other evidence of payment reasonably satisfactory to the
Administrative Agent.
(c) The Borrower agrees to indemnify and hold harmless each Bank and
each Agent for (i) the full amount of Covered Taxes (including any Covered Taxes
imposed on amounts payable under this Section 4.04) which arise from any payment
made under this Agreement or any Note and are paid by such Bank or such Agent
and any liability (including penalties, interest, additions to tax and expenses)
arising therefrom or with respect thereto, whether or not such Covered Taxes
were correctly or legally asserted, and (ii) any Taxes paid or payable by such
Bank or such Agent (the amount of which will be determined by such Bank or such
Agent in its sole discretion, and will be binding on all parties to this
Agreement unless manifestly unreasonable) which were levied or imposed by any
Governmental Authority on any additional amounts paid by the Borrower under this
Section 4.04. A certificate as to the amount of any such required
indemnification payment prepared with a reasonable basis by the Bank or such
Agent shall be final, conclusive and binding for all purposes. Payment under
this indemnification shall be made within 30 days after the date such Bank or
such Agent makes written demand therefor by the delivery of such certificate.
(d) If a Bank or Agent receives a refund or credit of Taxes paid by
the Borrower pursuant to paragraph (b) or (c) of this Section 4.04, then such
Bank or such Agent shall promptly repay the Borrower such refund or credit net
of all out-of-pocket expenses related thereto; provided, however, that if, due
-------- -------
to any adjustment of such Taxes, such Bank or such Agent loses the benefit of
all or any portion of such refund or credit, the Borrower will indemnify and
hold harmless such Lender or such Agent in accordance with this sub-
-33-
section; provided further, however, that such Bank will determine the amount of
-------- ------- -------
any such refund or credit, and the amount of any lost benefit in respect
thereof, in its sole discretion, and such determinations will be binding on all
parties to this Agreement unless manifestly unreasonable.
(e) If the Borrower is required to pay additional amounts to any Bank
or any Agent on behalf of any Bank pursuant to this Section 4.04, then such Bank
shall use reasonable efforts (consistent with legal and regulatory restrictions)
to change the jurisdiction of its Lending Office or take other appropriate
action so as to eliminate any such additional payment by the Borrower which may
thereafter accrue, if such change or other action in the reasonable judgment of
such Bank is not otherwise disadvantageous to such Bank.
(f) (i) Each Bank which is not a U.S. Person agrees that:
(A) it shall, no later than the Closing Date (or, in the case of a
Bank which becomes a party hereto after the Closing Date, the date upon
which such Bank becomes a party hereto) deliver to the Administrative Agent
and to the Borrower through the Administrative Agent (x) two accurate and
complete signed originals of Internal Revenue Service Form 4224 or any
successor thereto ("Form 4224"), or two accurate and complete signed
---------
originals of Internal Revenue Service Form 1001 or any successor thereto
("Form 1001"), as appropriate, or (y) if such Bank is not a "bank" within
-----------
the meaning of Section 881(c)(3)(A) of the Code and cannot deliver either
Form 1001 or Form 4224 pursuant to clause (x) above, a certificate (any
such certificate, a "Section 4.04(f) Certificate") and, in the case of
---------------------------
either (x) or (y), two accurate and complete original signed copies of
Internal Revenue Service Form W-8 or any successor thereto ("Form W-8") or
--------
Internal Revenue Service Form W-9 or any successor thereto ("Form W-9"),
--------
whichever is applicable; and
(B) it shall, before or promptly after the occurrence of any event
(including the passing of time) requiring a change in or renewal of the
most recent Form 4224, Form 1001, Form W-8, Form W-9 or Section 4.04
Certificate previously delivered by such Bank, deliver to the
Administrative Agent and to the Borrower through the Administrative Agent
two accurate and complete original signed copies of Form 4224, Form 1001,
Form W-8, Form W-9 and a Section 4.04 Certificate, in replacement of the
forms previously delivered by such Bank.
(ii) Each Bank shall, unless unable to do so by virtue of a Change in
Law occurring after the date such Bank becomes a party hereto, certify (x) in
the case of a Form 1001 or 4224, that it is entitled to receive payments under
this Agreement without deduction or withholding of any United States federal
income taxes and (y) in the case of a Form W-8 or W-9, that it is entitled to an
exemption from United States backup withholding tax.
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(iii) Notwithstanding the foregoing provisions of this subsection (f)
or any other provision of this Section 4.04, no Bank shall be required to
deliver any form pursuant to this Section 4.04 if such Bank is not legally able
to do so.
(g) The Borrower will not be required to pay any additional amount in
respect of Taxes pursuant to this Section 4.04 to any Bank or to the
Administrative Agent with respect to any Bank if the obligation to pay such
additional amount would not have arisen but for a failure by such Bank to comply
with its obligations under subsection 4.04(f).
SECTION 5. Conditions Precedent to Loans. The occurrence of the
-----------------------------
Amendment Effective Date pursuant to Section 13.10 is subject to the
satisfaction of the following conditions:
5.01 Execution of Agreement; Notes. On or prior to the Amendment
-----------------------------
Effective Date (i) this Agreement shall have been executed and delivered as
provided in Section 13.10 and (ii), if requested by the Bank in writing, there
shall have been delivered to the Administrative Agent for the account of each of
the Banks the appropriate Note executed by the Borrower, in each case in the
amount, maturity and as otherwise provided herein.
5.02 Payment of Fees. On or before the Amendment Effective Date
---------------
and thereafter at the time of each Credit Event and after giving effect thereto,
all costs, fees and expenses, and all other compensation contemplated by this
Agreement or any other agreement with any of the Agents, due to any of the
Agents, or the Banks (including, without limitation, legal fees and expenses)
shall have been paid to the extent then due.
5.03 Opinions of Counsel. On the Amendment Effective Date, the
-------------------
Agents shall have received, with sufficient copies for each Bank, from ▇▇▇▇▇▇▇▇
Kill & Olick, P.C., special counsel to Holdings and the Borrower, an opinion
addressed to the Agents and each of the Banks and dated the Amendment Effective
Date covering the matters set forth in Exhibit D.
5.04 Corporate Documents; Proceedings; etc. On the Amendment
-------------------------------------
Effective Date, the Agents shall have received a certificate, with sufficient
copies for each Bank, dated the Amendment Effective Date, signed by an
Authorized Officer and attested to by the Secretary or any Assistant Secretary
of each Credit Party, together with copies of the Certificate of Incorporation
and By-Laws of such Credit Party and the resolutions of such Credit Party
referred to in such certificate, and the foregoing shall be reasonably
acceptable to the Agents.
-35-
5.05 Acquisition Documents. On the Amendment Effective Date, there
shall have been delivered to the Agents true and correct copies, certified as
true and complete by an appropriate officer of the appropriate Credit Party, of
each of the Acquisition Documents which shall be (x) in form and substance
reasonably satisfactory to the Agents and (y) in full force and effect on the
Amendment Effective Date.
5.06 Acquisition. (a) On or prior to the Amendment Effective
-----------
Date, the Acquisition shall have been consummated in accordance with the
Acquisition Documents (without waiver of any of the provisions thereof) and in a
manner reasonably satisfactory to the Agents and ▇▇▇▇▇ shall be merged into the
Borrower by operation of law as a result of the dissolution of ▇▇▇▇▇.
(b) Each of the Borrower's and Holdings' and, to the best of their
knowledge, each other Person's representations and warranties in each of the
Acquisition Documents shall be true and correct in all material respects.
5.07 Officer's Certificate. On the Amendment Effective Date, the
---------------------
Agents shall have received certificates, with sufficient copies for each Bank,
dated such date signed by an appropriate officer of Holdings and the Borrower
stating that all of the applicable conditions set forth in Sections 5.02, 5.06,
5.08, 5.09, 5.12, 5.13, exist as of such date.
5.08 Approvals. On or prior to the Amendment Effective Date, all
---------
necessary and material governmental (domestic and foreign) and third party
approvals in connection with the transactions contemplated by the Credit
Documents and otherwise referred to herein or therein shall have been obtained
and remain in effect and all applicable waiting periods shall have expired
without any action being taken by any competent authority which materially
restrains, prevents or imposes materially adverse conditions upon the
transactions contemplated by the Credit Documents and otherwise referred to
herein or therein. Additionally, there shall not exist any judgment, order,
injunction or other restraint issued or filed or a hearing seeking injunctive
relief or other restraint pending or notified prohibiting or imposing materially
adverse conditions upon the making of Loans.
5.09 Existing ▇▇▇▇▇ Indebtedness. (a) On the Amendment Effective
---------------------------
Date, the commitments under the Existing ▇▇▇▇▇ Indebtedness shall have been
terminated, all loans thereunder shall have been repaid in full, together with
all accrued and unpaid interest thereon, all accrued and unpaid fees thereon
shall have been repaid in full, all letters of credit issued thereunder shall
have been terminated or incorporated hereunder as Letters of Credit, and all
other amounts then owing pursuant to the Existing ▇▇▇▇▇ Indebtedness shall have
been repaid in full.
(b) On the Amendment Effective Date, all security interests and Liens
created under the Existing ▇▇▇▇▇ Indebtedness and the related security documents
on the
-36-
capital stock of, and assets (including intercompany notes) owned by, the
Borrower and its Subsidiaries shall have been terminated and released, and the
Agents shall have received all such releases as may have been requested by the
Agents, which releases shall be in the form and substance reasonably
satisfactory to the Administrative Agent.
(c) The Agents shall have received evidence from the lenders under
the Existing ▇▇▇▇▇ Indebtedness in form, scope and substance reasonably
satisfactory to it that the matters set forth in this Section 5.09(a) and (b)
have been satisfied at such time.
5.10 Pledge and Security Agreements and Collateral Assignment of
-----------------------------------------------------------
Leases. (a) On the Amendment Effective Date, Holdings shall have duly
------
authorized, executed and delivered an amendment to the Holdings Pledge Agreement
in form and substance reasonably satisfactory to the Agents and the Required
Banks, the Holdings Pledge Agreement, as so amended, shall be in full force and
effect to secure the payment and performance of the Loans hereunder and the
other Obligations and the Collateral Agent shall have in its possession all the
Pledged Securities referred to in the Holdings Pledge Agreement then owned by
Holdings, together with executed and undated stock powers.
(b) On the Amendment Effective Date, the Borrower shall have duly
authorized, executed and delivered an amendment to each of the Borrower Pledge
Agreement and the Security Agreement, each in form and substance reasonably
satisfactory to the Agents and the Required Banks, the Borrower Pledge Agreement
and the Security Agreement, each as so amended, shall be in full force and
effect to secure the payment and performance of the Loans hereunder and the
other Obligations and the Collateral Agent shall have in its possession all the
Pledged Securities referred to in the Borrower Pledge Agreement then owned by
the Borrower, together with executed and undated stock powers.
(c) On the Amendment Effective Date, (i) the Security Agreement shall
be in full force and effect, (ii) no filings, recordings, registrations or other
actions shall be necessary or desirable to perfect the security interests
granted pursuant to the Security Agreement in the Security Agreement Collateral
covered thereby except as set forth in subclause (w), and (iii) the Banks shall
have received:
(w) UCC financing statements (form UCC-1) in appropriate form for
filing under the UCC and any other applicable law, rule or regulation as
may be reasonably necessary or appropriate to perfect the liens created, or
purported to be created, by the Security Agreement in property and assets
acquired by the Borrower as a result of the Acquisition and/or the
dissolution of ▇▇▇▇▇;
(x) evidence of the completion of all recordings and filings of, or
with respect to, the Security Agreement, including, without limitation,
UCC-3 amendments as may be reasonably necessary or, in the opinion of the
Collateral Agent, de-
-37-
sirable to perfect or continue to perfect the security interests, as
collateral security for the payment and performance of the Loans hereunder
and the other Obligations, intended to be created by the Security
Agreement;
(y) evidence that all other actions necessary or, in the opinion of
the Collateral Agent, desirable to perfect and protect the security
interests purported to be created by the Security Agreement have been
taken; and
(z) the Collateral Agent shall have received judgment, tax and UCC
lien search reports listing all effective financing statements which name
Holdings, the Borrower, any Subsidiary Guarantor as debtor and which are
filed in those jurisdictions in which any of the Collateral is located and
the jurisdictions in which Holdings', the Borrower's, each Subsidiary
Guarantor's or ▇▇▇▇▇'▇ principal place of business is located, none of
which, except as set forth on Schedule 9.01, shall encumber the Collateral
covered or intended to be covered by the Security Agreement.
(d) On the Amendment Effective Date, the Borrower shall have duly
authorized, executed and delivered to the Collateral Agent an amendment to the
Collateral Assignment of Leases, in form and substance reasonably satisfactory
to the Agents and the Required Banks, with respect to each office or warehouse
facility leased by the Borrower and listed on Schedule 5.10, such Collateral
Assignments of Leases, as so amended, shall be substantially in full force and
effect, to secure the payment and performance of the Loans hereunder and the
other Obligations, and the Borrower shall endeavor in a reasonable manner to
obtain and deliver to the Collateral Agent a Landlord Consent from each lessor
under those leases so indicated on Schedule 5.10 pursuant to which the Borrower
leases office or warehouse space, within 90 days of the Effective Date.
(e) On the Amendment Effective Date, the Borrower shall have duly
authorized, executed and delivered to the Collateral Agent an amendment to the
Collateral Assignment of Location Leases, to secure the payment and performance
of the Loans hereunder and the other Obligations, with respect to all premises
leased by the Borrower at which Collateral constituting personal property is
located and such Collateral Assignment of Location Leases shall be substantially
in full force and effect, to secure the payment and performance of the Loans
hereunder and the other Obligations.
5.11 Mortgages; Title Insurance; Surveys; etc. In connection with
----------------------------------------
the execution and delivery of any Additional Mortgage pursuant to Section 8.11
hereby, the Collateral Agent shall receive:
(i) a fully executed Mortgage, in form and substance reasonably
satisfactory to the Agents and the Required Banks, covering such of the
Real Property owned or leased by the Borrower or any of the Subsidiary
Guarantors as shall be
-38-
subject to Section 8.11 hereby, together with evidence that counterparts of
such amendments have been delivered to the title insurance company insuring
the Lien of any Additional Mortgage, as so amended, for recording in all
places to the extent necessary to create a valid and enforceable first
priority mortgage lien (subject to Permitted Encumbrances relating
thereto), as collateral security for the payment and performance of the
Loans hereunder and the other Obligations, on each Additional Mortgaged
Property in favor of the Collateral Agent (or such other trustee as may be
required or desired under local law) for the benefit of the Secured
Creditors; and
(ii) endorsements to the Mortgage Policies on each Additional
Mortgaged Property issued by Chicago Title or another national title
insurer licensed to do business in the jurisdiction where the applicable
Mortgaged Property is located and assuring the Collateral Agent that such
Additional Mortgage is valid and enforceable first priority mortgage Liens,
as collateral security for the payment and performance of the Loans
hereunder and the other Obligations, on the respective Additional Mortgaged
Property, free and clear of all defects and encumbrances except Permitted
Encumbrances and such endorsements to the Mortgage Policies shall otherwise
be in form and substance reasonably satisfactory to the Collateral Agent
and shall include, as appropriate, an endorsement for future advances under
this Agreement and the Notes and for any other matter that the Collateral
Agent in its discretion may reasonably request to the extent available in
the jurisdictions in which such Additional Mortgaged Property is located.
5.12 Adverse Change, etc. At the time of each Credit Event and
-------------------
after giving effect thereto, nothing shall have occurred since September 30,
1997 (and the Banks shall have become aware of no facts, conditions or other
information not previously available to them) which the Agents or the Required
Banks reasonably believe could have a material adverse effect on: (i) the
rights or remedies of the Agents or the Banks, (ii) the ability of Holdings or
the Borrower to perform their respective obligations to the Agents and the Banks
or (iii) the business operations, assets, liabilities, condition (financial or
otherwise) or prospects of Holdings and its Subsidiaries taken as a whole or on
the Borrower and its Subsidiaries taken as a whole (the circumstances described
in clauses (i), (ii) and (iii) as they apply to Holdings and the Borrower and
their respective Subsidiaries being collectively referred to as a "Material
--------
Adverse Effect").
--------------
5.13 Litigation. On the Amendment Effective Date, no litigation by
----------
any entity (private or governmental) shall be pending or threatened with respect
to this Agreement or any documentation executed in connection therewith, or
which the Agents or the Required Banks shall reasonably believe could have a
Materially Adverse Effect.
SECTION 6. Conditions Precedent to All Credit Events. The
-----------------------------------------
obligation of each Bank to make Loans (including Loans made on the Effective
Date), and the obligation
-39-
of an Issuing Bank to issue any Letter of Credit, is subject, at the time of
each such Credit Event (except as hereinafter indicated), to the satisfaction of
the following conditions:
6.01 No Default; Representations and Warranties. At the time of
------------------------------------------
each such Credit Event and also after giving effect thereto (i) there shall
exist no Default or Event of Default, (ii) there shall not exist or become known
any facts, conditions, or circumstances which the Agents or the Required Banks
reasonably believe could have a Material Adverse Effect, (iii) all
representations and warranties contained herein or in any other Credit Document
shall be true and correct in all material respects with the same effect as
though such representations and warranties had been made on the date of the
making of such Credit Event (it being understood and agreed that any
representation or warranty which by its terms is made as of a specified date
shall be required to be true and correct in all material respects only as of
such specified date) and (iv) in the case of a Tranche B Revolving Loan, if the
proceeds of such Loan are to be used to fund a Permitted Acquisition whose fair
market value, as determined in good faith by the Board of Directors of Holdings,
is greater than $40,000,000, the prior written consent of the Required Banks to
such acquisition shall have been obtained.
6.02 Notice of Borrowing; Letter of Credit Request. (a) Prior to
---------------------------------------------
the making of each Loan, the Agent shall have received the notice required by
Section 1.03(a).
(b) Prior to the issuance of each Letter of Credit, the Agent and the
respective Issuing Bank shall have received a Letter of Credit Request meeting
the requirements of Section 2.02(a).
The occurrence of the Amendment Effective Date and each Credit Event
and the acceptance of the proceeds of each Credit Event shall constitute a
representation and warranty by the Borrower to the Agents and each of the Banks
that all the conditions specified in Section 5 and in this Section 6 and
applicable to the occurrence of the Effective Date and such Credit Event exist
as of that time (except to the extent that any of the conditions specified in
Section 5 are required to be satisfactory to or determined by any Bank, the
Required Banks and/or the Agents). All of the Notes, certificates, legal
opinions and other documents and papers referred to in Section 5 and in this
Section 6, unless otherwise specified, shall be delivered to the Administrative
Agent at the Notice Office for the account of each of the Banks and, except for
the Notes, in sufficient counterparts for each of the Banks.
SECTION 7. Representations, Warranties and Agreements. In order to
------------------------------------------
induce the Banks to enter into this Agreement and to make the Loans, and issue
(or participate in) the Letters of Credit as provided herein, each of Holdings
and the Borrower makes the following representations, warranties and agreements,
all of which shall survive the execution and delivery of this Agreement and the
Notes and the making of the Loans and
-40-
issuance of the Letters of Credit, with the occurrence of each Credit Event on
or after the Effective Date being deemed to constitute a representation and
warranty that the matters specified in this Section 7 are true and correct in
all material respects on and as of the Effective Date and on the date of each
such Credit Event (it being understood and agreed that any representation or
warranty which by its terms is made as of a specified date shall be required to
be true and correct only as of such specified date).
7.01 Corporate Status. Except as set forth on Schedule 7.01,
----------------
Holdings, the Borrower and each of their respective Subsidiaries (i) is a duly
organized and validly existing corporation in good standing under the laws of
the jurisdiction of its incorporation, (ii) has the corporate power and
authority to own its property and assets and to transact the business in which
it is engaged and (iii) is duly qualified and is authorized to do business and
is in good standing in each jurisdiction where the conduct of its business
requires such qualifications except for failures to be so qualified which,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.
7.02 Corporate Power and Authority. Each Credit Party has the
-----------------------------
corporate power and authority to execute, deliver and perform the terms and
provisions of each of the Credit Documents to which it is party and has taken
all necessary corporate or partnership action to authorize the execution,
delivery and performance by it of each of such Credit Documents. Each Credit
Party has duly executed and delivered each of the Documents to which it is
party, and, assuming due execution and delivery of each other party thereto,
each of such Credit Documents constitutes its legal, valid and binding
obligation of such Credit Party enforceable against such Credit Party in
accordance with its terms, except to the extent that the enforceability thereof
may be limited by (a) bankruptcy, insolvency, fraudulent conveyance,
preferential transfer, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting creditors' rights and remedies
generally, (b) general principles of equity (whether such enforceability is
considered in a proceeding in equity or at law), and by the discretion of the
court before which any proceeding therefor may be brought, or (c) public policy
considerations or court administrative, regulatory or other governmental
decisions that may limit rights to indemnification or contribution or limit or
affect any covenants or agreements relating to competition or future employment.
7.03 No Violation. Neither the execution, delivery or performance
------------
by any Credit Party of the Credit Documents to which it is a party, nor
compliance by it with the terms and provisions thereof, (i) will contravene any
provision of any applicable law, statute, rule or regulation or any applicable
order, writ, injunction or decree of any court or governmental instrumentality,
in each case, to the extent such contravention could reasonably be expected to
result in a Material Adverse Effect, (ii) will conflict with or result in any
breach of any of the terms, covenants, conditions or provisions of, or
constitute a default
-41-
under, or result in the creation or imposition of (or the obligation to create
or impose) any Lien (except pursuant to the Security Documents) upon any of the
material properties or assets of Holdings, the Borrower or any of their
respective Subsidiaries pursuant to the terms of any indenture, mortgage, deed
of trust, credit agreement or loan agreement, or any other material agreement,
contract or instrument, to which Holdings, the Borrower or any of their
respective Subsidiaries is a party or by which it or any of its property or
assets is bound or to which it may be subject, which conflict, breach or default
would not reasonably be expected to have a Material Adverse Effect or (iii) will
violate any provision of the Certificate of Incorporation or By-Laws of
Holdings, the Borrower or any of their respective Subsidiaries.
7.04 Governmental Approvals. Except as set forth on Schedule 7.04,
----------------------
no order, consent, approval, license, authorization or validation of, or filing,
recording or registration with (except as have been obtained or if failed to
obtain would not reasonably be expected to have a Material Adverse Effect or (in
the case of filings, recordings or registrations) made prior to the Effective
Date), or exemption by, any governmental or public body or authority, or any
subdivision thereof, is required to authorize, or is required in connection
with, (i) the execution, delivery and performance of any Document or (ii) the
legality, validity, binding effect or enforceability of any such Document.
7.05 Financial Statements; Financial Condition; Undisclosed
------------------------------------------------------
Liabilities; Projections; etc. (a) To the best knowledge of Holdings and the
-----------------------------
Borrower, the statements of financial condition of Holdings and its Subsidiaries
at March 28, 1997 and of ▇▇▇▇▇ as of June 30, 1997 and the related statements of
income and cash flow for the last fiscal year ended on such date, as the case
may be, and furnished to the Banks prior to the Amendment Effective Date present
fairly in all material respects the financial condition of Holdings and its
Subsidiaries and of ▇▇▇▇▇ and its Subsidiaries at the date of such statements of
financial condition and the results of the operations of Holdings and its
Subsidiaries for the respective last fiscal year or three-month period, as the
case may be. To the best knowledge of Holdings and the Borrower, all such
financial statements have been prepared in accordance with GAAP consistently
applied, except as disclosed therein and subject to normal year end audit
adjustments.
(b) The annual and interim financial statements included in the SEC
Reports (both as to Holdings and as to its Subsidiaries on a combined basis)
(including statements of income and cash flows and changes in shareholders'
equity), present fairly in all material respects the financial condition of the
relevant Persons at the dates of said statements and the results for the periods
covered thereby. All such financial statements have been prepared in accordance
with GAAP consistently applied and the financial statements as of and for the
fiscal years have been audited by and accompanied by the opinion of Ernst &
Young LLP, independent public accountants.
-42-
(c) Since September 30, 1997, after giving effect to the Acquisition,
nothing has occurred that has had or could reasonably be expected to have a
Material Adverse Effect.
(d) Except as fully reflected in the financial statements described
in Section 7.05(b) and the Indebtedness incurred under this Agreement and except
as set forth in Schedule 7.05, (i) there were as of the Amendment Effective Date
(and after giving effect to any Loans made on such date), no liabilities or
obligations (excluding obligations or liabilities incurred in the ordinary
course of business, which, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect) with respect to
Holdings or the Borrower or any of their respective Subsidiaries of any nature
whatsoever (whether absolute, accrued, contingent or otherwise and whether or
not due), and (ii) neither Holdings nor the Borrower nor any of their respective
Subsidiaries knows of any basis for the assertion against Holdings or the
Borrower or any of their respective Subsidiaries of any such liability or
obligation which, either individually or in the aggregate, has, or could be
reasonably likely to have, a Material Adverse Effect.
(e) The pro forma information contained in the SEC Reports and the
--- -----
Projections are based on good faith estimates and assumptions made by Holdings
or Borrower, and on the Amendment Effective Date Holdings or Borrower believes
that the Projections and such pro forma information were reasonable and, in the
--- -----
case of the Projections, attainable under the facts and circumstances known to
Holdings or Borrower, it being recognized by the Banks, however, that
projections as to future events are not to be viewed as facts and that the
actual results during the period or periods covered by the Projections are
likely to differ from the projected results and that the differences could be
material. There is no material fact known to Holdings or the Borrower or any of
their respective Subsidiaries which would have a Material Adverse Effect and
which is not publicly available or has not been disclosed herein or in such
other documents, certificates and statements furnished to the Banks for use in
connection with the transactions contemplated hereby.
(f) On and as of the Amendment Effective Date, after giving effect to
the Acquisition and to all Indebtedness (including the Loans) being incurred or
assumed and Liens created by the Borrower in connection therewith (assuming the
full utilization of all Commitments on the Effective Date), (a) the sum of the
assets, at a going business value (i.e., the amount that may be realized within
---
a reasonable time, considered to be six months to one year, either through
collection or sale at the regular market value, conceiving the latter as the
amount that would be obtained for such assets within such period by a capable
and diligent businessman from an interested buyer who is willing to purchase
under ordinary selling conditions), of each of Holdings, individually, and the
Borrower, individually, will exceed its debts; (b) each of Holdings,
individually, and the Borrower, individually, has not incurred and does not
intend to incur, and does not believe that it will incur, debts
-43-
beyond its ability to pay such debts as such debts mature; and (c) each of
Holdings, individually, and the Borrower, individually, will have sufficient
capital with which to conduct its business. For purposes of this Section
7.05(f), "debt" means any liability on a claim, and "claim" means (i) right to
---- -----
payment, whether or not such a right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable, secured, or unsecured or (ii) right to an equitable remedy for
breach of performance if such breach gives rise to a payment, whether or not
such right to an equitable remedy is reduced to judgment, fixed, contingent,
matured, unmatured, disputed, undisputed, secured or unsecured; provided that to
--------
the extent any such "claim" is not fixed, liquidated and contingent, the amount
thereof shall equal the Company's good faith estimate of the maximum amount
thereof.
(g) Except as fully disclosed in the financial statements delivered
pursuant to Section 7.05(a), there were as of the Amendment Effective Date no
liabilities or obligations with respect to Holdings, the Borrower or any of
their respective Subsidiaries of any nature whatsoever (whether absolute,
accrued, contingent or otherwise and whether or not due) which, either
individually or in aggregate, would be material to Holdings, the Borrower or to
the Borrower and its Subsidiaries taken as a whole. As of the Effective Date,
neither Holdings nor the Borrower knows of any basis for the assertion against
it of any liability or obligation of any nature whatsoever that is not fully
disclosed in the financial statements delivered pursuant to Section 7.05(a)
which, either individually or in the aggregate, could be material to Holdings or
the Borrower.
(h) On and as of the Amendment Effective Date, the financial
projections (the "Projections") previously delivered to the Administrative Agent
-----------
and the Banks have been prepared on a basis consistent with the financial
statements referred to in Section 7.05(a) (other than as set forth or presented
in such Projections), and there are no statements or conclusions in any of the
Projections which are based upon or include information known to the Borrower to
be misleading in any material respect or which fail to take into account
material information regarding the matters reported therein. On the Effective
Date, the Borrower believed that the Projections were reasonable and attainable;
it being recognized by the Banks, however, that projections as to future events
are not viewed as facts and that the actual results during the period or periods
covered by the Projections are likely to differ from the projected results and
the differences could be material.
7.06 Litigation. Except as set forth on Schedule 7.06, there are
----------
no actions, suits or proceedings pending or, to the best knowledge of Holdings
and the Borrower, threatened that could reasonably be expected to, singly or in
the aggregate, have a Material Adverse Effect.
7.07 True and Complete Disclosure. To the best of Holdings' and
----------------------------
the Borrower's knowledge, all factual information (taken as a whole) furnished
by or on behalf
-44-
of Holdings or the Borrower in writing and listed on Schedule 7.07 to any of the
Agents or any Bank for purposes of or in connection with this Agreement, the
other Credit Documents or any transaction contemplated herein or therein is, and
all other such factual information (taken as a whole) hereafter furnished by or
on behalf of Holdings or the Borrower in writing to any of the Agents or any
Bank will be, true and accurate in all material respects on the date as of which
such information is dated or certified.
7.08 Use of Proceeds; Margin Regulations. (a) All proceeds of the
-----------------------------------
Tranche A Term Loans shall be used by the Borrower to refinance the Existing
Credit Agreement and all proceeds of the Tranche B Term Loans shall be used by
the Borrower to effect the Acquisition.
(b) All proceeds of Tranche A Revolving Loans shall be used (subject
to the terms and conditions contained herein) for working capital purposes of
Holdings and the Borrower and its Subsidiaries; all proceeds of Tranche B
Revolving Loans shall be used (subject to the terms and conditions contained
herein) solely to finance the cash portion of the consideration paid to effect
Permitted Acquisitions.
(c) No part of the proceeds of any Loan will be used to purchase or
carry any Margin Stock or to extend credit for the purpose of purchasing or
carrying any Margin Stock. Neither the making of any Loan nor the use of the
proceeds thereof nor the occurrence of any other Credit Event will violate or be
inconsistent with the provisions of Regulation G, T, U or X of the Board of
Governors of the Federal Reserve System.
7.09 Tax Returns and Payments. Holdings, the Borrower and each of
------------------------
their respective Subsidiaries are members of an affiliated group of corporations
filing consolidated returns for Federal income tax purposes, of which Holdings
is the "common parent" (within the meaning of Section 1504 of the Code) of such
group. Each of Holdings, the Borrower and each of their respective Subsidiaries
have timely filed or caused to be timely filed, on the due dates thereof or
within applicable grace periods, with the appropriate taxing authority, all
Federal and all material state and other returns, statements, forms and reports
for taxes (the "Returns") required to be filed by or with respect to the income,
-------
properties or operations of Holdings, the Borrower and/or any of their
respective Subsidiaries. To the best knowledge of Holdings, the Returns
accurately reflect all liability for taxes of Holdings, the Borrower and their
respective Subsidiaries for the periods covered thereby. To the best knowledge
of Holdings, each of Holdings, the Borrower and each of their respective
Subsidiaries have paid all taxes payable by them other than taxes which are not
delinquent, and other than those contested in good faith and for which adequate
reserves have been established in accordance with GAAP. Except as disclosed in
the financial statements referred to in Section 7.05(a), there is no material
action, suit, proceeding, investigation, audit, or claim now pending or, to the
best knowledge of Holdings or the Borrower, threatened by any authority
regarding any taxes relating to Holdings, the Borrower or any of
-45-
their respective Subsidiaries. The charges, accruals and reserves on the books
of Holding and its Subsidiaries in respect of taxes and other governmental
charges are, in the opinion of Holdings and the Borrower, adequate. As of the
Effective Date, none of Holdings, the Borrower or any of their respective
Subsidiaries has entered into an agreement or waiver or been requested to enter
into an agreement or waiver extending any statute of limitations relating to the
payment or collection of taxes of Holdings, the Borrower or any of their
respective Subsidiaries, or is aware of any circumstances that would cause the
taxable years or other taxable periods of Holdings, the Borrower or any of their
respective Subsidiaries not to be subject to the normally applicable statute of
limitations. None of Holdings, the Borrower or any of their respective
Subsidiaries has provided, with respect to themselves or property held by them,
any consent under Section 341 of the Code.
7.10 Compliance with ERISA. Each Plan is in substantial compliance
---------------------
with ERISA and the Code; no Reportable Event has occurred with respect to a
Plan; no Plan is insolvent or in reorganization; no Plan has Unfunded Current
Liability; no Plan has an accumulated or waived funding deficiency, has
permitted decreases in its funding standard account or has applied for an
extension of any amortization period within the meaning of Section 412 of the
Code; all contributions required to be made with respect to a Plan have been
timely made; none of Holdings, the Borrower, or any of their respective
Subsidiaries nor any ERISA Affiliate has incurred any material liability to or
on account of a Plan pursuant to Section 409, 502(i), 502(1), 515, 4062, 4063,
4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of
the Code or expects to incur any liability under any of the foregoing Sections
with respect to any Plan; no proceedings have been instituted to terminate or
appoint a trustee to administer any Plan; no condition exists which presents a
material risk to Holdings, the Borrower or any of their respective Subsidiaries
or any ERISA Affiliate of incurring a liability to or on account of a Plan
pursuant to the foregoing provisions of ERISA and the Code; using actuarial
assumptions and computation methods consistent with Part 1 of subtitle E of
Title IV of ERISA, the aggregate liabilities of Holdings, the Borrower, their
respective Subsidiaries and their ERISA Affiliates to all Plans which are
multiemployer plans (as defined in Section 4001(a)(3) of ERISA) in the event of
a complete withdrawal therefrom, as of the close of the most recent fiscal year
of each such Plan ended prior to the date of the most recent Credit Event, would
not exceed $50,000; no lien imposed under the Code or ERISA on the assets of
Holdings, the Borrower or any of their respective Subsidiaries or any ERISA
Affiliate exists or is likely to arise on account of any Plan; and Holdings, the
Borrower and their respective Subsidiaries may cease contributions to or
terminate any Plan maintained by any of them without incurring any material
liability.
7.11 The Security Documents. (a) The provisions of the Security
----------------------
Agreement, as amended, are effective to create in favor of the Collateral Agent
for the benefit of the Secured Creditors a legal, valid and enforceable security
interest in all right, title and
-46-
interest of the Borrower and the Subsidiary Guarantors in the Security Agreement
Collateral described therein, as collateral security for the payment and
performance of the Loans and the other Obligations, and the Security Agreement,
upon the filing of Form UCC-1 financing statements or the appropriate equivalent
and amendments thereto (which filings have been made) or other methods of
perfection (which have been completed), creates, a fully perfected first lien
on, and security interest in, all right, title and interest in all of the
Security Agreement Collateral described therein, which security interest shall
be subject to no other Liens other than Permitted Filings. The recordation of
the Assignment of Security Interest and an amendment thereto in U.S. Patents and
Trademarks in the form attached to the Security Agreement in the United States
Patent and Trademark Office together with filings on Form UCC-1 and Form UCC-3
made pursuant to the Security Agreement are effective, under applicable law, to
perfect the security interest, as collateral security for the payment and
performance of the Loans and the other Obligations, granted to the Collateral
Agent in the trademarks and patents covered by the Security Agreement and the
recordation of the Assignment of Security Interest and an amendment thereto in
U.S. Copyrights in the form attached to the Security Agreement with the United
States Copyright Office together with filings on Form UCC-1 and Form UCC-3 made
pursuant to the Security Agreement are effective under federal law to perfect
the security interest, as collateral security for the payment and performance of
the Loans and the other Obligations, granted to the Collateral Agent in the
copyrights covered by the Security Agreement. The Borrower and each Subsidiary
Guarantor has good and marketable title to all Security Agreement Collateral
pledged by it under the Security Agreement, free and clear of all Liens except
those described above in this clause (a).
(b) The security interests created in favor of the Collateral Agent,
as Pledgee, for the benefit of the Secured Creditors under the Pledge
Agreements, upon the delivery of the Pledged Securities to the Collateral Agent,
constitute first priority perfected security interests in the Pledged Securities
described in the Pledge Agreements, as collateral security for the payment and
performance of the Loans and the other Obligations, subject to no security
interests of any other Person. No filings or recordings are required in order
to perfect the security interests created in the Pledged Securities and the
proceeds thereof under the Pledge Agreements other than filings on Form UCC-1
and Form UCC-3 deemed necessary by the Collateral Agent.
7.12 Representations and Warranties in Documents. All
-------------------------------------------
representations and warranties set forth in the other Documents are true and
correct in all material respects at the time as of which such representations
and warranties were made (or deemed made) and will be true and correct in all
material respects on the Effective Date.
7.13 Properties. Except as set forth on Schedule 7.13, Holdings,
----------
the Borrower and each of their respective Subsidiaries have good and valid title
to all properties
-47-
owned in fee by them, including all property reflected in the balance sheet
referred to in Section 7.05(a) and in the pro forma balance sheet referred to in
--- -----
Section 5.15 (except as sold or otherwise disposed of since the date of such
balance sheet in the ordinary course of business or in accordance with the terms
of this Agreement), free and clear of all Liens, other than Liens which are (x)
in the case of Mortgaged Real Property, Prior Liens and Liens permitted by the
applicable Mortgage and (y) in the case of other Real Property, Permitted Liens.
7.14 Capitalization. (a) On the Amendment Effective Date, the
--------------
authorized capital stock of Holdings shall consist of (i) 15,000,000 shares of
Holdings Common Stock, $.01 par value per share, of which 12,687,135 shares
shall be issued and outstanding, (ii) 1,000,000 shares of Holdings Nonvoting
Common Stock, $.01 par value per share, of which 480,648 shares shall be issued
and outstanding and (iii) 1,000,000 shares of Holdings Preferred Stock, $.01 par
value per share, none of which shall be issued and outstanding. All such
outstanding shares have been duly and validly issued, are fully paid and non-
assessable and have been issued free of preemptive rights. Except as set forth
in Schedule 7.14, as of the Effective Date, Holdings does not have outstanding
any securities convertible into or exchangeable for its capital stock or
outstanding any rights to subscribe for or to purchase, or any options for the
purchase of, or any agreement providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating to,
its capital stock, in each case other than as set forth in the SEC Reports.
(b) The authorized capital stock of the Borrower shall consist of
1,000 shares of common stock, $.01 par value per share, 100 of which shall be
issued and outstanding. All such outstanding shares of common stock have been
duly and validly issued, are fully paid and nonassessable and are free of
preemptive rights. As of the Effective Date, the Borrower does not have
outstanding any securities convertible into or exchangeable for its capital
stock or outstanding any rights to subscribe for or to purchase, or any options
for the purchase of, or any agreements providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating to,
its capital stock.
7.15 Subsidiaries. On and as of the Amendment Effective Date, the
------------
Borrower has no Subsidiaries other than those Subsidiaries listed on Schedule
7.15 and as of the Effective Date, Holdings has no direct Subsidiary other than
the Borrower and no indirect Subsidiary other than the direct Subsidiaries of
the Borrower listed on Schedule 7.15.
7.16 Compliance with Statutes, etc. Except as set forth on
-----------------------------
Schedule 7.16, each of Holdings, the Borrower and their respective Subsidiaries
is in compliance with all applicable statutes, regulations and orders of, and
all applicable restrictions imposed by, all governmental bodies, domestic or
foreign, in respect of the conduct of its business and the
-48-
ownership of its property, except such noncompliances as could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
7.17 Investment Company Act. None of Holdings, the Borrower or any
----------------------
of their respective Subsidiaries is an "investment company" or a company
"controlled" by an "investment company," within the meaning of the Investment
Company Act of 1940, as amended.
7.18 Public Utility Holding Company Act. None of Holdings, the
----------------------------------
Borrower or any of their respective Subsidiaries is a "holding company," or a
"subsidiary company" of a "holding company," or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company" within the meaning
of the Public Utility Holding Company Act of 1935, as amended.
7.19 Environmental Matters. Except as set forth on Schedule 7.19,
---------------------
(a) Holdings, the Borrower and each of their respective Subsidiaries have
complied in all material respects with, and on the date of each Credit Event
will be in compliance in all material respects with, all Environmental Laws and
the requirements of any permits, licenses or other authorizations issued under
such Environmental Laws. There are no pending or, to the best knowledge of
Holdings and the Borrower, past or threatened Environmental Claims against
Holdings, the Borrower or any of their respective Subsidiaries or any Real
Property now or formerly owned or operated by Holdings, the Borrower or any of
their respective Subsidiaries. There are no facts, circumstances, conditions or
occurrences on any Real Property now or formerly owned or operated by Holdings,
the Borrower or any of their respective Subsidiaries or, to the best knowledge
of Holdings or the Borrower, on any property adjoining or in the vicinity of any
such Real Property that, to the best knowledge of Holdings or the Borrower,
could reasonably be expected (i) to form the basis of an Environmental Claim
against Holdings, the Borrower or any of their respective Subsidiaries or any
such Real Property, which Environmental Claim could reasonably be expected to
result in a Material Adverse Effect, individually or in the aggregate with all
other Environmental Claims, or (ii) to cause any such Real Property to be
subject to any restrictions on the ownership, occupancy, use or transferability
of such Real Property by Holdings, the Borrower or any of their respective
Subsidiaries under any Environmental Law.
(b) Hazardous Materials have not at any time been generated, used,
treated or stored on, or transported to or from, any Real Property owned or
operated by Holdings, the Borrower or any of their respective Subsidiaries where
such generation, use, treatment or storage has violated or resulted in liability
under, or could reasonably be expected to violate or to result in liability
under, any Environmental Law, which violation or liability could reasonably be
expected to result in a Material Adverse Effect, individually or in the
aggregate with all other violations of or liability under any Environmental Law.
Hazardous Materials have not at any time been Released on or from any Real
Property owned or oper-
-49-
ated by Holdings, the Borrower or any of their respective Subsidiaries where
such Release has violated or resulted in material liability under, or could
reasonably be expected to violate or to result in material liability under, any
Environmental Law. There are not now nor have there been any underground storage
tanks or related piping located on any Real Property owned or operated by
Holdings, the Borrower or any of their respective Subsidiaries.
(c) Notwithstanding anything to the contrary in this Section 7.19,
the representations made in this Section 7.19 shall only be untrue if the
aggregate effect of all failures, noncompliances and liabilities of the types
described above could reasonably be expected to result in a Material Adverse
Effect.
7.20 Labor Relations. Except as set forth on Schedule 7.20, none
---------------
of Holdings, the Borrower or any of their respective Subsidiaries is engaged in
any unfair labor practice that could reasonably be expected to have a material
adverse effect on Holdings, the Borrower or on the Borrower and its Subsidiaries
taken as a whole. There is (i) no unfair labor practice complaint pending
against Holdings, the Borrower or any of their respective Subsidiaries or, to
the best knowledge of Holdings or the Borrower, threatened against any of them,
before the National Labor Relations Board, and no material grievance or
arbitration proceeding arising out of or under any collective bargaining
agreement is so pending against Holdings, the Borrower or any of their
respective Subsidiaries or, to the best knowledge of Holdings or the Borrower,
threatened against any of them, (ii) no strike, labor dispute, slowdown or
stoppage pending against Holdings, the Borrower or any of their respective
Subsidiaries or, to the best knowledge of the Borrower, threatened against
Holdings, the Borrower or any of their respective Subsidiaries and (iii) to the
best knowledge of Holdings and the Borrower, no union representation proceeding
is pending with respect to the employees of Holdings or the Borrower or any of
their respective Subsidiaries, except (with respect to any matter specified in
clause (i), (ii) or (iii) above, either individually or in the aggregate) such
as could not reasonably be expected to result in a Material Adverse Effect.
7.21 Patents, Licenses, Franchises and Formulas. Except as set
------------------------------------------
forth on Schedule 7.21, each of Holdings, the Borrower and their respective
Subsidiaries owns all material patents, trademarks, permits, service marks,
trade names, copyrights, licenses, franchises and formulas, or rights with
respect to the foregoing, and has obtained assignments of all leases and other
rights of whatever nature, reasonably necessary for the present conduct of its
business, without any known conflict with the rights of others which, or the
failure to obtain which, as the case may be, would reasonably be expected to
result in a Material Adverse Effect.
7.22 Indebtedness. Schedule 7.22 sets forth a true and complete
------------
list of all Indebtedness of Holdings, the Borrower and their respective
Subsidiaries as of the Effective Date and which is to remain outstanding after
giving effect to the incurrence of Loans on
-50-
such date (excluding the Loans and the Letters of Credit, the "Existing
Indebtedness"), in each case showing the aggregate principal amount thereof and
the name of the respective borrower and any other entity which directly or
indirectly guaranteed such debt.
SECTION 8. Affirmative Covenants. Holdings and the Borrower hereby
---------------------
covenant and agree that as of the Amendment Effective Date and thereafter for so
long as this Agreement is in effect and until the Total Commitments have
terminated, no Letters of Credit (other than Letters of Credit, together with
all Fees that have accrued and will accrue thereon through the stated
termination date of such Letters of Credit, which have been cash collateralized
in a cash collateral account satisfactory to the Letter of Credit Issuer in its
sole and absolute discretion) or Notes are outstanding and the Loans, together
with interest, Fees and all other obligations (other than indemnities described
in Section 13.13 which are not then due and payable) incurred hereunder are paid
in full:
8.01 Information Covenants. Holdings and/or the Borrower will
---------------------
furnish to each Bank:
(a) Monthly Reports. Within 30 days after the end of each fiscal
---------------
month of Holdings, (i) the consolidated balance sheets of Holdings and its
consolidated Subsidiaries as at the end of such month and the related
consolidated statements of operations and retained earnings/stockholders
deficiency and statement of cash flows for such month and for the elapsed
portion of the fiscal year ended with the last day of such month, in each
case setting forth comparative figures for the corresponding month in the
prior fiscal year and the budgeted figures for such month as set forth in
the respective budget delivered pursuant to Section 8.01(e) and (ii)
management's discussion and analysis of the important operational and
financial developments during the month and year-to-date periods, all of
which shall be certified by the chief financial officer or other Authorized
Officer of the Company, subject to certain recurring quarter-end
adjustments and normal year-end audit adjustments and the absence of
footnotes.
(b) Quarterly Financial Statements. Within 45 days after the close
------------------------------
of each of the first three quarterly accounting periods in each fiscal year
of Holdings, consolidated and consolidating balance sheet of Holdings and
its Subsidiaries as at the end of such quarterly accounting period and the
related consolidated and consolidating statements of operations, statements
of changes in stockholders equity and statements of cash flows for such
quarterly accounting period and for the elapsed portion of the fiscal year
ended with the last day of such quarterly accounting period; all of which
shall be in reasonable detail and certified by the chief financial officer
or other Authorized Officer of Holdings that they fairly present in all
material respects the financial condition of Holdings and its Subsidiaries
taken as a whole as of the dates indicated and the results of their
operations and changes in their cash
-51-
flows for the periods indicated, subject to normal year-end audit
adjustments and the absence of footnotes.
(c) Annual Financial Statements. Within 95 days after the close of
---------------------------
each fiscal year of Holdings, (i) the consolidated and consolidating
balance sheets of Holdings and its consolidated Subsidiaries as at the end
of such fiscal year and the related consolidated and consolidating
statements of operation and retained earnings/stockholder deficiency and of
cash flows for such fiscal year setting forth comparative figures for the
preceding fiscal year and certified (except for the consolidating balance
sheets and statements of operations) by Ernst & Young LLP or such other
independent certified public accountants of recognized national standing
reasonably acceptable to the Agents, together with a report of such
accounting firm stating that in the course of its regular audit of the
financial statements of Holdings and its Subsidiaries, which audit was
conducted in accordance with generally accepted auditing standards, such
accounting firm obtained no knowledge of any Default or Event of Default
which has occurred and is continuing under Sections 9.04, 9.05 or 9.07
through 9.10 inclusive or, if in the opinion of such accounting firm such a
Default or Event of Default has occurred and is continuing, a statement as
to the nature thereof and (ii) management's discussions and analysis of the
important operational and financial developments during such fiscal year.
(d) Management Letters. Promptly after the receipt thereof by
------------------
Holdings, the Borrower or any of their respective Subsidiaries, a copy of
any final "management letter" received by any of them from its certified
public accountants and the management's responses thereto.
(e) Budgets. No later than 45 days following the commencement of the
-------
first day of each fiscal year of Holdings, a budget in form consistent with
past practices and in the form delivered to the Agents on or prior to the
Effective Date (including budgeted statements of operation and sources and
uses of cash and balance sheets) prepared by Holdings for (x) each of the
twelve months of such fiscal year prepared in detail and (y) each of the
five years immediately following such fiscal year prepared in summary form,
in each case, of Holdings and its Subsidiaries, accompanied by the
statement of an Authorized Officer of the Borrower to the effect that, to
the best of his knowledge, the budget is a reasonable estimate for the
period covered thereby, the principal assumptions upon which such budgets
are based. Together with each delivery of financial statements pursuant to
Section 7.01(b) and (c), a comparison of the current year to date financial
results (other than in respect of the balance sheets included therein)
against the budgets required to be submitted pursuant to this clause (e)
shall be presented.
-52-
(f) Officer's Certificates. At the time of the delivery of the
----------------------
financial statements provided for in Sections 8.01(a), (b) and (c),
certificates of an Authorized Officer of each of the Borrower and Holdings
to the effect that, to the best of such officer's knowledge, no Default or
Event of Default has occurred and is continuing or, if any Default or Event
of Default has occurred and is continuing, specifying the nature and extent
thereof and what action the Borrower and Holdings propose to take with
respect thereto, which certificate shall, in the case of any such financial
statements delivered in respect of a period ending on the last day of the
respective fiscal quarter or year, (x) set forth the calculations required
to establish whether there was compliance with the provisions of Sections
4.02(e) and (f) (but with respect to Section 4.02(f) only to the extent
delivered with the financial statements required by Sections 8.01(a)),
9.04, 9.05 and 9.07 through 9.10, inclusive, at the end of such fiscal
quarter or year, as the case may be, and (y) if delivered with the
financial statements required by Section 8.01(a), set forth the amount of
Excess Cash Flow for the respective Excess Cash Payment Period.
(g) Notice of Default or Litigation. Promptly, and in any event
-------------------------------
within three Business Days after an officer of Holdings or the Borrower
obtains knowledge thereof, notice of (i) the occurrence of any event which
constitutes a Default or Event of Default specifying the nature and extent
thereof and what action the Borrower and Holdings propose to take with
respect thereto and (ii) any litigation or governmental investigation or
proceeding pending against Holdings, the Borrower or any of their
respective Subsidiaries which, singly or in the aggregate, could reasonably
be expected to have a Material Adverse Effect with respect to any material
Indebtedness of the Borrower and its Subsidiaries taken as a whole.
(h) Other Reports and Filings. Promptly, copies of all financial
-------------------------
information, proxy materials and other information and reports ("SEC
---
Reports"), if any, which Holdings, the Borrower or any of their respective
-------
Subsidiaries shall file with the Securities and Exchange Commission or any
successor thereto (the "SEC") or sent generally to analysts or holders of
---
capital stock or other securities of Holdings, the Borrower or any of their
respective Subsidiaries (in their capacities as such) including holders of
its Indebtedness pursuant to the terms of the documentation governing such
Indebtedness (or any trustee, agent or other representative therefor).
(i) Environmental Matters. Promptly upon, and in any event within
---------------------
ten Business Days after, an officer of Holdings, the Borrower or any of
their respective Subsidiaries obtains knowledge thereof, notice of one or
more of the following environmental matters, unless such environmental
matters could not, individually or when aggregated with all other such
environmental matters, be reasonably expected to have a Material Adverse
Effect:
-53-
(i) any pending or threatened Environmental Claim against
Holdings, the Borrower or any of its Subsidiaries or any Real Property
owned or operated by the Borrower or any of their respective
Subsidiaries;
(ii) any condition or occurrence on or arising from any Real
Property owned or operated by Holdings, the Borrower or any of their
respective Subsidiaries that (a) results in noncompliance by Holdings,
the Borrower or any of their respective Subsidiaries with any
applicable Environmental Law or (b) could reasonably be expected to
form the basis of an Environmental Claim against Holdings, the
Borrower or any of their respective Subsidiaries or any such Real
Property;
(iii) any condition or occurrence on any Real Property owned or
operated by Holdings, the Borrower or any of their respective
Subsidiaries that could reasonably be expected to cause such Real
Property to be subject to any restrictions on the ownership,
occupancy, use or transferability by Holdings, the Borrower or any of
their respective Subsidiaries of such Real Property under any
Environmental Law; and
(iv) the taking of any removal or remedial action in response to
the actual or alleged presence of any Hazardous Material on any Real
Property owned or operated by Holdings, the Borrower or any of their
respective Subsidiaries as required by any Environmental Law or any
governmental or other administrative agency; provided that in any
--------
event Holdings and the Borrower shall deliver to each Bank all notices
received by it or any of their respective Subsidiaries from any
government or governmental agency under, or pursuant to, CERCLA.
All such notices shall describe in reasonable detail the nature of the
claim, investigation, condition, occurrence or removal or remedial action
and Holdings', the Borrower's or such Subsidiary's response thereto. In
addition, the Borrower will provide the Banks with copies of all material
communications with any government or governmental agency relating to
Environmental Laws, all material communications with any Person (other than
its attorneys) relating to Environmental Claims, and such detailed reports
of any Environmental Claim as may reasonably be requested by the Banks.
(j) Annual Meetings with Banks. At the request of the Administrative
--------------------------
Agent, Holdings shall within 120 days after the close of each fiscal year
of Holdings hold a meeting at a time and place selected by Holdings and
acceptable to the Agents with all of the Banks at which meeting shall be
reviewed the financial results of the
-54-
previous fiscal year and the financial condition of Holdings and the
budgets presented for the current fiscal year of Holdings and its
Subsidiaries.
(k) Other Information. From time to time, such other information or
-----------------
documents (financial or otherwise) with respect to Holdings, the Borrower
or their respective Subsidiaries as any Bank may reasonably request in
writing.
(l) Permitted Acquisition Compliance Certificate. At least 10 days
--------------------------------------------
prior to a Permitted Acquisition or promptly upon, and in any event within
10 Business Days after, with respect to a Permitted Acquisition for which
the total consideration payable is less than $40,000,000, the closing of a
Permitted Acquisition, Holdings will deliver to the Administrative Agent a
certificate (a "Permitted Acquisition Compliance Certificate") of an
Authorized Officer to the effect that no Default or Event of Default exists
or would result therefrom (including giving pro forma effect to such
--- -----
acquisition and any additional Indebtedness resulting therefrom or incurred
therewith as if such acquisition had occurred and such Indebtedness had
been incurred as of the first day of the most recently completed Test
Period (including any other Permitted Acquisition that had occurred and the
related Indebtedness which was incurred, during or subsequent to such Test
Period)) and which certificate shall set forth in reasonable detail the pro
---
forma calculation of the Pro Forma Leverage Ratio and the Consolidated
-----
Adjusted Senior Leverage Ratio as of the date of the Permitted Acquisition,
giving effect thereto, and show compliance (in reasonable detail as to pro
---
forma calculations) with all the provisions of this Section 8.01(l);
-----
provided, however, that with respect to Permitted Acquisitions in respect
-------- -------
of which the total consideration is less than $10,000,000, the Permitted
Acquisition Compliance Certificate's requisite information may be
incorporated into the officer's certificate and financial statements
provided for in Sections 8.01(b) and (c) and furnished to each Bank at the
time of delivery of the financial statements provided for in Sections
8.01(b) and (c).
8.02 Books, Records and Inspections. Holdings and the Borrower
------------------------------
will, and will cause each of their respective Subsidiaries to, keep proper books
of record and account in which full, true and correct entries in conformity with
GAAP and all requirements of law shall be made of all dealings and transactions
in relation to its business and activities. Holdings and the Borrower will, and
will cause each of their respective Subsidiaries to, permit officers and
designated representatives of the Agents or any Bank to visit and inspect,
during regular business hours and under guidance of officers of Holdings and the
Borrower or such Subsidiary, any of the properties of Holdings and the Borrower
or such Subsidiary, and to examine the books of account of Holdings and the
Borrower or such Subsidiary and discuss the affairs, finances and accounts of
Holdings and the Borrower or such Subsidiary with, and be advised as to the same
by, its and their officers and independ-
-55-
ent accountants, all at such reasonable times and intervals and to such
reasonable extent as the Agents or such Bank may request.
8.03 Maintenance of Property; Insurance. (a) Schedule 8.03 sets
----------------------------------
forth a true and complete listing of all insurance maintained by Holdings, the
Borrower and their respective Subsidiaries as of the Effective Date. Holdings
and the Borrower will, and will cause each of their respective Subsidiaries to,
(i) keep all property necessary in its business in good working order and
condition (ordinary wear and tear excepted), (ii) maintain insurance on all its
property in at least such amounts and against at least such risks as is
consistent and in accordance with industry practice and (iii) furnish to each
Bank, upon written request, full information as to the insurance carried. In
addition to the requirements of the immediately preceding sentence, Holdings and
the Borrower will at all times cause insurance of the types described in
Schedule 8.03 to be maintained (with the same scope of coverage as that
described in Schedule 8.03) at levels which are at least as great as the
respective amount described on Schedule 8.03 in footnotes (1) and (2) thereof.
(b) Holdings and the Borrower will, and will cause their respective
Subsidiaries to, at all times keep their respective property insured in favor of
the Collateral Agent, and all policies or certificates (or certified copies
thereof) with respect to such insurance (and any other insurance maintained by
Holdings, the Borrower or any of their respective Subsidiaries) (i) shall be
endorsed to the Collateral Agent's satisfaction for the benefit of the
Collateral Agent (including, without limitation, by naming the Collateral Agent
as loss payee or as an additional insured), (ii) shall state that such insurance
policies shall not be canceled without 30 days' prior written notice thereof by
the respective insurer to the Collateral Agent, (iii) shall provide that the
respective insurers irrevocably waive any and all rights of subrogation with
respect to the Collateral Agent and the Secured Creditors, (iv) shall contain
the standard non-contributory mortgagee clause endorsement in favor of the
Collateral Agent with respect to hazard insurance coverage, (v) shall, except in
the case of public liability insurance and workers' compensation insurance,
provide that any losses shall be payable notwithstanding (A) any act or neglect
of Holdings, the Borrower or any of their respective Subsidiaries, (B) the
occupation or use of the properties for purposes more hazardous than those
permitted by the terms of the respective policy if such coverage is obtainable
at commercially reasonable rates and is of the kind from time to time
customarily insured against by Persons owning or using similar property and in
such amounts as are customary, (C) any foreclosure or other proceeding relating
to the insured properties if such coverage is available at commercially
reasonable rates or (D) any change in the title to or ownership or possession of
the insured properties and (vi) shall be deposited with the Collateral Agent if
such coverage is available at commercially reasonable rates.
(c) If Holdings, the Borrower or any of their respective Subsidiaries
shall fail to maintain all insurance in accordance with this Section 8.03, or if
Holdings, the Bor-
-56-
rower or any of their respective Subsidiaries shall fail to so endorse and
deposit all policies or certificates with respect thereto, the Agents and/or the
Collateral Agent shall have the right (but shall be under no obligation) to
procure such insurance and the Borrower agrees to reimburse the Agents or the
Collateral Agent, as the case may be, for all costs and expenses of procuring
such insurance.
8.04 Corporate Franchises. Holdings and the Borrower will, and
--------------------
will cause each of their respective Subsidiaries to, do or cause to be done, all
things necessary to preserve and keep in full force and effect its existence and
its material rights, franchises, licenses and patents; provided, however, that
-------- -------
nothing in this Section 8.04 shall prevent (i) sales of assets by Holdings, the
Borrower or any of their respective Subsidiaries in accordance with Section 9.02
or (ii) the withdrawal by Holdings, the Borrower or any of their respective
Subsidiaries of their qualification as a foreign corporation in any jurisdiction
where such withdrawal could not reasonably be expected to have a material
adverse effect on the business, operations, property, assets, liabilities,
condition (financial or otherwise) or prospects of Holdings, the Borrower or of
the Borrower and its Subsidiaries taken as a whole.
8.05 Compliance with Statutes, etc. Holdings and the Borrower
-----------------------------
will, and will cause each of their respective Subsidiaries to, comply with all
applicable statutes, regulations and orders of, and all applicable restrictions
imposed by, all governmental bodies, domestic or foreign, in respect of the
conduct of its business and the ownership of its property, except such
noncompliances as could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of Holdings, the Borrower or of the Borrower and its Subsidiaries taken as a
whole.
8.06 Compliance with Environmental Laws. (a) Holdings and the
----------------------------------
Borrower will comply, and will cause each of their respective Subsidiaries to
comply, in all material respects with, and not incur material liability under,
all Environmental Laws applicable to the business or operations of Holdings, the
Borrower or any of their respective Subsidiaries or to the ownership or use of
the Real Property now or hereafter owned or operated by Holdings, the Borrower
or any of their respective Subsidiaries, will promptly pay or cause to be paid
all reasonable costs and expenses incurred in connection with such compliance
and liability, and will keep or cause to be kept all such Real Property free and
clear of any material Liens imposed pursuant to such Environmental Laws. None
of Holdings, the Borrower nor any of their respective Subsidiaries will
generate, use, treat, store, release or dispose of, or permit the generation,
use, treatment, storage, release or disposal of Hazardous Materials on any Real
Property now or hereafter owned or operated by Holdings, the Borrower or any of
their respective Subsidiaries, or transport or knowingly permit the
transportation of Haz-
-57-
ardous Materials to or from any such Real Property except for Hazardous
Materials used or stored at any such Real Properties in compliance in all
material respects with all Environmental Laws and reasonably required in
connection with the operation, use and maintenance of any such Real Property.
(b) The Borrower will promptly give notice to the Administrative
Agent upon determining the existence of (i) any material violation of any
Environmental Law or (ii) any Environmental Claim, in each of clause (i) or
(ii), related to the business or operations of Holdings, the Borrower or any of
their respective Subsidiaries or to the ownership or use of any Real Property
now or hereafter owned or operated by Holdings, the Borrower or any of their
respective Subsidiaries, or (iii) any release or threatened release of Hazardous
Materials at, on, upon, under or from any Real Property now or hereafter owned
or operated by Holdings, the Borrower or any of their respective Subsidiaries,
or any facility or equipment thereat, in excess of a reportable quantity or
allowable standard or level under any Environmental Laws, or in a manner and/or
amount which could reasonably be expected to result in liability under any
Environmental Law, in each of clause (i), (ii) or (iii), in excess of $500,000
individually or in the aggregate with any other liability under any
Environmental Laws. In each of the aforementioned circumstances, immediately
following discovery thereof, Holdings and the Borrower will, and will cause each
of their respective Subsidiaries to, take appropriate steps to initiate and
expeditiously complete all investigation, compliance, response, corrective and
other action required under any Environmental Law to mitigate and eliminate any
such violation or liability and shall keep the Administrative Agent apprised of
such action.
(c) At the written request of the Administrative Agent or the
Required Banks, which request shall specify in reasonable detail the basis
therefor, at any time and from time to time, the Borrower will provide, at the
Borrower's sole cost and expense, an environmental site assessment report
concerning any Real Property now or hereafter owned or operated by Holdings, the
Borrower or any of their respective Subsidiaries, prepared by an environmental
consulting firm approved by the Administrative Agent which approval shall not be
unreasonably withheld or delayed, indicating status of compliance with
Environmental Laws and the presence or absence of Hazardous Materials and the
estimated cost of any compliance, investigation, removal or remedial action in
connection with any Hazardous Materials on, at, under or emanating from such
Real Property; provided that such request may be made only if (i) there has
--------
occurred and is continuing an Event of Default, (ii) the Administrative Agent
reasonably believes that Holdings, the Borrower or any such Real Property is not
in material compliance with any material Environmental Law, or (iii)
circumstances exist that reasonably could be expected to form the basis of a
material Environmental Claim against Holdings, the Borrower or any of their
respective Subsidiaries or any such Real Property. If the Borrower fails to
provide the same within 30 days after such request was made (or within such
longer period as the Administrative Agent may approve in writing, such approval
not to be unreasonably withheld), the Administrative Agent may
-58-
order the same, and the Borrower shall grant and hereby grants to the
Administrative Agent and the Banks and their agents access to such Real Property
and specifically grants the Administrative Agent and the Banks an irrevocable
non-exclusive license, subject to the rights of tenants, to undertake such an
assessment, all at the Borrower's expense.
8.07 ERISA. As soon as possible and, in any event, within 20 days
-----
after Holdings, the Borrower or any of their respective Subsidiaries or any
ERISA Affiliate knows or has reason to know of the occurrence of any of the
following, Holdings or the Borrower will deliver to each of the Banks a
certificate of the Chief Financial Officer or Treasurer of Holdings or the
Borrower setting forth details as to such occurrence and the action, if any,
that Holdings, the Borrower, such Subsidiary or such ERISA Affiliate is required
or proposes to take, together with any notices required or proposed to be given
to or filed with or by Holdings, the Borrower, such Subsidiary, the ERISA
Affiliate, the PBGC, or a Plan participant or the Plan administrator with
respect thereto: that a Reportable Event has occurred; that an accumulated
funding deficiency has been incurred or an application may be or has been made
to the Secretary of the Treasury for a waiver or modification of the minimum
funding standard (including any required installment payments) or an extension
of any amortization period under Section 412 of the Code with respect to a Plan;
that a contribution required to be made to a Plan has not been timely made; that
a Plan has been or may be terminated, reorganized, partitioned or declared
insolvent under Title IV of ERISA; that a Plan has an Unfunded Current Liability
giving rise to a lien under ERISA or the Code; that proceedings may be or have
been instituted to terminate or appoint a trustee to administer a Plan, that a
proceeding has been instituted pursuant to Section 515 of ERISA to collect a
delinquent contribution to a Plan; that Holdings, the Borrower, any of their
respective Subsidiaries or any ERISA Affiliate will or may incur any liability
(including any contingent or secondary liability) to or on account of the
termination of or withdrawal from a Plan under Section 4062, 4063, 4064, 4069,
4201, 4204 or 4212 of ERISA or with respect to a Plan under Section 401(a)(29),
4971 or 4975 of the Code or Section 409 or 502(i) or 502(l) of ERISA; or that
Holdings, the Borrower or any Subsidiary may incur any material liability
pursuant to any employee welfare benefit plan (as defined in Section 3(1) of
ERISA) that provides benefits to retired employees or other former employees
(other than as required by Section 601 of ERISA) or any Plan. The Borrower will
deliver to each of the Banks a complete copy of the annual report (Form 5500) of
each Plan required to be filed with the Internal Revenue Service. In addition
to any certificates or notices delivered to the Banks pursuant to the first
sentence hereof, copies of annual reports and any material notices received by
Holdings, the Borrower or any of their respective Subsidiaries or any ERISA
Affiliate with respect to any Plan shall be delivered to the Banks no later than
20 days after the date such report has been filed with the Internal Revenue
Service or such notice has been received by Holdings, the Borrower, the
Subsidiary or the ERISA Affiliate, as applicable.
-59-
8.08 End of Fiscal Years; Fiscal Quarters. Each of Holdings and
------------------------------------
the Borrower shall cause (i) each of its, and each of its Subsidiaries', fiscal
years to end on the Friday closest to March 31 and (ii) each of its, and each of
its Subsidiaries', fiscal quarters to end on a date consistent with the date of
its fiscal year end; provided that Holdings and the Borrower may change without
--------
the consent of the Agents or the Banks such fiscal year to a fiscal year to end
on March 31 and may change such fiscal year to any other fiscal year period of
twelve consecutive months with the consent of the Agents, which consent shall
not be unreasonably withheld.
8.09 Performance of Obligations. Each of Holdings and the Borrower
--------------------------
will, and will cause each of its Subsidiaries to, perform all of its obligations
under the terms of each mortgage, indenture, security agreement and other debt
instrument by which it is bound, except such non-performances as could not,
individually or in the aggregate, reasonably be expected to have a material
adverse effect on the business, operations, property, assets, liabilities,
condition (financial or otherwise) or prospects of Holdings, the Borrower or of
the Borrower and its Subsidiaries taken as a whole.
8.10 Payment of Taxes. Each of Holdings and the Borrower will pay
----------------
and discharge or cause to be paid and discharged, and will cause each of their
respective Subsidiaries to pay and discharge, all material Taxes imposed upon it
or upon its income or profits, or upon any material properties belonging to it,
in each case on a timely basis, and all lawful claims which, if unpaid, might
become a lien or charge upon any properties of Holdings, the Borrower or any of
their respective Subsidiaries; provided that none of Holdings, the Borrower or
--------
any of their respective Subsidiaries shall be required to pay any such tax,
assessment, charge, levy or claim which is being contested in good faith and by
proper proceedings if it has maintained adequate reserves with respect thereto
in accordance with GAAP.
8.11 Additional Security; Further Assurances. Promptly, and in any
---------------------------------------
event within 90 days after the acquisition of assets of the type that would have
constituted Collateral (if the person acquiring such assets had executed an
appropriate Security Document on the Effective Date) at the Effective Date (the
"Additional Collateral"), Holdings and the Borrower will, and will cause each of
---------------------
the Guarantors to, at the request of the Collateral Agent following consultation
with the Company as to the value of any such Additional Collateral, take all
necessary action, including entering into the appropriate security documents and
filing the appropriate financing statements under the provisions of the UCC or
applicable foreign, domestic or local laws, rules or regulations in each of the
offices where such filing is necessary or appropriate to grant the Collateral
Agent a perfected Lien in such Collateral (or comparable interest under foreign
law in the case of foreign Collateral) pursuant to and to the full extent
required by the Security Documents and this Agreement, subject to Permitted
Liens and Prior Liens; provided that no such action will be required by
--------
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the Borrower or any Guarantor to the extent that any such Additional Collateral
is subject to a preexisting agreement which prohibits the granting of any
additional liens; provided further that such preexisting agreement was not
-------- -------
entered into in connection with, or in anticipation of or contemplation of, the
acquisition of such assets by the Borrower or any of its Subsidiaries. In the
event that the Borrower or a Guarantor acquires an interest in additional real
property, the Borrower or such Guarantor, as the case may be, will take such
actions and execute such documents as the Administrative Agent shall require to
confirm the Lien of a Mortgage, if applicable, or to create a new Mortgage
(including, without limitation, satisfaction of the conditions set forth in
Sections 5.03 and 5.11) or leasehold mortgage in the event a fee interest is not
acquired. All actions taken by the parties in connection with the pledge of
Additional Collateral, including, without limitation, reasonable costs of
counsel for the Collateral Agent, shall be for the account of the Company, which
shall pay all reasonable sums due on demand.
(a) Holdings and the Borrower will, and will cause each of the
Guarantors to, at the expense of Holdings and the Borrower, make, execute,
endorse, acknowledge, file and/or deliver to the Collateral Agent from time to
time such vouchers, invoices, schedules, confirmatory assignments, conveyances,
financing statements, transfer endorsements, powers of attorney, certificates,
real property surveys, reports and other assurances or instruments and take such
further steps relating to the Collateral covered by any of the Security
Documents as the Collateral Agent may reasonably require upon reasonable notice.
Furthermore, the Company shall cause to be delivered to the Collateral Agent
such opinions of counsel, title insurance surveys and other related documents as
may be reasonably requested by the Collateral Agent to assure themselves that
this Section 8.11 has been complied with.
(b) If the Administrative Agent or the Required Banks reasonably
determine (and so advise Holdings and the Borrower) that they are required by
law or regulation to have appraisals prepared in respect of the Real Property of
the Company and its Subsidiaries constituting Collateral, the Company shall
provide to the Collateral Agent appraisals which satisfy the applicable
requirements of the Real Estate Appraisal Reform Amendments of the Financial
Institution Reform, Recovery and Enforcement Act of 1989 and which shall be in
form and substance reasonably satisfactory to the Collateral Agent; provided
--------
however, that no Guarantor, Borrower or Subsidiary, collectively, shall be
-------
required to obtain any such appraisal for any such location more frequently than
once in any 36 consecutive month period.
(c) Holdings and the Borrower agree that each action required above
by this Section 8.11 shall be completed within 90 days after such action is
either requested to be taken by the Administrative Agent or the Required Banks
or required to be taken by Holdings or the Borrower or any Subsidiary Guarantor
pursuant to the terms of this Section 8.11
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or, if such action is not capable of completion within such 90 day period,
Holdings or the Borrower or any Subsidiary Guarantor, as the case may be, shall
use their reasonable efforts to complete such action within the reasonable
period in which it can be expected to be completed; provided that in no event
--------
shall Holdings or the Borrower or any of their Subsidiaries be required to take
any action, other than using its reasonable efforts, to obtain consents from
third parties with respect to its compliance with this Section 8.11.
SECTION 9. Negative Covenants. Holdings and the Borrower hereby
------------------
covenant and agree that as of the Amendment Effective Date and thereafter for so
long as this Agreement is in effect and until the Total Commitments have
terminated, no Letters of Credit (other than Letters of Credit, together with
all Fees that have accrued and will accrue thereon through the stated
termination date of such Letters of Credit, which have been cash collateralized
in a cash collateral account in a manner satisfactory to the Letter of Credit
Issuer in its sole and absolute discretion) or Notes are outstanding and the
Loans, together with interest, Fees and all other Obligations (other than any
indemnities described in Section 13.13 which are not then due and payable)
incurred hereunder, are paid in full:
9.01 Liens. Holdings and the Borrower will not, and will not
-----
permit any of their respective Subsidiaries to, create, incur, assume or suffer
to exist any Lien upon or with respect to any property or assets (real or
personal, tangible or intangible) of Holdings or the Borrower or any of their
respective Subsidiaries, whether now owned or hereafter acquired, or sell any
such property or assets subject to an understanding or agreement, contingent or
otherwise, to repurchase such property or assets, or assign any right to receive
income or permit the filing of any financing statement under the UCC or any
other similar notice of Lien under any similar recording or notice statute;
provided that the provisions of this Section 9.01 shall not prevent the
--------
creation, incurrence, assumption or existence of the following (Liens described
below are herein referred to as "Permitted Liens"):
---------------
(a) inchoate Liens for taxes, assessments or governmental charges or
levies not yet due and payable or Liens for taxes, assessments or
governmental charges or levies being contested in good faith and by
appropriate proceedings for which adequate reserves have been established
in accordance with generally accepted accounting principles in the United
States;
(b) Liens in respect of property or assets of the Borrower or any of
its Subsidiaries imposed by law, which were incurred in the ordinary course
of business and do not secure Indebtedness for borrowed money, such as
carriers', warehousemen's, materialmen's, vendor's and mechanics' liens and
other similar Liens arising in the ordinary course of business, and (x)
which do not in the aggregate materially detract from the value of the
Borrower's or such Subsidiary's property or assets or materially impair the
use thereof in the operation of the business of the Borrower or such
Subsidiary or (y) which are being contested in good faith by appropriate
pro-
-62-
ceedings, which proceedings have the effect of preventing the forfeiture or
sale of the property or assets subject to any such Lien;
(c) Liens in existence on the Effective Date which are listed, and
the property subject thereto described, in Schedule 9.01, but only to the
respective date, if any, set forth in such Schedule 9.01 for the removal
and termination of any such Liens, plus renewals, replacements and
extensions of such Liens to the extent set forth on Schedule 9.01; provided
--------
that (x) the aggregate principal amount of the Indebtedness, if any,
secured by such Liens does not increase from that amount outstanding at the
time of any such renewal or extension and (y) any such renewal or extension
does not encumber any additional assets or properties of Holdings or any of
its Subsidiaries;
(d) Permitted Encumbrances;
(e) Liens created pursuant to the Security Documents or in favor of
the Agents or the Banks;
(f) licenses, leases or subleases granted to other Persons in the
ordinary course of business not materially interfering with the conduct of
the business of Holdings and its Subsidiaries taken as a whole or any
interest or title of a lessor or sublessor under any lease permitted by
Section 9.04(d);
(g) easements, rights-of-way, restrictions (including zoning
restrictions), encroachments, protrusions and other similar charges or
encumbrances, and minor title deficiencies, in each case whether now or
hereafter in existence, not securing Indebtedness and not materially
interfering with the conduct of the business of the Borrower or any of its
Subsidiaries;
(h) Liens arising from precautionary UCC financing statement filings
regarding operating leases entered into by the Borrower or any of its
Subsidiaries in the ordinary course of business;
(i) Liens arising out of the existence of judgments or awards not
constituting an Event of Default under Section 10.09; provided that no cash
--------
or property is deposited or delivered to secure the respective judgment or
award (or any appeal bond in respect thereof, except as permitted by
following clause (k));
(j) statutory and common law landlords' liens under leases to which
Holdings or any of its Subsidiaries is a party;
-63-
(k) Liens (other than any Lien imposed by ERISA) (x) incurred or
deposits made in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types of social
security, or (y) to secure the performance of tenders, statutory
obligations, surety, stay, customs and appeal bonds, statutory bonds, bids,
leases, government contracts, trade contracts, performance and return of
money bonds and other similar obligations (exclusive of obligations for the
payment of borrowed money);
(l) Liens (which may be pari passu with Liens securing Obligations)
---- -----
granted in favor of a Bank to secure Obligations of the Borrower and its
Subsidiaries in respect of Interest Rate Protection Agreements;
(m) Liens in favor of a banking institution arising as a matter of
law encumbering deposits (including the right of set-off) held by such
banking institutions incurred in the ordinary course of business and which
are within the general parameters customary in the banking industry;
(n) Liens in favor of customs and revenue authorities arising as a
matter of law to secure the payment of customs duties in connection with
the importation of goods;
(o) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for the sale of goods entered into by
the Borrower or any of its Subsidiaries in the ordinary course of business
in accordance with the past practices of the Borrower and its Subsidiaries
prior to the Effective Date;
(p) Deposits made to secure statutory, regulatory, contractual or
warranty requirements or obligations, including rights of offset and set-
off;
(q) Liens arising pursuant to Capitalized Lease Obligations and
purchase money obligations or security interests securing Indebtedness
representing the purchase price (or financing of the purchase price within
90 days after the respective purchase) of assets acquired after the
Effective Date; provided that (i) any such Liens attach only to the assets
--------
so purchased and does not encumber any other asset of Holdings or any of
its Subsidiaries, (ii) the Indebtedness secured by any such Lien (including
refinancings thereof) does not exceed 100% of the lesser of the fair market
value or the purchase price of the property being purchased at the time of
the incurrence of such Indebtedness and (iii) the Indebtedness secured
thereby is permitted to be incurred pursuant to Section 9.04(d);
(r) Liens on property or assets acquired pursuant to a Permitted
Acquisition, or on property or assets of a Subsidiary of the Borrower in
existence at the time
-64-
such Subsidiary is acquired pursuant to a Permitted Acquisition; provided
--------
that (i) any Indebtedness that is secured by such Liens is permitted to
exist under Section 9.04(g), and (ii) such Liens are not incurred in
connection with, or in contemplation or anticipation of, such Permitted
Acquisition and do not attach to any other asset of the Borrower or any of
its Subsidiaries;
(s) Deposits made in the ordinary course of business to secure
liability to insurance carriers in an amount not to exceed $1,000,000 in
the aggregate at any time outstanding;
(t) Liens arising out of or created by motor vehicle leases in an
amount not to exceed $12,500,000 in the aggregate at any time outstanding;
(u) Liens securing reimbursement obligations with respect to
commercial letters of credit not issued under this Agreement; and
(v) Liens not otherwise permitted by the foregoing clauses (a)
through (u) to the extent attaching to properties and assets with an
aggregate fair value not in excess of and securing liabilities not in
excess of $500,000 in the aggregate at any time outstanding.
9.02 Consolidation, Merger, Sale or Purchase of Assets, etc.
------------------------------------------------------
Holdings and the Borrower will not, and will not permit any of their respective
Subsidiaries to, wind up, liquidate or dissolve its affairs or enter into any
transaction of merger or consolidation, or convey, sell, lease or otherwise
dispose of (or agree to do any of the foregoing at any future time) all or any
part of its property or assets (other than inventory in the ordinary course of
business, including sales of inventory on consignment in the ordinary course of
business), or enter into any partnerships, joint ventures or sale-leaseback
transactions, or purchase or otherwise acquire (in one or a series of related
transactions) any part of the property or assets (other than purchases or other
acquisitions of inventory, materials and equipment in the ordinary course of
business) of any Person, except that the following shall be permitted:
(a) Holdings and its Subsidiaries may, as lessee or lessor, enter
into operating leases in the ordinary course of business with respect to
real or personal property;
(b) Capital Expenditures by Holdings and its Subsidiaries to the
extent not in violation of Section 9.07;
(c) the advances, investments and loans permitted pursuant to Section
9.05;
-65-
(d) Holdings and its Subsidiaries may sell or discount, in each case
without recourse, accounts receivable arising in the ordinary course of
business, but only in connection with the compromise or collection thereof;
(e) Holdings and its Subsidiaries may, in the ordinary course of
business, sell or exchange specific items of machinery or equipment, so
long as the proceeds of each such sale or exchange is used to acquire (and
results within 180 days of such sale or exchange in the acquisition of)
replacement items of machinery or equipment which are the functional
equivalent of the item of equipment so sold or exchanged;
(f) Holdings and its Subsidiaries may, in the ordinary course of
business, license, as licensor or licensee, patents, trademarks, copyrights
and know-how to third Persons and to one another, so long as any such
license by Holdings or its Subsidiaries in its capacity as licensor is
permitted to be assigned pursuant to the Security Agreement (to the extent
that a security interest in such patents, trademarks, copyrights and know-
how is granted thereunder) and does not otherwise prohibit the granting of
a Lien by Holdings or any of its Subsidiaries pursuant to the Security
Agreement in the intellectual property covered by such license;
(g) any Wholly Owned Subsidiary of the Borrower may transfer assets
to the Borrower or to any other Wholly Owned Subsidiary of the Borrower, so
long as (i) if the transferee is a Subsidiary, such Subsidiary is a
Guarantor and (ii) the security interests granted to the Collateral Agent
for the benefit of the Secured Creditors pursuant to the Security Documents
in the assets so transferred shall remain in full force and effect and
perfected (to at least the same extent as in effect immediately prior to
such transfer);
(h) any Wholly Owned Subsidiary of the Borrower may merge with and
into, or be dissolved or liquidated into, the Borrower so long as (i) the
Borrower is the surviving corporation of any such merger, dissolution or
liquidation and (ii) the security interests, if any, granted to the
Collateral Agent for the benefit of the Secured Creditors pursuant to the
Security Documents in the assets of such Wholly Owned Subsidiary shall
remain in full force and effect and perfected (to at least the same extent
as in effect immediately prior to such merger, dissolution or liquidation);
(i) any Wholly Owned Subsidiary of the Borrower may merge with and
into, or be dissolved or liquidated into, any Wholly Owned Subsidiary of
the Borrower so long as (i) such Wholly Owned Subsidiary is a Guarantor and
is the surviving corporation of any such merger, dissolution or liquidation
and (ii) the security interests granted to the Collateral Agent for the
benefit of the Secured Creditors pursuant to the Security Documents in the
assets of such Wholly Owned Subsidiary shall remain
-66-
in full force and effect and perfected (to at least the same extent as in
effect immediately prior to such merger, dissolution or liquidation);
(j) so long as no Default or Event of Default then exists or would
result therefrom (including giving pro forma effect to such acquisition and
--- -----
any additional Indebtedness resulting therefrom or incurred or assumed in
connection therewith as if such acquisition had occurred and such
Indebtedness had been incurred as of the first day of the most recently
completed Test Period (including any other Permitted Acquisition that
occurred, and related Indebtedness which was incurred, during or subsequent
to such Test Period)), Holdings or any of its Wholly Owned Subsidiaries may
consummate a Permitted Acquisition; provided that (i) Holdings shall have
--------
delivered to the Administrative Agent, at the time of delivery of the
Permitted Acquisition Notice, a certificate of an Authorized Officer of
Holdings showing compliance with Section 8.01(l) (a "Permitted Acquisition
---------------------
Compliance Certificate") and (ii) Holdings or the Borrower shall have given
----------------------
the Agents and the Banks at least 10 days prior notice of any Permitted
Acquisition (each such notice a "Permitted Acquisition Notice"); provided
---------------------------- --------
however, that with respect to Permitted Acquisitions in respect of which
-------
the total consideration payable is less than $40,000,000 such Permitted
Acquisition Notice and Permitted Acquisition Compliance Certificate of
Holdings may be delivered to the Agents promptly after the closing of such
Permitted Acquisition; and provided, further, that with respect to
-------- -------
Permitted Acquisitions in respect of which the total consideration is less
than $10,000,000, the Permitted Acquisition Compliance Certificate may be
delivered at the time of delivery of the financial statements provided for
in Section 8.01(b) and (c).
(k) leases or subleases granted by Holdings or any of its
Subsidiaries to third Persons not interfering in any material respect with
the business of Holdings or any of its Subsidiaries;
(l) "inactive" or "shell" Subsidiaries may be dissolved or otherwise
liquidated;
(m) other sales or dispositions of assets in the ordinary course of
business (other than assets disposed of in connection with a Recovery
Event); provided that (x) the aggregate Net Sale Proceeds received from all
--------
such sales and dispositions shall not exceed $5,000,000 in any fiscal year
of the Borrower, (y) each such sale shall be in an amount at least equal to
the fair market value thereof (as determined in good faith by the Borrower)
and for proceeds consisting solely of not less than (A) 85% cash and (B)
seller indebtedness evidenced by promissory notes, which promissory notes
shall be pledged and delivered to the Collateral Agent pursuant to the
Pledge Agreement, and (z) the Net Cash Proceeds of any such sale are
applied to repay the Loans to the extent required by Section 4.02(e); and
provided further, that
-------- -------
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the sale or disposition of the capital stock of (i) any Subsidiary
Guarantor shall be prohibited and (ii) any other Subsidiary of the Borrower
shall be prohibited unless it is for all of the outstanding capital stock
of such Subsidiary owned by the Borrower and its Subsidiaries;
(n) Holdings and its Subsidiaries may (i) purchase or sell inventory,
equipment and/or other assets in the ordinary course of business in
connection with transactions contemplated by Section 9.05(b) and (ii)
dispose of obsolete inventory or equipment not used or useful in the
business of Holdings or such Subsidiaries; and
(o) In connection with any Permitted Acquisition, a Person may merge
or consolidate with and into Holdings or any Wholly Owned Subsidiary of
Holdings.
To the extent the Required Banks waive the provisions of this Section 9.02 with
respect to the sale or other disposition of any Collateral, or any Collateral is
sold or otherwise disposed of as permitted by this Section 9.02, such Collateral
in each case shall be sold or otherwise disposed of free and clear of the Liens
created by the Security Documents and the Administrative Agent shall take such
actions (including, without limitation, directing the Collateral Agent to take
such actions) as are appropriate in connection therewith.
9.03 Dividends, etc. Holdings and the Borrower will not, and will
--------------
not permit any of their respective Subsidiaries to, declare or pay any dividends
(other than dividends payable solely in common stock or preferred stock
(provided such preferred stock meets the requirements of Section 9.13(c)(ii),
---------
(iii), (iv) and (v)) of Holdings or any such Subsidiary, as the case may be) or
return any capital to, its stockholders or authorize or make any other
distribution, payment or delivery of property or cash to its stockholders as
such, or redeem, retire, purchase or otherwise acquire, directly or indirectly,
for any consideration, any shares of any class of its capital stock, now or
hereafter outstanding (or any warrants for or options or stock appreciation
rights in respect of any of such shares), or set aside any funds for any of the
foregoing purposes, and the Borrower will not permit any of its Subsidiaries to
purchase or otherwise acquire for consideration any shares of any class of the
capital stock of the Borrower or any Subsidiary of the Borrower now or hereafter
outstanding (or any options or warrants or such stock appreciation rights issued
by such Person with respect to its capital stock) (all of the foregoing
"Dividends", it being understood that the payments made in accordance with the
----------
clauses contained in the proviso of Section 9.06 shall not be deemed to be
Dividends), except that:
(a) any Subsidiary of the Borrower may pay Dividends to the Borrower
or any Wholly-Owned Subsidiary of the Borrower;
(b) as long as no Default or Event of Default shall then exist or
result therefrom, (i) the Borrower may declare and pay a Dividend on the
Borrower's Common
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Stock, and (ii) Holdings may declare or pay a Dividend on Holdings' Common
Stock, in each case in an aggregate amount not to exceed $10,000,000;
(c) Borrower or any Subsidiary of Borrower may make payments to
Holdings in an amount not in excess of the federal and state (in such
states that permit consolidated or combined tax returns) income tax
liability that Holdings, the Borrower and its Subsidiaries would have been
liable for if Holdings, the Borrower and its Subsidiaries had filed their
taxes on a stand-alone basis; provided that such payments shall be made by
--------
Holdings no earlier than five days prior to the date on which Holdings is
required to make its payments to the Internal Revenue Service or the
applicable taxing authority, as applicable;
(d) if no Default or Event of Default shall have occurred and be
continuing, Borrower may declare and pay Dividends to Holdings so that
Holdings may repurchase Holdings Common Stock (or rights to acquire
Holdings Common Stock) from members of Holdings' or the Borrower's
management in connection with certain executive employment agreements in an
aggregate amount not to exceed $750,000 in any fiscal year;
(e) if no Default or Event of Default shall have occurred and be
continuing, Borrower may declare and pay Dividends to Holdings to pay
reasonable accounting fees and other support services provided to the
Borrower and to pay Holdings' operating expenses, in an aggregate amount
not to exceed $500,000 in any fiscal year; and
(f) Borrower may declare and pay Dividends to Holdings in connection
with any payment obligations (including administration costs and expenses)
under (i) Holdings' stock purchase program offered to employees of Holdings
and/or Subsidiaries of Holdings; (ii) the Employee Stock Option Plan; or
(iii) options to purchase Holdings Common Stock in an aggregate amount not
to exceed $500,000 in any fiscal year.
9.04 Indebtedness. The Holdings and the Borrower will not, and
------------
will not permit any of their respective Subsidiaries to, contract, create,
incur, assume or suffer to exist any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement and the other
Credit Documents;
(b) Existing Indebtedness outstanding on the Effective Date and
listed on Schedule 7.22, including any extensions, refinancings,
replacements or restructur-
-69-
ings thereof; provided that the then outstanding principal amount thereof
--------
is not increased;
(c) Indebtedness under Interest Rate Protection Agreements relating
to Indebtedness under this Agreement;
(d) Capitalized Lease Obligations and Indebtedness of Holdings and
its Subsidiaries incurred pursuant to purchase money Liens permitted under
Section 9.01(q); provided that all such Capitalized Lease Obligations are
--------
permitted under Section 9.02, and (ii) the sum of (x) the aggregate
Capitalized Lease Obligations outstanding at any time plus (y) the
aggregate principal amount of such purchase money Indebtedness outstanding
at such time shall not exceed $15,000,000 (including Capital Lease
Obligations referred to on Schedule 7.22);
(e) Indebtedness constituting Intercompany Loans to the extent
permitted by Section 9.05(g);
(f) Indebtedness consisting of guaranties by the Borrower of
Indebtedness, leases and other contractual obligations permitted to be
incurred by Subsidiaries of the Borrower that are Guarantors;
(g) Indebtedness acquired as a result of a Permitted Acquisition (or
Indebtedness assumed at the time of a Permitted Acquisition of an asset
securing such Indebtedness); provided that (i) such Indebtedness was not
--------
incurred in connection with, or in anticipation or contemplation of, such
Permitted Acquisition, (ii) at the time of such Permitted Acquisition such
Indebtedness does not exceed $10,000,000 in the aggregate, and (iii) so
long as, before and after giving effect to such Permitted Acquisition, no
Default or Event of Default shall have occurred or would result therefrom;
(h) additional Indebtedness of Holdings and its Subsidiaries not
otherwise permitted hereunder not exceeding $15,000,000 in aggregate
principal amount at any time outstanding;
(i) Indebtedness of Holdings and its Subsidiaries represented by
letters of credit not issued under this Agreement for the account of
Holdings or such Subsidiaries, as the case may be, in an aggregate amount
not to exceed $3,000,000;
(j) Indebtedness resulting from endorsement of negotiable instruments
for collection in the ordinary course of business;
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(k) Indebtedness arising with respect to customary indemnification
and purchase price adjustment obligations incurred in connection with any
sale of assets of Holdings or any of its Subsidiaries permitted under
Section 9.02; and
(l) Indebtedness incurred in the ordinary course of business with
respect to surety and appeal bonds, performance and return-of-money bonds
and other similar obligations.
9.05 Advances, Investments and Loans. Holdings and the Borrower
-------------------------------
will not, and will not permit any of their respective Subsidiaries to, lend
money or credit or make advances to any Person, or purchase or acquire any
stock, obligations or securities of, or any other interest in, or make any
capital contribution to, any Person, or purchase or own a futures contract or
otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, or hold any
cash, Cash Equivalents (collectively, "Investments"), except:
-----------
(a) Holdings and the Borrower and their Subsidiaries may invest in
cash and Cash Equivalents;
(b) the Borrower and its Subsidiaries may acquire and hold
receivables owing to it (and, in the case of Super Laundry, notes
receivable created in the ordinary course of business consistent with past
practice), if created or acquired in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms
(including the dating of receivables) of the Borrower or such Subsidiary
(or in the case of Super Laundry, having payment and other terms consistent
with past practice);
(c) the Borrower and its Subsidiaries may acquire and own investments
(including debt obligations) received in connection with the bankruptcy or
reorganization of suppliers and customers and in settlement of delinquent
obligations of, and other disputes with, customers and suppliers arising in
the ordinary course of business;
(d) Interest Rate Protection Agreements entered into to protect
Borrower against fluctuations in interest rates in respect of the
Obligations;
(e) advances, loans and investments in existence on the Effective
Date and listed on Schedule 9.05 shall be permitted, without giving effect
to any additions thereto or replacements thereof (except those additions or
replacements which are existing obligations as of the Effective Date but
only to the extent such further obligations are described on such Schedule
9.05);
-71-
(f) deposits made in the ordinary course of business consistent with
past practices to secure the performance of leases or other contractual
arrangements shall be permitted;
(g) Holdings and the Borrower may make intercompany loans and
advances to any of their Subsidiaries that are Guarantors and any
Subsidiary of Holdings and the Borrower may make intercompany loans and
advances to the Borrower or any other Subsidiary of Holdings and the
Borrower that is a Guarantor (collectively, "Intercompany Loans"); provided
------------------ --------
that (x) each Intercompany Loan shall contain subordination provisions
satisfactory to the Administrative Agent, (y) each Intercompany Loan shall
be evidenced by an Intercompany Note and (z) each such Intercompany Note
shall be pledged to the Collateral Agent pursuant to the Pledge Agreement;
(h) loans and advances by the Borrower and its Subsidiaries to
employees of the Borrower and its Subsidiaries in the ordinary course of
business and consistent with past practices shall be permitted in an
aggregate principal amount not to exceed $500,000 at any one time
outstanding; provided, however, that the foregoing limitation shall not
-------- -------
apply to loans and advances for moving and travel expenses or relocation
expenses incurred in connection with a Permitted Acquisition, which loans,
advances and expenses shall be permitted;
(i) Permitted Acquisitions shall be permitted;
(j) the Borrower and its Subsidiaries may acquire and hold promissory
notes and/or equity securities issued by the purchaser or purchasers in
connection with the sale of assets to the extent permitted under Section
9.02;
(k) Holdings and the Borrower may contribute cash to one or more of
their Subsidiaries that are or become Guarantors formed after the Effective
Date in accordance with Section 9.15 (including in connection with a
Permitted Acquisition) so long as such Subsidiary remains a Guarantor;
(l) Holdings and the Borrower may make capital contributions to any
of their respective Subsidiaries that are Guarantors;
(m) Holdings may acquire Holdings Common Stock issuable to holders of
Holdings Common Stock options granted by Holdings or pursuant to the
Employee Stock Option Plan, in each case by means of cashless transactions;
and
(n) Holdings and its Subsidiaries may make cash Investments not
otherwise permitted by clauses (a) through (m) above, in an amount not to
exceed $10,000,000
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outstanding at any one time; provided that before and after giving effect
--------
to each such Investment, no Default or Event of Default shall have occurred
or result therefrom.
9.06 Transactions with Affiliates. Except as set forth on Schedule
----------------------------
9.06, Holdings and the Borrower will not, and will not permit any of their
respective Subsidiaries to, enter into any transaction or series of related
transactions, whether or not in the ordinary course of business, with any
Affiliate, other than in the ordinary course of business and on terms and
conditions substantially as favorable to Holdings, the Borrower or such
Subsidiary as would reasonably be obtained by Holdings, the Borrower or such
Subsidiary at that time in a comparable arm's-length transaction with a Person
other than an Affiliate, except that:
(a) Dividends may be paid to the extent provided in Section 9.03;
(b) loans may be made and other transactions may be entered into by
the Borrower and its Subsidiaries to the extent permitted by Sections 9.02,
9.04 and 9.05;
(c) customary fees may be paid to non-officer directors of Holdings;
(d) Holdings and its Subsidiaries may enter into employment
arrangements with their respective officers and employees in the ordinary
course of business;
(e) payments under Tax Sharing Agreements may be paid to the extent
permitted by Section 9.03(c); and
(f) reasonable fees and compensation may be paid to and indemnity
provided on behalf of officers, directors, employees or consultants of
Holdings or any of its Subsidiaries.
Except as specifically provided above, no management or similar fees
shall be paid or payable by Holdings or any of its Subsidiaries to any Person
other than the Borrower.
9.07 Capital Expenditures. (a) Holdings will not, and will not
--------------------
permit any of its Subsidiaries to, make any Capital Expenditures, except that
during any period set forth below (taken as one accounting period) the Borrower
and its Subsidiaries may make Capital Expenditures so long as the aggregate
amount of such Capital Expenditures made under this Section 9.07(a) does not
exceed in any period set forth below the amount set forth opposite such period
below:
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Period Amount
------ ------
Effective Date through last day of Fiscal Year ending $ 7,500,000
closest to March 31, 1998
Fiscal Year ending closest to March 31, 1999 $ 90,000,000
Fiscal Year ending closest to March 31, 2000 $ 95,000,000
Fiscal Year ending closest to March 31, 2001 and $100,000,000
each Fiscal Year ending thereafter
(b) Notwithstanding anything to the contrary contained in clause (a)
above, to the extent that the Capital Expenditures made by Holdings and its
Subsidiaries in any period set forth in clause (a) above are less than the
amount permitted to be made in such period (without giving effect to any
additional amount available as a result of this clause (b) or clause (c) below),
the amount of such difference (the "Rollover Amount") may be carried forward and
---------------
used to make Capital Expenditures in the immediately succeeding fiscal year of
the Borrower; provided that in no event shall the Rollover Amount be greater
--------
than $5,000,000.
(c) In addition to the Capital Expenditures permitted pursuant to
preceding clauses (a) and (b), Holdings and its Subsidiaries may make additional
Capital Expenditures as follows: (i) Capital Expenditures consisting of the
reinvestment of Net Sale Proceeds of asset sales not required to be applied to
prepay the Loans pursuant to Section 4.02(g) as a result of clause (iv) of the
parenthetical phrase contained therein or the proviso thereto, (ii) the
reinvestment of proceeds of Recovery Events not required to be applied to prepay
the Loans pursuant to Section 4.02(i), (iii) Permitted Acquisitions made in
accordance with Section 9.02(k) and (iv) Permitted Acquisition Capital
Expenditures.
9.08 Leverage Ratio. Holdings and its Subsidiaries will not permit
--------------
the Pro Forma Leverage Ratio for any Test Period (taken as one accounting
period) ending on the last day of any fiscal quarter described below to be
greater than the ratio set forth opposite such fiscal quarter below:
Fiscal Quarter
Ended Closest to Ratio
----------------- -------
June 30, 1998 5.00
September 30, 1998 4.90
December 31, 1998 4.80
March 31, 1999 4.75
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June 30, 1999 4.70
September 30, 1999 4.65
December 31, 1999 4.60
March 31, 2000 4.50
June 30, 2000 4.45
September 30, 2000 4.40
December 31, 2000 4.35
March 31, 2001 4.25
June 30, 2001 4.20
September 30, 2001 4.15
December 31, 2001 4.10
March 31, 2002 4.00
June 30, 2002 3.95
September 30, 2002 3.90
December 31, 2002 3.85
March 31, 2003 and each Fiscal 3.75
Quarter thereafter
9.09 Consolidated Interest Coverage Ratio. Holdings and its
------------------------------------
Subsidiaries will not permit the Consolidated Interest Coverage Ratio for any
Test Period ended on the last day of a fiscal quarter of Holdings described
below to be less than the amount set forth opposite such fiscal quarter below:
Fiscal Quarter
Ended Closest to Ratio
---------------- -----
June 30, 1998 2.00
September 30, 1998 2.05
December 31, 1998 2.10
March 31, 1999 2.10
June 30, 1999 2.10
September 30, 1999 2.10
December 31, 1999 2.25
March 31, 2000 2.30
June 30, 2000 2.30
September 30, 2000 2.35
December 31, 2000 2.40
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March 31, 2001 2.45
June 30, 2001 2.45
September 30, 2001 2.50
December 31, 2001 2.55
March 31, 2002 2.60
June 30, 2002 2.60
September 30, 2002 2.65
December 31, 2002 2.70
March 31, 2003 and each Fiscal
Quarter thereafter 2.75
9.10 Minimum Consolidated EBITDA. Holdings and its Subsidiaries will
not permit Consolidated EBITDA for any Test Period, in each case taken as one
accounting period, ended on the last day of a fiscal quarter of Holdings
described below to be less than the amount set forth opposite such fiscal
quarter below; provided, however, that for purposes of this Section 9.10,
Consolidated EBITDA for any Test Period may give pro forma effect to a Permitted
Acquisition (or other acquisition or transaction with respect to which the
requisite consents of the Lenders have been obtained) as if such Permitted
Acquisition (or acquisition or other transaction) had occurred on the first day
of such Test Period:
Fiscal Quarter Amount
Ended Closest to (in millions)
---------------- -------------
June 30, 1998 $120.0
September 30, 1998 122.5
December 31, 1998 125.0
March 31, 1999 127.5
June 30, 1999 127.5
September 30, 1999 130.0
December 31, 1999 132.5
March 31, 2000 135.0
June 30, 2000 135.0
September 30, 2000 137.5
December 31, 2000 140.0
March 31, 2001 142.5
June 30, 2001 142.5
September 30, 2001 145.0
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Fiscal Quarter Amount
Ended Closest to (in millions)
---------------- -------------
December 31, 2001 147.5
March 31, 2002 150.0
June 30, 2002 150.0
September 30, 2002 152.5
December 31, 2002 155.0
March 31, 2003 and each Fiscal Quarter thereafter 157.5
9.11 Limitation on Voluntary Payments and Modifications of
-----------------------------------------------------
Indebtedness; Modifications of Certificate of Incorporation, By-Laws and Certain
--------------------------------------------------------------------------------
Other Agreements; etc. Holdings and the Borrower will not, and will not permit
---------------------
any of their respective Subsidiaries to:
(a) make (or give any notice in respect of) any voluntary or optional
payment or prepayment on or redemption or acquisition for value of
(including, without limitation, by way of depositing with the trustee with
respect thereto or any other Person money or securities before due for the
purpose of paying when due) any Existing Indebtedness (other than, as long
as no Default or Event of Default exists, an amount up to $30,000,000 to
prepay a portion of the 11 3/4% New Notes);
(b) amend or modify in any material respect or in any manner adverse
to the Borrower or the Banks, or permit such an amendment or modification
of, any provision of the Existing Indebtedness; and
(c) amend, modify or change in any way adverse to the interests of
the Banks, any Tax Sharing Agreement, its Certificate of Incorporation
(including, without limitation, by the filing or modification of any
certificate of designation) or By-Laws.
9.12 Limitation on Certain Restrictions on Subsidiaries. Holdings
--------------------------------------------------
will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any such Subsidiary to (a) pay
dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by Holdings or any Subsidiary of
Holdings, or pay any Indebtedness owed to Holdings or a Subsidiary of Holdings,
(b) make loans or advances to Holdings or any of Holdings' Subsidiaries or (c)
transfer any of its properties or assets to Holdings, except for such
encumbrances or restrictions existing under or by reason of (i) applicable law,
(ii) this Agreement and the other Credit Documents,
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(iii) customary provisions restricting subletting or assignment of any lease
governing a leasehold interest of the Borrower or a Subsidiary of the Borrower,
(iv) customary provisions restricting assignment of any licensing agreement
entered into by the Borrower or a Subsidiary of the Borrower in the ordinary
course of business, (v) any instrument governing any Indebtedness permitted
under Section 9.04(g), which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any Person, other than the Person or the
properties or assets of the Person so acquired; (vi) agreements existing on the
Effective Date to the extent and in the manner such agreements are in effect on
the Effective Date; and (vii) an agreement governing Indebtedness incurred to
refinance the Indebtedness issued, assumed or incurred pursuant to an agreement
referred to in clauses (ii), (v) or (vi).
9.13 Limitation on Issuance of Capital Stock. Except as provided
---------------------------------------
otherwise herein (a) Holdings and the Borrower and their respective Subsidiaries
shall not issue (i) any preferred stock or (ii) any redeemable common stock.
(b) The Borrower shall not issue, or permit any of its Subsidiaries
to issue, any capital stock (including by way of sales of treasury stock) or any
options or warrants to purchase, or securities convertible into, capital stock,
except (i) for transfers and replacements of then outstanding shares of capital
stock, (ii) for stock splits, stock dividends and similar issuances which do not
decrease the percentage ownership of Holdings or any of its Subsidiaries in any
class of the capital stock of the Borrower or such Subsidiary, (iii) to qualify
directors to the extent required by applicable law, (iv) Subsidiaries formed
after the Effective Date pursuant to Section 9.15 may issue capital stock to
Holdings, the Borrower or their respective Wholly-Owned Subsidiaries, in
accordance with the other requirements of this Agreement, (v) under or in
connection with the Employee Stock Option Plan or options to purchase Holdings
Common Stock and (vi) Borrower may issue equity securities to Holdings so long
as such equity securities are pledged to the Agents and the Banks as security
for Borrower's obligations under this Agreement on substantially the same terms
and conditions as the pledge by Holdings of the capital stock of Borrower on the
Effective Date and the cash proceeds of such equities will be applied in
accordance with Section 4.02(e).
(c) Notwithstanding the above, Holdings may issue preferred stock so
long as (i) no dividends are payable in cash; (ii) it is not redeemable at the
option of the holder thereof in whole or in part; (iii) it is not convertible
into Indebtedness of Holdings; and (iv) it matures after March 31, 2005 and
provides for no mandatory prepayment or mandatory offers to purchase prior to
such date.
9.14 Business. (a) Holdings shall engage in no business
--------
activities and shall have no assets or liabilities, other than its ownership of
the capital stock of the Borrower and liabilities incident thereto and except as
otherwise permitted by this Agreement.
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(b) The Borrower will not, and will not permit any of its
Subsidiaries to, engage (directly or indirectly) in any business other than the
business in which the Borrower and its Subsidiaries are engaged on the Effective
Date and reasonable extensions thereof or businesses complementary to their
respective businesses.
9.15 Limitation on the Creation of Subsidiaries. Notwithstanding
------------------------------------------
anything to the contrary contained in this Agreement, Holdings will not, and
will not permit any of its Subsidiaries to, establish, create or acquire after
the Effective Date any Subsidiary; provided that Holdings and its Wholly Owned
--------
Subsidiaries shall be permitted to establish or create Subsidiaries as a result
of investments made pursuant to Section 9.05(i), (k), (l) or (n) so long as,
except in the case of any Subsidiary that will be merged with and into Holdings
or any of its Wholly Owned Subsidiaries as promptly as practicable after an
Investment made pursuant to Section 9.05(i), (k), (l) or (n), the following
conditions are met: (i) at least 10 days' prior written notice thereof is given
to the Administrative Agent (or such shorter period of time as is acceptable to
the Administrative Agent), (ii) the capital stock of such new Subsidiary is
promptly pledged pursuant to, and to the extent required by, this Agreement and
the Pledge Agreement and the certificates, if any, representing such stock,
together with stock powers duly executed in blank, are delivered to the
Collateral Agent, (iii) such new Subsidiary promptly executes a counterpart of
the Guaranty, the Pledge Agreement and the Security Agreement; provided,
--------
however, that notwithstanding the foregoing, such Subsidiary shall in no event
-------
be required to guarantee the Obligations in excess of the amounts permitted
under the indenture pursuant to which the 11 3/4% New Notes were issued (the
"New Indenture"); and provided, further that as long as the New Indenture is in
-------------- -------- -------
effect no new Subsidiary established, created or acquired after the Effective
Date shall have total assets having a fair market value in excess of $20,000,000
and, notwithstanding Section 9.05, such assets (other than a de minimis amount
for the purpose of forming a new Subsidiary) shall be held by such new
Subsidiary solely as the result of a Permitted Acquisition occurring after the
Effective Date, and (iv) to the extent requested by the Administrative Agent or
the Required Banks, takes all actions required pursuant to Section 8.11;
provided that no such action will be required by any new Subsidiary (that is not
--------
a Wholly Owned Subsidiary) to the extent such new Subsidiary is a party to a
pre-existing agreement which prohibits such new Subsidiary from executing a
Guaranty; provided further, such pre-existing agreement was not entered into for
-------- -------
the purpose of avoiding the requirements of Section 9.14 and the restrictions
contained therein are no more adverse to Holdings and its Subsidiaries than to
the other equity owners in such new Subsidiary. In addition, each new
Subsidiary that is required to execute any Credit Document shall execute and
deliver, or cause to be executed and delivered, all other relevant documentation
of the type described in Section 5 as such new Subsidiary would have had to
deliver if such new Subsidiary were a Credit Party on the Effective Date.
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9.16 Restriction on Tax Consolidation. Holdings will not, and will
--------------------------------
not permit any of its Subsidiaries to, file or consent to the filing of any
consolidated income tax return with any Person other than Holdings and its
Subsidiaries except for tax periods beginning prior to such entity's having
become a Subsidiary of Holdings; provided, however, that if Holdings disposes of
-------- -------
more than 50% of the outstanding stock of any Subsidiary (by both voting power
and value), this Section 9.16 will not apply with respect to such Subsidiary.
SECTION 10. Events of Default. Upon the occurrence of any of the
-----------------
following specified events (each, an "Event of Default"):
----------------
10.01 Payments. The Borrower shall (i) default in the payment when
--------
due of any principal of any Loan or any Note or (ii) default, and such default
shall continue unremedied for three or more Business Days, in the payment when
due of any Unpaid Drawings or interest on any Loan or Note, or any Fees or any
other amounts owing hereunder or thereunder; or
10.02 Representations, etc. Any representation, warranty or
--------------------
statement made by any Credit Party herein or in any other Credit Document or in
any certificate delivered pursuant hereto or thereto shall prove to be untrue in
any material respect on the date as of which made or deemed made; or
10.03 Covenants. Holdings or the Borrower shall (i) default in the
---------
due performance or observance by it of any term, covenant or agreement contained
in Section 8.01(g) or (i) or 8.08 or Section 9 or (ii) default in the due
performance or observance by it of any other term, covenant or agreement
contained in this Agreement and such default shall continue unremedied for a
period of 30 days after written notice to the Borrower by the Agents or any
Bank; or
10.04 Default Under Other Agreements. Holdings, the Borrower or
------------------------------
any of their respective Subsidiaries shall (i) default in any payment of any
Indebtedness (other than the Obligations) beyond the period of grace, if any,
provided in the instrument or agreement under which such Indebtedness was
created or (ii) default in the observance or performance of any agreement or
condition relating to any Indebtedness (other than the Obligations) or contained
in any instrument or agreement evidencing, securing or relating thereto, or any
other event shall occur or condition exist, the effect of which default or other
event or condition is to cause, or to permit the holder or holders of such
Indebtedness (or a trustee or agent on behalf of such holder or holders) to
cause (determined without regard to whether any notice is required), any such
Indebtedness to become due prior to its stated maturity, or (iii) any
Indebtedness (other than the Obligations) of Holdings, the Borrower or any of
their respective Subsidiaries shall be declared to be due and payable, or
required to be prepaid other than by a regularly scheduled required prepayment,
prior to the
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stated maturity thereof, provided that (x) it shall not be a Default or Event of
Default under this Section 10.04 unless the aggregate principal amount of all
Indebtedness as described in preceding clauses (i) through (iii), inclusive, is
at least $2,500,000; or
10.05 Bankruptcy, etc. Holdings, the Borrower or any of their
---------------
respective Subsidiaries shall commence a voluntary case concerning itself under
Title 11 of the United States Code entitled "Bankruptcy," as now or hereafter in
----------
effect, or any successor thereto (the "Bankruptcy Code"); or an involuntary case
---------------
is commenced against Holdings, the Borrower or any of their respective
Subsidiaries and the petition is not controverted within 10 days, or is not
dismissed within 60 days, after commencement of the case; or a custodian (as
defined in the Bankruptcy Code) is appointed for, or takes charge of, all or
substantially all of the property of Holdings, the Borrower or any of their
respective Subsidiaries, or Holdings, the Borrower or any of their respective
Subsidiaries commences any other proceeding under any reorganization,
arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or
liquidation or similar law of any jurisdiction whether now or hereafter in
effect relating to Holdings, the Borrower or any of their respective
Subsidiaries, or there is commenced against Holdings, the Borrower or any of
their respective Subsidiaries any such proceeding which remains undismissed for
a period of 60 days, or Holdings, the Borrower or any of their respective
Subsidiaries is adjudicated insolvent or bankrupt; or any order of relief or
other order approving any such case or proceeding is entered; or Holdings, the
Borrower or any of their respective Subsidiaries suffers any appointment of any
custodian or the like for it or any substantial part of its property to continue
undischarged or unstayed for a period of 60 days; or Holdings, the Borrower or
any of their respective Subsidiaries makes a general assignment for the benefit
of creditors; or any corporate action is taken by Holdings, the Borrower or any
of their respective Subsidiaries for the purpose of effecting any of the
foregoing; or
10.06 ERISA. (a) Any Plan shall fail to satisfy the minimum
-----
funding standard required for any plan year or part thereof or a waiver of such
standard or extension of any amortization period is sought or granted under
Section 412 of the Code, any Plan shall have had or, in the reasonable opinion
of the Required Banks, is likely to have a trustee appointed to administer such
Plan, any Plan is, shall have been or is likely to be terminated or to be the
subject of termination proceedings under ERISA, any Plan shall have an Unfunded
Current Liability, a contribution required to be made to a Plan has not been
made, Holdings, the Borrower or any their respective Subsidiaries or any ERISA
Affiliate has incurred or is likely to incur a liability to or on account of a
Plan under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204
or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of the Code, or Holdings,
the Borrower or any of their respective Subsidiaries has incurred or is likely
to incur liabilities pursuant to one or more employee welfare benefit plans (as
defined in Section 3(1) of ERISA) which provide benefits to retired employees or
other former employees (other than as required by Section 601 of ERISA) or
employee pen-
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sion benefit plans (as defined in Section 3(2) of ERISA); (b) there shall result
from any such event or events the imposition of a lien, the granting of a
security interest, or a liability or a material risk of incurring a liability;
and in each case in clauses (a) and (b) above, such lien, security interest or
liability, individually and/or in the aggregate in the reasonable opinion of the
Required Banks, will have a material adverse effect upon the business,
operations, property, assets, liabilities or condition (financial or otherwise)
of Holdings, the Borrower or of the Borrower and its Subsidiaries taken as a
whole; or
10.07 Security Documents. At any time after the execution and
------------------
delivery thereof, any of the Security Documents shall cease to be in full force
and effect, or shall cease in any material respect to give the Collateral Agent
for the benefit of the Secured Creditors the Liens, rights, powers and
privileges purported to be created thereby (including, without limitation,
except with respect to the Collateral Assignments of Leases and the Collateral
Assignment of Location Leases, a perfected security interest in, and Lien on,
all of the Collateral), in favor of the Collateral Agent, superior to and prior
to the rights of all third Persons, and subject to no other Liens except as
permitted pursuant to this Agreement or the Security Documents, or any Credit
Party shall default in the due performance or observance of any term, covenant
or agreement on its part to be performed or observed pursuant to any of the
Security Documents and such default shall continue beyond any grace period
specifically applicable thereto pursuant to the terms of such Security Document;
or
10.08 Guaranty. Any Guaranty or any material provision thereof
--------
shall cease to be in full force or effect as to the relevant Guarantor, or any
Guarantor or Person acting by or on behalf of such Guarantor shall deny or
disaffirm such Guarantor's obligations under the relevant Guaranty, or any
Guarantor shall default in the due performance or observance of any material
term, covenant or agreement on its part to be performed or observed pursuant to
the Guaranty; or
10.09 Judgments. One or more judgments or decrees shall be entered
---------
against Holdings, the Borrower or any of their respective Subsidiaries involving
in the aggregate for Holdings, the Borrower and their respective Subsidiaries a
liability (not paid or fully covered by a reputable and solvent insurance
company) and such judgments and decrees either shall be final and non-appealable
or shall not be vacated, discharged or stayed or bonded pending appeal for any
period of 60 consecutive days, and the aggregate amount of all such judgments
exceeds $2,500,000; or
10.10 Change of Control. A Change of Control shall occur;
-----------------
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Agents may, and upon the written request of the
Required Banks, shall, by written notice to the Borrower, take any or all of the
following actions, without preju-
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dice to the rights of any Agents, any Bank or the holder of any Note to enforce
its claims against any Credit Party (provided that, if an Event of Default
--------
specified in Section 10.05 shall occur with respect to the Borrower or Holdings,
the result which would occur upon the giving of written notice by the Agent to
the Borrower as specified in clauses (i) and (ii) below shall occur
automatically without the giving of any such notice and the Agent may exercise
the rights specified in clause (v) below without the giving of any such notice):
(i) declare the Total Commitments terminated, whereupon all Commitments of each
Bank shall forthwith terminate immediately and any Commitment Commission shall
forthwith become due and payable without any other notice of any kind; (ii)
declare the principal of and any accrued interest in respect of all Loans and
the Notes and all Obligations owing hereunder and thereunder to be, whereupon
the same shall become, forthwith due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by each
Credit Party; (iii) terminate any Letter of Credit, which may be terminated, in
accordance with its terms; (iv) direct the Borrower to pay (and the Borrower
agrees that upon receipt of such notice, or upon the occurrence of an Event of
Default specified in Section 10.05 with respect to the Borrower or Holdings, it
will pay) to the Collateral Agent at the Payment Office such additional amount
of cash, to be held as security by the Collateral Agent, as is equal to the
aggregate Stated Amount of all Letters of Credit issued for the account of the
Borrower and then outstanding; (v) enforce, as Collateral Agent, any or all of
the Liens, security interests and rights created pursuant to the Security
Documents; and (vi) apply any cash collateral as provided in Section 4.02.
SECTION 11. Definitions and Accounting Terms.
--------------------------------
11.01 Defined Terms. As used in this Agreement, the following
-------------
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):
"Acquisition" shall mean the acquisition of ▇▇▇▇▇ pursuant to the
Acquisition Documents and the merger of ▇▇▇▇▇ into the Borrower by operation of
law as a result of the dissolution of ▇▇▇▇▇.
"Acquisition Documents" shall mean the Purchase Agreement dated
January 20, 1998 and the partnership agreement and related organizational
documents of ▇▇▇▇▇.
"Additional Mortgage" shall have the meaning provided in Section
8.11(a).
"Additional Mortgaged Property" shall have the meaning provided in
Section 8.11(a).
"Adjusted Certificate of Deposit Rate" shall mean, on any day, the sum
(rounded to the nearest 1/100 of 1%) of (1) the rate obtained by dividing (x)
the most recent
-83-
weekly average dealer offering rate for negotiable certificates of deposit with
a three-month maturity in the secondary market as published in the most recent
Federal Reserve System publication entitled "Select Interest Rates," published
weekly on Form H.15 as of the date hereof, or if such publication or a
substitute containing the foregoing rate information shall not be published by
the Federal Reserve System for any week, the weekly average offering rate
determined by the Administrative Agent on the basis of quotations for such
certificates received by it from three certificate of deposit dealers in New
York of recognized standing or, if such quotations are unavailable, then on the
basis of other sources reasonably selected by the Agent, by (y) a percentage
equal to 100% minus the stated maximum rate of all reserve requirements as
specified in Regulation D applicable on such day to a three-month certificate of
deposit of a member bank of the Federal Reserve System in excess of $100,000
(including, without limitation, any marginal, emergency, supplemental, special
or other reserves), plus (2) the then daily net annual assessment rate as
estimated by the Agent for determining the current annual assessment payable by
BTCo to the Federal Deposit Insurance Corporation for insuring three month
certificates of deposit.
"Adjusted Percentage-Tranche A" shall mean (x) at a time when no Bank
Default exists, for each Tranche A Revolving Loan Bank, such Bank's Percentage
and (y) at a time when a Bank Default exists (i) for each Bank that is a
Defaulting Bank, zero and (ii) for each Bank that is a Non-Defaulting Bank, the
percentage determined by dividing such Bank's Tranche A Revolving Loan
Commitment at such time by the Adjusted Total Tranche A Revolving Loan
Commitment at such time, it being understood that all references herein to
Tranche A Revolving Loan Commitments and the Adjusted Total Tranche A Revolving
Loan Commitment at a time when the Total Tranche A Revolving Loan Commitment or
Adjusted Total Tranche A Revolving Loan Commitment, as the case may be, has been
terminated shall be references to the Tranche A Revolving Loan Commitments or
Adjusted Total Tranche A Revolving Loan Commitment, as the case may be, in
effect immediately prior to such termination; provided that (A) no Bank's
--------
Adjusted Percentage shall change upon the occurrence of a Bank Default from that
in effect immediately prior to such Bank Default if after giving effect to such
Bank Default, and any repayment of Tranche A Revolving Loans at such time
pursuant to Section 4.02(a) or otherwise, the sum of (i) the aggregate
outstanding principal amount of Tranche A Revolving Loans of all Non-Defaulting
Banks plus (ii) the Letter of Credit Outstandings plus (iii) the outstanding
principal amount of Swingline Loans exceed the Adjusted Total Tranche A
Revolving Loan Commitment; (B) the changes to the Adjusted Percentage that would
have become effective upon the occurrence of a Bank Default but that did not
become effective as a result of the preceding clause (A) shall become effective
on the first date after the occurrence of the relevant Bank Default on which the
sum of (i) the aggregate outstanding principal amount of the Tranche A Revolving
Loans of all Non-Defaulting Banks plus (ii) the Letter of Credit Outstandings
plus (iii) the outstanding principal amount of Swingline Loans is equal to or
less than the Adjusted Total Tranche A Revolving Loan Commitment; and (C) if (i)
a Non-
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Defaulting Bank's Adjusted Percentage is changed pursuant to the preceding
clause (B) and (ii) any repayment of such Bank's Revolving Loans, or of Unpaid
Drawings with respect to Letters of Credit, that were made during the period
commencing after the date of the relevant Bank Default and ending on the date of
such change to its Adjusted Percentage must be returned to the Borrower as a
preferential or similar payment in any bankruptcy or similar proceeding of the
Borrower, then the change to such Non-Defaulting Bank's Adjusted Percentage
effected pursuant to said clause (B) shall be reduced to that positive change,
if any, as would have been made to its Adjusted Percentage if (x) such
repayments had not been made and (y) the maximum change to its Adjusted
Percentage would have resulted in the sum of the outstanding principal of
Revolving Loans made by such Bank plus such Bank's new Adjusted Percentage of
the outstanding principal amount of Letter of Credit Outstandings equalling such
Bank's Tranche A Revolving Loan Commitment at such time.
"Adjusted Percentage-Tranche B" shall mean (x) at a time when no Bank
Default exists, for each Tranche B Revolving Loan Bank, such Bank's Percentage
and (y) at a time when a Bank Default exists (i) for each Bank that is a
Defaulting Bank, zero and (ii) for each Bank that is a Non-Defaulting Bank, the
percentage determined by dividing such Bank's Tranche B Revolving Loan
Commitment at such time by the Adjusted Total Tranche B Revolving Loan
Commitment at such time, it being understood that all references herein to
Tranche B Revolving Loan Commitments and the Adjusted Total Tranche B Revolving
Loan Commitment at a time when the Total Tranche B Revolving Loan Commitment or
Adjusted Total Tranche B Revolving Loan Commitment, as the case may be, has been
terminated shall be references to the Tranche B Revolving Loan Commitments or
Adjusted Total Tranche B Revolving Loan Commitment, as the case may be, in
effect immediately prior to such termination.
"Adjusted Total Tranche A Revolving Loan Commitment" shall mean at any
time the Total Tranche A Revolving Loan Commitment less the aggregate Tranche A
Revolving Loan Commitments of all Defaulting Banks.
"Adjusted Total Tranche B Revolving Loan Commitment" shall mean at any
time the Total Tranche B Revolving Loan Commitment less the aggregate Tranche B
Revolving Loan Commitments of all Defaulting Banks.
"Administrative Agent" shall mean Bankers Trust Company, in its
capacity as Agent for the Banks hereunder, and shall include any successor to
the Agent appointed pursuant to Section 12.09.
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person; provided, however, that for purposes of
-------- -------
Section 9.06, an Affiliate of Holdings shall include any Person that directly or
indirectly owns more than 5% of any class of the
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capital stock of Holdings and any officer or director of Holdings or any such
Person. A Person shall be deemed to control another Person if such Person
possesses, directly or indirectly, the power to direct or cause the direction of
the management and policies of such other Person, whether through the ownership
of voting securities, by contract or otherwise.
"Agents" shall mean, collectively, the Administrative Agent and the
Syndication Agent.
"Agreement" shall mean this Amended and Restated Credit Agreement, as
modified, supplemented or amended from time to time.
"Amendment Effective Date" shall have the meaning provided in Section
13.10.
"Applicable Base Rate Margin" shall mean (i) in the case of Revolving
Loans a percentage per annum equal to 0.75%, (ii) in the case of Tranche A Term
Loans, 1.25% and (iii) in the case of Tranche B Term Loans, 1.50%; provided that
--------
each of the percentages set forth above shall be adjusted by the applicable
Leverage Pricing Adjustment; provided, however, that the applicable Leverage
-------- -------
Pricing Adjustment, as of the Amendment Effective Date until receipt of
Holdings' June 1998 quarterly financial statements shall be -.25%.
"Applicable Eurodollar Margin" shall mean (i) in the case of Revolving
Loans a percentage per annum equal to 1.75%, (ii) in the case of Tranche A Term
Loans, 2.25% and (iii) in the case of Tranche B Term Loans, 2.50%; provided that
--------
each of the percentages set forth above shall be adjusted by the applicable
Leverage Pricing Adjustment, if any; provided, however, that the applicable
-------- -------
Leverage Pricing Adjustment, as of the Amendment Effective Date until receipt of
Holdings' June 1998 quarterly financial statements shall be -.25%.
"Assignment and Assumption Agreement" shall mean the Assignment and
Assumption Agreement substantially in the form of Exhibit F hereto
---------
(appropriately completed).
"Authorized Officer" of any Credit Party shall mean any of the
Chairman of the Board, the President, the Chief Financial Officer, any Vice
President, the Treasurer, the Secretary, any Assistant Secretary, any Assistant
Treasurer or the Controller of such Credit Party or any other officer of such
Credit Party which is designated in writing to the Agent by any of the foregoing
officers of such Credit Party as being authorized to give such notices under
this Agreement.
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"Bank" shall mean each financial institution listed on Annex I, as
well as any Person which becomes a "Bank" hereunder pursuant to 13.04(b).
"Bank Default" shall mean (i) the refusal (which has not been
retracted) of a Bank to make available its portion of any Borrowing or to fund
its portion of any unreimbursed payment under Section 2.03(c) or (ii) a Bank
having notified in writing the Borrower and/or the Agent that it does not intend
to comply with its obligations under Section 1.01 or Section 2, in the case of
either clause (i) or (ii) as a result of any takeover of such Bank by any
regulatory authority or agency.
"Bankruptcy Code" shall have the meaning provided in Section 10.05.
"Base Rate" at any time shall mean the highest of (x) the rate which
is 1/2 of 1% in excess of the Adjusted Certificate of Deposit Rate, (y) the
Prime Lending Rate and (z) the rate which is 1/2 of 1% in excess of the Federal
Funds Rate.
"Base Rate Loan" shall mean each Loan designated or deemed designated
as such by the Borrower at the time of the incurrence thereof or conversion
thereto.
"Borrower" shall have the meaning provided in the first paragraph of
this Agreement.
"Borrower's Common Stock" shall mean the common stock of Coinmach
Corporation.
"Borrower Pledge Agreement" shall mean the Borrower Pledge Agreement
executed in connection with the Existing Credit Agreement, substantially in the
form of Exhibit G-1 hereto, made by the Borrower in favor of the Collateral
-----------
Agent, as such agreement may be amended, modified or supplemented from time to
time.
"Borrowing" shall mean the borrowing of one Type of Loan of a single
Tranche from all the Banks having Commitments of the respective Tranche on a
given date (or resulting from a conversion or conversions on such date) having
in the case of Eurodollar Loans the same Interest Period; provided that Base
--------
Rate Loans incurred pursuant to Section 1.10(b) shall be considered part of the
related Borrowing of Eurodollar Loans.
"BTCo" shall mean Bankers Trust Company in its individual capacity.
"Business Day" shall mean (i) for all purposes other than as covered
by clause (ii) below, any day except Saturday, Sunday and any day which shall be
in New York City a legal holiday or a day on which banking institutions are
authorized or required by law or other government action to close and (ii) with
respect to all notices and determinations in connection with, and payments of
principal and interest on, Eurodollar Loans,
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any day which is a Business Day described in clause (i) above and which is also
a day for trading by and between banks in the New York interbank Eurodollar
market.
"Capital Expenditures" shall mean, with respect to any Person, all
expenditures by such Person which should be added to the fixed assets account on
the consolidated balance sheet of such Person in accordance with GAAP (which
shall not include (i) interest capitalized during construction but only to the
extent included in Consolidated Interest Expense and (ii) increases to property
and equipment that are reflected (or under the accounting policies and
presentation of the Borrower as in effect on the Effective Date, would have been
reflected) in "Additions to net assets from acquired businesses" on the
Borrower's Condensed Consolidated Statements of Cash Flows), including all such
expenditures with respect to plant, property or equipment (including, without
limitation, expenditures for maintenance and repairs which should be capitalized
in accordance with GAAP and the amount reflected (or under the accounting
policies and presentation of the Borrower as in effect on the Effective Date,
would have been reflected) in "Advance rental payments to location owners" on
the Borrower's Condensed Consolidated Statements of Cash Flows) and the amount
of all Capitalized Lease Obligations incurred by such Person.
"Capital Lease," as applied to any Person, shall mean any lease of any
property (whether real, personal or mixed) by that Person as lessee which, in
conformity with GAAP, should be accounted for as a capital lease on the balance
sheet of that Person.
"Capitalized Lease Obligations" shall mean all obligations under
Capital Leases of Holdings or any of its Subsidiaries in each case taken at the
amount thereof that should be accounted for as liabilities in accordance with
GAAP.
"Cash Equivalents" shall mean (i) securities issued or directly and
fully guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
--------
States of America is pledged in support thereof) having maturities of not more
than twelve months from the date of acquisition, (ii) U.S. dollar denominated
time deposits, certificates of deposit and banker acceptances of (x) any Bank or
(y) any bank whose short-term commercial paper rating from S&P is at least A-1
or the equivalent thereof or from ▇▇▇▇▇'▇ is at least P-1 or the equivalent
thereof (any such bank or Bank, an "Approved Bank"), in each case with
maturities of not more than twelve months from the date of acquisition, (iii)
commercial paper issued by any Approved Bank or by the parent company of any
Approved Bank and commercial paper issued by, or guaranteed by, any industrial
or financial company with a short-term commercial paper rating of at least A-1
or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by
Moody's, as the case may be, and in each case maturing within twelve months
after the date of acquisition, (iv) marketable direct obligations issued by any
state of the United States of America or any political subdivision of any such
state or any public instrumentality thereof maturing within twelve months from
the date of acquisition thereof
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and, at the time of acquisition having one of the two highest ratings obtainable
from either S&P or Moody's, (v) any repurchase agreement entered into with any
Approved Bank which is secured by any obligation of the type described in any of
clauses (i) through (iii) and (vi) investments in money market funds
substantially all the assets of which are comprised of securities of the types
described in clauses (i) through (iv) above.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, 42 U.S.C. (S) 9601 et seq., as the same
-- ---
may be amended from time to time.
"Change in Law" shall mean the introduction of any law or governmental
rule, regulation, order, guideline or request (whether or not having the force
of law), or any change in law or governmental rule, regulation, order, guideline
or request (whether or not having the force of law), or the interpretation or
administration thereof.
"Change of Control" shall mean (i) Holdings shall at any time cease to
own directly 100% of the capital stock of the Borrower; (ii) any "Person" or
"group" (as such terms are used in Section 13(d) and 14(d) of the Exchange Act)
is or shall become the "beneficial owner" (as defined in Rules 13(d)-3 and
13(d)-5 under the Exchange Act), directly or indirectly, of more than GTCR and
more than 35% of Holdings Common Stock or (iii) the Board of Directors of
Holdings shall cease to consist of a majority of Continuing Directors.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and the rulings issued thereunder.
Section references to the Code are to the Code, as in effect at the date of this
Agreement, and to any subsequent provision of the Code, amendatory thereof,
supplemental thereto or substituted therefor.
"Collateral" shall mean all property (whether real or personal) with
respect to which any security interests have been granted (or purported to be
granted) pursuant to any Security Document, including, without limitation, all
Pledge Agreement Collateral, all Security Agreement Collateral, all Mortgaged
Properties and all cash and Cash Equivalents delivered as collateral pursuant to
Section 4.02 or 10.
"Collateral Agent" shall mean the Administrative Agent acting as
collateral agent for the Secured Creditors pursuant to the Security Documents.
"Collateral Assignment of Leases" shall mean the Collateral Assignment
of Leases executed in connection with the Existing Credit Agreement,
substantially in the form of Exhibit J hereto, made by the Borrower and the
---------
Subsidiary Guarantors in favor of the
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Collateral Agent relating to certain warehouse and office facilities, as such
agreement may be amended, modified or supplemented from time to time.
"Collateral Assignment of Location Leases" shall mean the Collateral
Assignment of Location Leases executed in connection with the Existing Credit
Agreement, substantially in the form of Exhibit K hereto, made by the Borrower
---------
and the Subsidiary Guarantors in favor of the Collateral Agent relating to
leased premises at which Collateral constituting personal property is located,
as such agreement may be amended, modified or supplemented from time to time.
"Collective Bargaining Agreements" shall have the meaning provided in
Section 5.05.
"Commitment" shall mean any of the commitments of any Bank; i.e.,
---
whether the Tranche A Term Loan Commitment or Tranche B Term Loan Commitment, or
Tranche A Revolving Loan Commitment or Tranche B Revolving Loan Commitment or
the commitment of BTCo to make Swingline Loans.
"Commitment Commission" shall have the meaning provided in Section
3.01(a).
"Consolidated Adjusted Senior Leverage Ratio" shall mean the ratio of
(x) Holdings' Consolidated Senior Indebtedness to (y) Holdings' Consolidated
EBITDA for the Test Period then last ended, with such Consolidated Adjusted
Senior Leverage Ratio to be determined on a pro forma basis as if any Permitted
--- -----
Acquisition that occurred during or subsequent to such Test Period (and the
incurrence, assumption and/or repayment of any Indebtedness in connection with
any such Permitted Acquisition), as the case may be, had occurred on the first
day of such Test Period (and such Indebtedness, if any, had remained outstanding
(or had not been outstanding, as the case may be) throughout such Test Period),
it being understood that in calculating the Consolidated Adjusted Senior
Leverage Ratio in connection with each and every Permitted Acquisition,
Consolidated EBITDA shall include the results of operations of the Person or
assets acquired pursuant to each such Permitted Acquisition on a pro forma basis
--- -----
as if such acquisition had occurred on the first day of the respective Test
Period and shall include any conforming accounting adjustments made in
connection therewith, including any Permitted Acquisition Cost-Savings.
"Consolidated Current Assets" shall mean, at any time, the
consolidated current assets of Holdings and its Consolidated Subsidiaries
excluding cash and Cash Equivalents.
"Consolidated Current Liabilities" shall mean, at any time, the
consolidated current liabilities of Holdings and its Consolidated Subsidiaries
at such time, but excluding
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(i) the current portion of any Indebtedness under this Agreement and any other
long-term Indebtedness which would otherwise be included therein and (ii) the
current portion of Indebtedness.
"Consolidated EBIT" shall mean, for any period, (A) the sum of the
amounts for such period of (i) Consolidated Net Income, (ii) provisions for cash
taxes based on income, (iii) Consolidated Net Cash Interest Expense, (iv)
amortization or write-off of deferred financing costs to the extent deducted in
determining Consolidated Net Income and (v) losses on sales of assets (excluding
sales in the ordinary course of business) and other extraordinary or
nonrecurring losses less (B) the amount for such period of gains on sales of
----
assets (excluding sales in the ordinary course of business) and other
extraordinary or nonrecurring gains, all as determined on a consolidated basis
in accordance with GAAP.
"Consolidated EBITDA" shall mean, for any period, the sum of the
amounts for such period of (i) Consolidated EBIT, (ii) depreciation expense,
(iii) amortization expense and (iv) without duplication, all other non-cash
charges (including non-cash compensation expenses relating to employee stock
options) included in determining Consolidated Net Income during such period, all
as determined on a consolidated basis in accordance with GAAP.
"Consolidated Indebtedness" shall mean an amount equal to the
principal amount of all Indebtedness of Holdings and its Subsidiaries,
determined in accordance with GAAP.
"Consolidated Interest Coverage Ratio" for any period shall mean the
ratio of Consolidated EBITDA to Consolidated Net Cash Interest Expense for such
period.
"Consolidated Net Cash Interest Expense" shall mean, for any period,
without duplication, the total consolidated cash interest expense of Holdings
and its Consolidated Subsidiaries on a consolidated basis for such period plus,
without duplication, that portion of Capitalized Lease Obligations of Holdings
and its Consolidated Subsidiaries representing the interest factor for such
period, in each case net of the total consolidated cash interest income of
Holdings and its Consolidated Subsidiaries for such period, but excluding the
amortization of any deferred financing costs.
"Consolidated Net Income" shall mean, for any period, the consolidated
net after tax income of Holdings and its Consolidated Subsidiaries determined in
accordance with GAAP.
"Consolidated Senior Indebtedness" shall mean an amount equal to the
principal amount of all funded Senior Indebtedness of Holdings and its
Consolidated Subsidiaries determined in accordance with GAAP.
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"Consolidated Subsidiaries" shall mean, as to any Person, all
Subsidiaries of such Person which are consolidated with such Person for
financial reporting purposes in accordance with GAAP.
"Consolidated Working Capital" shall mean Consolidated Current Assets
minus Consolidated Current Liabilities.
"Contingent Obligation" shall mean, as to any Person, any obligation
of such Person guaranteeing or intended to guarantee any Indebtedness, leases,
dividends or other obligations ("primary obligations") of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, including,
without limitation, any obligation of such Person, whether or not contingent,
(i) to purchase any such primary obligation or any property constituting direct
or indirect security therefor, (ii) to advance or supply funds (x) for the
purchase or payment of any such primary obligation or (y) to maintain working
capital or equity capital of the primary obligor or otherwise to maintain the
net worth or solvency of the primary obligor, (iii) to purchase property,
securities or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make payment of
such primary obligation or (iv) otherwise to assure or hold harmless the holder
of such primary obligation against loss in respect thereof; provided, however,
-------- -------
that the term Contingent Obligation shall not include endorsements of
instruments for deposit or collection in the ordinary course of business. The
amount of any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
Contingent Obligation is made (or, if less, the maximum amount of such primary
obligation for which such Person may be liable pursuant to the terms of the
instrument evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder) as determined by such
Person in good faith.
"Continuing Directors" shall mean the directors of Holdings on the
Effective Date and each other director, if such Director's nomination for
election to the Board of Directors of Holdings is recommended by a majority of
the then Continuing Directors.
"Covered Taxes" shall mean any and all Taxes, other than Excluded
Taxes.
"Credit Documents" shall mean (i) this Agreement, (ii) each Note,
(iii) each Security Document and (iv) each Mortgage.
"Credit Event" shall mean the making of any Loan or the issuance of
any Letter of Credit.
"Credit Party" shall mean Holdings, the Borrower and each Subsidiary
Guarantor.
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"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulting Bank" shall mean any Bank with respect to which a Bank
Default is in effect.
"Direct Wholly-Owned Subsidiary" shall mean, as to any Person, any
other Person which would constitute a Wholly-Owned Subsidiary of such Person
even if the phrase "and/or one or more Wholly-Owned Subsidiaries of such Person"
appearing in the definition of the term "Wholly-Owned Subsidiary" were deleted.
"Dividend" with respect to any Person shall mean that such Person has
declared or paid a dividend or returned any equity capital to its stockholders
or authorized or made any other distribution, payment or delivery of property
(other than common stock of such Person) or cash to its stockholders as such, or
redeemed, retired, purchased or otherwise acquired, directly or indirectly, for
a consideration any shares of any class of its capital stock outstanding on or
after the Effective Date (or any options or warrants issued by such Person with
respect to its capital stock), or set aside any funds for any of the foregoing
purposes, or shall have permitted any of its Subsidiaries to purchase or
otherwise acquire for a consideration any shares of any class of the capital
stock of such Person outstanding on or after the Effective Date (or any options
or warrants issued by such Person with respect to its capital stock). Without
limiting the foregoing, "Dividends" with respect to any Person shall also
include all payments made or required to be made by such Person with respect to
any stock appreciation rights, plans, equity incentive or achievement plans or
any similar plans or setting aside of any funds for the foregoing purposes.
"Documents" shall mean the Credit Documents and the Acquisition
Documents.
"Dollars" and the sign "$" shall each mean freely transferable lawful
money of the United States.
"Drawing" shall have the meaning provided in Section 2.04(b).
"Effective Date" shall mean December 19, 1997.
"11 3/4% New Notes" shall mean the 11 3/4% Notes due 2005 issued
pursuant to an indenture dated as of October 8, 1997 between the Borrower and
State Street Bank and Trust Company, as Trustee, as in effect on the Amendment
Effective Date.
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"Eligible Transferee" shall mean and include a commercial bank,
financial institution or other institutional "accredited investor" (as defined
in Regulation D of the Securities Act).
"Employee Benefit Plans" shall mean all employee benefit plans (other
than multiemployer plans as defined in Section 4001(a)(3) of ERISA), or any
other similar plans or arrangements for the benefit of employees of Holdings or
any Subsidiary of Holdings and any profit sharing plans and deferred
compensation plans of Holdings or any Subsidiary of Holdings.
"Employee Stock Option Plan" shall mean the Seconded Amended and
Restated 1996 Employee Stock Option Plan of Holdings existing on the Effective
Date as such plan may be amended from time to time.
"Employment Agreements" shall mean any employment agreement entered
into by Holdings or any Subsidiary of Holdings.
"End Date" shall have the meaning provided in the definition of
Leverage Pricing Adjustment contained herein.
"Environmental Claims" means any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, directives, claims, liens,
notices of noncompliance or violation, investigations or proceedings relating in
any way to any Environmental Law or any permit issued, or any approval given,
under any such Environmental Law (hereafter, "Claims"), including, without
------
limitation, (a) any and all Claims by governmental or regulatory authorities for
enforcement, cleanup, investigation, removal, response, remedial or other
actions or damages pursuant to any Environmental Law, and (b) any and all Claims
by any third party seeking damages, contribution, indemnification, cost
recovery, compensation or injunctive relief in connection with alleged injury or
threat of injury to health, safety or the environment due to the presence of
Hazardous Materials.
"Environmental Law" means any applicable Federal, state, foreign or
local statute, law, rule, regulation, ordinance, code, legally binding guideline
or written policy and any rule of common law now or hereafter in effect and in
each case as amended, and any judicial or administrative interpretation thereof,
including any judicial or administrative order, consent decree or judgment, to
the extent binding on Holdings, the Borrower or any of their respective
Subsidiaries, relating to the environment, employee health and safety or
Hazardous Materials, including, without limitation, CERCLA; RCRA; the Federal
Water Pollution Control Act, 33 U.S.C. (S) 1251 et seq.; the Toxic Substances
-- ---
Control Act, 15 U.S.C. (S) 2601 et seq.; the Clean Air Act, 42 U.S.C. (S) 7401
-- ---
et seq.; the Safe Drinking Water Act, 42 U.S.C. (S) 3803 et seq.; the Oil
-- --- -- ---
Pollution Act of 1990, 33 U.S.C. (S) 2701 et seq.; the Emergency Planning and
-- ---
the Community Right-to-Know Act of 1986, ▇▇ ▇.▇.▇.
-▇▇-
(▇) ▇▇▇▇▇ et seq.; the Hazardous Material Transportation Act, 49 U.S.C. (S)
-- ---
1801 et seq.; and the Occupational Safety and Health Act, 29 U.S.C. (S) 651
---
et seq. (to the extent it regulates occupational exposure to Hazardous
Materials); and any state and local or foreign counterparts or equivalents, in
each case as amended from time to time.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the applicable regulations promulgated
thereunder. Section references to ERISA are to ERISA, as in effect at the date
of this Agreement and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section 3(9)
of ERISA) which together with Holdings or any Subsidiary of Holdings would be
deemed to be a "single employer" within the meaning of Section 414(b), (c), (m)
or (o) of the Code.
"Eurodollar Loan" shall mean each Loan designated as such by the
Borrower at the time of the incurrence thereof or conversion thereto.
"Eurodollar Rate" shall mean with respect a Eurodollar Loan (a) the
offered quotation to first-class banks in the New York interbank Eurodollar
market by BTCo for Dollar deposits of amounts in immediately available funds
comparable to the outstanding principal amount of the Eurodollar Loan for which
an interest rate is then being determined with maturities (comparable to the
Interest Period applicable to such Eurodollar Loan commencing two Business Days
thereafter as of 10:00 A.M. (New York time) on the date which is two Business
Days prior to the commencement of such Interest Period, divided (and rounded off
to the nearest 1/16 of 1%) by (b) a percentage equal to 100% minus the then
stated maximum rate of all reserve requirements (including, without limitation,
any marginal, emergency, supplemental, special or other reserves required by
applicable law) applicable to any member bank of the Federal Reserve System in
respect of Eurocurrency funding or liabilities as defined in Regulation D (or
any successor category of liabilities under Regulation D).
"Event of Default" shall have the meaning provided in Section 10.
"Excess Cash Flow" shall mean, for any fiscal year of Holdings,
Consolidated EBITDA for such period minus Consolidated Net Cash Interest Expense
-----
for such period minus the provision for income taxes for such period (to the
-----
extent paid in cash) minus the amount of Capital Expenditures made by Holdings
-----
and its Subsidiaries during such period minus (plus) additions (reductions) to
-----
Consolidated Working Capital for such period minus scheduled repayments of
-----
principal of outstanding Indebtedness to the extent actually paid (including any
voluntary payments of principal of Indebtedness but excluding voluntary payments
---
of Revolving Loans).
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"Excess Cash Flow Percentage" shall mean 50% unless and so long as the
Consolidated Adjusted Leverage Ratio is less than or equal to 3.00:1.00, in
which case it shall mean zero.
"Excess Cash Payment Date" shall mean the date occurring 95 days after
the last day of each fiscal year of the Borrower (beginning with its fiscal year
ended closest to March 31, 1999).
"Excess Cash Payment Period" shall mean with respect to the repayment
required on each Excess Cash Payment Date, the immediately preceding fiscal year
of the Borrower.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Excluded Taxes" shall mean Taxes (including income or franchise
Taxes) imposed upon or determined by reference to any Bank's net income or net
profits but only to the extent such Taxes are imposed
(i) by the United States of America (or any State or local
jurisdiction or any agency thereof) including, without limitation, branch
profits Taxes; or
(ii) by any jurisdiction in which an applicable Bank is organized
or has its principal office or applicable lending office.
"Existing ▇▇▇▇▇ Indebtedness" shall mean all Indebtedness of ▇▇▇▇▇.
"Existing Indebtedness" shall have the meaning provided in Section
7.22.
"Existing Letters of Credit" shall have the meaning provided in
Section 2.01(a).
"Facing Fee" shall have the meaning provided in Section 3.01(c).
"Federal Funds Rate" shall mean for any period, a fluctuating interest
rate equal for each day during such period to the weighted average of the rates
on overnight Federal Funds transactions with members of the Federal Reserve
System arranged by Federal Funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal Funds
brokers of recognized standing selected by the Administrative Agent.
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"Fees" shall mean all amounts payable pursuant to or referred to in
Section 3.01.
"Final Scheduled Maturity Dates" shall mean, collectively, the
Revolving Loan Maturity Date and the Tranche A Term Loan Maturity Date and the
Tranche B Term Loan Maturity Date.
"Form 1001" shall have the meaning set forth in Section 4.04(f).
"Form 4224" shall have the meaning set forth in Section 4.04(f).
"Form W-8" shall have the meaning set forth in Section 4.04(f).
"Form W-9" shall have the meaning set forth in Section 4.04(f).
"GAAP" shall have the meaning provided in Section 13.07(a).
"GTCR" shall mean, collectively, Golder, Thoma, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Inc.,
or any entity controlled thereby.
"Governmental Authority" shall mean any government or political
subdivision or any agency, authority, board, bureau, central bank, commission,
department or instrumentality of either, or any court, tribunal, grand jury or
arbitrator, in each case whether foreign or domestic, or any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Guaranteed Obligations" shall mean the irrevocable and unconditional
guaranty made by Holdings and each Subsidiary Guarantor (i) to each Bank for the
full and prompt payment when due (whether at the stated maturity, by
acceleration or otherwise) of the principal and interest on each Note issued by
the Borrower to such Bank, and Loans made, under this Agreement and all
reimbursement obligations and Unpaid Drawings with respect to Letters of Credit,
together with all the other obligations and liabilities (including, without
limitation, indemnities, fees and interest thereon) of the Borrower to such Bank
now existing or hereafter incurred under, arising out of or in connection with
this Agreement or any other Credit Document and the due performance and
compliance with all the terms, conditions and agreements contained in the Credit
Documents by the Borrower and (ii) to each Bank and each Affiliate of a Bank
which enters into an Interest Rate Protection Agreement with the Borrower, which
by its express terms are entitled to the benefit of the Guaranty pursuant to
Section 14 with the written consent of the Borrower, the full and prompt payment
when due (whether by acceleration or otherwise) of all obligations of the
Borrower owing under any such Interest Rate Protection Agreement, whether now in
exis-
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tence or hereafter arising, and the due performance and compliance with all
terms, conditions and agreements contained therein.
"Guarantor" shall mean Holdings and each Subsidiary Guarantor.
"Guaranty" shall mean the guaranty issued pursuant to Section 14.
"Hazardous Materials" means (a) any petroleum or petroleum products or
constituents thereof, radioactive materials, asbestos that is friable, urea
formaldehyde foam insulation, transformers or other equipment that contain
dielectric fluid containing levels of polychlorinated biphenyls in excess of 50
ppm, and radon gas; (b) any chemicals, materials or substances defined as or
included in the definition of "hazardous substances," "hazardous waste,"
"hazardous materials," "extremely hazardous substances," "restricted hazardous
waste," "toxic substances," "toxic pollutants," "contaminants," or "pollutants,"
or words of similar import, under any applicable Environmental Law; and (c) any
other chemical, material or substance, exposure to which is prohibited, limited
or regulated by any governmental authority under Environmental Laws.
"Holdings" shall have the meaning provided in the first paragraph of
this Agreement.
"Holdings Common Stock" shall mean the common stock of Holdings.
"Holdings Pledge Agreement" shall mean the Holdings Pledge Agreement
executed in connection with the Existing Credit Agreement, substantially in the
form of Exhibit G-2 hereto, made by Holdings in favor of the Collateral Agent,
-----------
as such agreement may be amended, modified or supplemented from time to time.
"Holdings Preferred Stock" shall mean the Preferred Stock, par value
$0.01 per share, of Holdings.
"Indebtedness" shall mean, as to any Person, without duplication, (i)
all indebtedness of such Person for borrowed money (ii) the deferred purchase
price of assets or services payable to the sellers thereof or any of such
seller's assignees which in accordance with GAAP would be shown on the liability
side of the balance sheet of such Person but excluding deferred rent as
determined in accordance with GAAP, or for the deferred purchase price of
property or services, (iii) the maximum amount available to be drawn under all
letters of credit issued for the account of such Person and all unpaid drawings
in respect of such letters of credit, (iv) all Indebtedness of the types
described in clause (i), (ii), (iii), (iv), (v), (vi), (vii) or (viii) of this
definition secured by any Lien on any property owned by such Person, whether or
not such Indebtedness has been assumed by such Person (to the extent of the
value of the respective property), (v) the aggregate amount required to be
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capitalized under leases under which such Person is the lessee, (vi) all
obligations of such person to pay a specified purchase price for goods or
services, whether or not delivered or accepted; i.e., take-or-pay and similar
---
obligations, (vii) all Contingent Obligations of such Person and (viii) all
obligations under any Interest Rate Protection Agreement or Other Hedging
Agreement or under any similar type of agreement.
"Intercompany Loans" shall have the meaning provided in Section
9.05(g).
"Intercompany Notes" shall mean promissory notes, in the form of
Exhibit E, evidencing an Intercompany Loan.
---------
"Interest Determination Date" shall mean, with respect to any
Eurodollar Loan, the second Business Day prior to the commencement of any
Interest Period relating to such Eurodollar Loan.
"Interest Period" shall have the meaning provided in Section 1.09.
"Interest Rate Protection Agreement" shall mean any interest rate swap
agreement, interest rate cap agreement, interest collar agreement, interest rate
hedging agreement or other similar agreement or arrangement.
"Issuing Bank" shall mean BTCo and any Bank which at the request of
the Borrower and with the consent of the Agent agrees, in such Bank's sole
discretion, to become an Issuing Bank for the purpose of issuing Letters of
Credit pursuant to Section 2. The sole Issuing Bank on the Effective Date is
BTCo.
"Landlord Consent" shall mean a Landlord Consent substantially in the
form of Exhibit L hereto.
---------
"L/C Supportable Indebtedness" shall mean (i) obligations of Holdings,
the Borrower or the Borrower's Subsidiaries incurred in the ordinary course of
business with respect to insurance obligations and workers' compensation, surety
bonds and other similar statutory obligations and (ii) such other obligations of
Holdings, the Borrower or any of the Borrower's Subsidiaries as are reasonably
acceptable to the respective Issuing Bank and otherwise permitted to exist
pursuant to the terms of this Agreement.
"Leaseholds" of any Person means all the right, title and interest of
such Person as lessee or licensee in, to and under leases or licenses of land,
improvements and/or fixtures.
"Letter of Credit" shall have the meaning provided in Section 2.01(a).
"Letter of Credit Fee" shall have the meaning provided in Section
3.01(b).
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"Letter of Credit Outstandings" shall mean, at any time, the sum of
(i) the aggregate Stated Amount of all outstanding Letters of Credit and (ii)
the amount of all Unpaid Drawings.
"Letter of Credit Request" shall have the meaning provided in Section
2.02(a).
"Letter of Credit Sublimit" shall mean $10,000,000.
"Leverage Pricing Adjustment" shall mean zero; provided that from and
--------
after the first day of any Margin Adjustment Period (the "Start Date") to and
----------
including the last day of such Margin Adjustment Period (the "End Date"), the
--------
Leverage Pricing Adjustment shall be the respective percentage per annum set
forth in clause (A), (B), (C), or (D) below if, but only if, as of the last day
of the most recent fiscal quarter or year, as the case may be, ended immediately
prior to such Start Date (the "Test Date"), the applicable conditions set forth
---------
in clause (A), (B), (C), or (D) below, as the case may be, are met:
(A) in the case of all Loans, +.25% if, but only if, as of the Test
Date for such Start Date the Pro Forma Leverage Ratio for the Test Period
ended on such Test Date shall be greater than 4.25:1.00;
(B) in the case of all Loans, -.25% if, but only if, as of the Test
Date for such Start Date the Pro Forma Leverage Ratio for the Test Period
ended on such Test Date shall be less than 4.00:1.00 and none of the
conditions set forth in clause (C) or (D) below, as the case may be, are
satisfied;
(C) in the case of all Loans, -.50% if, but only if, as of the Test
Date for such Start Date the Pro Forma Leverage Ratio for the Test Period
ended on such Test Date shall be less than 3.50:1.00 and neither of the
conditions set forth in clause (D) below, is satisfied; or
(D) in the case of all Loans, -.75% if, but only if, as of the Test
Date for such Start Date the Pro Forma Leverage Ratio for the Test Period
ended on such Test Date shall be less than 3.00:1.00. Notwithstanding
anything to the contrary contained above in this definition, the Leverage
Pricing Adjustment shall be +.25% at all times during which there shall
exist a Default or an Event of Default.
"Lien" shall mean any mortgage, pledge, hypothecation, assignment,
attachments, deposit arrangement, encumbrance, lien (statutory or other),
preference, priority or other security agreement of any kind or nature
whatsoever (including, without limitation, any conditional sale or other title
retention agreement, any financing or similar statement or notice filed under
the UCC or any other similar recording or notice statute, and any lease
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having substantially the same effect as any of the foregoing) including any
agreement to give any of the foregoing.
"Loan" shall mean each Tranche A Term Loan, each Tranche B Term Loan,
each Tranche A Revolving Loan, each Tranche B Revolving Loan and each Swingline
Loan.
"▇▇▇▇▇" shall mean collectively ▇▇▇▇▇ Laundry Service L.P., a Delaware
limited partnership and related entities.
"Mandatory Borrowing" shall have the meaning provided in Section
1.01(e).
"Margin Adjustment Period" shall mean each period which shall commence
on a date on which the financial statements (or certificate in the case of
Section 8.01(l)) are delivered pursuant to Section 8.01(b), (c) or (l), as the
case may be, and which shall end on the earlier of (i) the date of actual
delivery of the next financial statements (or certificate in the case of Section
8.01(l)) pursuant to Section 8.01(b), (c) or (l), as the case may be, and (ii)
the latest date on which the next financial statements (or certificate in the
case of Section 8.01(l)) are required to be delivered pursuant to Section
8.01(b), (c) or (l), as the case may be; provided that the first Margin
--------
Adjustment Period shall commence on the date that the financial statements are
delivered for the Company's first fiscal quarter ending after the Effective Date
(other than in the case of a consummation of a Permitted Acquisition, in which
case the Margin Adjustment Period shall commence on the consummation of such
Permitted Acquisition).
"Margin Stock" shall have the meaning provided in Regulation U.
"Material Adverse Effect" shall have the meaning provided in Section
5.12.
"Maturity Date" shall mean, with respect to any Tranche of Loans, the
Tranche A Term Loan Maturity Date, the Tranche B Term Loan Maturity Date, the
Revolving Loan Maturity Date or the Swingline Maturity Date, as the case may be.
"Maximum Swingline Amount" shall mean $5,000,000.
"Mortgage" shall mean fully executed counterparts of mortgages,
leasehold mortgages, deeds of trust and leasehold deeds of trust to secure debt
executed and delivered on the Effective Date with respect to a Mortgaged
Property, in each case in form and substance reasonably satisfactory to the
Agent.
"Mortgage Policies" shall mean the mortgage title insurance policies
issued on the Effective Date in respect of each Mortgage Property.
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"Mortgaged Properties" shall mean, collectively, each Mortgaged
Property and each Additional Mortgaged Property.
"Mortgaged Property" shall mean each Real Property owned or leased by
the Borrower or a Subsidiary Guarantor and listed on Schedule 5.11 hereto and
any Additional Mortgaged Property.
"Net Sale Proceeds" shall mean for any sale of assets, the gross cash
proceeds (including any cash received by way of deferred payment pursuant to a
promissory note, receivable or otherwise, but only as and when received)
received from any sale of assets, net of reasonable transaction costs
(including, without limitation, any underwriting, brokerage or other customary
selling commissions and reasonable legal, advisory and other fees and expenses,
including title and recording expenses, associated therewith) and payments of
unassumed liabilities relating to the assets sold at the time of, or within 30
days after, the date of such sale, the amount of such gross cash proceeds
required to be used to repay any Indebtedness (other than Indebtedness of the
Banks pursuant to this Agreement) which is secured by the respective assets
which were sold, and the estimated marginal increase in income taxes which will
be payable by Holdings' consolidated group with respect to the fiscal year in
which the sale occurs as a result of such sale; but excluding any portion of any
such gross cash proceeds which Holdings determines in good faith should be
reserved for post-closing adjustments (to the extent Holdings delivers to the
Banks a certificate signed by its chief financial officer, controller or chief
accounting officer as to such determination), it being understood and agreed
that on the day that all such post-closing adjustments have been determined,
(which shall not be later than six months following the date of the respective
asset sale), the amount (if any) by which the reserved amount in respect of such
sale or disposition exceeds the actual post-closing adjustments payable by
Holdings or any of its Subsidiaries shall constitute Net Sale Proceeds on such
date) received by Holdings and/or any of its Subsidiaries from such sale, lease,
transfer or other disposition.
"Non-Defaulting Bank" shall mean and include each Bank other than a
Defaulting Bank.
"Note" shall mean each Tranche A Term Note, each Tranche B Term Note,
each Tranche A Revolving Note, each Tranche B Revolving Note and the Swingline
Note.
"Notice of Borrowing" shall have the meaning provided in Section 1.03.
"Notice of Conversion" shall have the meaning provided in Section
1.06.
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"Notice Office" shall mean the office of the Agent located at ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. Prior, or such
other office as the Agent may hereafter designate in writing as such to the
other parties hereto.
"Obligations" shall mean all amounts, direct or indirect, contingent
or absolute, of every type or description, and at any time existing, owing to
the Agent, the Collateral Agent or any Bank pursuant to the terms of any Credit
Document.
"Original Credit Agreement" shall mean the credit facility provided to
the Borrower pursuant to the Amended and Restated Credit Agreement dated as of
December 19, 1997 among Holdings, the Borrower, the lending institutions parties
thereto, Bankers Trust Company and First Union National Bank of North Carolina
as agents.
"Other Taxes" shall have the meaning set forth in Section 4.04(a).
"Participant" shall have the meaning provided in Section 2.03(a).
"Payment Office" shall mean the office of the Administrative Agent
located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or such other
office as the Agent may hereafter designate in writing as such to the other
parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Section 4002 of ERISA, or any successor thereto.
"Percentage" in the case of a Tranche A Revolving Loan Bank at any
time shall mean a fraction (expressed as a percentage) the numerator of which is
the Tranche A Revolving Loan Commitment of such Bank at such time and the
denominator of which is the Total Tranche A Revolving Loan Commitment at such
time and, in the case of a Tranche B Revolving Loan Bank, at any time shall mean
a fraction (expressed as a percentage) the numerator of which is the Tranche B
Revolving Loan Commitment of such Bank at such time and the denominator of which
is the Total Tranche B Revolving Loan Commitment at such time; provided that if
--------
the Percentage of any Bank is to be determined after the applicable Total
Revolving Loan Commitment has been terminated, then the Percentages of the Banks
shall be determined immediately prior (and without giving effect) to such
termination.
"Permitted Acquisition" shall mean (a) the merger or consolidation of
any Person into Holdings or any Wholly Owned Subsidiary of Holdings or (b) the
acquisition by Holdings or its Subsidiaries of all or substantially all of the
assets of any Person (or all or substantially all of the assets of a product
line or division of any Person) not already a Subsidiary of Holdings or 100% of
the capital stock of any such Person; provided that any such merger,
--------
consolidation or acquisition shall only be a Permitted Acquisition so long as
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(i) no Default or Event of Default exists (or will result from such
acquisitions), (ii) pro forma for such acquisitions and the financings incurred
--- -----
and conforming accounting adjustments made in connection therewith, (x) the
Consolidated Adjusted Senior Leverage Ratio of Holdings is less than 2.25:1.00;
and (y) the Pro Forma Leverage Ratio of Holdings is less than 4.50:1.00; and
(iii) such Permitted Acquisition shall be engaged in a business in which the
Borrower and its Subsidiaries are engaged or a reasonable extension thereof or a
complementary business; provided, however, that to the extent any such Permitted
-------- -------
Acquisition or series of Permitted Acquisitions is not made by the Borrower or
any of its Subsidiaries or is not contributed by Holdings to either the Borrower
or any of its Subsidiaries, neither the Borrower nor any of its Subsidiaries
shall incur any Indebtedness (including Guarantees) with respect thereto.
Notwithstanding anything to the contrary contained in the immediately preceding
sentence, an acquisition shall be a Permitted Acquisition only if all
requirements of Section 9.02(j) with respect to Permitted Acquisitions are met
with respect thereto.
"Permitted Acquisition Capital Expenditures" shall be an amount equal
to 115% of the Capital Expenditures made by the Person (or in the case of an
asset acquisition, the Capital Expenditures relating to the assets) being
acquired as a part of a Permitted Acquisition prior to the time of such
Permitted Acquisition measured by the amount reported in the quarterly
financials for the four immediately preceding fiscal quarters. Such full 115%
amount shall be available for Capital Expenditures in each succeeding fiscal
year, beginning the next full fiscal year after the date of such Permitted
Acquisition, and a pro rata amount for the year in which such Permitted
--- ----
Acquisition is consummated shall be available.
"Permitted Acquisition Compliance Certificate" shall have the meaning
provided in 8.01(l).
"Permitted Acquisition Cost-Savings" shall mean certain cost-savings
adjustments reasonably anticipated by the Borrower to be achieved in connection
with Permitted Acquisitions and upon the Agents' request shall be (i) made in
accordance with Regulation S-X; (ii) verified by Ernst & Young L.L.P., or
another nationally recognized accounting firm or as otherwise agreed to by the
Agents; and (iii) not in excess of 10% of pro forma actual Consolidated EBITDA
--- -----
without regard to such cost-savings; provided, however, that all such Permitted
-------- -------
Acquisition Cost-Savings shall be estimated on a good-faith basis by the
Borrower and shall be reduced by (x) one half, six months following each such
Permitted Acquisition, (y) an additional one quarter, nine months following each
such Permitted Acquisition and (z) an additional one quarter, twelve months
following each such Permitted Acquisition.
"Permitted Acquisition Notice" shall mean a notice which notice shall
contain (i) the date such Permitted Acquisition is scheduled to be consummated,
(ii) the esti-
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mated purchase price of such Permitted Acquisition, (iii) a description of the
business and the stock and/or assets to be acquired in connection with such
Permitted Acquisition, (iv) the sources of cash to be paid in respect of such
Permitted Acquisition and (v) in the case of Holdings Common Stock issued as
consideration to the seller in connection with a Permitted Acquisition, a
description of the Holdings Common Stock to be issued in connection with the
consummation of such Permitted Acquisition and the estimated fair market value
(as determined in good faith by the Board of Directors of Holdings) thereof.
"Permitted Encumbrance" shall mean, with respect to any Mortgaged
Property, such exceptions to title as are set forth in the title insurance
policy or title commitment delivered with respect thereto, all of which
exceptions must be acceptable to the Administrative Agent in its reasonable
discretion.
"Permitted Liens" shall have the meaning provided in Section 9.01.
"Person" shall mean any individual, partnership, joint venture, firm,
corporation, association, trust or other enterprise or any government or
political subdivision or any agency, department or instrumentality thereof.
"Plan" shall mean any multiemployer or single-employer plan, as
defined in Section 4001 of ERISA, which is maintained or contributed to by (or
to which there is an obligation to contribute of), the Borrower or a Subsidiary
of the Borrower or an ERISA Affiliate, and each such plan for the five year
period immediately following the latest date on which the Borrower, a Subsidiary
of the Borrower or an ERISA Affiliate maintained, contributed to or had an
obligation to contribute to such plan.
"Pledge Agreements" shall mean the Holdings Pledge Agreement and the
Borrower Pledge Agreement.
"Pledge Agreement Collateral" shall mean all "Collateral" as defined
in each of the Pledge Agreements.
"Pledged Securities" shall mean "Pledged Securities" as defined in
each of the Holdings Pledge Agreement and the Borrower Pledge Agreement.
"Pledged Stock" shall mean "Pledged Stock" as defined in each of the
Holdings Pledge Agreement and the Borrower Pledge Agreement.
"Prime Lending Rate" shall mean the rate which BTCo announces from
time to time as its prime lending rate, the Prime Lending Rate to change when
and as such prime lending rate changes. The Prime Lending Rate is a reference
rate and does not necessarily
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represent the lowest or best rate actually charged to any customer. BTCo may
make commercial loans or other loans at rates of interest at, above or below the
Prime Lending Rate.
"Prior Liens" shall have the meaning provided in the Security
Agreement.
"Pro Forma Leverage Ratio" shall mean, at any time for the
determination thereof, the ratio of (x) Consolidated Indebtedness at such time
to (y) Consolidated EBITDA for the Test Period then last ended, with such Pro
Forma Leverage Ratio to be determined on a pro forma basis as if any Permitted
--- -----
Acquisition that occurred during or subsequent to such Test Period (and the
incurrence, assumption and/or repayment of any Indebtedness in connection with
any such Permitted Acquisition), as the case may be, had occurred on the first
day of such Test Period (and such Indebtedness, if any, had remained outstanding
(or had not been outstanding, as the case may be) throughout such Test Period)
it being understood that in calculating the Pro Forma Leverage Ratio in
connection with each and every Permitted Acquisition, Consolidated EBITDA shall
include the results of operations of the Person or assets acquired pursuant to
each such Permitted Acquisition on a pro forma basis as if such acquisition had
--- -----
occurred on the first day of the respective Test Period and shall include any
conforming accounting adjustments made in connection therewith, including any
Permitted Acquisition Cost-Savings. On the date of any Permitted Acquisition
pursuant to which the Pro Forma Leverage Ratio is to be calculated and on each
date of calculation of Pro Forma Leverage Ratio, Holdings shall deliver to the
Administrative Agent a certificate of an Authorized Officer of Holdings setting
forth in reasonable detail the pro forma calculations required to establish the
--- -----
Pro Forma Leverage Ratio (with such pro forma calculations to be made on a basis
--- -----
reasonably satisfactory to the Administrative Agent and to assume that the
interest expense attributable to any Indebtedness (whether existing or being
incurred) bearing a floating interest rate shall be computed as if the rate in
effect on the date of such Permitted Acquisition (taking into account any
Interest Rate Protection Agreement applicable to such Indebtedness if such
Interest Rate Protection Agreement has a remaining term in excess of 12 months)
had been the applicable rate for the entire period).
"Projections" shall have the meaning provided in Section 7.05(h).
"Purchase Agreement" shall mean the purchase agreement dated January
20, 1998 by and between ▇▇▇▇▇ Laundry Service Midwest Limited Partnership, JPS
Laundry, Inc., ▇▇▇▇▇ Laundry Service, Inc., Coin Controlled Washers, Inc., ▇▇▇▇▇
Laundry Service-Central Limited Partnership, ▇▇▇▇▇ Services-Texas, Inc.,
Superior Coin, Inc., Superior Coin II, Inc., Advance ▇▇▇▇▇ Domestic Machines,
Inc., ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and Coinmach Corporation.
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"Quarterly Payment Date" shall mean the last Business Day of each
March, June, September and December, occurring after the Effective Date;
provided that the first Quarterly Payment Date shall be March 31, 1998.
--------
"RCRA" shall mean the Resource Conservation and Recovery Act, as the
same may be amended from time to time, 42 U.S.C. (S) 6901 et seq.
-- ---
"Real Property" of any Person shall mean all the right, title and
interest of such Person in and to land, improvements and fixtures, including
Leaseholds.
"Recovery Event" shall mean the receipt by the Borrower or any
Subsidiary Guarantor of any cash insurance proceeds or condemnation award
payable (i) by reason of theft, loss, physical destruction or damage or any
other similar event with respect to any property or assets of the Borrower or
any Subsidiary Guarantor and (ii) under any policy of insurance required to be
maintained under Section 8.03.
"Register" shall have the meaning provided in Section 13.16.
"Regulation D" shall mean Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof establishing reserve requirements.
"Regulation G" shall mean Regulation G of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation S-X" shall mean Regulation S-X, Title 17, Code of Federal
Regulations as from time to time in effect and any successor to all or a portion
thereof.
"Regulation T" shall mean Regulation T of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation U" shall mean Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation X" shall mean Regulation X of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
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"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposing or
migration into the environment.
"Replaced Bank" shall have the meaning provided in Section 1.13.
"Replacement Bank" shall have the meaning provided in Section 1.13.
"Reportable Event" shall mean an event described in Section 4043(c) of
ERISA with respect to a Plan as to which the 30-day notice requirement has not
been waived by the PBGC.
"Required Banks" means Non-Defaulting Banks holding at least a
majority of the outstanding Loans (after giving effect to each Non-Defaulting
Tranche A Revolving Loan Bank's Percentage of Swingline Loans), Letter of Credit
Outstandings (after giving effect to each Participant's Adjusted Percentage-
Tranche A) and Total Unutilized Tranche A Revolving Loan Commitments and Total
Unutilized Tranche B Revolving Loan Commitments held by Non-Defaulting Banks.
"Returns" shall have the meaning provided in Section 7.09.
"Revolving Loan" shall mean Tranche A Revolving Loans and Tranche B
Revolving Loans.
"Revolving Loan Banks" shall mean the Tranche A Revolving Loan Banks
and the Tranche B Revolving Loan Banks.
"Revolving Loan Commitment" shall mean, for each Bank, the amount set
forth opposite such Bank's name in Annex I hereto directly below the column
entitled "Tranche A Revolving Loan Commitment," or "Tranche B Revolving Loan
Commitment" as each may be (x) reduced from time to time pursuant to Sections
3.02, 3.03, 4.02 and/or 10 or (y) adjusted from time to time as a result of
assignments to or from such Bank pursuant to Section 1.13 or 13.04(b).
"Revolving Loan Maturity Date" shall mean December 31, 2003.
"Revolving Loan Percentage" shall mean (i) in the case of Tranche A
Revolving Loan Bank at any time shall mean a fraction (expressed as a
percentage) the numerator of which is the Tranche A Revolving Loan Commitment of
such Bank at such time and the denominator of which is the Total Tranche A
Revolving Loan Commitment at such time and (ii) in the case of Tranche B
Revolving Loan Banks at any time shall mean a fraction (expressed as a
percentage) the numerator of which is the Tranche B Revolving Loan
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Commitment of such Bank at such time and the denominator of which is the Total
Tranche B Revolving Loan Commitment at such time.
"Rollover Amount" shall have the meaning provided in Section 9.07(b).
"Scheduled Repayments" shall mean Term Loan Scheduled Repayments.
"SEC" shall have the meaning provided in Section 8.01(h).
"SEC Reports" shall have the meaning provided in Section 8.01(h).
"Secured Creditors" shall have the meaning assigned that term in the
Security Documents.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Security Agreement" shall mean the Security Agreement executed in
connection with the Existing Credit Agreement, substantially in the form of
Exhibit H hereto, made by the Borrower and the Subsidiary Guarantors in favor of
---------
the Collateral Agent, as such agreement may be amended, modified or supplemented
from time to time.
"Security Agreement Collateral" shall mean all "Collateral" as defined
in the Security Agreement.
"Security Document" shall mean each Pledge Agreement, the Security
Agreement, each Mortgage, each Collateral Assignment of Leases, each Collateral
Assignment of Location Leases and, after the execution and delivery thereof,
each Additional Mortgage and each Subsidiary Security Document.
"Senior Indebtedness" shall mean, as to any Person, at any date all
Indebtedness that would be required to be reflected on a consolidated balance
sheet of such Person at such date (including, without limitation, all Capital
Leases) exclusive of subordinated Indebtedness.
"Start Date" shall have the meaning provided in the definition of
Leverage Pricing Adjustment.
"Stated Amount" of each Letter of Credit shall, at any time, mean the
maximum amount available to be drawn thereunder (in each case determined without
regard to whether any conditions to drawing could then be met).
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"Strategic Investor" shall mean a person engaged in a business which
supplies service or equipment to Holdings or its Subsidiaries or is otherwise
engaged in a related or complementary business.
"Subsidiary" shall mean, as to any Person, (i) any corporation more
than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person and/or one or
more Subsidiaries of such Person and (ii) any partnership, association, joint
venture or other entity in which such Person and/or one or more Subsidiaries of
such Person has more than a 50% equity interest at the time.
"Subsidiary Guarantor" shall mean (i) each Subsidiary of the Borrower
which is a party hereto or (ii) each Subsidiary of Holdings which is a party
hereto.
"Super Laundry" shall mean Super Laundry Equipment Corp., a New York
corporation and a Wholly-Owned Subsidiary of the Borrower.
"Supermajority Banks" means (w) in the case of the Tranche A Term
Loans, Non-Defaulting Banks holding at least 66 2/3% of the outstanding Tranche
A Term Loans, (x) in the case of the Tranche B Term Loans, Non-Defaulting Banks
holding at least 66 2/3% of the outstanding Tranche B Term Loans, (y) in the
case of Tranche A Revolving Loans, Non-Defaulting Banks holding at least 66 2/3%
of the outstanding Tranche A Revolving Loans (after giving effect to each Non-
Defaulting Bank's Percentage of Swingline Loans), Letter of Credit Outstandings
(after giving effect to each Participant's Adjusted Percentage) and Total
Unutilized Tranche A Revolving Loan Commitments held by the Non-Defaulting Banks
and (z) in the case of Tranche B Revolving Loans, Non-Defaulting Banks holding
at least 66 2/3% of the outstanding Tranche B Revolving Loans and Total
Unutilized Tranche B Revolving Loan commitments held by the Non-Defaulting
Banks.
"Swingline Expiry Date" shall mean the date which is five Business
Days prior to the Revolving Loan Maturity Date.
"Swingline Loan" shall have the meaning provided in Section 1.01(d).
"Swingline Note" shall have the meaning provided in Section 1.05(a).
"Syndication Agent" shall mean First Union National Bank, in its
capacity as Syndication Agent for the Banks hereunder, and shall include any
successor to the Syndication Agent.
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"Syndication Date" shall mean that date upon which the Agents
determine in their collective sole discretion (and notify the Borrower) that the
primary syndication (and resultant addition of institutions as Banks pursuant to
Section 13.04) has been completed.
"Tax Sharing Agreements" shall mean all tax sharing, tax allocation
and other similar agreements entered into by Holdings or any Subsidiary of
Holdings.
"Taxes" shall mean any present or future tax, levy, stamp, impost,
duty, deduction, assessment or other charge or withholding (including any
intangible, documentary or excise tax), and all liabilities with respect thereto
(including penalties, interest and expenses) imposed, levied, collected,
withheld or assessed by or on behalf of any Governmental Authority.
"Term Loan" shall mean the Tranche A Term Loan or the Tranche B Term
Loan.
"Term Loan Commitment" shall mean each Tranche A Term Loan Commitment
and each Tranche B Term Loan Commitment, with the Term Loan Commitment of any
Bank at any time to equal the sum of its Tranche A Term Loan Commitment and
Tranche B Term Loan Commitment as then in effect.
"Test Date" shall have the meaning provided in the definition of
Leverage Pricing Adjustment.
"Test Period" shall mean for any determination the four consecutive
fiscal quarters of Holdings (taken as one accounting period), ended, in the case
of any determination of Leverage Pricing Adjustment on the applicable Test Date
and, in all other cases, ended on the date indicated in the applicable Section
hereof.
"Total Commitments" shall mean, at any time, the sum of the
Commitments of each of the Banks.
"Total Revolving Loan Commitment" shall mean, at any time, the sum of
the then Total Tranche A Revolving Loan Commitments and Total Tranche B
Revolving Loan Commitments.
"Total Term Loan Commitment" shall mean, at any time, the sum of the
Total Tranche A Term Loan Commitment and Total Tranche B Term Loan Commitment.
"Total Tranche A Revolving Loan Commitment" shall mean, at any time,
the sum of the then Tranche A Revolving Loan Commitments of each of the Tranche
A Revolving Loan Banks.
"Total Tranche B Revolving Loan Commitment" shall mean, at any time,
the sum of the then Tranche B Revolving Loan Commitments of each of the Tranche
B Revolving Loan Banks.
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"Total Tranche A Term Loan Commitment" shall mean, at any time, the
sum of the Tranche A Term Loan Commitments of each of the Banks.
"Total Tranche B Term Loan Commitment" shall mean, at any time, the
sum of the Tranche B Term Loan Commitments of each of the Banks.
"Total Unutilized Tranche A Revolving Loan Commitment" shall mean, at
any time, an amount equal to the remainder of (x) the then Tranche A Total
Revolving Loan Commitment, less (y) the sum of the aggregate principal amount of
Tranche A Revolving Loans and Swingline Loans then outstanding plus the then
aggregate amount of Letter of Credit Outstandings.
"Total Unutilized Tranche B Revolving Loan Commitment" shall mean, at
any time, an amount equal to the remainder of (x) the then Tranche B Total
Revolving Loan Commitment, less (y) the aggregate principal amount of Tranche B
Revolving Loans then outstanding.
"Tranche" shall mean the respective facility and commitments utilized
in making Loans hereunder, with there being five separate Tranches; i.e.,
---
Tranche A Term Loans, Tranche B Term Loans, Tranche A Revolving Loans, Tranche B
Revolving Loans and Swingline Loans.
"Tranche A Revolving Loan" shall have the meaning provided in Section
1.01(b).
"Tranche B Revolving Loan" shall have the meaning provided in Section
1.01(c).
"Tranche A Revolving Loan Banks" shall have the meaning provided in
Section 1.01(b).
"Tranche B Revolving Loan Banks" shall have the meaning provided in
Section 1.01(c).
"Tranche A Revolving Loan Commitment" shall mean, for each Bank, the
amount set forth opposite such Bank's name in Annex I hereto directly below the
column entitled "Tranche A Revolving Loan Commitment."
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"Tranche B Revolving Loan Commitment" shall mean, for each Bank, the
amount set forth opposite such Bank's name in Annex I hereto directly below the
column entitled "Tranche B Revolving Loan Commitment."
"Tranche A Revolving Loan Maturity Date" shall mean December 31, 2003.
"Tranche B Revolving Loan Maturity Date" shall mean December 31, 2003.
"Tranche A Term Loan Scheduled Repayment" shall have the meaning
provided in Section 4.02(c).
"Tranche A Term Loan Scheduled Repayment Date" shall have the meaning
provided in Section 4.02(c).
"Tranche A Term Loan" shall have the meaning provided in Section
1.01(a).
"Tranche A Term Loan Bank" shall have the meaning provided in Section
1.01 (a).
"Tranche A Term Loan Commitment" shall mean, for each Bank, the amount
set forth opposite such Bank's name in Annex I hereto directly below the column
entitled "Tranche A Term Loan Commitment", as same may be (x) reduced from time
to time pursuant to Sections 3.03, 4.02 and/or 10 or (y) adjusted from time to
time as a result of assignments to or from such Bank pursuant to Section 1.13 or
13.04.
"Tranche A Term Loan Maturity Date" shall mean December 31, 2004.
"Tranche A Term Note" shall have the meaning provided in Section
1.05(a).
"Tranche B Term Loan Scheduled Repayment" shall have the meaning
provided in Section 4.02(d).
"Tranche B Term Loan Scheduled Repayment Date" shall have the meaning
provided in Section 4.02(d).
"Tranche B Term Loan" shall have the meaning provided in Section
1.01(b).
"Tranche B Term Loan Bank" shall have the meaning provided in Section
1.01(b).
"Tranche B Term Loan Commitment" shall mean, for each Bank, the amount
set forth opposite such Bank's name in Annex I hereto directly below the column
entitled "Tranche B Term Loan Commitment", as same may be (x) reduced from time
to time pur-
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suant to Sections 3.03, 4.02 and/or 10 or (y) adjusted from time to time as a
result of assignments to or from such Bank pursuant to Section 1.13 or 13.04.
"Tranche B Term Loan Maturity Date" shall mean June 30, 2005.
"Tranche B Term Note" shall have the meaning provided in Section
1.05(a).
"Type" shall mean the type of Loan determined with regard to the
interest option applicable thereto; i.e., whether a Base Rate Loan or a
---
Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code as from time to time in
effect in the relevant jurisdiction.
"Unfunded Current Liability" of any Plan means the amount, if any, by
which the actuarial present value of the accumulated benefits under the Plan as
of the close of its most recent plan year exceeds the fair market value of the
assets allocable thereto, each determined in accordance with Statement of
Financial Accounting Standards No. 87, based upon the actuarial assumptions used
by the Plan's actuary in the most recent annual valuation of the Plan.
"United States" and "U.S." shall each mean the United States of
America.
"Unpaid Drawing" shall have the meaning provided for in Section
2.04(a).
"Unutilized Tranche A Revolving Loan Commitment" with respect to any
Tranche A Revolving Loan Bank, at any time, shall mean such Bank's Tranche A
Revolving Loan Commitment at such time less the sum of (i) the aggregate
outstanding principal amount of Tranche A Revolving Loans made by such Bank
(plus, in the case of BTCo, the aggregate outstanding principal amount of
Swingline Loans made by BTCo) and (ii) such Bank's Adjusted Percentage of the
Letter of Credit Outstandings in respect of Letters of Credit issued under this
Agreement.
"Unutilized Tranche B Revolving Loan Commitment" with respect to any
Tranche B Revolving Loan Bank, at any time, shall mean such Bank's Tranche B
Revolving Loan Commitment at such time less the aggregate outstanding principal
amount of Tranche B Revolving Loans made by such Bank.
"Voting Stock" means any class or classes of capital stock of Holdings
pursuant to which the holders thereof have the general voting power under
ordinary circumstances to elect at least a majority of the Board of Directors of
Holdings.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i) any
corporation 100% of whose capital stock (other than director's qualifying
shares) is at the time
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owned by such Person and/or one or more Wholly-Owned Subsidiaries of such Person
and (ii) any partnership, association, joint venture or other entity in which
such Person and/or one or more Wholly-Owned Subsidiaries of such Person has a
100% equity interest at such time.
SECTION 12. The Administrative Agent.
------------------------
12.01 Appointment. The Banks hereby designate Bankers Trust
-----------
Company as Administrative Agent (for purposes of this Section 12, the term
"Administrative Agent" shall include BTCo in its capacity as Collateral Agent
pursuant to the Security Documents) to act as specified herein and in the other
Credit Documents. Each Bank hereby irrevocably authorizes, and each holder of
any Note by the acceptance of such Note shall be deemed irrevocably to
authorize, the Administrative Agent to take such action on its behalf under the
provisions of this Agreement, the other Credit Documents and any other
instruments and agreements referred to herein or therein and to exercise such
powers and to perform such duties hereunder and thereunder as are specifically
delegated to or required of the Administrative Agent by the terms hereof and
thereof and such other powers as are reasonably incidental thereto. The
Administrative Agent may perform any of its duties hereunder by or through its
respective officers, directors, agents, employees or affiliates.
12.02 Nature of Duties. The Administrative Agent shall not have
----------------
any duties or responsibilities except those expressly set forth in this
Agreement and the Security Documents. Neither the Administrative Agent nor any
of its respective officers, directors, agents, employees or affiliates shall be
liable for any action taken or omitted by it or them hereunder or under any
other Credit Document or in connection herewith or therewith, unless caused by
its or their gross negligence or willful misconduct. The duties of the
Administrative Agent shall be mechanical and administrative in nature; the
Administrative Agent shall not have by reason of this Agreement or any other
Credit Document a fiduciary relationship in respect of any Bank or the holder of
any Note; and nothing in this Agreement or any other Credit Document, expressed
or implied, is intended to or shall be so construed as to impose upon the
Administrative Agent any obligations in respect of this Agreement or any other
Credit Document except as expressly set forth herein or therein.
12.03 Lack of Reliance on the Administrative Agent. Independently
--------------------------------------------
and without reliance upon the Administrative Agent, each Bank and the holder of
each Note, to the extent it deems appropriate, has made and shall continue to
make (i) its own independent investigation of the financial condition and
affairs of Holdings and its Subsidiaries in connection with the making and the
continuance of the Loans and the taking or not taking of any action in
connection herewith and (ii) its own appraisal of the creditworthiness of
Holdings and its Subsidiaries and, except as expressly provided in this
Agreement, the Administrative Agent shall not have any duty or responsibility,
either initially or on a continuing basis, to provide any Bank or the holder of
any Note with any credit or other infor-
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mation with respect thereto, whether coming into its possession before the
making of the Loans or at any time or times thereafter. The Administrative Agent
shall not be responsible to any Bank or the holder of any Note for any recitals,
statements, information, representations or warranties herein or in any
document, certificate or other writing delivered in connection herewith or for
the execution, effectiveness, genuineness, validity, enforceability, perfection,
collectibility, priority or sufficiency of this Agreement or any other Credit
Document or the financial condition of Holdings and its Subsidiaries or be
required to make any inquiry concerning either the performance or observance of
any of the terms, provisions or conditions of this Agreement or any other Credit
Document, or the financial condition of Holdings and its Subsidiaries or the
existence or possible existence of any Default or Event of Default.
12.04 Certain Rights of the Administrative Agent. If the Agent
------------------------------------------
shall request instructions from the Required Banks with respect to any act or
action (including failure to act) in connection with this Agreement or any other
Credit Document, the Administrative Agent shall be entitled to refrain from such
act or taking such action unless and until the Administrative Agent shall have
received instructions from the Required Banks; and the Administrative Agent
shall not incur liability to any Person by reason of so refraining. Without
limiting the foregoing, no Bank or the holder of any Note shall have any right
of action whatsoever against the Administrative Agent as a result of the
Administrative Agent acting or refraining from acting hereunder or under any
other Credit Document in accordance with the instructions of the Required Banks.
12.05 Reliance. The Administrative Agent shall be entitled to
--------
rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, statement, certificate, telex, teletype or telecopier
message, cablegram, radiogram, order or other document or telephone message
signed, sent or made by any Person that the Administrative Agent believed to be
the proper Person, and, with respect to all legal matters pertaining to this
Agreement and any other Credit Document and its duties hereunder and thereunder,
upon advice of counsel selected by the Administrative Agent.
12.06 Indemnification. To the extent the Administrative Agent is
---------------
not reimbursed and indemnified by the Borrower, the Banks will reimburse and
indemnify the Administrative Agent, in proportion to their respective
"percentages" as used in determining the Required Banks (with such "percentages"
to be determined as if there are no Defaulting Banks), for and against any and
all liabilities, obligations, losses, damages, penalties, claims, actions,
judgments, costs, expenses or disbursements of whatsoever kind or nature which
may be imposed on, asserted against or incurred by the Administrative Agent in
performing its respective duties hereunder or under any other Credit Document,
in any way relating to or arising out of this Agreement or any other Credit
Document, except to the extent such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits,
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costs, expenses or disbursements are finally judicially determined to have
resulted from the Administrative Agent's gross negligence or willful misconduct.
12.07 The Administrative Agent in Its Individual Capacity. With
---------------------------------------------------
respect to its obligation to make Loans under this Agreement, the Administrative
Agent shall have the rights and powers specified herein for a "Bank" and may
exercise the same rights and powers as though it were not performing the duties
specified herein; and the term "Banks," "Required Banks," "holders of Notes" or
any similar terms shall, unless the context clearly otherwise indicates, include
the Administrative Agent in its individual capacity. The Administrative Agent
may accept deposits from, lend money to, and generally engage in any kind of
banking, trust or other business with any Credit Party or any Affiliate of any
Credit Party as if they were not performing the duties specified herein, and may
accept fees and other consideration from the Borrower or any other Credit Party
for services in connection with this Agreement and otherwise without having to
account for the same to the Banks.
12.08 Holders. The Administrative Agent may deem and treat the
-------
payee of any Note as the owner thereof for all purposes hereof unless and until
a written notice of the assignment, transfer or endorsement thereof, as the case
may be, shall have been filed with the Administrative Agent. Any request,
authority or consent of any Person who, at the time of making such request or
giving such authority or consent, is the holder of any Note shall be conclusive
and binding on any subsequent holder, transferee, assignee or indorsee, as the
case may be, of such Note or of any Note or Notes issued in exchange therefor.
12.09 Resignation by the Administrative Agent. (a) The
---------------------------------------
Administrative Agent may resign from the performance of all its functions and
duties hereunder and/or under the other Credit Documents at any time by giving
15 Business Days' prior written notice to the Borrower and the Banks. Such
resignation shall take effect upon the appointment of a successor Administrative
Agent pursuant to clauses (b) and (c) below or as otherwise provided below.
(b) Upon any such notice of resignation, the Banks shall appoint a
successor Administrative Agent hereunder or thereunder who shall be a commercial
bank or trust company reasonably acceptable to the Borrower, except after an
Event of Default.
(c) If a successor Administrative Agent shall not have been so
appointed within such 15 Business Day period, the Administrative Agent, with the
consent of the Borrower, except after an Event of Default, shall then appoint a
successor Administrative Agent who shall serve as Administrative Agent hereunder
or thereunder until such time, if any, as the Banks appoint a successor
Administrative Agent as provided above.
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(d) If no successor Administrative Agent has been appointed pursuant
to clause (b) or (c) above by the 20th Business Day after the date such notice
of resignation was given by the Administrative Agent, the Administrative Agent's
resignation shall become effective and the Banks shall thereafter perform all
the duties of the Administrative Agent hereunder and/or under any other Credit
Document until such time, if any, as the Banks appoint a successor
Administrative Agent as provided above.
SECTION 13. Miscellaneous.
-------------
13.01 Payment of Expenses, etc. The Borrower shall: (i) whether
------------------------
or not the transactions herein contemplated are consummated, pay all reasonable
out-of-pocket costs and expenses of the Agents (including, without limitation,
the reasonable fees and disbursements of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ and local
counsel) in connection with the preparation, execution and delivery of this
Agreement and the other Credit Documents and the documents and instruments
referred to herein and therein and any amendment, waiver or consent relating
hereto or thereto, and in connection with the initial syndication efforts with
respect to this Agreement and of the Agents and, following an Event of Default,
each of the Banks in connection with the enforcement of this Agreement and the
other Credit Documents and the documents and instruments referred to herein and
therein (including, without limitation, the reasonable fees and disbursements of
counsel for the Agents and, following an Event of Default, for each of the
Banks); (ii) pay and hold each of the Banks harmless from and against any and
all present and future stamp, excise and other similar taxes with respect to the
foregoing matters and save each of the Banks harmless from and against any and
all liabilities with respect to or resulting from any delay or omission to pay
such taxes; and (iii) indemnify each of the Agents and each Bank, and each of
their Affiliates and each of them and their respective officers, directors,
trustees, employees, representatives and agents from and hold each of them
harmless against any and all liabilities, obligations (including removal or
remedial actions), losses, damages, penalties, claims, actions, judgments,
suits, costs, expenses and disbursements (including reasonable attorneys' and
consultants' fees and disbursements) incurred by, imposed on or assessed against
any of them as a result of, or arising out of, or in any way related to, or by
reason of, (a) any investigation, litigation or other proceeding (whether or not
any Agent or any Bank is a party thereto) related to the entering into and/or
performance of this Agreement or any other Credit Document or the use of any
Letter of Credit or the proceeds of any Loans hereunder or the consummation of
any transactions contemplated herein or in any other Credit Document or the
exercise of any of their rights or remedies provided herein or in the other
Credit Documents, or (b) the actual or alleged presence of Hazardous Materials
in the air, surface water or groundwater or on the surface or subsurface of any
Real Property owned or at any time operated by Holdings or any of its
Subsidiaries, the generation, storage, transportation, handling or disposal of
Hazardous Materials at any location, whether or not owned or operated by
Holdings or any of its Subsidiaries, the non-compliance of any Real Property
with foreign, federal, state and local laws, regulations, and ordinances
(including applicable permits thereunder) applicable to any Real Property, or
any Environmental Claim asserted against Holdings, any of its Subsidiaries or
any Real
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Property owned or at any time operated by Holdings or any of its Subsidiaries,
including, in each case, without limitation, the reasonable fees and
disbursements of counsel and other consultants incurred in connection with any
such investigation, litigation or other proceeding (but excluding any losses,
liabilities, claims, damages or expenses to the extent finally judicially
determined to have been incurred by reason of the gross negligence or willful
misconduct of the Person to be indemnified). To the extent that the undertaking
to indemnify, pay or hold harmless any Agent or any Bank set forth in the
preceding sentence may be unenforceable because it is violative of any law or
public policy, the Borrower shall make the maximum contribution to the payment
and satisfaction of each of the indemnified liabilities which is permissible
under applicable law.
13.02 Right of Set-off. In addition to any rights now or hereafter
----------------
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence of an Event of Default, each Agent, each Letter
of Credit Issuer and each Bank is hereby authorized at any time or from time to
time, without presentment, demand, protest or other notice of any kind to
Holdings or the Borrower or to any other Person, any such notice being hereby
expressly waived, to set off and to appropriate and apply any and all deposits
(general or special) and any other Indebtedness at any time held or owing by
such Agent, such Letter of Credit Issuer and such Bank (including, without
limitation, by branches and agencies of such Agent, such Letter of Credit Issuer
and such Bank wherever located) to or for the credit or the account of Holdings
or the Borrower or any other Guarantor against and on account of the Obligations
and liabilities of Holdings or the Borrower or any other Guarantor to such
Agent, such Letter of Credit Issuer and such Bank under this Agreement or under
any of the other Credit Documents, including, without limitation, all interests
in Obligations purchased by such Bank pursuant to Section 13.06(b), and all
other claims of any nature or description arising out of or connected with this
Agreement or any other Credit Document, irrespective of whether or not such
Agent, such Letter of Credit Issuer and such Bank shall have made any demand
hereunder and although said Obligations, liabilities or claims, or any of them,
shall be contingent or unmatured.
13.03 Notices. Except as otherwise expressly provided herein, all
-------
notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, telecopier or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered: if to Holdings, at
Holdings' address specified opposite its signature below; if to the Borrower, at
the Borrower's address specified opposite its signature below; if to any Bank
and any Agent (other than the Administrative Agent), at its address specified
opposite its name on Annex II below; and if to the Administrative Agent, at its
Notice Office; or, as to any Credit Party or the Administrative Agent, at such
other address as shall
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be designated by such party in a written notice to the other parties hereto and,
as to each Bank or any other Agent, at such other address as shall be designated
by such Bank in a written notice to the Borrower and the Administrative Agent.
All such notices and communications shall, when mailed, telegraphed, telexed,
telecopied, or cabled or sent by overnight courier, be effective when deposited
in the mails, delivered to the telegraph company, cable company or overnight
courier, as the case may be, or sent by telex or telecopier, except that notices
and communications to the Administrative Agent and the Borrower shall not be
effective until received by the Administrative Agent or the Borrower, as the
case may be.
13.04 Benefit of Agreement. (a) This Agreement shall be binding
--------------------
upon and inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided, however, no Credit Party may assign
-------- -------
or transfer any of its rights, obligations or interest hereunder or under any
other Credit Document without the prior written consent of the Banks; and
provided further, that, although any Bank may transfer, assign or grant
-------- -------
participations in its rights hereunder, such Bank shall remain a "Bank" for all
purposes hereunder (and may not transfer or assign all or any portion of its
Commitments hereunder except as provided in Section 13.04(b)) and the
transferee, assignee or participant, as the case may be, shall not constitute a
"Bank" hereunder; and provided further, that no Bank shall transfer or grant any
-------- -------
participation under which the participant shall have rights to approve any
amendment to or waiver of this Agreement or any other Credit Document except to
the extent such amendment or waiver would (i) extend the applicable Final
Scheduled Maturity Date of the Tranche in which such participant is
participating, or reduce the rate or extend the time of payment of interest or
Fees thereon (except in connection with a waiver of applicability of any post-
default increase in interest rates) or reduce the principal amount thereof, or
increase the amount of the participant's participation over the amount thereof
then in effect (it being understood that a waiver of any Default or Event of
Default or of a mandatory reduction in the Total Commitment shall not constitute
a change in the terms of such participation, and that an increase in any
Commitment or Loan shall be permitted without the consent of any participant if
the participant's participation is not increased as a result thereof), (ii)
consent to the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement or (iii) release (x) the Guarantee of Holdings
or (y) all or substantially all of the Collateral under all of the Security
Documents (except as expressly provided in the Security Documents) or in
connection with a sale otherwise permitted hereby), supporting the Loans
hereunder in which such participant is participating. In the case of any such
participation, the participant shall not have any rights under this Agreement or
any of the other Credit Documents (the participant's rights against such Bank in
respect of such participation to be those set forth in the agreement executed by
such Bank in favor of the participant relating thereto) and all amounts payable
by the Borrower hereunder shall be determined as if such Bank had not sold such
participation.
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(b) Notwithstanding the foregoing, any Bank (or any Bank together
with one or more other Banks) may (x) assign all or a portion of its Commitments
(and related outstanding Obligations hereunder) and/or its outstanding Term
Loans to (i) its parent company and/or any affiliate of such Bank which is at
least 50% owned by such Bank or its parent company or to one or more Banks or
(ii) in the case of any Bank that is a fund that invests in bank loans, any
other fund that invests in bank loans and is managed by the same investment
advisor of such Bank or by an affiliate of such investment advisor or (y) assign
all, or if less than all, a portion equal to at least $5,000,000 in the
aggregate for the assigning Bank or assigning Banks, of such Commitments and/or
outstanding principal amount of Term Loans hereunder to one or more Eligible
Transferees (treating any fund that invests in bank loans and any other fund
that invests in bank loans and is managed by the same investment advisor of such
fund or by an affiliate of such investment advisor as a single Eligible
Transferee), each of which assignees shall become a party to this Agreement as a
Bank by execution of an Assignment and Assumption Agreement; provided that, (i)
--------
at such time Annex I shall be deemed modified to reflect the Commitments (and/or
outstanding Term Loans, as the case may be) of such new Bank and of the existing
Banks, (ii) new Notes will be issued, at the Borrower's expense, to such new
Bank and to the assigning Bank upon the request of such new Bank or assigning
Bank, such new Notes to be in conformity with the requirements of Section 1.05
(with appropriate modifications) to the extent needed to reflect the revised
Commitments (and/or outstanding Term Loans, as the case may be), (iii) the
consent of BTCo shall be required in connection with any such assignment (which
consent shall not be unreasonably withheld) and (iv) the Administrative Agent
shall receive at the time of each such assignment, from the assigning or
assignee Bank, the payment of a non-refundable assignment fee of $3,500. To the
extent of any assignment pursuant to this Section 13.04(b), the assigning Bank
shall be relieved of its obligations hereunder with respect to its assigned
Commitments. At the time of each assignment pursuant to this Section 13.04(b) to
a Person which is not already a Bank hereunder and which is not a United States
person (as such term is defined in Section 7701(a)(30) of the Code) for Federal
income tax purposes, the respective assignee Bank shall, to the extent legally
entitled to do so, provide to the Borrower in the case of a Bank described in
clause (ii) or (iv) of Section 4.04(b), the forms described in such clause (ii)
or (iv), as the case may be. To the extent that an assignment of all or any
portion of a Bank's Commitments and related outstanding Obligations pursuant to
Section 1.13 or this Section 13.04(b) would, at the time of such assignment,
result in increased costs under Section 1.10, 1.11 or 4.04 from those being
charged by the respective assigning Bank prior to such assignment, then the
Borrower shall not be obligated to pay such increased costs (although the
Borrower shall be obligated to pay any other increased costs of the type
described above resulting from changes after the date of the respective
assignment).
(c) Nothing in this Agreement shall prevent or prohibit any Bank from
pledging its Loans and Notes hereunder to a Federal Reserve Bank in support of
borrow-
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ings made by such Bank from such Federal Reserve Bank and, with the
consent of the Administrative Agent, any Bank which is a fund may pledge all or
any portion of its Loans and Notes to its trustee in support of its obligations
to its trustee. No pledge pursuant to this clause (c) shall release the
transferor Bank from any of its obligations hereunder.
13.05 No Waiver; Remedies Cumulative. No failure or delay on the
------------------------------
part of the Administrative Agent or any Bank or any holder of any Note in
exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between the Borrower or any other Credit Party
and the Administrative Agent or the Syndication Agent or any Bank or the holder
of any Note shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege hereunder or under any other Credit
Document preclude any other or further exercise thereof or the exercise of any
other right, power or privilege hereunder or thereunder. The rights, powers and
remedies herein or in any other Credit Document expressly provided are
cumulative and not exclusive of any rights, powers or remedies which the
Administrative Agent or any Bank or the holder of any Note would otherwise have.
No notice to or demand on any Credit Party in any case shall entitle any Credit
Party to any other or further notice or demand in similar or other circumstances
or constitute a waiver of the rights of the Administrative Agent or any Bank or
the holder of any Note to any other or further action in any circumstances
without notice or demand.
13.06 Payments Pro Rata. (a) Except as otherwise provided in this
-----------------
Agreement, the Administrative Agent agrees that promptly after its receipt of
each payment from or on behalf of the Borrower in respect of any Obligations
hereunder, it shall distribute such payment to the Banks (other than any Bank
that has consented in writing to waive its pro rata share of any such payment)
--- ----
pro rata based upon their respective shares, if any, of the Obligations with
--- ----
respect to which such payment was received.
(b) Each of the Banks agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise), which is applicable to the payment of the principal of, or interest
on, the Loans, Unpaid Drawings, Commitment Commission or Letter of Credit Fees,
of a sum which with respect to the related sum or sums received by other Banks
is in a greater proportion than the total of such Obligation then owed and due
to such Bank bears to the total of such Obligation then owed and due to all of
the Banks immediately prior to such receipt, then such Bank receiving such
excess payment shall purchase for cash without recourse or warranty from the
other Banks an interest in the Obligations of the respective Party to such Banks
in such amount as shall result in a proportional participation by all the Banks
in such amount; provided that if all or any portion of such excess amount
--------
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is thereafter recovered from such Bank, such purchase shall be rescinded and the
purchase price restored to the extent of such recovery, but without interest.
(c) Notwithstanding anything to the contrary contained herein, the
provisions of the preceding Sections 13.06(a) and (b) shall be subject to the
express provisions of this Agreement which require, or permit, differing
payments to be made to Non-Defaulting Banks as opposed to Defaulting Banks.
13.07 Calculations; Computations. (a) The financial statements to
--------------------------
be furnished to the Banks pursuant hereto shall be made and prepared in
accordance with generally accepted accounting principles in the United States
consistently applied throughout the periods involved (except as set forth in the
notes thereto or as otherwise disclosed in writing by the Borrower to the
Banks); provided that, except as otherwise specifically provided herein, all
--------
computations of Excess Cash Flow and all computations determining compliance
with Sections 9.08 through 9.10, inclusive, shall utilize accounting principles
and policies in conformity with those used to prepare the financial statements
of Holdings for the fiscal year ended September 30, 1996 delivered to the Banks
pursuant to Section 7.05(a) (with the foregoing generally accepted accounting
principles, subject to the preceding proviso, herein called "GAAP").
----
(b) All computations of interest, Commitment Commission and Fees
hereunder shall be made on the basis of a year of 360 days for the actual number
of days (including the first day but excluding the last day (determined in
accordance with the terms hereof) occurring in the period for which such
interest, Commitment Commission or Fees are payable (except for interest payable
in respect of Base Rate Loans based on the Prime Lending Rate, which shall be
computed on the basis of a 365/66 day year).
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF
-----------------------------------------------------------
JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS
----------
AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL, EXCEPT AS
OTHERWISE PROVIDED IN CERTAIN OF THE MORTGAGES, BE CONSTRUED IN ACCORDANCE WITH
AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK. ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE
SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS. EACH OF HOLDINGS AND THE BORROWER
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HEREBY IRREVOCABLY DESIGNATES, APPOINTS AND EMPOWERS CT CORPORATION SYSTEM, WITH
OFFICES ON THE DATE HEREOF AT ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ AS ITS
DESIGNEE, APPOINTEE AND AGENT TO RECEIVE, ACCEPT AND ACKNOWLEDGE FOR AND ON ITS
BEHALF, AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND ALL LEGAL PROCESS,
SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE SERVED IN ANY SUCH ACTION OR
PROCEEDING. IF FOR ANY REASON SUCH DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO
BE AVAILABLE TO ACT AS SUCH, EACH CREDIT PARTY AGREES TO DESIGNATE A NEW
DESIGNEE, APPOINTEE AND AGENT IN NEW YORK CITY ON THE TERMS AND FOR THE PURPOSES
OF THIS PROVISION SATISFACTORY TO THE AGENT UNDER THIS AGREEMENT. EACH OF
HOLDINGS AND THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS
OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE
MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO
ANY CREDIT PARTY AT ITS ADDRESS SET FORTH OPPOSITE ITS SIGNATURE BELOW, SUCH
SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING. NOTHING HEREIN SHALL
AFFECT THE RIGHT OF THE AGENT UNDER THIS AGREEMENT, ANY BANK OR THE HOLDER OF
ANY NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE
LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY CREDIT PARTY IN ANY OTHER
JURISDICTION.
(b) EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY WAIVES ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF
THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN
CLAUSE (a) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD
OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY
SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING
OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
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13.09 Counterparts. This Agreement may be executed in any number
------------
of counterparts and by the different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument. A set of
counterparts executed by all the parties hereto shall be lodged with the
Borrower and each of the Agents.
13.10 Effectiveness. (a) This Agreement shall become effective on
-------------
the date (the "Amendment Effective Date") on which (i) Holdings, the Borrower,
------------------------
each of the Tranche B Term Loan Banks, the Supermajority Banks of each Tranche
(determined immediately before the occurrence of the Amendment Effective Date)
and each of the Agents shall have signed a counterpart hereof (whether the same
or different counterparts) and shall have delivered (including by way of
facsimile device) the same to the Administrative Agent at its Notice Office and
(ii) the conditions contained in Sections 5, 6 and 13.10(b) are met to the
satisfaction of the Agents and the Required Banks (determined immediately after
the occurrence of the Effective Date). Unless the Administrative Agent has
received actual notice from any Bank that the conditions contained in Sections 5
and 6 have not been met to its satisfaction, upon the satisfaction of the
condition described in clause (i) of the immediately preceding sentence and upon
the Agents good faith determination that the conditions described in clause (ii)
of the immediately preceding sentence have been met, then the Amendment
Effective Date shall have been deemed to have occurred, regardless of any
subsequent determination that one or more of the conditions thereto had not been
met (although the occurrence of the Amendment Effective Date shall not release
the Borrower or Holdings from any liability for failure to satisfy one or more
of the applicable conditions contained in Section 5 or 6). The Administrative
Agent will give the Borrower and each Bank prompt written notice of the
occurrence of the Amendment Effective Date.
(b) On the Amendment Effective Date, each Bank shall have delivered
to the Administrative Agent for the account of the Borrower an amount equal to
the Loans to be made by such Bank on the Amendment Effective Date.
Notwithstanding anything to the contrary contained in this Section 13.10(b), in
satisfying the foregoing condition, unless the Agent shall have been notified by
any Bank prior to the occurrence of the Amendment Effective Date that such Bank
does not intend to make available to the Administrative Agent such Bank's Loans
required to be made by it on such date, then the Administrative Agent may, in
reliance on such assumption, make available to the Borrower the corresponding
amounts in accordance with the provisions of Section 1.04, and the making
available by the Agent of such amounts shall satisfy the condition contained in
this Section 13.10(b).
13.11 Headings Descriptive. The headings of the several sections
--------------------
and subsections of this Agreement are inserted for convenience only and shall
not in any way affect the meaning or construction of any provision of this
Agreement.
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13.12 Amendment or Waiver; etc. (a) Neither this Agreement nor
------------------------
any other Credit Document nor any terms hereof or thereof may be changed,
waived, discharged or terminated unless such change, waiver, discharge or
termination is in writing signed by the respective Credit Parties party thereto
and the Required Banks, provided that no such change, waiver, discharge or
--------
termination shall, without the consent of each Bank (other than a Defaulting
Bank) (with Obligations being directly affected in the case of following clause
(i)), (i) extend the Final Scheduled Maturity Dates of or extend the stated
maturity of any Letter of Credit beyond the Revolving Loan Maturity Date, or
reduce the rate or extend the time of payment of interest or Fees thereon, or
reduce the principal amount thereof (except to the extent repaid in cash), (ii)
release (x) the Guarantee of Holdings or a Subsidiary Guarantor or (y) all or
substantially all of the Collateral (except as expressly provided in the
Security Documents in connection with a sale otherwise permitted hereby), (iii)
amend, modify or waive any provision of this Section 13.12, (iv) reduce the
percentage specified in the definition of Required Banks (it being understood
that, with the consent of the Required Banks, additional extensions of credit
pursuant to this Agreement may be included in the determination of the Required
Banks on substantially the same basis as the extensions of Term Loans and
Revolving Loan Commitments are included on the Effective Date) or (v) consent to
the assignment or transfer by the Borrower or Holdings of any of its rights and
obligations under this Agreement; provided further, that no such change, waiver,
-------- -------
discharge or termination shall (u) increase the Commitments of any Bank over the
amount thereof then in effect without the consent of such Bank (it being
understood that waivers or modifications of conditions precedent, covenants,
Defaults or Events of Default or of a mandatory reduction in the Total
Commitment shall not constitute an increase of the Commitment of any Bank, and
that an increase in the available portion of any Commitment of any Bank shall
not constitute an increase in the Commitment of such Bank), (v) without the
consent of BTCo, amend, modify or waive any provision of Section 2 or alter its
rights or obligations with respect to Letters of Credit, (w) without the consent
of the Administrative Agent, amend, modify or waive any provision of Section 12
as same applies to such Administrative Agent or any other provision as same
relates to the rights or obligations of such Administrative Agent, (x) without
the consent of the Collateral Agent, amend, modify or waive any provision
relating to the rights or obligations of the Collateral Agent, (y) without the
consent of the Supermajority Banks of each Tranche which is being allocated a
lesser prepayment, repayment or commitment reduction as a result of the actions
described below (or without the consent of the Supermajority Banks of each
Tranche in the case of an amendment to the definition of Supermajority Banks),
amend the definition of Supermajority Banks or alter the required application of
any prepayments or repayments (or commitment reductions), as between the various
Tranches, pursuant to Section 4.01 or 4.02 (although the Required Banks may
waive, in whole or in part, any such prepayment, repayment or commitment
reduction, so long as the application, as amongst the various Tranches, of any
such prepayment, repayment or commitment reduction which is still required to be
made is not altered) or (z) without the consent of the Supermajority Banks of
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the respective Tranche, amend, modify or waive any Tranche A Term Loan Scheduled
Repayment or Tranche B Term Loan Scheduled Repayment.
(b) If, in connection with any proposed change, waiver, discharge or
termination to any of the provisions of this Agreement as contemplated by
clauses (i) through (v), inclusive, of the first proviso to Section 13.12(a),
the consent of the Required Banks is obtained but the consent of one or more of
such other Banks whose consent is required is not obtained, then the Borrower
shall have the right, so long as all non-consenting Banks whose individual
consent is required are treated as described in either clauses (A) or (B) below,
to either (A) replace each such non-consenting Bank or Banks (or, at the option
of the Borrower if the respective Bank's consent is required with respect to
less than all Tranches of Loans (or related Commitments), to replace only the
respective Tranche or Tranches of Commitments and/or Loans of the respective
non-consenting Bank which gave rise to the need to obtain such Bank's individual
consent) with one or more Replacement Banks pursuant to Section 1.13 so long as
at the time of such replacement, each such Replacement Bank consents to the
proposed change, waiver, discharge or termination or (B) terminate such non-
consenting Bank's Revolving Loan Commitment (if such Bank's consent is required
as a result of its Revolving Loan Commitment) and/or repay outstanding Term
Loans of such Bank which gave rise to the need to obtain such Bank's consent, in
accordance with Sections 3.02(b) and/or 4.01(v); provided that, unless the
--------
Commitments are terminated, and Loans repaid, pursuant to preceding clause (B)
are immediately replaced in full at such time through the addition of new Banks
or the increase of the Commitments and/or outstanding Loans of existing Banks
(who in each case must specifically consent thereto), then in the case of any
action pursuant to preceding clause (B) the Required Banks (determined before
giving effect to the proposed action) shall specifically consent thereto;
provided further, that in any event the Borrower shall not have the right to
-------- -------
replace a Bank, terminate its Revolving Loan Commitment or repay its Loans
solely as a result of the exercise of such Bank's rights (and the withholding of
any required consent by such Bank) pursuant to the second proviso to Section
13.12(a).
13.13 Survival. All indemnities set forth herein including,
--------
without limitation, in Sections 1.10, 1.11, 2.05, 4.04, 13.01 and 13.06 shall,
subject to Section 13.15 (to the extent applicable), survive the execution,
delivery and termination of this Agreement and the Notes and the making and
repayment of the Loans (it being understood and agreed that all such indemnities
shall also survive as to any Bank that has assigned all of its obligations
hereunder pursuant to Section 13.04(b) with respect to the period of time in
which such Bank was a "Bank" hereunder).
13.14 Domicile of Loans. Each Bank may transfer and carry its
-----------------
Loans at, to or for the account of any office, Subsidiary or Affiliate of such
Bank. Notwithstanding anything to the contrary contained herein, to the extent
that a transfer of Loans pursuant to
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this Section 13.14 would, at the time of such transfer, result in increased
costs under Section 1.10, 1.11, 2.05 or 4.04 from those being charged by the
respective Bank prior to such transfer, then the Borrower shall not be obligated
to pay such increased costs (although the Borrower shall be obligated to pay any
other increased costs of the type described above resulting from changes after
the date of the respective transfer).
13.15 Register. The Borrower hereby designates the Administrative
--------
Agent to serve as the Borrower's agent, solely for purposes of this Section
13.15, to maintain a register (the "Register") on which it will record the
--------
Commitments from time to time of each of the Banks, the Loans made by each of
the Banks and each repayment in respect of the principal amount of the Loans of
each Bank. Failure to make any such recordation, or any error in such
recordation shall not affect the Borrower's obligations in respect of such
Loans. With respect to any Bank, the transfer of the Commitments of such Bank
and the rights to the principal of, and interest on, any Loan made pursuant to
such Commitments shall not be effective unless and until such transfer is
recorded on the Register maintained by the Agent with respect to ownership of
such Commitments and Loans and prior to such recordation all amounts owing to
the transferor with respect to such Commitments and Loans shall remain owing to
the transferor. The registration of assignment or transfer of all or part of
any Commitments and Loans shall be recorded by the Administrative Agent on the
Register only upon the acceptance by the Administrative Agent of a properly
executed and delivered Assignment and Assumption Agreement pursuant to Section
13.04(b). Coincident with the delivery of such an Assignment and Assumption
Agreement to the Administrative Agent for acceptance and registration of
assignment or transfer of all or part of a Loan, or as soon thereafter as
practicable, the assigning or transferor Bank shall surrender the Note
evidencing such Loan, and thereupon one or more new Notes in the same aggregate
principal amount shall be issued to the assigning or transferor Bank and/or the
new Bank. The Borrower agrees to indemnify the Administrative Agent from and
against any and all losses, claims, damages and liabilities of whatsoever nature
which may be imposed on, asserted against or incurred by the Administrative
Agent in performing its duties under this Section 13.15.
13.16 Confidentiality. (a) Subject to the provisions of clause
---------------
(b) of this Section 13.16, each Bank agrees that it will use its best efforts
not to disclose without the prior consent of Holdings or the Borrower (other
than to its employees, auditors, advisors or counsel or to another Bank if the
Bank or such Bank's holding or parent company in its sole discretion determines
that any such party should have access to such information; provided such
--------
Persons shall be subject to the provisions of this Section 13.16 to the same
extent as such Bank) any information with respect to Holdings or any of its
Subsidiaries which is now or in the future furnished pursuant to this Agreement
or any other Credit Document and which is designated by Holdings to the Banks in
writing as confidential; provided that any Bank may disclose any such
--------
information (a) as has become generally available to the
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public, (b) as may be required or appropriate in any report, statement or
testimony submitted to any municipal, state or Federal regulatory body having or
claiming to have jurisdiction over such Bank or to the Federal Reserve Board or
the Federal Deposit Insurance Corporation or similar organizations (whether in
the United States or elsewhere) or their successors, (c) as may be required or
appropriate in respect to any summons or subpoena or in connection with any
litigation, (d) in order to comply with any law, order, regulation or ruling
applicable to such Bank, (e) to the Agent or the Collateral Agent and (f) to any
prospective or actual transferee or participant in connection with any
contemplated transfer or participation of any of the Notes or Commitments or any
interest therein by such Bank; provided that such prospective transferee or
--------
participant agrees to be bound by the provisions of this Section.
(b) Each of Holdings and the Borrower hereby acknowledge and agrees
that each Bank may share with any of its affiliates any information related to
Holdings or any of its Subsidiaries (including, without limitation, any
nonpublic customer information regarding the creditworthiness of Holdings and
its Subsidiaries, provided such Persons shall be subject to the provisions of
this Section 13.16 to the same extent as such Bank.
SECTION 14. Guaranty.
--------
14.01 The Guaranty. (a) In order to induce the Banks to enter
------------
into this Agreement and to extend credit hereunder and in recognition of the
direct benefits to be received by each Guarantor from the proceeds of the Loans
and the issuance of the Letters of Credit and to induce the Banks or any of
their respective Affiliates to enter into Interest Rate Protection Agreements,
each Guarantor hereby agrees with the Banks as follows: Each Guarantor hereby
unconditionally and irrevocably, jointly and severally, guarantees as primary
obligor and not merely as surety the full and prompt payment when due, whether
upon maturity, by acceleration or otherwise, of any and all of the Guaranteed
Obligations of the Borrower to the Secured Creditors. If any or all of the
Guaranteed Obligations of the Borrower to the Secured Creditors becomes due and
payable hereunder, each Guarantor, jointly and severally, unconditionally
promises to pay such indebtedness to the Secured Creditors, or order, on demand,
together with any and all reasonable expenses which may be incurred by the Agent
or the Secured Creditors in collecting any of the Guaranteed Obligations. If
claim is ever made upon any Secured Creditor for repayment or recovery of any
amount or amounts received in payment or on account of any of the Guaranteed
Obligations and any of the aforesaid payees repays all or part of said amount by
reason of (i) any judgment, decree or order of any court or administrative body
having jurisdiction over such payee or any of its property or (ii) any
settlement or compromise of any such claim effected by such payee with any such
claimant (including the Borrower), then and in such event each Guarantor agrees
that any such judgment, decree, order, settlement or compromise shall be binding
upon such Guarantor, notwithstanding any revocation of this Guaranty or any
other
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instrument evidencing any liability of the Company, and each other Guarantor
shall be and remain jointly and severally liable to the aforesaid payees
hereunder for the amount so repaid or recovered to the same extent as if such
amount had never originally been received by any such payee. This is a guaranty
of payment and not of collection.
(b) Anything contained in this Guaranty to the contrary
notwithstanding, the obligations of each Guarantor hereunder shall be limited to
a maximum aggregate amount equal to the largest amount that would not render its
Obligations and/or the grant of security interests in Collateral to secure its
obligations hereunder subject to avoidance as a fraudulent transfer or
conveyance under Section 548 of the Bankruptcy Code or any applicable provisions
of comparable state law (collectively, the "Fraudulent Transfer Laws"), in each
------------------------
case after giving effect to all other liabilities of such Guarantor, contingent
or otherwise, that are relevant under the Fraudulent Transfer Laws (specifically
excluding, however, any liabilities of such Guarantor in respect of intercompany
Indebtedness to the Borrower or other Affiliates of the Borrower to the extent
that such Indebtedness would be discharged in an amount equal to the amount paid
by such Guarantor hereunder, and after giving effect (x) to the direct and
indirect benefits received by such Guarantor as a result of the Credit Documents
and the Loans and (y) as assets to the value (as determined under the applicable
provisions of the Fraudulent Transfer Laws) of any rights to subrogation,
reimbursement, indemnification or contribution of such Guarantor pursuant to
applicable law or pursuant to the terms or any agreement (including without
limitation any such right of contribution under Section 14.01(c)).
(c) Guarantors under this Guaranty together desire to allocate among
themselves in a fair and equitable manner their obligations arising under this
Guaranty. Accordingly, in the event any payment or distribution is made on any
date by any Guarantor under this Guaranty (a "Funding Guarantor") that exceeds
-----------------
its Fair Share (as defined below) as of such date, that Funding Guarantor shall
be entitled to a contribution from each of the other Guarantors in the amount of
such other Guarantor's Fair Share Shortfall (as defined below) as of such date,
with the result that all such contributions will cause each Guarantor's
Aggregate Payments (as defined below) to equal its Fair Share as of such date.
"Fair Share" means, with respect to a Guarantor as of any date of determination,
----------
an amount equal to (i) the ratio of (x) the Adjusted Maximum Amount (as defined
below) with respect to such Guarantor to (y) the aggregate of the Adjusted
Maximum Amounts with respect to all Guarantors, multiplied by (ii) the aggregate
---------- --
amount paid or distributed on or before such date by all Funding Guarantors
under this Guaranty in respect of the obligations guarantied. "Fair Share
----------
Shortfall" means, with respect to a Guarantor as of any date of determination,
---------
the excess, if any, of the Fair Share of such Guarantor over the Aggregate
Payments of such Guarantor. "Adjusted Maximum Amount" means, with respect to a
-----------------------
Guarantor as of any date of determination, the maximum aggregate amount of the
obligations of such Guarantor under this Guaranty, determined as of such date in
accordance with this Section
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13.01; provided that, solely for purposes of calculating the "Adjusted Maximum
--------
Amount" with respect to any Guarantor for purposes of this Section 13.01(b), any
assets or liabilities of such Guarantor arising by virtue of any rights to
subrogation, reimbursement or indemnification or any rights to or obligations of
contribution hereunder shall not be considered as assets or liabilities of such
Guarantor. "Aggregate Payments" means, with respect to a Guarantor as of any
------------------
date of determination, an amount equal to (i) the aggregate amount of all
payments and distributions made on or before such date by such Guarantor in
respect of this Guaranty (including, without limitation, in respect of this
Section 14.01(c)) minus (ii) the aggregate amount of all payments received on or
-----
before such date by such Guarantor from the other Guarantors as contributions
under this Section 14.01(c). The amounts payable as contributions hereunder
shall be determined as of the date on which the related payment or distribution
is made by the applicable Funding Guarantor. The allocation among Guarantors of
their obligations as set forth in this Section 14.01(c) shall not be construed
in any way to limit the liability of any Guarantor hereunder.
14.02 Bankruptcy. Additionally, each Guarantor unconditionally and
----------
irrevocably guarantees the payment of any and all of the Guaranteed Obligations
of the Borrower to the Secured Creditors whether or not then due or payable by
the Borrower upon the occurrence in respect of the Borrower of any of the events
specified in Section 10.05, and unconditionally and irrevocably promises to pay
such Guaranteed Obligations to the Secured Creditors, or order, on demand, in
lawful money of the United States. If claim is ever made upon any Secured
Creditor for repayment or recovery of any amount or amounts received in payment
or on account of any of the Guaranteed Obligations and any of the aforesaid
payees repays all or part of said amount by reason of (i) any judgment, decree
or order of any court or administrative body having jurisdiction over such payee
or any of its property or (ii) any settlement or compromise of any such claim
effected by such payee with any such claimant (including the Borrower), then and
in such event each Guarantor agrees that any such judgment, decree, order,
settlement or compromise shall be binding upon such Guarantor, notwithstanding
any revocation of this Guaranty or any other instrument evidencing any liability
of the Company, and each other Guarantor shall be and remain jointly and
severally liable to the aforesaid payees hereunder for the amount so repaid or
recovered to the same extent as if such amount had never originally been
received by any such payee. This is a guaranty of payment and not of
collection.
14.03 Nature of Liability. The liability of each Guarantor
-------------------
hereunder is exclusive and independent of any security for or other guaranty of
the Guaranteed Obligations of the Borrower whether executed by such Guarantor,
any other guarantor or by any other party, and the liability of each Guarantor
hereunder shall not be affected or impaired by (a) any direction as to
application of payment by the Borrower or by any other party, or (b) any other
continuing or other guaranty, undertaking or maximum liability of a guarantor or
of any other party as to the Guaranteed Obligations of the Borrower, or (c) any
payment on
-131-
or in reduction of any such other guaranty or undertaking, or (d) any
dissolution, termination or increase, decrease or change in personnel by the
Borrower, or (e) any payment made to the Administrative Agent or the Secured
Creditors on the indebtedness which the Administrative Agent or such Secured
Creditors repay the Borrower pursuant to court order in any bankruptcy,
reorganization, arrangement, moratorium or other debtor relief proceeding, and
each Guarantor waives any right to the deferral or modification of its
obligations hereunder by reason of any such proceeding.
14.04 Independent Obligation. The obligations of each Guarantor
----------------------
hereunder are independent of the obligations of any other guarantor or the
Borrower, and a separate action or actions may be brought and prosecuted against
each Guarantor whether or not action is brought against any other guarantor or
the Borrower and whether or not any other guarantor or the Borrower be joined in
any such action or actions. Each Guarantor waives, to the fullest extent
permitted by law, the benefit of any statute of limitations affecting its
liability hereunder or the enforcement thereof. Any payment by the Borrower or
other circumstance which operates to toll any statute of limitations as to the
Borrower shall operate to toll the statute of limitations as to each Guarantor.
14.05 Authorization. Each Guarantor authorizes the Administrative
-------------
Agent and the Secured Creditors without notice or demand (except as shall be
required by applicable statute and cannot be waived), and without affecting or
impairing its liability hereunder, from time to time to:
(a) change the manner, place or terms of payment of, and/or change or
extend the time of payment of, renew, increase, accelerate or alter, any of
the Guaranteed Obligations (including any increase or decrease in the rate
of interest thereon), any security therefor, or any liability incurred
directly or indirectly in respect thereof, and the Guaranty herein made
shall apply to the Guaranteed Obligations as so changed, extended, renewed
or altered;
(b) take and hold security for the payment of the Guaranteed
Obligations and sell, exchange, release, surrender, realize upon or
otherwise deal with in any manner and in any order any property by
whomsoever at any time pledged or mortgaged to secure, or howsoever
securing, the Guaranteed Obligations or any liabilities (including any of
those hereunder) incurred directly or indirectly in respect thereof or
hereof, and/or any offset there against;
(c) exercise or refrain from exercising any rights against the
Borrower or others or otherwise act or refrain from acting;
(d) release or substitute any one or more endorsers, guarantors, the
Borrower or other obligors;
-132-
(e) settle or compromise any of the Guaranteed Obligations, any
security therefor or any liability (including any of those hereunder)
incurred directly or indirectly in respect thereof or hereof, and may
subordinate the payment of all or any part thereof to the payment of any
liability (whether due or not) of the Borrower to its creditors other than
the Banks;
(f) apply any sums by whomsoever paid or howsoever realized to any
liability or liabilities of the Borrower to the Secured Creditors
regardless of what liability or liabilities of any Guarantor or the
Borrower remain unpaid;
(g) consent to or waive any breach of, or any act, omission or
default under, this Agreement or any of the instruments or agreements
referred to herein, or otherwise amend, modify or supplement this Agreement
or any of such other instruments or agreements; and/or
(h) take any other action which would, under otherwise applicable
principles of common law, give rise to a legal or equitable discharge of
any Guarantor from its liabilities under this Section 14.
14.06 Reliance. It is not necessary for the Administrative Agent
--------
or the Secured Creditors to inquire into the capacity or powers of the Borrower
or its Subsidiaries or the officers, directors, partners or agents acting or
purporting to act on its behalf, and any Guaranteed Obligations made or created
in reliance upon the professed exercise of such powers shall be guaranteed
hereunder.
14.07 Subordination. Any of the indebtedness of the Borrower
-------------
relating to the Guaranteed Obligations now or hereafter owing to any Guarantor
is hereby subordinated to the Guaranteed Obligations of the Borrower owing to
the Agent and the Secured Creditors; and if the Administrative Agent so requests
at a time when an Event of Default exists, all such indebtedness relating to the
Guaranteed Obligations of the Borrower to any Guarantor shall be collected,
enforced and received by such Guarantor for the benefit of the Secured Creditors
and be paid over to the Agent on behalf of the Secured Creditors on account of
the Guaranteed Obligations of the Borrower to the Secured Creditors, but without
affecting or impairing in any manner the liability of any Guarantor under the
other provisions of this Guaranty. Prior to the transfer by any Guarantor of
any note or negotiable instrument evidencing any of the indebtedness relating to
the Guaranteed Obligations of the Borrower to such Guarantor, such Guarantor
shall ▇▇▇▇ such note or negotiable instrument with a legend that the same is
subject to this subordination.
14.08 Waiver. (a) Each Guarantor waives any right (except as
------
shall be required by applicable statute and cannot be waived) to require the
Administrative Agent or the Secured Creditors to (i) proceed against the
Borrower, any other guarantor or any other
-133-
party, (ii) proceed against or exhaust any security held from the Borrower, any
other guarantor or any other party or (iii) pursue any other remedy in the
Administrative Agent's or the Secured Creditors' power whatsoever. Each
Guarantor waives any defense based on or arising out of any defense of the
Borrower, any other guarantor or any other party, other than payment in full of
the Guaranteed Obligations, based on or arising out of the disability of the
Borrower, any other guarantor or any other party, or the unenforceability of the
Guaranteed Obligations or any part thereof from any cause, or the cessation from
any cause of the liability of the Borrower other than payment in full of the
Guaranteed Obligations. The Administrative Agent and the Secured Creditors may,
at their election, foreclose on any security held by the Administrative Agent,
the Collateral Agent or the Secured Creditors by one or more judicial or
nonjudicial sales, whether or not every aspect of any such sale is commercially
reasonable (to the extent such sale is permitted by applicable law), or exercise
any other right or remedy the Administrative Agent and the Secured Creditors may
have against the Borrower or any other party, or any security, without affecting
or impairing in any way the liability of any Guarantor hereunder except to the
extent the Guaranteed Obligations have been paid. Each Guarantor waives any
defense arising out of any such election by the Administrative Agent and the
Secured Creditors, even though such election operates to impair or extinguish
any right of reimbursement or subrogation or other right or remedy of such
Guarantor against any Borrower or any other party or any security.
(b) Each Guarantor waives all presentments, demands for performance,
protests and notices, including without limitation notices of nonperformance,
notices of protest, notices of dishonor, notices of acceptance of this Guaranty,
and notices of the existence, creation or incurring of new or additional
Guaranteed Obligations. Each Guarantor assumes all responsibility for being and
keeping itself informed of the Borrower's financial condition and assets, and of
all other circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations and the nature, scope and extent of the risks which each Guarantor
assumes and incurs hereunder, and agrees that the Administrative Agent and the
Secured Creditors shall have no duty to advise each Guarantor of information
known to them regarding such circumstances or risks.
(c) Each Guarantor waives all rights of subrogation until all
Guaranteed Obligations have been paid in full in cash.
-134-
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
Address:
-------
55 Lumber Road COINMACH LAUNDRY CORPORATION
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: SENIOR VICE PRESIDENT
Address:
-------
55 Lumber Road COINMACH CORPORATION
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: SENIOR VICE PRESIDENT
BANKERS TRUST COMPANY,
Individually and as Administrative Agent
By: /S/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: PRINCIPAL
FIRST UNION NATIONAL BANK,
Individually and as Syndication Agent
By: /S/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: SENIOR VICE PRESIDENT
-135-
▇▇▇▇▇▇ SYNDICATED LOANS INC.
By: ▇▇▇▇▇▇ Commercial Paper Inc., not in its
individual capacity by solely as administrative
By: /S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: AUTHORIZED SIGNATORY
-136-
BANK OF SCOTLAND
By: /S/ ▇▇▇▇▇ ▇▇▇▇ TAT
---------------------
Name: ▇▇▇▇▇ ▇▇▇▇ TAT
Title: VICE PRESIDENT
-137-
CREDIT LYONNAIS NEW YORK BRANCH
By: /S/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: FIRST VICE PRESIDENT -
MANAGER
-138-
FLEET NATIONAL BANK
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: SENIOR VICE PRESIDENT
-139-
THE BANK OF NOVA SCOTIA
By: /S/ J. ▇▇▇▇ ▇▇▇▇▇▇▇
-------------------
Name: J. ▇▇▇▇ ▇▇▇▇▇▇▇
Title: AUTHORIZED SIGNATORY
-140-
BANK POLSKA KASA OPIEKI S.A. -
GROUP PEKAO S.A.
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: VICE PRESIDENT -
SENIOR LENDING OFFICER
-141-
BANQUE PARIBAS
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: VICE PRESIDENT
By: /S/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: REGIONAL GENERAL
MANAGER
-142-
DRESDNER BANK AG, NEW YORK &
GRAND CAYMAN BRANCHES
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: VICE PRESIDENT
-143-
FIRSTRUST BANK
By: /S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: CHIEF RISK OFFICER
-144-
THE INDUSTRIAL BANK OF JAPAN, LIM-
ITED
By: /S/ TAKUYA HONJO
----------------------------
Name: TAKUYA HONJO
Title: SENIOR VICE PRESIDENT
-145-
ROYAL BANK OF CANADA
By: /S/ ▇▇▇▇ ▇'▇▇▇▇▇▇
-------------------
Name: ▇▇▇▇ ▇'▇▇▇▇▇▇
Title: MANAGER
-146-
THE SAKURA BANK, LIMITED
By:
----------------------------
Name:
Title:
-147-
TRANSAMERICA BUSINESS CREDIT COR-
PORATION
By: /S/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: SENIOR VICE PRESIDENT
-148-
ANNEX I
-------
COMMITMENTS
-----------
Tranche A Tranche B Tranche A Tranche B
Term Loan Term Loan Revolving Loan Revolving Loan
Bank Commitment Commitment Commitment Commitment
---- ---------- ---------- -------------- --------------
Bankers Trust Company $13,882,978.74 $ 100,000,000 $ 5,384,973.38 $ 19,232,047.88
First Union National 5,744,680.85 $ 100,000,000 2,680,851.06 9,574,468.09
Bank
Credit Lyonnais, New 5,265,957.45 2,457,446.81 8,776,595.74
York Branch
▇▇▇▇▇▇ Syndicated Loans
Inc. 5,265,957.45 2,457,446.81 8,776,595.74
Transamerica Business
Credit Corporation 5,265,957.45 2,457,446.81 8,776,595.74
Bank of Scotland 5,265,957.45 2,457,446.81 8,776,595.74
Royal Bank of Canada 6,542,553.19 3,053,191.49 10,904,255.32
Dresdner Bank AG, New
York & Grand Cayman 4,627,659.57 2,159,574.47 7,712,765.96
Branches
The Industrial Bank of 3,031,914.89 1,414,893.62 5,053,191.49
Japan, Limited
Banque Paribas 4,627,659.57 2,159,574.47 7,712,765.96
Fleet National Bank 4,627,659.57 2,159,574.47 7,712,765.96
The Bank of Nova Scotia 4,627,659.57 2,159,574.47 7,712,765.96
The Sakura Bank, Limited 4,627,659.57 2,159,574.47 7,712,765.96
Bank Polska Kasa Opieki
S.A. - Group Pekao S.A. 0.00 1,093,750.00 3,906,250.00
-149-
Firstrust Bank 1,595,744.68 744,680.85 2,659,574.47
-------------- --------------- -------------- ---------------
TOTAL: $75,000,000.00 $200,000,000.00 $35,000,000.00 $125,000,000.00
-150-
ANNEX II
--------
BANK ADDRESSES
--------------
Bankers Trust Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. Prior
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
First Union National Bank
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ Syndicated Loans, Inc.
3 World Financial ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Bank of Scotland
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇-Tat
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
-151-
Credit Lyonnais, New York Branch
1301 Avenue of the Americas
New York, New York 10019
Attention: ▇▇▇▇▇▇ ▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Fleet National Bank
One Federal Street
Mail Stop - MA of D03C
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇▇
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Bank Polska Kasa Opieki S.A. - Group Pekao S.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Banque Paribas
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
-152-
Dresdner Bank AG, New York & Grand Cayman Branches
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇)▇▇▇-▇▇▇▇
Firstrust
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
The Industrial Bank of Japan, Limited
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Royal Bank of Canada
▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
The Sakura Bank, Limited
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
-153-
Transamerica Business Credit Corporation
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇-▇▇▇
▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
-154-
SCHEDULE 2.0
------------
EXISTING LETTERS OF CREDIT
--------------------------
-155-
SCHEDULE 5.11
-------------
REAL PROPERTY
-------------
-156-
SCHEDULE 7.04
-------------
GOVERNMENTAL APPROVALS
----------------------
-157-
SCHEDULE 7.05
-------------
FINANCIALS
----------
-158-
SCHEDULE 7.15
-------------
SUBSIDIARIES
------------
-159-
SCHEDULE 7.22
-------------
INDEBTEDNESS
------------
-160-
SCHEDULE 8.03
-------------
INSURANCE
---------
-161-
SCHEDULE 9.01
-------------
EXISTING LIENS
--------------
-162-
SCHEDULE 9.05
-------------
INVESTMENTS
-----------
-163-